Use these short definitions to get your bearings, then open a term for more detail. Your policy or annuity contract controls its actual benefits, charges, and conditions.
A qualifying direct exchange of certain insurance or annuity contracts that may defer recognition of gain. Eligibility, ownership, and contract requirements matter.
A rider that may allow part of a life insurance death benefit to be paid early after a qualifying illness. Benefits, costs, and eligibility depend on the contract.
Index-crediting methods that compare index values over a stated period. Caps, participation rates, spreads, and contract terms affect the interest credited.
The person, people, or entity designated to receive a policy benefit, subject to the contract and applicable law.
An agreement governing the transfer of a business ownership interest. Life insurance may help fund the purchase after an insured owner dies.
The amount available when a cash-value policy is surrendered, after applicable charges and policy debt. Surrender ends coverage and may have tax consequences.
One of the federal tax tests used to determine whether a contract qualifies as life insurance. It relates cash value to the benefits provided.
An arrangement giving a lender rights to policy proceeds as security for a debt. The assignment terms govern those rights.
Term coverage with a contractual option to convert to eligible permanent coverage. Deadlines, available products, and conversion conditions vary.
A policy charge for insurance protection. It is one of the charges that can reduce policy value; the contract explains how it is calculated.
The amount payable after the insured dies under the policy terms. Outstanding policy debt or earlier benefits may reduce the amount received.
Term life coverage with a death benefit scheduled to decline over time, often considered alongside a declining obligation.
Life insurance commonly used to help beneficiaries cover funeral costs and other final expenses. Underwriting and any waiting period depend on the policy.
An insurance contract that may credit interest using an index formula. The owner is not directly invested in the index; charges, limits, and withdrawal terms matter.
Coverage provided through a group contract, often an employer. Benefit limits and the ability to keep coverage after leaving the group vary.
A federal tax qualification test that limits premiums relative to benefits. It is paired with a required relationship between cash value and death benefit.
The percentage of an index change used in a crediting calculation. Other limits, such as a cap or spread, may also apply.
A way to compare cash flows by calculating the rate that balances amounts paid and received over time. An illustration-based IRR is not a guaranteed return.
A trust that may own life insurance as part of an estate plan. Its design, administration, and tax consequences require qualified legal and tax guidance.
Life insurance a business uses to help address the financial impact of an important employee or owner dying. Ownership and beneficiary arrangements matter.
A life insurance contract that fails applicable funding limits or is received in exchange for a MEC. Loans and distributions receive different tax treatment.
The difference between a policy’s death benefit and account value used in certain insurance calculations. The policy defines the applicable calculation.
Contractual choices that may preserve some policy value when premiums stop, such as reduced coverage or a surrender payment. Available choices vary.
Additional permanent life insurance purchased under an eligible policy or rider. Funding rules, costs, cash value, and death benefits depend on the contract.
Whole life insurance eligible to receive dividends if declared by the insurer. Dividends are not guaranteed; contractual guarantees are separate.
A loan secured by available policy value. Interest accrues, and unpaid debt can reduce benefits and increase lapse risk. Tax consequences depend on policy status and circumstances.
Federal tax rules relevant to amounts not received as annuity payments under certain insurance and annuity contracts. Treatment depends on contract type and circumstances.
Federal tax rules defining qualifying life insurance contracts. These requirements affect the relationship among premiums, cash value, and insurance benefits.
A contract period during which withdrawals or surrender may trigger charges. Free-withdrawal provisions, market value adjustments, and other terms should be reviewed.
Coverage for a stated term. It generally does not build cash value; renewal, conversion, and premium terms depend on the contract.
The insurer’s process for evaluating an application and determining eligibility, coverage terms, and premium classification.
Permanent insurance with policy value and funding flexibility under contract limits. Charges, credited interest, and funding determine whether the policy can remain in force.
A provision that may waive specified premiums after a qualifying disability or other covered event. Definitions, waiting periods, and exclusions vary.
Amounts a participating insurer may declare for eligible policies. They are not guaranteed, and available dividend options depend on the policy.
A minimum indexed interest credit for a crediting period under specified terms. Policy charges and loans can still reduce cash value even when indexed interest is zero.
