Life Insurance Glossary of Terms
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Beneficiary - Holding some office or valuable possession, in subordination to another; the person named by the owner of the policy to receive the life insurance proceeds.
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Cash Value/Cash Surrender Value - This is the amount the insurance Company will pay the insurance policy owner when the life insurance policy is cancelled.
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Convertible Term Insurance - The type of term insurance that can be converted or exchanged into a permanent insurance policy at the option of the policy owner without evidence of insurability.
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Death Benefit - insurance or pension money payable to a beneficiary of a deceased
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Face Amount - The amount stated on an insurance policy, to be paid upon death or maturity. Excluding are the amounts added from policy dividends application or accidental death.
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Insurability - Acceptability of an applicant according to the insurance company.
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Insured Person - an individual whose concerns are safeguarded by an insurance policy; an insurance policy protects this person from property or health loss and death.
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Level Premium Term Life Insurance - This type of life insurance has a premium that continues to exist as much as 30 years. Once the end of the coverage has been reached, the premium could carry on, however higher annual rates apply.
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Loan (Policy loan) - A loan made by a life insurance company to a policy owner based on the cash value of a policy.
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Paid-up insurance - Life insurance policy under which all premiums have already been paid, with no further premium payment due.
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Participating Policy - An insurance contract that pays dividends to the policy holder.
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Permanent Life Insurance - This type of insurance will remain as long as the person lives. It is also possible to get a certain amount of money during the coverage.
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Policy Owner - Entity that owns an insurance policy and has the right to exercise all privileges under the contract of insurance.
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Premiums - These are payments made in a regular pattern to keep the policy active.
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Term Life Insurance - It's pure insurance with no cash value account. It provides coverage for a specific period of time. Get the lowest rate on term life insurance by comparing term life insurance quotes
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Universal Life Insurance - It is a permanent life insurance with added flexibility. A certain portion of the premium can be used to build cash value with increased interest rates. Just like the permanent life insurance, this type of insurance also lasts a lifetime.
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Variable Universal Life Insurance - a type of life insurance that builds cash value. . You decide how your net policy values are invested, and you bear the investment risk.
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Whole Life Insurance - A type of permanent Life Insurance will payout on your death. It is important to be sure you are making your payments, because if you miss a payment your policy could become inactive. Whole life insurance payments are also an investment that can be borrowed against or withdrawn from. The money in your whole life insurance will stay tax-deferred until the day you use it.
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