Flashcards
An arrangement where property is held by a person or corporation (trustee) for the benefit of others (beneficiaries). The grantor is the person who establishes the trust. The trustee manages the assets in the trust, following the trust agreement.
The person responsible for managing the trust. The trustee may be any person of legal age and sound mind.
A qualified retirement plan for public school employees and non-profit organizations, also referred to as a 403(b).
Unauthorized insurers are those who are nonadmitted, meaning they have not been approved or authorized to sell insurance in the state.
The person who reviews the insurance application and decides if the applicant is acceptable and at what premium rate.
The process by which a life insurance company determines whether it can accept an application for life insurance, and if so, on what basis so that the proper premium is charged.
Most states have adopted similar laws related to unfair claims settlement practices. These practices apply to both the insured and the insurer.
Unfair discrimination happens when similar risks are treated differently and premiums are based not on relative risk but on factors like race. State laws will address unfair discrimination related to insurance. For example, in some states, car insurance premiums cannot be based on gender. In those states to base car insurance premiums on gender would be a form of unfair discrimination.
Most states have adopted similar laws related to unfair trade practices. These include unfair discrimination, misrepresentations related to the benefits, advantages, conditions, or terms of an insurance policy, misrepresentations related to dividends, and misleading statements related to the financial health of the insurer, amongst many others.
Commonly referred to as the common disaster clause this Act says that when the insured and the primary beneficiary die from the same accident it is assumed the insured died last.
Insurance contracts are an example of a unilateral contract. This means they are one-sided. So long as the life insurance premium is paid, the insurance company promises to pay the beneficiary the death benefit if a certain event occurs (the insured dies). With a unilateral contract only the insurer makes a legally enforceable promise to pay covered claims.
A type of life insurance that provides a guaranteed amount of life insurance (subject to adjustment by the insured), but with premiums and cash values that are based upon prevailing interest rates in the economy, also known as interest-sensitive whole life. Universal life insurance has a flexible premium.
Care for an illness, injury, or condition serious enough that a reasonable person would seek care right away, but not so severe it requires emergency room care.
The USA PATRIOT Act requires financial institutions to establish anti-money laundering programs, which at a minimum must include: the development of internal policies, procedures, and controls; designation of a compliance officer; an ongoing employee training program; and an independent audit function to test programs. It requires the filing of currency transaction reports and suspicious activity reports with FinCEN (the Financial Crimes Enforcement Network, a division of the Department of the Treasury).
The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed amount.
The review process used by insurance companies to reduce healthcare costs by avoiding unnecessary care. Utilization management includes three basic categories: prospective review, concurrent review, and retrospective review.
A type of annuity contract in which benefits and cash/surrender values vary in accordance with the investment experience of various types of securities (typically, shares in mutual funds) held by the insurer in the separate account. The rate of return in the separate account is variable. Variable annuities are considered to be securities. Agents (producers) marketing them must be registered with FINRA. Generally, producers will pass the Securities Industry Essentials Exam (SIE) and the Series 6 top-off to become registered with FINRA. Additionally, a life insurance license is needed. Variable annuities have tax-deferred earnings during the pay-in period. Most variable annuities are non-qualified, funded with after-tax dollars.
A form of life insurance, derived from whole life insurance, but without the guarantees, in which benefits and cash/surrender values vary in accordance with the investment experience of various types of securities held by the insurer in the separate account, on the same basis as variable annuities. Variable life is considered to be a securities product. Agents (producers) marketing them must have passed the SIE and either Series 6 or 7 and be registered with FINRA. In addition, a life insurance license is required. Variable life has a fixed (level) premium. The rate of return in the separate account is variable.
A type of life insurance combining the features of both variable life and universal life. A variable universal life policy is the only life insurance policy that allows the insured to self-direct funds in the separate account. Variable universal life has a flexible premium.
Viatical settlements involve the sale of an existing life insurance policy by a viator (person with a life-threatening or terminal illness) to a viatical settlement company in return for a cash payment that is a percentage of the policy´s death benefit.
Ownership of contributions made into a qualified plan. A participant vests in their contributions immediately. When they vest in the employer contributions depends upon the type of plan and ERISA requirements.
A health benefit that at least partially covers vision care, like eye exams and glasses. All plans in the Health Insurance Marketplace® include vision coverage for children. Only some plans include vision coverage for adults. A stand-alone vision plan can be purchased by an individual to reduce vision care expenses.
The waiting period, or elimination period, is the amount of time that a person is unable to work before the coverage kicks in. The waiting period begins when the person meets the policy’s definition of totally disabled. The longer the waiting period, the lower the premium.
The time that must pass before coverage can become effective for an employee or dependent who is otherwise eligible for coverage under a job-based health plan.
A voluntary giving up of a legal, given right.
If the underwriter approves an incomplete application the insurer is waiving their rights to contest a claim related to whatever was left blank (doctrine of waiver and estoppel).
The waiver of premium rider on a life insurance policy waives the premium in the event the owner of the policy becomes totally disabled, keeping the life insurance policy in force. When the insured meets the policy’s definition of total disability, a six-month waiting period begins. This waiting period acts like a deductible. If the insured satisfies the waiting period the insurer will return the premiums paid to the insured, and then waive the premiums going forward for as long as the insured is totally disabled.
Relieves the insurer of liability, or reduces the liability, for loss caused by war.
A warranty is a guarantee of truth. Applicants cannot be asked to warranty their health.
A type of life insurance that provides a guaranteed death benefit at a guaranteed flat premium and that accumulates cash value that may be borrowed against.
An insurance plan that employers are required to have to cover employees who get sick or injured on the job.