SEC 11 Flashcards
(42 cards)
What is the main purpose of life insurance?
The primary purpose is to provide financial compensation to your dependents following your death
An optional , added policy feature that may or may not increase the cost of the insurance policy
Rider
Least expensive type of insurance that also provides temporary protection for a specific number of years.
Term life insurance
The person named to receive the death benefit of the policy
Beneficiary
The amount of insurance coverage purchased
Face value
The policyholder will be allowed to renew the term insurance at a higher rate
Renewable term
Usually paid for throughout the life of the policyholder
Straight life insurance
is similar in coverage to the straight except that payments are made for a limited number of years (20 or 30 usually).
Limited payment life
Most expensive insurance because it is a savings plan and also a life protection
Endowment plan
When you can cancel the insurance policy and use its value to convert to term insurance with the same face value as your policy but for a limited time of coverage
Extended Term
Allows people who are ill or with a disease to receive all or part of the death proceeds before death
Accelerated death benefit
A percentage of the company’s profit
Dividend
If the individual collect all the money for himself to invest it.
Lump sum payment
Is a specified amount of money which is paid in equal payments at regular intervals, such as monthly
Annuity
Options of how to receive your annuity
Fixed account, fixed number of years, lifetime, and life annuity which is guaranteed
A percent of the face value
Quoted price
An individual licensed to make stock and bond sales
Broker
Commission
Brokerage fee
Considered a good source of stock and bond information
Wall Street Journal
Found by subtracting the previous day’s closing price from the present day’s closing price
Net change
Annual yield formula
Annual interest/ selling price of the bond
The amount that a seller receives from the sale of bonds
Proceeds
Earned interest that is not payable until the end of the current interest period.
Accrued interest
Two types of stock
Common stock and preferred stock
