Primerica Life Insurance Terms

Risk - Ans - uncertainty of a financial loss; 2 types Two typed of risks - Ans - Pure (Insurable) and speculative (uninsurable) Benefits of purchasing insurance? - Ans - You get to transfer financial risk left after passing to insurance company Law of large numbers - Ans - the larger the size of the group the more accurately the experience aka predicted losses of that group can be predicted Policyowner - Ans - person who owns policy, pays premiums, and chooses the beneficiary Insured - Ans - the life of the person the policy covers (could be policyowner) Insurer - Ans - the insurance company which issues the policy and pays the death benefit to the beneficiary upon the death of the insured Beneficiary - Ans - the person who receives death proceeds What does having life insurance create or do? - Ans - Creates an immediate estate for the beneficiary which could help pay for daily expenses, mortgage, or college etc Estate - Ans - the net worth of a person; things you own minus things you ow