Term
| contains a policy loan provision |
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Definition
| cash-value life insurance |
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Term
| allows the policy owner to borrow the cash value of the policy |
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Definition
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Term
| all states permit insurers to charge a variable policy loan interest rate based on the nation association of insurance commissioner's |
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Definition
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Term
| a variable approach is a policy loan rate equal to the interest rate credited to the cash value plus a |
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Definition
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Term
| under participating policies, many insurers will reduce the dividend based the amount of cash value borrowed |
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Definition
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Term
| must either be paid annually or added to the outstanding loan if not paid |
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Definition
| interest on a policy loan |
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Term
| if the loan is not repaid by the time the policy matures as a death claim or endowment, the face amt of the policy is reduced by the amt of |
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Definition
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Term
| w/ the exception of a policy loan to pay a premium, the insurer can defer granting the loan for up to |
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Definition
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Term
| person's who borrow their cash values often believe that they are paying interest on their own money. this view is incorrect b/c the cash value legally belongs to the |
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Definition
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Term
| the insurer's assets must be invested in interest-bearing securities and other investments so that the contractual obligations can be |
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Definition
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Term
| a policy owner must pay interest on the loan to offset what to the insurer? why? |
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Definition
| loss of interest b/c if the loan had not been granted, the insurer could have earned interest on the funds |
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Term
| make it necessary for the insurer to keep some assets in lower-yielding, liquid investments to meet the demand for policy loans |
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Definition
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Term
| b/c the funds from the policy could have been invested in higher-yielding investments, policy owners who borrow should pay invest b/c higher yields must be forsaken to |
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Definition
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