Life Insurance Terminology

Life Insurance Terminology

• A Beneficiary is the person who receives the money from the policy when the insured dies.
• The Insured is the person on whose life the policy is written.
• Additional benefits can be added to a policy, such as accidental death benefit or disability income, to provide extra coverage.
• Riders are optional features that can be added to a policy to customize its coverage.
• The Death Benefit is the amount of money the beneficiary receives when the insured dies.
• The Premium is the regular payment made by the policyholder to the insurance company to keep the policy in force.
• A Life Insurance Policy is a contract between the policyholder and the insurance company that outlines the terms and conditions of the coverage.
• Cash Value is the accumulated savings component of a life insurance policy, which grows over time.
• Policyholder's Equity refers to the cash value of a life insurance policy, which represents the policyholder's ownership interest in the policy.