Adjustable Life Insurance
Coverage under which the face value, premiums, and plan of insurance can be changed at the discretion of the policy owner in the following manner, without additional policies being issued:
- face value can be increased or decreased ( to increase coverage, the insured must furnish evidence of insurability). The resultant size of the cash value will depend on the amount of face value and premium.
- premiums and length of time they are to paid can be increased or decreased. Unscheduled premiums can be paid on a lump sum basis. Premiums paid on an adjusted basis can either lengthen or shorten the time the protection element will be in force, as well as lengthen or shorten the period for making premium payments. For example, assume that John, who is 28, buys a $100,000 adjustable term life policy to age 65 with an annual premium of $1250. As his career prospers, he finds at age 32 that he can double the annual premium payment to $2500. This increase may change the original term amount to a fully paid-up life policy at age 65. With time, John might experience economic hardship and have to decrease his annual payment by two thirds. This could result in changing the paid-up-at-65 policy back to a term policy to age 65. Thus, at any time the policy can be either ordinary life or term.
Popular Insurance Terms
Monetary value of the reputation of a business. Goodwill is an intangible asset and thus may be difficult to measure. ...
Employer, association, labor union, or other group ...
Policy used to provide the funds for buy and sell agreements under which an income payment or a series of income payments is paid to the buyer of the disabled partner's interest contained ...
Critical point in the total amount of claims paid above which the excess insurance policy pays a percentage (generally 80-100%) of the claims for any policy year experience. ...
Authority to act on behalf of an individual that terminates upon its revocation or death of that individual. ...
Coverage for extra expenses associated with the reconstruction of a damaged or destroyed building where zoning requirements mandate more costly construction material. This endorsement is ...
Death payment that increases with the age of an insured. Graded benefits may increase gradually and then level off, or may increase sharply before becoming level. This type of coverage is ...
Written statements on a form by a prospective insured about himself, including assets and other personal information. These statements and additional information, such as a medical report, ...
Coverage for automobile or aircraft operators if they are sued for negligently killing or injuring a passenger. The PERSONAL AUTOMOBILE POLICY (PAP) provides MEDICAL PAYMENTS INSURANCE for ...
Have a question or comment?
We're here to help.