Backdating:
Some insurance companies allow policies to be dated earlier than the actual date issued in order to save age. By underwriting at a younger age, the premiums will typically be lower than if the policy is dated at the actual date.  However, take note that premiums will be due from the date on the policy, not the actual date.

Beneficiary:
The person (or entity) to whom the proceeds of a life insurance policy are payable when the insured dies.  There are various types of beneficiaries (see primary, contingent or secondary and tertiary beneficiaries)

Binding receipt:
The receipt for payment of the first premium, which assures the applicant that, if he or she dies before receiving the policy, the company will pay the full claims if the policy is issued (or would have been issued) as applied for.

Broker:
In insurance, one who places business with more than one company and who has no exclusive contract requiring that all his or her business first be offered to a single company.  Unlike the agent, who is considered to represent the company, the broker usually is considered as representing the buyer.

Burial insurance:
A general term usually referring to a small policy of life insurance ($5,000 to $25,000) intended only to met the final expense needs of the insured.

Business continuation insurance:
Generally refers to a life insurance policy used to fund a business continuation plan (also see buy-sell insurance).

Business Insurance:
Life insurance coverage concerned primarily with the protection of an insured’s business or vocation.  Business insurance protects a business against the loss of its valuable lives or key executives; stabilizes the business through the establishment of better credit relations; and provides a practical plan for the retirement of business interests in the event of the death of one of the owners.

Buy-Sell agreement:
An agreement between the owners of a business, which provides that the interest of any one of them who dies shall be sold to and will be purchased by the surviving co-owners or by the business at a value agreed upon by the parties and stipulated in the agreement.  Also applies to buyout arrangements between owners and key employees.

(back to main Life Insurance Glossary page)

Visit these links to learn about:

Get instant life insurance quotes:

To speak with a licensed representative, contact us or call 866-691-0100.

Latest News

Life Insurance for Marijuana Users
life insurance for marijuana users

Many people are under the impression that you cannot buy life insurance for marijuana users. In fact, many applicants lie about their usage and then are denied coverage, not because they use marijuana, but because they lied about it. Insurance companies refer to this as misrepresentation. The truth of the matter is using marijuana does […]

Read More
The Pros and Cons of Using Life Insurance as an Investment
life insurance as an investment

When we consider using life insurance as an investment, there are as many people in favor of it as there are opposed. Certainly, financial gurus like Dave Ramsey and Suze Orman are against life insurance for any reason other than a death benefit, but remember, while speaking out against most life insurance products, they are […]

Read More
Death and Taxes … and Life Insurance
life insurance and taxes

Life insurance provides your family and loved ones with a vital financial safety net in the event of your death. But with a variety of life insurance policy options available, many people wonder exactly how to handle their policies when it comes to filing taxes. The good news is that in most cases, you do […]

Read More