GP/Insurance Flashcards
Discount Rate
The rate the Federal Reserve charges member banks to borrow to satisfy reserve requirements
Prime Rate
What banks charge best/ most credit worthy borrowers.
Set by commercial banks (NOT the fed).
The fed may influence the prime rate, but doesn’t set it.
Investment Advisers Act
(IAA)
The investment advisors act (IAA)  provides a three-pronged definition for determining who is an investment advisor:
ABC
1.  a person who provides ADVICE or issues, reports or analysis regarding securities.
2.  a person who is in the BUSINESS of providing such services.
3.  A person who provides such services for COMPENSATION.
all 3 must apply
The SEC defines compensation as “receipt of any economic benefit.” This includes commission on the sale of products.
Form ADV-W
Form ADV-W
 An investment advisor, ceases to operations by filing form, a ADV – W. Records must be kept for not less than five years from the end of the fiscal year of the last recorded entry.
Incontestable Provision (life insurance)
after two years, the validity of a contract cannot be questioned (exception: Fraud)
Suicide Clause Provision
if within two years, the insured dies by suicide, the amount payable by the company shall be the premium paid 
Grace Period Provision (life ins)
Number of days allowed for premium in default
APL Provision (life ins)
(automatic premium loan- applies to whole life only).  If the insured does not pay the premium by the due date, the company automatically will pay the premium and charge it against the cash value of the policy.
Reinstatement Provision (life ins)
provides for a policy to be reinstated within a specified time. After the date of premium default- WITH PROOF OF INSURABILITY.
Conversion Provision (life ins)
Exchange term for a permanent type plan WITHOUT having to prove evidence of insurability. For exam, you can always exchange term for whole life, not in real life. 
