What is Term life insurance? Term life insurance is life insurance coverage at a guaranteed rate for a specified period of time. (Example: 30 year level term would guarantee a level premium for 30 years based on a specified death benefit) Term life insurance is usually the least expensive form of life coverage.
What is Universal Life Insurance? Universal life insurance is a flexible premium policy under which the policy owner may adjust the death benefit from time to time and vary the amount or timing of premium payments given specified limitations. Premiums are credited to a policy account from which mortality charges are deducted and to which interest is credited based on short term interest rates. This crediting usually allows some cash value build up in the policy.
What is Whole Life Insurance? Whole life insurance is a permanent type of life insurance coverage that can provide lifetime protection at a level premium. Premiums must generally be paid as long as the policy is in force.
Equities: Investments in the form of ownership of property, usually common stocks, as distinguished from fixed income bearing securities, such as bonds or mortgages. Equity in the Unearned Premium Reserve: Amount by which an unearned premium reserve is overstated because it is established on the basis of gross premium rather than net premium.
Deferred Annuity: An annuity providing for the income payments to begin at some specified future date. Deferred Compensation: Arrangements by which compensation to employees for past or current services is postponed until some future date. Deferred Group Annuity: A type of group annuity providing for the purchase each year of a paid-up deferred annuity for each member of the group, the total amount received by the member at retirement being the sum of these deferred annuities.
Premium: The sum paid by a policyholder to keep an insurance policy in force. Premium finance: allows the insured to pay part of the premium when coverage takes effect and pay the rest during the policy period. Premium Loan: A policy loan made for the purpose of paying premiums. Premium Tax: A tax, imposed by each state, on the premium income of insurers doing business in the state.
Variable Annuity: An annuity contract in which the amount of each periodic income payment may fluctuate. The fluctuation may be related to securities market values, a cost of living index, or some other variable factor. Variable Annuity: An annuity under which the benefit varies according to the investment results of a life insurance company's separate account (usually invested primarily in common stocks).
Variable Life Insurance: Life insurance under which the benefits relate to the value of assets behind the contract at the time the benefit is paid. The amount of death benefit payable would, under variable life policies that have been proposed, never be less than the initial death benefit payable under the policy.
