The space created between the total death benefit and the cash value of a universal life insurance policy. An automatic increase in the death benefit results when the cash value approaches the initial face amount under Option A. If this space did not exist, the universal life insurance policy would not qualify as a life insurance policy under the definition of life insurance by the Internal Revenue Code (IRC) and would cease to reap the favorable tax treatment afforded life insurance policies by the IRC.
Popular Insurance Terms
Additional Living Expense Insurance is a type of coverage present on several types of Homeowner’s Insurance that reimburses additional costs caused because of the insured’s ...
Coverage outside an insured's home for personal items usually carried or worn while traveling. Protection is for personal property (apparel and jewelry), not for real property or property ...
Group in which subscribing members agree to (1) regulations governing their behavior, and (2) the qualifications that reinsurance contracts ceded to them must meet in order to be ...
Interest adjusted method that measures the cost of life insurance. Named for the late distinguished actuary M. Albert Linton. This method compares a whole life policy with a combination of ...
Excess of the value of an insurer's admitted assets over the total value of its liabilities and minimum capital requirements established by applicable statutes designed to assure the ...
Type of accounting method, in life insurance, designed to match revenues and expenses of an insurer according to principles designed by the Financial Accounting Standards Board and the ...
Money paid through state and federal programs to workers who are temporarily unemployed. The program, which was created by the social security act of 1935, is managed by the individual ...
Arrangement by which a policy owner authorizes an insurance company to draft his checking account for premiums due on an insurance policy. The drafting is usually monthly, persistency of ...
Future benefits to be paid to the policyholders and beneficiaries, assigned surpluses, and miscellaneous debts. These primary liabilities take the form of reserves, which must be listed on ...
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