Mississippi Life and Health Insurance Accurate 100%(RATED A+)
Absolute assignment - ANSWER Policy assignment under which the assignee (person to whom the policy is assigned)
receives full control over the policy and also full rights to its benefits. Generally, when a policy is assigned to secure
a debt, the owner retains all rights in the policy in excess of the debt, even though the assignment is absolute in
form. (See assignment)
Accelerated benefits rider - ANSWER A life insurance rider that allows for the early payment of some portion of the
policies face amount should the insured suffers from a terminal i l l n e s s or injury.
Acceptance - ANSWER (See offer and acceptance)
Accidental bodily injury provision - ANSWER Disability income or accident policy provision that requires that the injury
be accidental in order for benefits to be payable.
Accidental death and dismemberment (AD&D) - ANSWER Insurance providing payment
if the insured's death results
from an accident, if the insured accidentally severs a limb above the wrist or ankle joints, or totally and irreversibly
Accidental death benefit rider - ANSWER A life insurance policy rider providing for payment of an additional benefit
when death occurs by accidental means.
Accidental dismemberment - ANSWER Often defined as "the severance of limbs at or above the wrists or ankle
joints, or the entire irrevocable loss of sight." Loss of use in itself may or not be considered dismemberment.
Accidental means provision - ANSWER Unforeseen, unexpected, unintended cause of an accident. Requirement of an
accident-based policy that the cause of the mishap must be accidental for any claim to be payable.
Accident and health insurance - ANSWER Under which benefits are payable in case of disease, accidental injury, or accidental death. Also called health insurance, personal health insurance, and sickness and accident insurance.
Accumulation unit - ANSWER Premiums an annuitant pays into annuities are credited as accumulation units. At the end of
the accumulation period, accumulation units are converted to annuity units.
Acquired immune deficiency syndrome (AIDS) - ANSWER A life-threatening condition brought on by the human
immunodeficiency virus; insurers must adhere to strict underwriting and claims guidelines in regard to AIDS risks
and AIDS-related conditions.
Acute illness - ANSWER A serious condition, such as pneumonia, from which the body can fully recover with proper
medical attention.
Adhesion - ANSWER A life insurance policy is a contract of adhesion because buyers must adhere to the terms of the
contract already in existence. They have no opportunity to negotiate terms, rates, values, and so on.
Adjustable life insurance - ANSWER Combines features of both term and whole life coverage with the length of coverage
and amount of accumulated cash value as the adjustable factors. Premiums may be increased or decreased to fit the
specific needs. Such adjustments are not retroactive and apply only to the future.
Administrative-services-only (ASO) Plan - ANSWER Arrangement under which an insurance company or an
independent organization, for a fee, handles the administration of claims, benefits, and other administrative
functionsfor a self-insured group.
Admitted insurer - ANSWER An insurance company that has met the legal and financial
requirements for operation within
a given state.
Adult day care - ANSWER Type of care (usually custodial) designed for individuals who require assistance with various
activities of daily living, while their primary caregivers are absent. Offered in care centers.
Adverse selection - ANSWER Selection "against the company." Tendency of less favorable insurance risks to seek or continue insurance to a greater extent than others. Also, tendency of policy owners to take advantage of favorable
options in insurance contracts.
Advertising Code - ANSWER Rules established by the National Association of Insurance Commissioners (NAIC) to
regulate insurance advertising.
Agency - ANSWER Situation wherein one party (an agent) has the power to act for another (the principal) i n dealing
with third parties.
Agent - ANSWER Anyone not a duly licensed broker who solicits insurance or aids in placing risks, delivering policies, or
collecting premiums on behalf of an insurance company.
Agent's report - ANSWER The section of an insurance application where the agent reports personal observations about the
applicant.
Aleatory - ANSWER Feature of insurance contracts in that there is an element of chance for both parties and that the dollar
given by the policyholder (premiums) and the insurer (benefits) may not be equal.
Alien Insurer - ANSWER Company incorporated or organized under the laws of any foreign nation, providence, or territory.
Ambulatory surgery - ANSWER Surgery performed on an outpatient basis
Amount at risk - ANSWER Difference between the face amount of the policy and the reserve or policy value at a given
time. In other words, the dollar amount over what the policy owner has contributed of cash value toward payment of
the policyowner's own claim. Because the cash value increases every year, the net amount at risk naturally
decreases until it finally reaches zero when the cash value or reserve become the face amount.
Annually renewable term (ART - ANSWER A form of renewable term insurance that provides coverage for one year and
allows the policy owner to renew coverage each year without evidence of insurability. Also called yearly renewable
term (YRT)
Annuitant - ANSWER One to whom an annuity is payable, or a person upon the continuance of whose life further
Absolute assignment - ANSWER Policy assignment under which the assignee (person to whom the policy is assigned)
receives full control over the policy and also full rights to its benefits. Generally, when a policy is assigned to secure
a debt, the owner retains all rights in the policy in excess of the debt, even though the assignment is absolute in
form. (See assignment)
Accelerated benefits rider - ANSWER A life insurance rider that allows for the early payment of some portion of the
policies face amount should the insured suffers from a terminal i l l n e s s or injury.
Acceptance - ANSWER (See offer and acceptance)
Accidental bodily injury provision - ANSWER Disability income or accident policy provision that requires that the injury
be accidental in order for benefits to be payable.
Accidental death and dismemberment (AD&D) - ANSWER Insurance providing payment
if the insured's death results
from an accident, if the insured accidentally severs a limb above the wrist or ankle joints, or totally and irreversibly
Accidental death benefit rider - ANSWER A life insurance policy rider providing for payment of an additional benefit
when death occurs by accidental means.
Accidental dismemberment - ANSWER Often defined as "the severance of limbs at or above the wrists or ankle
joints, or the entire irrevocable loss of sight." Loss of use in itself may or not be considered dismemberment.
Accidental means provision - ANSWER Unforeseen, unexpected, unintended cause of an accident. Requirement of an
accident-based policy that the cause of the mishap must be accidental for any claim to be payable.
Accident and health insurance - ANSWER Under which benefits are payable in case of disease, accidental injury, or accidental death. Also called health insurance, personal health insurance, and sickness and accident insurance.
Accumulation unit - ANSWER Premiums an annuitant pays into annuities are credited as accumulation units. At the end of
the accumulation period, accumulation units are converted to annuity units.
Acquired immune deficiency syndrome (AIDS) - ANSWER A life-threatening condition brought on by the human
immunodeficiency virus; insurers must adhere to strict underwriting and claims guidelines in regard to AIDS risks
and AIDS-related conditions.
Acute illness - ANSWER A serious condition, such as pneumonia, from which the body can fully recover with proper
medical attention.
Adhesion - ANSWER A life insurance policy is a contract of adhesion because buyers must adhere to the terms of the
contract already in existence. They have no opportunity to negotiate terms, rates, values, and so on.
Adjustable life insurance - ANSWER Combines features of both term and whole life coverage with the length of coverage
and amount of accumulated cash value as the adjustable factors. Premiums may be increased or decreased to fit the
specific needs. Such adjustments are not retroactive and apply only to the future.
Administrative-services-only (ASO) Plan - ANSWER Arrangement under which an insurance company or an
independent organization, for a fee, handles the administration of claims, benefits, and other administrative
functionsfor a self-insured group.
Admitted insurer - ANSWER An insurance company that has met the legal and financial
requirements for operation within
a given state.
Adult day care - ANSWER Type of care (usually custodial) designed for individuals who require assistance with various
activities of daily living, while their primary caregivers are absent. Offered in care centers.
Adverse selection - ANSWER Selection "against the company." Tendency of less favorable insurance risks to seek or continue insurance to a greater extent than others. Also, tendency of policy owners to take advantage of favorable
options in insurance contracts.
Advertising Code - ANSWER Rules established by the National Association of Insurance Commissioners (NAIC) to
regulate insurance advertising.
Agency - ANSWER Situation wherein one party (an agent) has the power to act for another (the principal) i n dealing
with third parties.
Agent - ANSWER Anyone not a duly licensed broker who solicits insurance or aids in placing risks, delivering policies, or
collecting premiums on behalf of an insurance company.
Agent's report - ANSWER The section of an insurance application where the agent reports personal observations about the
applicant.
Aleatory - ANSWER Feature of insurance contracts in that there is an element of chance for both parties and that the dollar
given by the policyholder (premiums) and the insurer (benefits) may not be equal.
Alien Insurer - ANSWER Company incorporated or organized under the laws of any foreign nation, providence, or territory.
Ambulatory surgery - ANSWER Surgery performed on an outpatient basis
Amount at risk - ANSWER Difference between the face amount of the policy and the reserve or policy value at a given
time. In other words, the dollar amount over what the policy owner has contributed of cash value toward payment of
the policyowner's own claim. Because the cash value increases every year, the net amount at risk naturally
decreases until it finally reaches zero when the cash value or reserve become the face amount.
Annually renewable term (ART - ANSWER A form of renewable term insurance that provides coverage for one year and
allows the policy owner to renew coverage each year without evidence of insurability. Also called yearly renewable
term (YRT)
Annuitant - ANSWER One to whom an annuity is payable, or a person upon the continuance of whose life further
