Beneficiary
The person(s) named in the policy to receive the life insurance proceeds upon the death of the insured.

Cash (Surrender) Value
The amount that is available in cash for loans and that may be available for withdrawals. Accessing Cash Surrender Value may reduce the death benefit and may increase the risk of lapse.

Convertible Term Insurance
Term insurance which can be exchanged (converted), at the option of the policyowner and without evidence of insurability, for a permanent insurance policy.

Dividend
A return of part of the premium on participating insurance that is based on the insurer's investment, mortality, and expense experience. Dividends are not guaranteed.

Face Amount
The amount stated on the face of the policy that will be paid in case of death. It does not include additional amounts payable under accidental death or other special provisions, or acquired through the application of policy dividends.

Insurability
Acceptability to the company of an applicant for insurance.

Insured or Insured Life
The person on whose life the policy is issued.

Level Premium (Life Insurance)
Life insurance for which the premium remains the same from year to year. The premium is normally more than the actual cost of protection during the earlier years of the policy and less than the actual cost in the later years. The building of a reserve is a natural result of level premiums. The payments in the early years, together with the interest that is to be earned, serves to balance out the underpayment of the later years.

Loan (Policy Loan)
A loan made by a life insurance company from its general funds to a policyowner on the security of the cash value of a policy.

Paid-up Insurance
Insurance that will remain in force with no need to pay additional premiums.

Participating Policy
A life insurance policy that is eligible for the payment of dividends by the insurer (see also Dividend.)

Permanent (Life Insurance)
Any form of life insurance except term; generally insurance that builds up a cash value, such as whole life.

Policyowner
The person who owns a life insurance policy. This is usually the insured person, but it may also be a relative of the insured, a partnership or a corporation.

Premiums
Payments to the insurance company to buy a policy and to keep it in force.

Renewable Term Insurance
Term insurance which can be renewed at the end of the term, at the option of the policyowner and without evidence of insurability, for a limited number of successive terms. The rates generally increase at each renewal as the age of the insured increases.

Term Life Insurance
Level term life insurance provides a guaranteed death benefit and guaranteed level premium for a term of one or more years. Its pays a death benefit if the insured dies within the selected term period. Term insurance generally does not build cash value. Most term products allow the ability to convert to a permanent plan. Choose from 1, 5, 10, 15, 20 and 30-year guaranteed term periods. Term life insurance is best used to cover temporary life insurance needs.

Universal Life Insurance
Universal Life is a permanent life insurance product that offers flexibility in premium and death benefit. Its purpose is to be a combination of term insurance protection with the accumulating cash value of whole life insurance. Premiums can be paid in a lump sum, annually, or anywhere in between. Universal life plans have a guaranteed interest rate and guaranteed mortality factors. However, the insurance carrier can credit excess interest as well as charge lower mortality factors. With guidelines, premiums can be increased or decreased to meet the policy owner's changing needs. As long as the cash value is substantial enough to keep the policy in force, the policy will not lapse. Benefits of this policy include long term protection and the ability to accumulate cash values.

Whole Life Insurance
Whole life insurance by definition has a fixed premium (the initial premium table never changes) and an accumulating cash value. The cash value is designed to increase to age 100 when it will then be equal to the death benefit. Benefits include cash value accumulation, permanent insurance coverage, and guaranteed premiums.