Group Paid-up Life Insurance
Combination of two basic plans: accumulating units of paid-up permanent life insurance, and decreasing units of group term life insurance. The premium paid each month consists of the (a) employee's contribution and (b) employer's contribution. The employee's portion purchases increments of paid-up insurance, and the employer's portion purchases group decreasing term. The employer's contribution is tax deductible as a business expense, and these contributions are not taxable income to the employee. (However, if the employer purchases increments of paid-up units of permanent insurance, these contributions are taxable income to the employee on a current basis.) Paid-up units purchased by an employee are vested and thus can be taken as a paid-up life benefit regardless of the reason for termination of employment. The paid-up benefit will always remain in force; no further premium payments are required.
Popular Insurance Terms
Presence of other contract (s) covering the same conditions. When more than one policy covers the exposure, each policy will pay an equal share of the loss. ...
Process of forming a large group of homogeneous lives that in order to allow the law of large numbers to operate, thereby projecting a probable rate of mortality or morbidity whose ...
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Employee of the insurance company who has the authority to appoint brokers on behalf of the insurance company. This supervisor has the objective and responsibility to sell the insurance ...
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