A risk, or subject of insurance, with insurable qualifications below the standard of risks on which the premium for the coverage was based. For example, a Life Insurance prospect with heart disease would be an impaired risk. See Substandard Risk. Contrast with Standard Risk.

The payment of insurance premiums with funds borrowed outside the contract itself.

A mortality table in which the experience has been smoothed out by a formula.

Various rights that may be exercised under the policy contract by the policy owner. Some of the incidents of ownership would be: (1) the right to cash in the policy, (2) to receive a loan on the cash value of the policy, and (3) to change the beneficiary.

A settlement option under which fixed, periodic benefit payments are made until the principal and interest are exhausted.

The premium for participating in Life Insurance. If an insured elects to use his dividends to pay premiums, this becomes the net premium when dividends are subtracted from it. Contrast with Net Premium.

A Life Insurance contract which provides income on a monthly basis, as opposed to a policy which pays proceeds in a lump sum.

A benefit, the dollar amount of which does not vary.

The document provided to each member of a group plan. It shows the benefits provided under the group contract issued to the employer or other insured.

A clause in a policy providing that after a policy has been in effect for a given length of time (two or three years), the insurer shall not be able to contest the statements contained in the application. A Health Insurance provision also states that after that time no claim shall be denied or reduced on the grounds that a condition not excluded by name at the time of issue, existed prior to the effective date. In Life policies, if an insured lied as to the condition of his health at the time the policy was taken out, that lie could not be used to contest payment under the policy if death occurred after the time limit stated in the incontestable clause.