In insurance contexts, the 'Amount at Risk' is a key concept that refers to the potential financial loss an insurer faces, which can vary depending on the type of insurance policy.
Cash value refers to the amount of money a policyholder is entitled to receive upon the cancellation of a life insurance policy or the amount available for loans and withdrawals before the policy matures or is cashed out.
Lapse occurs in insurance when a policy becomes inactive due to non-payment of the renewal premium, impacting both property and casualty and life insurance sectors.
Loan value refers to the maximum amount a lender is willing to extend as a loan based on collateral or the cash value of a policy.
A Participating Insurance Policy is a type of life insurance policy that pays dividends to the policyholder. These dividends are typically a share of the insurer's profits and can be taken in cash, used to reduce premiums, or reinvested back into the policy.
The savings element in cash value life insurance represents the portion of the policy that accumulates value over time, which policyholders can potentially access through withdrawals or surrenders. It functions both as a savings and investment vehicle.
A life insurance policy that combines the features of universal life insurance and variable life insurance, allowing policyholders to direct excess interest credited to the cash value account based on investment results in various separate accounts such as equities, bonds, and real estate.
