Reversions and Life Interests

Extract

A reversion, in its simplest form, is merely the right of one person to receive a sum of money, or its equivalent in securities, on the death of another person now living. In practice this right is often contingent upon the happening of some other event, such as the reversioner surviving the life tenant, and as the existence of such a contingency means that a purchaser might suffer entire loss of capital, it is usual to eliminate it by effecting an appropriate policy of assurance. When this is done the contingent reversion becomes an absolute one, subject to the payment of the appropriate premium.