Group Paid-up Life Insurance
Combination of two basic plans: accumulating units of paid-up permanent life insurance, and decreasing units of group term life insurance. The premium paid each month consists of the (a) employee's contribution and (b) employer's contribution. The employee's portion purchases increments of paid-up insurance, and the employer's portion purchases group decreasing term. The employer's contribution is tax deductible as a business expense, and these contributions are not taxable income to the employee. (However, if the employer purchases increments of paid-up units of permanent insurance, these contributions are taxable income to the employee on a current basis.) Paid-up units purchased by an employee are vested and thus can be taken as a paid-up life benefit regardless of the reason for termination of employment. The paid-up benefit will always remain in force; no further premium payments are required.
Popular Insurance Terms
Method of premium payment under which a temporary premium is charged based on projected loss experience. At the end of the year this premium is adjusted to reflect the actual loss ...
Group arrangement in which a network of attorneys provides legal services to the participants in the plan with the attorney fees being reimbursed by the provider. The attorneys who are ...
Deductible eliminated through the payment of an additional premium, resulting in first-dollar coverage under the policy. ...
Act that prohibits insurance companies, group health plans, and health maintenance organizations from establishing lifetime limits or annual limits on mental health coverage that are lower ...
Number of individuals exposed to the risk of illness, sickness, and disease at each age, and the actual number of individuals who incurred an illness, sickness, and disease at each age. ...
Smallest acceptable premium for which an insurance company will write a policy. This minimum charge is necessary to cover fixed expenses in placing the policy on the books. ...
Circumstance resulting when government expenditures exceed government income. To finance this difference, the United States Treasury will auction Treasury bills, notes, and bonds. In order ...
Modified participating level coverage permanent life insurance policy under which the dividends are credited to the policy, thereby reducing the premiums below that usually charged for an ...
Same as term Fortuitous Loss: loss occurring by accident or chance, not by anyone's intention. Insurance policies provide coverage against losses that occur only on a chance basis, where ...
Have a question or comment?
We're here to help.