Chapter 2: Life Insurance Basics
chronically ill
means a condition in which a person in unable to perform at least 2 activities of daily living or that requires substantial supervision to protect the individual from threats to health and safety.
terminally ill
means a conditions that can reasonably be expected to result in death within 24 months.
who do viatical producers represent?
providers
insurable interest
the possibility of losing money or something of value in the event of a loss.
assest protection
the use of life insurance to guard one's wealth against creditor claims without engaging in practices that are ultimately illegal, such as concealment or fraudulent.
insureds are referred to as ?
viators
liquidity
when a policy's cash values can be borrowed against at any time and used for immediate needs.
estate creation and conservation
when an insured purchases a life insurance policy, he will have an estate of at least that amount the moment of the first premium is paid.
survivor protection
When life insurance provides the funds necessary for the survivors of the insured to be able to maintain their lifestyle in the event of his/her death
viatical settlement broker
a licensed person that, for free, negotiates viatical settlement contracts between the viator and the viatical settlement providers.
viators usually will receive what from the person who purchases the policy?
a percentage of the policy's face value
viatical settlement provider
a person who enters into or effectuates a viatical settlement contract. This term does not include a bank, financing entity, or the issuer of life insurance policy providing accelerated benefits.
what does a viatical settlement provider mean?
a person, other than a viator, that enters into a viatical settlement contract
while viatical settlements are not policy options, they are SEPARATE CONTRACTS in which the insured sells the death benefit to whom at a discounted rate?
a third party
viatical settlements
allow someone living with a life threatening condition to sell their existing life insurance policy and use the proceeds when they are most needed, before their death.
viatical settlement purchaser
anyone who gives a sum of money as consideration for a life insurance policy or interest in the death benefits of a life insurance policy.
when must the insurable interest exist between the policy owner and the insured?
at the time of the application
who do viatical brokers represent?
insureds
the new owner of the policy will maintain what and eventually receive what?
maintain premium payments; collect the entire death benefit
