Bonus

Bonus is paid as an addition to the basic benefit payable under a contract

Types of reversionary bonus

Simple Reversionary Bonus
Insurer declares bonus on the sum assured

Compound Bonus
Compute the annual bonus on a compound interest

Terminal  Bonus
As incentives to the insured to continue with the company for long term. It increases as the duration increases.

Guiding Principles of Determining amount of loading

Adequacy
The total loading from all policies must be sufficient to cover the company's total operating expenses. It should also provide a margin of safety and finally it should contribute to the profits or surplus of the company.

Equity
Expenses and safety margins etc   should be equitably apportioned among various kinds of policies, depending on type of plan, age and  term etc

Competitiveness 
The resulting gross premiums should enable the company to improve its competitive position