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Common Life Insurance Terms
Your Source for Life Insurance Information in Charleston, SC
When you work with the agents at C2G Capital Management LLC you'll enjoy a comprehensive service experience. We care about our clients and want to ensure their loved one's well-being by offering the most informational life insurance
consultations in all of Charleston, SC. We will take the time to make sure you're satisfied with and completely knowledgeable about your life insurance policy. If you do happen to find yourself with any questions, hopefully the common life insurance terms below can help clarify things.
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Common Life Insurance Terms
Accelerated Death Benefit Rider
- An optional add-on life insurance benefit that allows the insured to receive partial payment of the policy’s face amount before dying in the case of terminal illness or injury.
Accidental Death & Dismemberment Insurance (AD&D)
- A type of insurance that provides payment if the insured’s death is the result of an accident, if he/she becomes paralyzed, loses limbs, or permanently loses eyesight. The types of injuries covered by dismemberment vary by insurer and will be enumerated in the AD&D policy.
Accidental Death Benefit Rider
- An optional life insurance add-on that pays extra benefits above the face amount if the cause of death is a covered accident.
Cash Value
- Most permanent life insurance policies have a built-in cash accumulation function. The policy owner can borrow against it or receive payment if they cancel the policy.
Conversion Privilege
- The ability to convert a term life insurance policy into a permanent policy, usually without a medical exam or proof of insurability.
Guaranteed Issue Life Insurance
- A type of life insurance that is offered without regard to health conditions. The applicant does not have to undergo a medical examination or even answer any medical questions. Guaranteed issue life insurance products are generally more expensive than fully underwritten products.
Permanent Life Insurance
- A life insurance policy that covers the insured until death rather than a specific number of years.
Return of Premium (ROP)
- A type of Term Life insurance that returns the equivalent all premiums back to the policy owner at the end of the term if the insured is still living. The policy may also pay a percentage of the premiums if the policy is cancelled before the term ends.
Term Life Insurance
- A type of life insurance that proves coverage for a specific number of years, usually 10, 15, 20 or 30 years. If the insured lives beyond the term, premiums generally increase each year.
Underwriting
- The process of determining whether a life insurance company will insure an applicant and at what rate class. The insurance company uses a person’s health, age, and other factors to decide whether or not to accept customers and to determine how much the customer will have to pay in premiums. The company reviews the application, the results of the medical exam, lab results, medical tests and records, and other relevant information to make its decision.