General Policy Definitions

Question 1

Endow (Mature)

Answer 1

The maturity date or time at which the policy’s cash value equals the face amount and the proceeds are paid to the policyowner.

Question 2

Face Amount

Answer 2

The death benefit amount payable on a life insurance policy. In other words, the amount of coverage the policy provides. This is sometimes referred to as the limit of liability.

Question 3

Cash Value

Answer 3

Money accumulated in a permanent policy that the policyowner may borrow as a policy loan or receive if the policy is surrendered before it matures.

Question 4

Rider

Answer 4

An added benefit attached to the policy that modifies existing coverage. A rider is usually added at the time of application and typically requires an increase in premium.