Life Insurance

Front 1

Is a contract whereby a party (the insurer) for considerations agrees to pay another party a sum of money in the event of his death in any cause not excluded in the contract or upon his surviving a specific period or otherwise contingent upon the continuance or cessation of life

Back 1

Life Insurance

Front 2

Entered into between two parties namely the insurer(insurance company) and the insured who has insurable interest

Back 2

Contract

Front 3

Parties to the life insurance contract

Back 3

Considerations

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Face amount of the policy in the event of death of the insured

Back 4

Sum of Money

Front 5

Probability of pre mature death

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Death of the Insured

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If the insure survives he himself collects the amount of the insurance

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Surviving a Specified Period

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If death occurs company will pay more than the premium received. However if the event does not occur no.payment will be made

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Aleatory

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After the insured has paid the premium only one of the parties is exposed to a legally enforceable promise to perform certain acts in the future

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Unilateral Contract

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All conditions must be satisfied

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Conditional

Front 10

Both parties view with care the character conduct and credit standing of each other

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Personal

Front 11

Should be considered more as a valued contract because the agreement states that the loss of life will be compensated at a specified sum

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Indemnity

Front 12

An assembly of a series of relationships between the probable number of people living and dying at any given age

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Mortality

Front 13

Based on money market rates

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Interest Earned

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Expenses of doing the insurance business

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Loading

Front 15

Designed to provide protection during a specified period of time i.e 10,15 or 20 years or until age 60

Pays the face amount only in the event of death;low cost; with renewal and conversion rights;no cash

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Term Insurance

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Not renewed at the end of the initial period

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Straight term

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Issued for a specified number of years and are subsequently renewable for similar periods of time, regardless of insured's death

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Renewable Term Insurance

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From term to whole life insurance coverage

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Convertible term

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Face amount does not change overtime

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Level Term

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Face amount gradually declines each year . It is availed of to secure payment of mortgages in case the debtor dies before complete paymet is made

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Decreasing Term

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Face amount increases periodically on a predetermined basis

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Increasing Term

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Automatically increases tth amount of protection by the same percentage that theaconsumer price index (CPI) has increased since the basic policy was issued

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Cost of Living Rider

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Insured will be able to purchase additional amounts of insurance protection in the future regardless of health subject to stated maximums

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Guaranteed Insurability Rider

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Mode of payment : annually ,semi-annually,quarterly, or monthly

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Premium

Front 25

One month for the payment of every premium

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Grace Period

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If a premium becomes due and is not paid within the grace period , the company shall automatically advance as a loan , a sum sufficient to cover the premium

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Automatic Premium Loan

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Transfer to rights of insurance policy

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Assignment

Front 28

Placing back in force policies that have lapsed on account of non-payment of premium

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Reinstatement

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Proceeds are left with the company with the provision for the payment of interest at specified intervals and for the ultimate settlement of the principal

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Interest Only Option

Front 30

One master plan covers the group. Employees do not deal with the company, but they deal with their employer

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Group Insurance

Front 31

Face amount is paid at the end of the protection period if the insured is still alive

Pays the face amount in the event of death within the stated number of years

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Endowment

Front 32

More flexible premium payment options

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Universal Life

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Death benefit and cash value fluctuate with the investment performance of one or more port folios of securities

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Variable Life

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Insured is given a choice of investments to be used to support the contract

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Variable Universal Life

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Form of whole life insurance with premiums that are lower than usual for an initial period of time as 5 or 10 years after that time premium are somewhat higher than they otherwise would be

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Modified Life

Front 36

Sold in every small amounts primarily to meet needs (burial) of low income insured

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Industrial Life

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Protection offered in connection with installment sales

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Credit Life

Front 38

Maximum amount issued depending on residence

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Savings Bank Life

Front 39

Is a statement made by an applicant for insurance before the policy is issued

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Representation

Front 40

Is a closure in an insurance contract holding that before the insurer is liable, a certain fact, condition, of circumstance affecting the risk must exist

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Warranty

Front 41

Are those stated in the contract

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Express Warranties

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Are not found in the contract

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Implied warranties

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Describes a condition fact or circumstance to which the insured agrees to be held during the life of the contract

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Promissory warranty

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Is one that must exist only at the time the contract is first into effect

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Affirmative warranty

Front 45

Is defined as silence when obligated to speak

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Concealment