Accelerated Benefit Rider
A life insurance policy benefit that allows the insured
or policy owner The right to receive a percentage of
the insurance policy death benefit in advance if the
insured is diagnosed with a terminal illness and not
expected to live for a period of at least 12 months.
Written proof of terminal illness from a medical professional
must be obtained before the insurance company will pay
a benefit.
Accidental Death and Dismemberment Rider
A life policy rider that pays a percentage of the death
benefit if the insured is killed in a covered accident
or loses sight or limbs as a result of an accident. This
benefit can be added on most life insurance policies
but is generally expensive and very limited in what it
will cover.
Accumulation Value
In adjustable, equity indexed, variable universal and universal
life policies, the accumulation value is equal to the policy’s
cash value before the deduction of any applicable surrender
charges when determining the policy’s net surrender
vale.
Age at Issue
Policies are approved and issued on a specific date. Insurers
generally use the nearest age or last age of the insured
to determine the insured’s age as of the issuance
date.
Agent
Individuals or businesses that are licensed to sell life
insurance by the State Departments of Insurance. The
agent or insurance sales person or entity has primary
duties to the insurance company and not to the applicant.
Agents may represent just one-ore many-insurance companies,
and are generally paid commissions by the insurer with
whom the policy has been written.
AM Best Rating Services
AM Best is an independent rating organization that ranks
insurance companies by financial strength and managerial
abilities. Please see the various financial ratings of
each insurance company when requesting a quote. The website
for AM Best is www.ambest.com.
Annual Renewable Term Insurance
Annual Renewable Term (ART) is a type of term life insurance
that offers a guaranteed rate for one year. Each subsequent
year, the policy renews at a higher rate based on the
insured's next age. At some point, the price of annually
renewable term becomes cost prohibitive.
Application
A form provided by the insurer to obtain an individual’s
declaration of personal, occupation health, financial,
and avocation information. The information provided by
the insured (and typically completed by the agent) forms
the basis on which an insurance company will make an offer
to provide coverage. The application becomes a part of
the legal contract of insurance, and the insurer is generally
allowed to challenge misstatements if death occurs within
2 years of policy issue.
Assignment
Life insurance is considered property. Therefore insurance
policies are legally assignable to another party in part
or in full including all rights.
Assignee
An individual or entity that receives the rights in a life
insurance policy assigned by the policy owner.
Attained Age
The current age of the insured as measured from the age
at the time the policy was issued.
Automatic Premium Loan Provision
Generally applicable to fixed premium policies such as
whole life, an “APL” provision will allow
the insurance company to borrow the due and payable premium
from cash values if the premium hasn’t been paid
after 31 days from the premium due date. This provision
prevents unpaid premium from putting the policy into
a “lapse” condition.
Beneficiary
An individual or individuals, corporation, or trust that
is entitled to receive the policy proceeds of an insurance
policy in the event that the insured is deceased. Beneficiaries
can be named in a number of different ways including
primary, contingent, tertiary, revocable and irrevocable
to list a few.
Broker
The terms “broker” and “agent” are
defined by the various State Departments of Insurance.
A broker (a term typically applied to those selling property
and casualty insurance) is deemed to primarily represent
the customer and not the insurance company. A broker generally
represents more than one insurance company, and the broker’s
compensation is generally paid as a commission by the insurer
with whom the policy has been written.
Cash Surrender Value
The actual cash value that the policy owner would receive
in the event a policy is surrendered. In a whole life
policy, the surrender value is typically equal to the
cash value less the surrender charge if applicable. The
surrender value may be less in indeterminate premium
policies, depending on how long the policy was in force
before surrender.
Cash Value
Cash value is the excess accumulation of funds within a
whole life or universal life insurance policy. Cash values
generally grow tax deferred and can be withdrawn or borrowed
if the policy allows. Cash values are not guaranteed.
Children's Insurance Rider
A rider added to an insurance policy to protect the lives
of children. Usually offered in increments of $5,000.00
and generally covers all eligible children to their age
18. Not available with all policies.
Collateral Assignment
Similar to an assignment, certain rights in a life insurance
policy can be assigned to a third party, typically as
security for a loan or other transaction. Collateral
assignments are generally not made for a specified amount,
rather are defined “to the extent that his interest
may appear.” The assignment is registered with
the insurer, and typically the assignee must prove to
the insurer the amounts that are owed to it if and when
the assignment collection criteria are met.
Conditional Receipt
A conditional receipt is given to an insured that submits
money with the initial application for life insurance.
It offers immediate coverage “conditionally”,
after the medical exam is completed, contingent upon
the company's acceptance of the insured. The terms of
the conditional receipt will vary among insurance companies.
Contestable Clause
All insurance companies have a period of two years from
the policy issue date during which statements made on
the application can be challenged for misstatement should
death occur within that period. After the contestable
period, the policy becomes incontestable except for application
statements that can be proven as fraudulent.
Contestability Period
Within the first 2 years of an insurance policy, the insurance
company has the right to investigate a death claim for
fraud and misrepresentation. The contestability period
allows the insurance company to deny claims that are
fraudulent. All insurance companies will investigate
death claims with the first 2 years. The burden of proof
for denying a claim is on the insurance company.
Contingent Beneficiary
An individual or entity that is entitled to receive the
proceeds of a life insurance policy if the primary beneficiary
is not living at the time of the insured’s death.
The contingent beneficiary can be an individual, several
individuals, a corporation, trust, or charitable organization.
Contract
A life insurance policy is considered a legal contract
between the insurer and the owner of the policy. Only
the policy itself serves as the contract. Statements
made by the agent and policy illustrations are not part
of the contract of insurance.
Conversion Privilege
This benefit allows the covered individual the opportunity
to "convert" or exchange an existing term life
insurance policy for a permanent or "whole life" policy
without evidence of insurability. The conversion privilege
protects an insured's ability to maintain insurance coverage
when outside coverage may not be attainable due to significant
health problems. Conversion privileges vary among insurance
policies. In short, if all other things are equal, the
policy offering the longer conversion period is usually
the better the policy.
Convertible Term Insurance
Term insurance which can be exchanged (converted), at the
option of the policy owner and without evidence of insurability,
for a permanent insurance policy.
Cost of Insurance
Generally applicable to current assumption policies such
as equity indexed, variable and universal life, cost of
insurance charges are monthly charges for mortality and
other elements of insurer expense that are assessed against
the policy based on the insured’s current age, the
original rate class, and the current net amount at risk.
Current Assumption
Life insurance policies that provide for contractually
guaranteed minimum interest rates and maximum costs of
insurance while at the same time offering the potential
for higher non guaranteed policy credits and lower non
guaranteed costs of insurance and other expenses. Assumptions
may be changed by the insurer at its discretion and experience.
Current Interest Rate
The interest rate that the insurance company declares at
the beginning of each determined period that is credited
daily to the unloaded portion of the accumulation value.
The current interest rate will never be less than the
guaranteed interest rate.
Date of Issue
The effective date of the policy as issued by the insurer.
Death Benefit
The insurance amount stated in the insurance policy. Can
be any amount subject to certain specific limitation
set forth by the insurance company. Death benefits are
payable on the death of the insured and are generally
payable to the beneficiary or beneficiaries income tax
free.
Death Claim
When an insured dies, the policy owner will provide the
insurer with poof of death (including a death certificate)
and other information to cause the proceeds of the policy
to be paid to the beneficiary.
Decreasing Term
Decreasing term is a type of term life insurance where
the insurance amount decreases over time. Most decreasing
term policies are tied to some form of note or mortgage
and as you pay down the mortgage, the insurance amount
decreases. These policies were very popular 10-15 years
ago; however, level term life insurance is now generally
more competitive.
Deduction Amount
A monthly charge in a universal life policy, deducted from
the accumulation value on each deduction day, which is
comprised of the cost of insurance charge and any other
expense charge shown on the policy summary and any charge
for supplemental benefits.
Deduction Day
Each month, the day on which the deduction amount is taken
from the policy. The deduction day is always listed in
the policy summary. The first deduction day is the policy
date.
Dividend
Dividends are cash payments credited to whole life policies
generally as a percentage of current cash value. They
are not guaranteed. Dividends are paid by mutual insurance
companies and are considered to be a return of excess
premium payments. Dividends can be used to increase cash
value, reduce the current premium, or buy additional
paid up insurance.
Endow
A policy will endow when the whole life or “endowment” policy’s
cash value is equal to the death benefit of the policy.
Evidence of Insurability
When purchasing any life insurance policy, you must prove
that your health is reasonably good. Proving your health
is the evidence that you are insurable. Once a life insurance
policy is in force, no further evidence of insurability
is required to maintain the policy.
Excess Interest
The difference between the current rate of interest an
insurer actually pays and the guaranteed interest rate.
Exclusions
Exclusions are specific events or circumstances where the
insurance company has the right to deny an insurance
claim. They are always listed in the policy. Common exclusions
include suicide within the first 2 years and fraud. A
careful review of your policy for exclusions is wise.
Expense Charge
A monthly charge paid to an insurance company based on
various elements of the policy such as insured’s
attained age, original rate class, etc. Allowable charges
are specified in the policy; at its discretion, the insurer
may charge less than the contractual amount as circumstances
allow.
Face Amount
The amount of insurance listed in the policy and applied
for by the purchaser. The face amount is the same as
the death benefit. Face amounts can be any amount subject
to certain specific limitations set forth by the insurance
company.
Flat Extra Rating
A flat extra rating is an extra charge that is applied
to some policies where the insured has very adverse health
conditions such as cancer or does hazardous sports or
hobbies such as skydiving. Flat extra charges are usually
applied as a dollar cost per thousand. For example, an
individual that had cancer within the last 3 years may
be charged a flat extra rating of $3.00/$1,000 of insurance
for the first 5 policy years. The flat extra charge allows
the insurance company to offer a policy where they might
otherwise have to decline to make an offer.
Free-Look Provision
The free look provision allows policyholders a 10-30 day
period to review the policy and, if they choose not to
accept the policy, return it for a full refund. If returned,
the policy will be considered to be void from inception.
Funding Premium
The premium for policies such as universal, equity-indexed
and variable universal life that are designed without
fixed premiums. As these indeterminate premium policies
do not have a set premium, the term funding premium is
used to describe the chosen premium that is paid for
a specific policy. The funding premium can change at
the discretion of the policyholder subject to certain
policy minimums.
Grace Period
The period after the premium payment is due wherein the policy owner is generally
given 31 days within which to make payment without jeopardizing the death benefit.
Universal Life and Variable Universal Life policies may allow 30-60 days for
additional funding premiums to be paid if there is insufficient cash value
to sustain the policy during the monthly calculation of expense charges and
policy credits.
Gross Return
Generally a term for Variable Universal Life, a gross return
is the long-term average return assumed to be earned
before deducting the management fees and other expenses
described in the prospectus. Variable Universal Life
Illustrations almost always assume a gross return, not
to exceed the regulatory maximum of 12 percent. Annual
fees can range from 0.25 percent to more than 2.0 percent
of the account value.
Guaranteed Insurability Option
A policy rider, the guaranteed insurability option assures
the policy holder the right to purchase additional amounts
of insurance at predetermined future intervals or ages
without providing evidence of insurability.
Indebtedness
Policy indebtedness is all outstanding loans on an insurance
policy, including any unpaid interest. The loan interest
rate charged, which is payable in advance, is shown on
the policy summary.
Indeterminate Premium
A characteristic of equity index, universal, adjustable,
and variable universal life policies in which the premium
is estimated but not guaranteed. As long as the policy
minimum premium is paid, the policy may remain in force.
If however, only the minimum premium is paid, there is
a strong likelihood that premiums will have to be increased
in the future to maintain enough cash to cover the increased
insurance costs. It is the policy owner’s responsibility
to manage policy payments to ensure the sufficiency of
the policy.
Insurable Interest
When a policy is purchased, the buyer must have an economic
interest in the life if the insured, or a demonstrable
expectation of loss upon the death of the insured. A
spouse is always considered to have an insurable interest.
A business partner is similarly considered to have an
insurable interest based on the economic value of the
partnership. Your neighbor, however, cannot but a policy
on your life-even with your cooperation-unless a valid
economic basis can be demonstrated. Once a policy is
purchased, the policy owner is free to designate anyone
he or she wishes as beneficiary. Policy ownership can
be transferred after the policy had been issued, somewhat
bypassing insurable interest statutes.
Insurability
Insurability refers to an individual's good health and
ability to obtain life insurance. If an individual is
unable to obtain life insurance due to bad health, the
individual is considered to be uninsurable.
Insured or insured life
The person on whose life the policy is issued.
Issue Date
The specific date when the insurance company issues an
insurance policy. The issue date is shown in the policy
summary.
Key Person Insurance
Also known as Key Man insurance, Key Woman Insurance, or
Business Life Insurance. Key Person insurance is life insurance
purchased by the company on the life of an employee or
employees whose loss would have adverse effects on the
company. Employees are valuable assets and the loss of
some key employees could significantly impact the profitability,
stability and progress of the company.
Lapsed Policy
The termination of an insurance policy resulting from non-payment
of premiums within the specified premium grace period.
Level Premium
Generally refers to the initial period of a term policy in which the premiums
are guaranteed to remain fixed. At the end of the initial period, premiums
will generally increase annually and at a significantly higher rate than the
level premium.
Level Premium Period
The level premium period generally refers to the length
of guaranteed premiums for level term life insurance
policies. For example, insurance companies currently
offer 5, 10, 15, 20, 25, and 30-year level premium policies.
Level Term Insurance
Level term insurance offers a fixed price and fixed death
benefit for a predetermined time period usually 5, 10,
15, 20, 25, or 30 years.
Life Settlement
A life settlement is a transaction in which an existing
life insurance policy that is no longer needed or is
in danger of lapsing is offered for sale to institutional
investors in the secondary market. Individuals over the
age of 70 with moderate health concerns who own such
insurance
might find that their policy is worth as much as 25 percent
of the current death benefit. The financial enterprises
that purchase life settlements will maintain such policies
until the insured’s death.
Maturity Date
A Life insurance policy will typically mature at age 95
or 100, although newer policies may provide for contract
maturity as far out as age 120. When the policy matures,
all accrued benefits as described in the policy are paid.
Some insurers allow the deferral of matured values until
the insured’s actual death.
Medical Information Bureau (MIB)
All responses on a policy application are subject to submission
to the MIB, an independent entity that collects and stores
medical data on life and health insurance applicants.
This information is exchanged among member insurance
companies with written authorization of the insured.
Its purpose is to prevent applicant fraud and to help
insurers discover withheld information that may be contained
in the database.
Misstatement of Age
If the age of the insured is misstated and is not discovered
until death of the insured, the insurance company has
the contractual right to adjust the death benefit to
reflect the face amount that would have been paid with
the corrected age and actual premiums paid.
Modal Premium
The modal premium is the payment method selected by the
insured to pay policy premiums. There are generally 4
premium mode options including annual, semiannual, quarterly,
and monthly bank draft. There is usually a higher incremental
cost for all modal premium options other that annual.
In other words, you may pay 2-6% more on an annualized
basis for semiannual, quarterly, and monthly bank draft
options.
Modified Endowment contracts (MEC)
Modified Endowment Contracts (MEC) are the result of paying
too much funding premium into a equity indexed universal
life, variable universal life , or other adjustable life
policy in too short a period of time (usually in the
first 7 years). The insurance company can accurately
determine whether payments into a life insurance policy
run the risk of becoming a “MEC.” When a
policy becomes a MEC, the tax status of death benefit
is unaffected and any policy build up continues to grow
tax deferred. However, any withdrawal of cash values
prior to the insured’s age 59 ½ will be
subject to a 10% penalty. Additionally, withdrawals from
the policy are taxed on the LIFO tax basis meaning the
cash value “last in is the first out” therefore
generating an instant taxable event.
Monthly Anniversary
Adjustable life, indexed life, universal and variable
universal life insurance policies account for expenses
and credits
on a monthly basis. Therefore, the monthly anniversary
is the same day of each month as the policy anniversary
date.
Moody's Investor Service
Moody's Investor Service is an independent insurance
rating service that rates the financial strength of all
insurance
companies. You can visit Moody’s Investor Service
online at www.moodys.com.
A password is required.
Net Amount of Insurance at Risk
The difference between a life insurance policy’s
total face amount and the policy’s cash value. The
net amount at risk is the amount of insurance that the
insurance company is responsible for covering in the event
that death occurs. Insurance companies calculate the actual
insurance costs associated with a specific policy based
on the net amount of insurance at risk.
Net Cash Surrender Value
A life insurance policy’s cash surrender value less
any outstanding loans or surrender charges.
Nonforfeiture Values
For more than 100 years, insurance regulators have required
that permanent life insurance policies have certain equity
rights, even when the policy might lapse due to non payment
of premiums. Nonforfeiture values include cash value
net of loans, reduced paid-up life insurance, and extended
term insurance.
Option A-Level Death Benefit
Universal life policyholders may elect a level death benefit
(Option A) that is fixed and doesn’t increase unless
required to maintain a policy’s status as life
insurance under IRS rules. With a level death benefit
option, the net amount of insurance at risk with decrease
over time assuming proper premiums are paid.
Option B Increasing Death Benefits
Universal life policyholders may elect an increasing death
benefit (Option B) that increases as a policy’s
cash values increase. With an increasing death benefit
option, the net amount of insurance at risk never decreases
over time as all cash values are added to the initial
face amount to determine the actual death benefit.
Other Insured Rider
An optional policy rider that provides specified amounts
of term insurance on the life of a spouse or child of
the primary insured.
Participating Policy
A participating policy is typically issued by a mutual
life insurer whose profits (surplus) are for the benefit
of its policyholders. If there is sufficient surplus
to be paid out amongst the current policyholders, they
will be paid out in the form of dividends. Dividends
can be taken in cash, used to reduce the premium due,
or used to purchase additional paid up insurance.
Payor
Typically the policy owner, the payor is the person or entity making premium
payments on a life insurance policy.
Permanent Life Insurance
Permanent life insurance is "whole life" insurance.
Permanent insurance is more costly than term because it
builds cash value and is designed to last a lifetime. The
premiums and death benefits are generally fixed for the
insured's lifetime.
Planned Periodic Payment
Adjustable life, equity indexed universal life, and variable
universal life insurance policies do not have specified
planned periodic premiums. The policy owner determines
how much premium to pay subject to policy minimums. The
application will ask for a specific amount to be billed
on a periodic basis (monthly, quarterly, semi-annual,
or annual), and this amount can generally be changed
at the policy owner’s discretion.
Policy
The policy is the basic written agreement between the insurer
and the policy owner. The policy, together with the application,
exam and all endorsements and attached papers, constitutes
the entire contract of insurance. The policy illustration
is specifically excluded from the contract.
Policy Anniversary
The policy anniversary occurs yearly on the day and month
of the policy date.
Policy Date
The actual day month and year on which coverage becomes
effective.
Policy Exchange
Usually the result of a policy replacement, any potential
taxable gain associated with terminating a policy can
be deferred by qualifying the purchase of a new policy
as an exchange under the provisions of Internal Revenue
Code 1035.
Policy Loan Amount
An amount of cash values less the policy surrender charges
that can be borrowed by the policy owner. The policy
loan does not have to be repaid, but interest (as specified
in the policy) will be charged and the total loan plus
unpaid interest will be subtracted from policy proceeds
if the loan is outstanding at the time of death or surrender
of the policy.
Policy Month
Twelve one month periods during the policy date of the
policy anniversary.
Policy Owner
The policy owner is an individual, trust or entity that
has control of or owns the policy. The policy owner has
rights to changing the beneficiary, payment modes, and
payout options.
Preferred Risk
Preferred risk refers to the general health of the individual
applying for insurance. All insurance companies have several
categories of risk that allow the insurance company to
properly price the individual risk associated with each
application for life insurance. A Preferred Risk is considered
to be an individual in very good health with an above average
life expectancy.
Premium
The payment amount required to maintain the insurance policy.
Premiums can generally be paid annually, semiannually,
quarterly, or monthly bank draft.
Primary Beneficiary
The primary beneficiary is the individual(s), trust, or
other entity that receives the proceeds of the insurance
policy in the event of the insured's death.
Rated/Rate Class
Individuals are “rated” based on health, occupation,
avocation, and other lifestyle considerations. Individuals
with above average “ratings” are generally
classified as “preferred, “and all things being
equal will pay lower premiums than individuals that are”standard” or “sub-standard” risks.
Reinstatement Provision
Most life insurance policies will grant the policy owner
the right for a limited period of time to reinstate a
policy after it has lapsed. Evidence of insurability
will generally be required, as well as back premiums
and interest.
Replacement
Often defined by state insurance regulation, a replacement
is typically deemed to have been made when an agent solicits
a new policy in exchange for an old one.
Rider
A rider is an additional feature or benefit added to a
policy at an additional cost. Riders are usually available
for disability, children' insurance, an additional purchase
options. Riders may vary among insurance companies.
Secondary Guarantee
Contractual guarantees offered by life insurance companies
that state policies are guaranteed to pay a death benefit
even if the cash value falls to $0. Rather
than the cash value sustaining the policy, the insurer provides a secondary
guarantee that it will pay the death benefit regardless of policy reserves.
Secondary guaranteed policies are extremely cost effective for assuring a
long term death benefit but will not build excess cash
values. They are designed
to provide low cost life insurance protection for an individual’s lifetime
whether they live 30 years or to age 110.
Second-to-die (Survivorship) Life Insurance
Second-to-die (Survivorship) life insurance is a form of
whole life insurance that covers two lives and pays the
proceeds at the death of the second insured. This type
of policy is used primarily for estate planning.
Standard and Poor’s
Rating Services
Standard and Poor’s is an independent insurance rating
service that ranks the financial strength of all insurance
companies. You can visit Standard and Poor’s online
at www.standardandpoors.com.
Standard Risk
Standard risk is an underwriting classification that refers
to the overall health of the individual applying for life
insurance. A standard risk is an individual that is in
average health with an average life expectancy.
Stated Amount
A dollar amount used to determine the death benefit of
the policy.
Sub-Standard Risk
Sub-Standard risk is an underwriting classification for
individuals that have significant health concerns. Generally,
sub-standard risks have a shorter than average life expectancy
due to a health impairment and will therefore pay higher
premiums for their insurance than preferred or standard
risk individuals.
Suicide Provision
All life insurance policies have a standard suicide provision
that states there will be no insurance proceeds paid
in the event that the insured commits suicide within
the first 2 policy years. During this 2-year period,
the insurance company's liability is limited to premiums
paid.
Surrender
The policy owner’s right to terminate policy coverage
in exchange for the policy’s cash surrender value
or other nonforfeiture values.
Surrender Charge
Typically applicable to adjustable life, indexed universal
life, and variable universal policies, a generally declining
schedule of charges against the cash value may be imposed
on the policy for a certain number of years from policy
inception if the policy is surrendered, the death benefit
is reduced, or in some instances, the surrender charge
is taken into account in the monthly calculation to determine
if the policy is still in force.’
Surrender Value
In most policies, the surrender value is typically the
cash accumulated value less any applicable surrender charges.
The surrender value will vary depending on the insurance
company and the actual policy type. Generally speaking,
the surrender value will equal cash values after a certain
period of time depending on the specifics of the policy
and how long the policy has been in force before the policy
is surrendered.
Term Life Insurance
Term life insurance is "temporary" coverage usually
offered in level periods of 5, 10, 15, 20, 25, and 30 years.
Term life insurance is designed to cover specific risks
for a specific time period. Term insurance is the cheapest
form of life insurance.
Underwriter
The underwriter (insurance company) is an employee of the
insurance company and is the individual responsible for
reviewing applications and medical histories and accessing
the applicants risk to the company. The underwriter is
the person that determines the rate class that each applicant
will obtain based on the applicant' medical history.
Underwriting
Underwriting is the process where the insurance company reviews each individual's
application and medical history and determines the rate class that each individual
will obtain. Underwriting is the most crucial part of the entire process of
applying for life insurance.
Universal Life Insurance
Universal life insurance is a combination of whole life
insurance and term life insurance. The pricing of the
policy is based on annual renewable term life insurance
and increases each year. The premiums are flexible and
are designed to cover the costs of the insurance with
the difference being applied to a cash value that grows
at a given interest rate. Universal life polices are
more expensive than term and cheaper than whole life.
Some universal life policies offer long term guarantees
but most do not. If considering universal life, make
sure than you buy a policy hat offers long-term guarantees.
Valuation Date
A date on which policy account values-typically in variable
policies-are contractually determined.
Variable Universal Life Insurance
Universal life insurance is a combination of whole life
insurance and term life insurance. The pricing of the
policy is based on annual renewable term life insurance
and increases each year. The premiums are flexible and
are designed to cover the costs of the insurance with
the difference being applied to a cash value that grows
at a given interest rate. Universal life polices are
more expensive than term and cheaper than whole life.
Some universal life policies offer long term guarantees
but most do not. If considering universal life, make
sure than you buy a policy hat offers long-term guarantees.
Waiver of Monthly Deduction
A rider that waives monthly cost of insurance charges in
an Adjustable, Universal, or Variable Universal life insurance
policy for a period of disability as outlined and defined
in the policy.
Waiver of Premium Rider
The waiver of premium rider can be added to the basic life
policy and covers the insured in the event that he or she
becomes disabled. If disability occurs and the rider is
in effect, the insurance premiums are waived for the period
of disability. Generally, this benefit becomes effective
after the insured had been disabled for 6 months and lasts
until the insured is no longer disabled.
Waiver of Specified Premium
A rider that waives premiums in a Whole Life or term policy-or
waives a planned premium in an Adjustable, Variable,
or Universal Life policy-for a period of disability as
outlined and defined in the policy.
Weiss Research Rating Services
Weiss is an independent insurance rating service that ranks
insurance companies for safety. Weiss Research is the
most conservative of all rating services. You can visit
Weiss Research online at www.weissratings.com.
Whole Life Insurance
Whole life insurance offers fixed premium payments for
life and builds guaranteed cash value. Whole life is
the most expensive form of life insurance. Purchasers
of whole life insurance are "self-funding" their
insurance program and want to "own" their life
insurance.
