The first page of a Life Insurance policy.

A contract provision found in Industrial Life policies, which permits the insurer to pay a portion of the proceeds of the policy to any relative or person who has possession of the policy, and who appears equitably entitled to such payment. This provision is designed to facilitate payment when some doubt may exist as to who the beneficiary is, and to save legal expenses in the settling of an estate.

A policy that pays an income to the beneficiary, up to some future date designated in the policy, after the death of the insured. The period of payment is measured from the date of the inception of the contract, and at the end of the income period the face amount of the policy is paid to the beneficiary. If the insured lives beyond the income period, only the face amount is payable in the event of his death.

A policy that pays an income to the beneficiary starting after the death of the insured and continuing for a stated period of time. At the end of the income period the face amount of the policy is paid to the beneficiary.

A contract that provides insurance within a single policy for a father, mother, and born and unborn children. The father’s coverage is typically Whole Life Insurance, with the mother and children insured for smaller amounts of Term Insurance.

See Life Office Management Association.

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

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

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

A settlement option under which the proceeds are guaranteed to be paid in equal installments for a specified period of time.

This is another term used to describe Universal Life type policies.

A life insurance policy under which the policyholder may vary the amount or timing of premium payments.

A whole life contract and a security which features flexible premium payments, non-guaranteed cash values and either a minimum guaranteed death benefit or no guaranteed death benefit. Policy values are dependent on the performance of a separate account.

Fellow of the Life Management Institute. See Life Office Management Association.

A plan for covering groups of persons with individual policies having uniform provisions, although they may differ in benefits. Individual contracts are issued to each person, with individual underwriting. It is usually applied to groups too small to qualify for true group coverage, and the solicitation of cases usually takes place among an employer’s work force with his consent. In Life Insurance, it is sometimes called Wholesale Insurance. Contrast with True Group Insurance.

A period of time (usually 10, 20 or 30 days) during which a policyholder may examine a newly issued individual policy of life or health insurance, and surrender it in exchange for a full refund of premium if not satisfied for any reason.

A method for determining reserves on Life Insurance contracts, whereby no reserve is required for the first year of a contract’s life, with an appropriate adjustment in subsequent years’ reserves to make up the difference. This method of valuation makes it possible for an insured to have more funds available for the high first year expenses incurred in the writing of Life Insurance.

A limited payment Life Insurance contract on which all required payments have been made. For instance, a 20-Pay Life policy would be fully paid after the insured has paid premiums for 20 years.