The Glossary

A tax-free transfer from one life insurance or annuity contract into another.

A rider that lets you take part of the death benefit early under certain qualifying conditions.

Converting an annuity into a stream of guaranteed income payments.

A contract between business owners that controls what happens to an owner's share if they die, become disabled, or leave.

What you actually receive if you cancel a permanent life policy.

The living-benefit savings component inside a permanent life insurance policy.

The backup beneficiary who receives proceeds if the primary beneficiary is no longer living.

The right to convert a term life policy into a permanent policy without new underwriting.

The amount paid to your beneficiary when you pass away.

A federal (and sometimes state) tax on the transfer of assets at death above a set exemption.

The stated dollar amount of coverage on a life insurance policy.

A contract with an insurance carrier that pays a guaranteed interest rate for a set period.

Life insurance provided through an employer, typically at low or no cost to the employee.

A legal document outlining your medical wishes if you cannot speak for yourself.

An annuity that credits interest based on a market index, with a floor that protects against loss.

Permanent life insurance whose cash value growth is tied to a market index like the S&P 500 — with a floor and a cap.

A trust that, once created, generally cannot be changed — used for asset protection and estate tax planning.

The maximum interest credit an indexed universal life policy can earn in a given period.

Life insurance a business owns on a critical employee or owner.

A life insurance feature that lets you access part of the death benefit while still alive if you face a serious illness.

A life insurance policy funded so heavily it loses some of the favorable tax treatment of insurance.

The percentage of an index's gain that an indexed product credits to your account.

A legal document authorizing someone to make decisions on your behalf if you cannot.

The court process of validating a will and distributing assets after death.

The minimum amount you must withdraw each year from most retirement accounts starting at a set age.

A term life rider that refunds your premiums if you outlive the policy.

A trust you create and can change during your lifetime that avoids probate at death.

Moving money from a pre-tax retirement account into a Roth account and paying the taxes now.

A fee deducted if you withdraw more than allowed from an annuity or permanent life policy early.

Growth that isn't taxed until you take it out.

Growth that isn't taxed when it accumulates or when it's withdrawn (if rules are followed).

Life insurance that lasts a set number of years — usually 10, 20, or 30 — then ends.

The carrier's process for evaluating risk and pricing a policy.

Permanent life insurance with flexible premiums and a cash value that earns interest set by the carrier.

An annuity where the value moves with sub-account investments — gains and losses possible.

Permanent life insurance where the cash value is invested in sub-accounts that work like mutual funds.

A rider that keeps your policy in force without payments if you become disabled.

Permanent life insurance that lasts your entire life and slowly builds cash value you can use.

A legal document that directs how your property is distributed after death.