Lien Plan

(1) A plan for issuing coverage on substandard risks under which a standard premium is paid, but less than the full face amount of the policy is payable if death occurs within a certain period of years. It is rarely used and is even illegal in some states. (2) A plan under which an impairment of the insurer’s assets if offset by pro rata liens against policies to be deducted from the face amount when paid as a claim.