Primerica Chapter 2 Types of life insurance policies
annuities investment options
-fixed annuities -variable annuity -indexed annuities
the face amount
death benefit
universal life
flexible premium like adjustable life, annually renewable term insurance
Indexed annuities
guaranteed interest rate. tied to an index like S&P 500
fixed annuities
guaranteed minim rate of interest. fixed rate of return
option b
increasing death benefit option
level
most common and refers to the death benefit
Most term policies are renewable or convertible or both
most term policies are renewable or convertible or both
Term Life
only provides protection for a specific period of time
Straight life
ordinary life or continuous whole life the lowest annual premium
beneficiary
person who receives annuity assets
annuitant
person who receives benefits or payments from the annuity. whose life expectancy is taken into consideration and for whom the annuity is written. A corporation may own an annuity but the receiver must be a natural person
adjustable life
policy owner can make adjustments
limited -pay life / single premium life
premiums for coverage will be completely paid up before the age of 100. some are paid all in 20 years some are paid in 65 years.
types of premium payment options
single payment periodic payment
variable annuity
FINRA and SEC ( 2 types of liscenses ) nothing guaranteed
annuity
a contract that provides income for a specified period of years and protects a person from outliving his or her money.
annuity period
annualization period, liquidation period or payout period, the sum accumaulated starts doing income payments
variance whole life
assets must be held in seperate accounts
increasing
death benefit increases and reaches the optium level at the end of the period
decreasing
death benefit reaches $0 (when there is a mortage due)
variable universal life
dually regulated by state and federal government (SEC FIRNA)
returns of premium
increasing term life that pays an additional benefit equal to the amount of premium paid
survivorship
insures 2 or more lives, pays the last death. (second to die or last survivor)
option a
level death benefit
single whole life premium
level death benefit to the insured age of 100 for a time lump-sum payment . it generates immediate cash.
accumulation period
pay-in period, the owner makes payments into an annuity, earn interest on a tax deferred basis
immediate annuities
purchased with a single lump-sum payment, provides income payment that start within one year from the date of purchased
Whole life term
remains in effect for the entire life of the insured or until the age of 100
Joint life
single policy designed to insure 2 or more lives, cost less than individual policies and paid after 1st death
Annually renewable term
the death benefit remains the same however the premium must be renewed each year without proof of insurablity / premium price increases with age
the level of the premium throughout the term
the premium is leveled but the death benefit may influcate
owner (annuity)
the purchaser of the contract
renewable
the right to renew policy without proof of insurability .... however the premium will be based on the insured's current age
