Life Insurance Policies (CH 4) Flashcards
Binding Receipt
A rarely used type of receipt in which coverage begins at the moment of delivery and cannot be reversed, regardless of what the underwriter may discover at a later date.
Conditional Receipt
A provision that, if premium settlement accompanies the application, coverage shall be in force from the date of application (whether the policy has been issued or not), provided the insurance company would have issued the coverage on the basis of facts as revealed by the application and other usual sources of underwriting information. A physical does not have to be completed for the company to make this judgment..
Convertible Term Insurance
A Term policy that can be converted to a permanent type of coverage without proof of insurability.
Also called a Conversion Option.
Credit Life Insurance
Insurance on a debtor in favor of a lender, intended to pay off a loan or the balance due if the insured dies or is disabled.
Fixed Annuity
An annuity whose accumulated proceeds are guaranteed by both the insurer and various state insurance funds.
Group Life Insurance
Life Insurance that a person is eligible to purchase through membership in a group. The group may not be formed just to buy insurance.
Industrial Life Insurance
Life Insurance generally with a face amount of less than $1,000 with premiums collected monthly o more frequently by the agent in person. The grace period for this type of insurance is 28 days. Premiums were traditionally collected at the factory or workplace.
Jumping Juvenile Life Insurance
Juvenile insurance on which the face amount increases by a multiple, usually five, of the original face amount when the insured reaches 21.
Level Term Insurance
The amount of insurance protection in the Term policy remains constant during the policy period.
Limited Payment Life
A permanent Life insurance policy on which premiums are paid for a specified number of years or to a specified age of the insured. Protection continues for the entire life of the insured. Policy maturity does not occur until age 121 even though the policy is paid up earlier.
LP65 and 20-Pay Life are examples.
Master Policy
The policy contract issued to the employer under a Group Insurance plan.
Mortality Table
A statistical table showing the number of deaths for all ages from 1 to 121.
Ordinary Life Insurance
Another term sometimes used interchangeably with Whole Life, Continuous Premium, or Straight Life. With this type of life insurance, the client pays the premium until death or age 121, whichever comes first. Has the lowest premium of all types of life insurance.
Participating Policy
Insurance that pays policy dividends. Issued by a mutual company. Sometimes called par.
Permanent Insurance
Life Insurance with some type of cash value accumulation.