Moinot Insurance Group, LLC

Independent Insurance Agency



Moinot Insurance Group, LLC
2100 West Loop South, Suite 800
Houston, TX 77027

Call to speak with us now! 281.892.1455 

LIFE INSURANCE TERMS



Accelerated Death Benefit: This benefit is included with many policies today. It provides for the payment of a portion of the death benefit prior to the insured's death should the insured be diagnosed as terminally ill. The specific requirements vary by company.


Assignment - In insurance, a legal transfer of ownership of a policy by the policy owner to another party.


Beneficiary - In insurance, the person to whom the proceeds of an insurance policy are payable. The various types of beneficiaries are; primary beneficiaries (those first entitled to proceeds), secondary beneficiaries (those entitled to proceeds if no primary beneficiaries are living); and tertiary beneficiaries (those entitled to proceeds if no primary or secondary beneficiaries are living).


Benefit - In insurance, the sum of money payable upon the happening of the conditions set out in the insurance policy. For example, the benefit is payable in a life insurance policy upon the death of the insured.


Business Continuation Plan - A contingency plan put in place by a business to deal with the unexpected death or disability of an owner or key employee.


Buy-Sell Agreement - An agreement between owners of a business stipulating when and how the owner's interest will be sold to a pre-specified party under a pre-determined pricing formula.


Cash Value - In insurance, the equity amount or cash accumulation in a permanent life insurance policy.


Cash Surrender Value - In insurance, the amount of money redeemable to the owner of a permanent life insurance policy when the policy is surrendered to the company.


Conversion Option - Allows the policy owner, before an original insurance policy expires, to elect to have a new policy issued that will continue the insurance coverage without showing evidence of insurability (i.e. without taking a medical exam).


Convertible Term - A term insurance contract that may be converted to a permanent form of insurance without a medical examination.


Level Death Benefit - The death benefit is fixed at the time the policy is purchased and cannot be changed during the term of the contract. If the policy owner is unable to pay the full premium amount for an extended period of time, the policy will lapse. The policy cannot be kept in force with a reduced amount of coverage if premium payments are not made, as it can with a universal life policy that has a flexible death benefit.


Level Premium - The premium is fixed at the time the policy is purchased and cannot be changed during the term of the contract.


Life Insurance - Insurance against loss due to the death of a particular person (the insured) upon whose death the insurance company agrees to pay a stated sum or income to the beneficiary.


Permanent Life Insurance - Insurance that does not expire after a pre-specified term. Usually the duration of a permanent insurance policy is the insured's "whole life"; until death, or age 121, whichever comes first. (Permanent insurance includes: whole life, universal life, and variable life)


Policy Loan - In life insurance, a loan made by the life insurance company to the policy owner, with the policy's cash value assigned as security.


Probate - The legal and administrative fees required to settle an estate upon the death of the estate owner.


Renewal Option - An option that allows the policyholder to renew a term policy before its termination date without having to provide evidence of insurability.


Rider (Policy Rider) - A rider adds something to the policy. The term is loosely used to refer to any supplemental agreement attached to and made a part of the policy, whether the conditions of the policy are expanded, additional coverage is added or a coverage of condition is waived.


Term Insurance - Protection for a limited number of years; expiring without value if the insured survives the stated term.


Term of Policy - Period for which the policy is in force. With life insurance, this period is to the end of the specified term for term life insurance, to the maturity date for endowment policies and to the insured's death (or by age 100, whichever comes first) for permanent life insurance.


Total Disability - Disability preventing insured from performing any duty of their usual occupations or any occupation for remuneration; actual definition depends on the policy wording.


Transfer of Risk - An insurance contract is designed to transfer risk. Individuals face the risk of monetary losses resulting from a death, disability or illness. An individual can ensure that they will not have to bear the complete monetary loss due to these factors by purchasing an insurance policy, which transfers the risk of loss to the insurance company. If a death, disability or illness occurs, the insurance company will pay proceeds that will compensate for the loss.


Universal Life Insurance - Two-part contract containing permanently renewable term insurance and a cash value account, which generally earns interest at a higher rate than a traditional policy. Universal life policies have adjustable premiums and an adjustable death benefit. Excess premiums, after the company deducts its fee and a monthly cost for the term coverage, are deposited in the cash value account where they earn a valuable rate of interest.


Variable Life Insurance - A insurance policy that combines permanent insurance protection and an investment account. Accumulated cash values are held in a separate account where they may be invested in different portfolios of stocks, bonds, or commercial paper. The value of the policy depends on the fluctuating market value of invested funds..


Whole Life Insurance - Life insurance protection that extends from policy issue to the death of the insured, or by age 121, whichever comes first. A whole life policy has fixed premium payments, a fixed death benefit and cash value accumulation