Terminology is the study of term insurance… just kidding. Bad joke? Now you know how my wife feels. Moving on… It is important to understand the terminology used to describe life insurance.\u00a0 Below are a few of the more important definitions to understand.<\/p>\n
The amount of coverage purchased by the policyholder.\u00a0 Most of the time this is equal to the death benefit (there can be exceptions).<\/p>\n
The amount paid to the beneficiaries by the insurance company upon death of the insured.\u00a0 Most of the time this is equal to the death benefit (there can be exceptions).<\/p>\n
The amount of death benefit that is paid by the policy (insurance company).\u00a0 For term policies the entire death benefit is pure death protection.\u00a0 For cash value policies death protection is equal to the death benefit minus the accumulated cash value.\u00a0 For ordinary cash value policies the amount of death protection decreases as the cash value increases.\u00a0 An example: If the face value of a policy is $100,000 and the cash value accumulated to date is $20,000, the value of death protection is $80,000.\u00a0 As the cash value increases to $40,000, the amount of death protection decreases to $60,000 in order to equal the $100,000 policy face value to be paid out to beneficiaries.<\/p>\n
Cancellation of the policy by the policy holder.\u00a0 Surrender charges are usually involved.<\/p>\n
Amount of the cash value that the policyholder is entitled to after surrendering a policy.\u00a0 Typically this value is equal to the cash value of the policy minus the surrender charge.<\/p>\n","protected":false},"excerpt":{"rendered":"
Terminology is the study of term insurance… just kidding. Bad joke? Now you know how my wife feels. Moving on… It is important to understand the terminology used to describe life insurance.\u00a0 Below are a few of the more important definitions to understand. Face value (face amount) The amount of coverage purchased by the policyholder.\u00a0 […]<\/p>\n","protected":false},"author":1,"featured_media":3990,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[2,8,11],"tags":[],"_links":{"self":[{"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/posts\/361"}],"collection":[{"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/comments?post=361"}],"version-history":[{"count":0,"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/posts\/361\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/maysfinancial.local\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/media?parent=361"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/categories?post=361"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/maysfinancial.local\/wp-json\/wp\/v2\/tags?post=361"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}