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Definitions
- T
Tax-Deferral
Postponing
the payment of income taxes until some point in the future,
often at retirement. Generally, the cash value growth inside
life insurance is eligible for deferral, unless the amount
of cash received through surrender exceeds the policy's tax
basis.
Tax-Payer
Identification Number (TIN)
The policy owner's Social Security number. The insurer
must have a certified tax-payer identification number to avoid
backup withholding when there is taxable gain.
Ten-Year
Level Term
A Term Life insurance policy with a level death benefit
where the premium remains the same for ten years.
Term
Conversion
Many Term policies come with conversion rights guaranteeing
that, for a specified period of time, the policy can be converted
to a permanent plan for the equivalent amount of coverage,
without having to provide additional evidence of insurability.
Termination
Termination of a policy upon the policy owner's failure
to pay the premium within the grace period.
Term
Life Insurance
A life insurance plan that provides death benefit protection
only and for a specified period of time (term). The policy
pays benefits only if the insured dies during the term.
Tertiary
Beneficiary
In life insurance, a beneficiary designated as third in
line to receive the proceeds or benefits if the primary and
secondary beneficiaries do not survive the insured.
Third-Party
Owner: A policyowner who is not the insured.
Thirty-Year
Level Term
A Term Life insurance policy with a level death benefit
where the premium remains the same for thirty years.
Trust
A legal instrument allowing one party to control property
for the benefit of another.
Transfer
for Value
Transfer of the ownership of a life insurance contract
for valuable consideration.
Trust
A legal instrument allowing one party to control property
for the benefit of another.
Twenty-Year
Level Term
A Term Life insurance policy with a level death benefit
where the premium remains the same for twenty years.
Twenty-Five
Year Level Term
A Term Life insurance policy with a level death benefit
where the premium remains the same for twenty-five years.
Twisting
The practice of inducing by misrepresentation, or inaccurate
or incomplete comparison, a policy holder in one company to
lapse, forfeit or surrender his insurance for the purpose
of taking out a policy in another company.
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.
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