This document summarizes key aspects of life insurance, including:
- The differences between individual and group life insurance policies in terms of portability, optional benefits, and ability to change provisions.
- Key terms related to life insurance policies such as insured, insurer, policy, face value, beneficiary, and premium.
- The main types of life insurance - term life insurance and permanent insurance.
2. Life Insurance
Association or Group
Individual
Fully portable and transferable
Usually not portable and
not transferable Provisions can be changed at policy
anniversary and by the employer
Contracts can be cancelled
by insurer Contract cannot be cancelled
Limited selection of optional benefits available
Large selection of optional benefits
available
Provisions cannot be changed
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3. Insured or policy holder The individual who contracts the policy with
the insurance company
Insurer The insurance company
Policy The insurance contract that contains the
legally enforceable agreement between the
insurer and the insured
Face value The amount of money paid by the insurer in the
event of the death of the insured
Beneficiary The individual(s) named to receive
the face value of the policy upon the
death of the insured
Premium
The amount of money the insured pays the insurer
for the policy
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5. Bryan is a 32 year old nonsmoker. He would like to purchase a 10year
term life insurance policy with a face value of $300,000.00.
1) Calculate Bryan's annual premium
http://www.edu.gov.mb.ca/k12/assess/archives/cm_wt_rp_08.pdf
2) Calculate the semiannual premium Bryan would pay.
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