Beneficiary – is a person who receives the proceeds of a life insurance policy.

Cash Value

• accumulated cash value

Death benefit – is the amount of money to be paid to beneficiaries upon a designated person’s death.  The amount to be paid is based on the face value of the policy reduced by any unpaid loans or claims.

Hybrid insurance policy – is a life insurance policy that combines elements of term life and whole life.

Life insurance – is protection in the event of death.

Life insurance policy – is an agreement between an insurance company and a policyholder which sets out the terms that will result in a payment to beneficiaries upon death of a designated person.

Lump sum payment – is a one-timC\C_payments over a period of time.

Permanent life insurance – is a policy that stays in place, as long as a death benefit will be paid someday.  The policy has an accumulated cash value which can be accessed by the policy-holder at anytime for any reason.

Premium – is the amount paid to the insurance company for life insurance protection.  The amount can be paid monthly, quarterly, or once a year.

Term – is a period of time.

Term life insurance – is a basic form of life insurance, for a specific period of time in which the policyholder pays for protection in the event of death.  The specific period of time can be based on a certain date or a person’s age.

• annually renewable term life – adjusts every year and are lower in early years when the insured person is younger; the premium increases after each year because the insured person is older.
• level term life – the premium is the same every year, so long as the policy does not lapse for non-payment.

Universal life insurance – combines term life insurance with a savings features that can be invested in a tax-deferred account; earnings on the account may be used to increase or decrease the policy’s premium.

Variable universal insurance – combines term life insurance with an investment feature and as the value of the investments increase, the policyholder can increase the value of the insurance policy or borrow against the accumulated cash value or cash in the policy.

Whole life insurance policy – provides protection in the invent of the insured person’s death but also allows the policy to build up a cash value, in which the policyholder can take out loans.