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Definitions - N

Net Cost
The out-of-pocket cost of owning any particular life insurance policy.

Non-Contributory
A term applied to employee benefit plans under which the employer bears the full cost of the benefits for the employees. One hundred percent of the eligible employees must be insured.

Non-Forfeiture Option
One of the choices available if the policy holder discontinues premium payments on a policy with a cash value. This, if any, may be taken in cash, as extended term insurance or as reduced paid-up insurance.

Non-Medical Insurance (Non-Med)
Life insurance issued based on the insured's statement of health with no medical examination required.

Non-Medical Limit
The maximum face value of a policy that a given company will issue without the applicant taking a medical examination.

Non-Participating Policy
A life insurance policy in which the company does not distribute to policy holders any part of its surplus. Note should be taken that premiums for nonparticipating polices are usually lower than for comparable participating polices. Note that some nonparticipating polices have both a maximum premium and a current lower premium. The current premium reflects anticipated experience that is more favorable than the company is willing to guarantee, and it may be changed from time to time for the entire block of business to which the policy belongs.

Nonresident Agent
An agent licensed to write insurance in a state in which he or she does not live.

Non-Tobacco Status
No cigarette or tobacco usage based upon company guidelines.

Some whole life policies let you pay premiums for a shorter period such as 20 years, or until age 65. Premiums for these policies are higher since the premium payments are made during a shorter period.