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Definitions
- S
Saving
Age
A
procedure for making the effective date of a policy earlier than
the application date. Backdating is often used to make the age
of the insured at issue lower than it actually was in order to
get a lower premium. Most policies can be backdated up to six
months. Also referred to as Saving Age.
Scheduled
Premiums
Refers to planned premiums that are scheduled at the time
of issue.
Secondary
Beneficiary
A person(s) designated by the policyowner to receive policy
proceeds if the Primary Beneficiary is deceased at the time benefits
become payable. Also referred to as Secondary Beneficiary.
Second-To-Die
A type of life insurance policy that insures the lives of
two people, typically a husband and wife. The death benefit proceeds
are payable upon the second death and used to satisfy the estate
tax. Available as either Whole Life or Universal Life, these policies
feature premiums that are often less expensive than buying two
separate policies. Also referred to as Joint and Last Survivorship
Life Insurance or Joint Survivorship Life Insurance.
Section
401(k) Plan
Internal Revenue Code 401(k) is an employer-sponsored, salary-reduction
retirement savings program. The employee defers a percentage of
current salary on a pre-tax basis and the employer often matches
some portion of that amount. There is a cap on the annual contribution,
and a 10% penalty is levied on moneys withdrawn before age 59
1/2.
Select
Mortality
Descriptive of the mortality experience of newly underwritten
insured's. This period of discernibly different (favorable) mortality
usually lasts 5 to 15 years.
Settlement
Options
The ways in which policy holders or beneficiaries may choose
to have benefits paid other than a lump sum.
Short
Term
Preliminary Term insurance, not to exceed 11 months, which
may be attached to a policy to change the anniversary date for
the purpose of more conveniently spacing premium payments.
Simplified
Underwriting: An underwriting process that applies a less
strict analysis of risk factors. Participants in group plans may
qualify for this abbreviated form of underwriting.
Single
Premium Life Insurance
A life insurance plan that requires only one premium and is
guaranteed to remain paid-up throughout the insured's lifetime.
Split
Dollar Plan
An arrangement in which two parties, usually an employer and
employee, jointly purchase the policy, pay premiums and share
in the policy's benefits.
Spousal
Discount
A discount for purchasing coverage together as husband and
wife from the same insurance company.
Standard
or Standard Plus
An underwriting rate classification for non-smokers who have
minor health impairments.
Standard
Risk
An average risk, not subject to rate loadings or restrictions
because of poor health.
Step-Rate
Premium
A rating structure in which the premiums increase periodically
at pre-determined times such as policy years or attained ages.
Stock
Life Insurance Company
A life insurance company owned by stockholders who elect a
board to direct the company's management. Stock companies, in
general, issue nonparticipating insurance, but may also issue
participating insurance.
Straight
Life Insurance
Whole life insurance on which premiums are payable
for life.
Sub-Standard
Risk
An individual, who, because of health history or physical
limitations, does not measure up to the qualification of a standard
risk.
Suicide
Clause
A policy provision usually stating that if the insured dies
by suicide within two years of the date of issue, the amount payable
would be limited to the total premiums paid, less any policy debt.
The full benefit would only be paid if the suicide occurs after
the first two policy years.
Surplus
The amount by which the value of an insurer's assets exceeds
its liabilities, i.e., the net worth of an insurance company.
Surrender
To terminate or cancel a life insurance policy before the
maturity date. In the case of a cash value policy, the policy
holder may exercise one of the non-forfeiture options at the time
of surrender.
Surrender
Charge
An amount retained by the issuer of a life insurance policy
when a policy is canceled, typically assessed only during the
first five to ten years of a policy.
Survivorship
Life Insurance
A type of life insurance policy that insures the lives of
two people, typically a husband and wife. The death benefit proceeds
are payable upon the second death and used to satisfy the estate
tax. Available as either Whole Life or Universal Life, these policies
feature premiums that are often less expensive than buying two
separate policies. Also referred to as Joint and Last Survivorship
Life Insurance or Joint Survivorship Life Insurance.
Some whole life
policies let you pay premiums for a shorter period such as 20
years, or until age 65. Premiums for these policies are higher
since the premium payments are made during a shorter period.
Quick Life
Insurance Terms Glossary
(some definitions
taken from the National Association of Insurance
Commissioners' Life Insurance Buyers
Guide)
LIFE
IS COMPLICATED....
BUT TERM LIFE INSURANCE DOES NOT HAVE TO BE.
Privacy
Statement | Legal Statement | Licenses
Privacy statement: Your privacy is
important to us. Advantage
Quote Life Insurance will keep all
the information gathered strictly confidential. Your personal
information will not be used for any other purpose or given to
anyone else.
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