Glossary

| 4 | A | B | C | D | E | F | H | I | J | K | L | M | N | O | P | Q | R | S | T | U - V - W |
________________________________________________________________________________

4

401
This retirement plan meets the qualification requirements of Internal Revenue Code Section 401(a). In this type of plan, employers determine the amount of money that they may contribute on your behalf each year, the requirements that you must meet to receive those contributions, and under what circumstances the money may be made available to you. Some 401(a) plans may allow for employee after-tax contributions or, in the case of a 401(k) plan, employee pre-tax contributions. Types of 401(a) plans include profit sharing plans, pension plans, and money purchase plans.

401(k)
Under section 401(k) of the Internal Revenue Code, employees of private corporations and, beginning in 1997, some tax-exempt organizations, can set aside money for retirement on a pre-tax basis through a plan sponsored by their employer. To encourage saving for retirement through these plans, the federal government created special tax advantages for 401(k) contributions.

403(b)
Under Section 403(b) of the Internal Revenue Code, employees of 501(c)(3) non-profit institutions (such as colleges and universities, hospitals, museums, research institutes, and foundations and public schools) can set aside money for retirement on a pre-tax basis through a plan offered by their employer. To encourage saving for retirement through these plans, the federal government created special tax advantages for 403(b) contributions.

457
Under section 457 of the Internal Revenue Code, employees of state or local governments, their agencies, and tax-exempt employers can set aside money for retirement on a pre-tax basis through a plan sponsored by their employer. To encourage saving for retirement through these plans, the federal government created special tax advantages for 457 contributions.

457(f)
Under Section 457(f) of the Internal Revenue Code, an employer can set aside money to supplement retirement income for a select group of employees in their organization. Since these programs are designed to attract and retain key employees and do not provide a benefit for all employees, these programs do not qualify for all of the tax advantages that are made available to 401(a) plans, for example.

A

Accelerated Death Benefits
A life insurance policy option that provides policy proceeds to insured individuals over their lifetimes, in the event of a terminal illness. This is in lieu of a traditional policy that pays beneficiaries after the insured's death. Such benefits kick in if the insured becomes terminally ill, needs extreme medical intervention, or must reside in a nursing home. The payments made while the insured is living are deducted from any death benefits paid to beneficiaries.

Actuary
An insurance professional skilled in the analysis, evaluation, and management of statistical information. Evaluates insurance firms' reserves, determines rates and rating methods, and determines other business and financial risks.

Agent
Insurance is sold by two types of agents: independent agents and exclusive or captive agents. Independent agents are self-employed, represent several insurance companies and are paid on commission. Exclusive or captive agents represent only one insurance company and are either salaried or work on commission.

Annuitant
The person, usually the annuity owner, whose life expectancy is used to calculate the income payment amount on the annuity.

Annuity
A contract sold by life insurance companies that allows you to pay a lump sum or accumulate money over time, and the issuing company guarantees payment to the buyer in the future subject to policy terms.

Annuity Payments
Periodic payments made to an annuitant or to the annuitant's designated beneficiary. The payments may be made on an annual, semiannual, quarterly, or monthly basis, and may last for life or for a specified period. Moreover, depending on whether the annuity in question is a fixed annuity or a variable annuity, the annuitant (or his/her beneficiary) may receive either payments of a fixed dollar amount or payments that vary in amount according to the value of the underlying securities.

Arbitration
Procedure in which an insurance company and the insured or a vendor may agree to settle a claim dispute by accepting a binding or non-binding decision made by a third party.

B

Beneficiary
A person who is named in a will, retirement plan, individual retirement account, or insurance policy and who will inherit money or other property left by the decedent. A trust or institution also can be named as a beneficiary.

C

Cancellation
The termination of insurance coverage during the policy period. Flat cancellation is the cancellation of a policy as of its effective date, without any premium charge.

Carrier
Insurance company that actually underwrites and issues the insurance policy.

Carryover
Refers to the process of shifting to a future taxable year those losses and other deductions that exceed limits for the current tax year.

Carryover Basis
Basis in property that may 'carry over' from the transferor to the transferee. Generally this occurs when there is an exchange of property, or property is transferred by gift.

Cash Surrender Value
Amount available to the owner if a life insurance policy or annuity is surrendered. The amount represents the cash value minus surrender charges and any outstanding loans due upon cancellation of the policy.

Cash Value
The cash within a permanent life insurance policy. Cash value is the premium paid less the cost of insurance policy.

Cash Value Life Insurance
A permanent insurance policy that builds cash value, often described as a savings account within the policy.

Claim
Notice to an insurer that under the terms of a policy, a loss maybe covered.

Claim Written
Request by an insured for the insurance company to cover an incurred loss, usually submitted on the company's standard form.

Commission
Fee paid to an agent or insurance salesperson as a percentage of the policy premium.

Common Policy Provisions
Words, sentences, and paragraphs in an insurance policy that generally take the form of clauses that govern the policy and that set forth the rights and obligations of both insured and insurer under the policy.

Conservative
A conservative strategy focuses primarily on capital preservation rather than capital appreciation.

Consumer Price Index (CPI)
Measure of change in consumer prices, published monthly by the U.S. Bureau of Labor Statistics in the Department of Labor. This index is widely used as a cost-of-living benchmark to adjust Social Security payments and other payment schedules.

Contestability Period
Period of time, generally two years, during which an insurance company can declare a life insurance contract void because of misrepresentation or concealment by the insured in obtaining the policy. 

Convertible Term Insurance
Term life insurance coverage that can be converted into permanent life insurance upon the policy's expiration. The insured generally cannot be denied permanent coverage or charged an additional premium because of health problems.

Cost Basis
The original price of an asset, plus any additions and reinvested earnings that is used to determine capital gains or losses at the time of sale of the asset. In the case of an inheritance, the cost basis is the appraised value of the asset at the time of the donor's death

Countable Assets
In terms of eligibility for Medicaid, countable assets are anything of value owned that is not exempt by law or otherwise inaccessible. Countable assets include, but are not limited to: savings and checking accounts, stocks, bonds, CDs, Treasury notes and bills, savings bonds, investment property and vacation homes, second vehicles, livestock, IRAs and other retirement plans, mutual funds, precious metals and coins, and whole life insurance above a certain surrender value. States use the total value of your countable assets as one of the tests to determine eligibility for Medicaid.

Covered Expenses
In health insurance, reimbursement for an insured's medically-related expenses, including, but not limited to surgery, medicines, hospitalization, ambulance service, and X-rays.

Coverage Forms
Attachments to an insurance policy to complete the coverage provided by the policy.

Crummey Power
A right exercised by the beneficiary of a trust to withdraw money from the trust for a limited amount of time each year.

D

Death Benefit
The amount payable, as stated in a life insurance policy, to the designated beneficiary(ies) upon the death of the insured. The amount paid is the face value, plus any riders, less any outstanding loans.

Declaration
Part of a property or liability insurance policy that states the name and address of policyholder, property insured, its location and description, the policy period, premiums, and supplemental information. Referred to as the "dec page."

Decline
The company refuses to accept the request for insurance coverage.

Deferred Annuity
An annuity in which the income payments/withdrawals begin at some future date.

Defined Benefit Plan
This is a type of retirement plans that provides a fixed amount of money after retirement following a set number of years (in other words, the benefit is "defined" in advance).

Defined Contribution Plan
This is a type of retirement plan in which the level of contributions and the benefits will vary, depending on the return from the investments.

Dependent
An individual for whom the taxpayer provides at least 50 percent of the support regardless of where they live. Generally the individual bears a specific relationship to the taxpayer (i.e., child, sibling, parent) and/or resides primarily in taxpayer's household.

Deposit Premium
The premium deposit paid by a prospective policyholder when an application is made for an insurance policy. It is usually equal to at least the first month's estimated premium and is applied toward the total policy premium when billed.

Disability
A physical or mental impairment that substantially limits one or more of an individual's major life activities. Disability may be partial or total.

Disability Benefit Period
The period during which disability insurance benefits are paid. While this period may vary between policies, benefits paid until age 65 are common for long-term policies and benefits paid for 26 weeks are common for short-term policies.

Disability Income Rider
Addition to a life insurance policy stating that when an insured becomes disabled for a certain amount of time, premiums are waived. Depending on the rider, the insured may also begin to receive monthly income payments from the policy.

Disability Insurance
Also known as disability income insurance, this type of policy provides income benefits to the insured if he or she becomes ill or is injured and can no longer work.

Discretionary Income
Amount of a consumer's income remaining after essentials such as food, housing, and utilities and prior commitments have been paid.

Discretionary Trust
A trust which allows the trustee discretion in making distributions of income or principal to the beneficiary.

Dismemberment Insurance
A form of health insurance that provides payment when the insured loses one or more limbs, or the sight in one or both eyes. This coverage is usually issued in combination with accidental death insurance.

Distribution
This refers to a withdrawal from your retirement account.

Domestic Insurance Company
Term used by a state to refer to any company incorporated there.

Double Indemnity
Also called an accidental death benefit, a life insurance policy provision that doubles payment of a designated death benefit when death results from certain specified causes (usually certain types of accidents).

E

Earned Income
Income generated by providing goods or services and received in the form of wages and salaries.

Earned Income Limit
An annually adjusted limit that applies to Social Security recipients who continue to work while receiving benefits.

Earnings Record
Record compiled by the Social Security Administration that shows an individual's actual lifetime earnings as reported to the SSA by an employer, or for self-employed individuals, by the Internal Revenue Service (IRS). Only earnings that are less than the maximum earnings limit for that year are credited to the earnings record and will be used to compute Social Security benefits.

Employee Benefit Program
The collection of non-salary compensation offered by an employer that may include health insurance, life insurance, disability insurance, pensions or other retirement plans, tuition reimbursement, stock options, and child care benefits.

Endorsement
Amendment to the policy used to add or delete coverage. Also referred to as a "rider."

Estate
All assets a person owns at the time of death, including securities, real estate, business interests, physical property, and cash, less outstanding liabilities. The estate is distributed to heirs according to the terms of the person's will or, if there is no will, by court ruling.

Estate Planning
The process of developing and implementing a master plan that facilitates the distribution of assets after death according to goals and objectives.

Estate Tax
A tax imposed by the federal government and some state governments on the transfer of assets to heirs.

Execution
The signing, sealing, and delivery of a contract or agreement making it valid.

Executor/Executrix
An individual or professional organization, such as a bank's trust department, named in a will to administer an estate upon the death of the owner.

Exempt
Assets that are not considered for bankruptcy proceedings. Exempt is also used to refer to assets not considered in the determination of eligibility for Medicaid.

Expiration Date
The date on which the policy ends.

F

Face Amount
The dollar amount to be paid to the beneficiary when the insured dies. It does not include other amounts that may be paid from insurance purchased with dividends or any policy riders.

Federal Gift Tax
A federal tax that is imposed on the transfer of securities, property, or other assets.

Fiduciary
A person, company, or association that holds assets in trust for a beneficiary. The fiduciary is charged with many responsibilities including investing the assets wisely for the beneficiary's benefit.

Fiduciary Capacity
A person is said to act in a fiduciary capacity when business is transacted, or money and property are handled for the benefit of another. The term is not limited to technical or express trusts, but may also apply to such offices or relations as attorneys, guardians, executors, brokers, and agents.

Fiduciary Income Tax Return
An income tax return that is filed by the court representative or estate administrator for a decedent's estate, trust, or a bankruptcy estate to report income, deductions, gains, losses, distributions, income that is accumulated or held for future distribution, income tax liability of the estate or trust, and employment taxes on wages paid to household employees.

Fixed Annuity
A contract issued by an insurance company allowing for a fixed rate of interest in both the accumulation and income phases; periodically adjusted by the insurance company.

Free Look Period
The right of an insured to examine an insurance policy for a stated period, and if not satisfied, the right to return the policy and receive a full refund of the initial premium.

H

Health Status
Medical conditions (both physical and mental illnesses), claims experience, receipt of health care, medical history, genetic information, evidence of insurability (including conditions arising out of acts of domestic violence), and disability.

Heir
An individual who inherits some or all of the estate of a deceased person by virtue of being in the direct line of descent, or being designated in a will or by legal authority. The term is often applied to those who would inherit by will, deed, or operation of law.

HIPAA
The Health Insurance Portability and Accountability Act, better known as Kassebaum-Kennedy, after the two senators who spearheaded the bill. Passed in 1996 to help people buy and keep health insurance, even when they have serious health conditions, the law sets basic requirements that health plans must meet. Since states can and have modified and expanded upon these provisions, consumers' protections vary from state to state.

Hospice
Facility that provides short-term continuous care in a home-like setting for terminally ill people with a life expectancy of six months or less.

I

Immediate Annuity
An annuity that begins to make income payments immediately (or soon after) after the first premium is paid, as opposed to a deferred annuity.

Incapacity
The inability to properly care for one's property and/or person, or to make or communicate rational decisions concerning one's affairs.

Income in Respect of a Decedent
All gross income that the decedent had a right to receive, but did not receive, prior to death such as uncollected wages, deferred compensation, and pension benefits.

Income Tax
The annual tax on income that is levied by the federal government and by certain state and local governments.

Incompetency
The inability to properly care for one's property and/or person, or to make or communicate rational decisions concerning one's person.

Independent Agent
A contractor who represents different insurance companies, is not controlled by any one company, and earns commissions from policies sold.

Index
A statistical composite that measures changes in the economy or in financial markets by measuring the ups and downs of stock, bond, and commodities markets, and reflecting market prices and the number of shares outstanding for the companies in the index. Some well known indexes include the New York Stock Exchange Composite Index, S&P 500, American Stock Exchange Composite Index, and Dow Jones Industrial Average.

Individual Policy
An insurance policy (life, health, or disability) that provides coverage for an individual person (and, in some cases, his/her family members); as opposed to a group policy that provides coverage for a group of individuals.

Individual Retirement Account
Also known as an IRA, this tax-advantaged retirement account allows an employed person to invest up to a certain level each year.

Inflation
When the price of goods and services rises, the result is called inflation. This means that things that can be purchased today at one price are likely to cost more in the future.

Insolvency
Insurer's inability to pay debts. Insurance insolvency standards and the regulatory actions taken vary from state to state. The last resort in the case of insolvency is liquidation.

Insurable
An individual applicant who qualifies for an insurance policy based on the coverage standards that are set by the insurance company.

Insurable Interest
A relationship between an insured person or property and the potential beneficiary of the insurance. This requirement must be present at the time the life insurance policy is applied for but doesn't need to exist at the time of the insured's death. Insurable interest exists because there is a reasonable expectation that the beneficiary will benefit from the continued life of the insured, or experience a loss at the death of the insured.

Insured
The policyholder - the person(s) protected in case of a loss or claim.

Insurer
The insurance company.

Insurance Premium
The amount paid for an insurance policy.

Interest
The cost charged for the use of money, expressed as a rate per period of time, usually one year (in which case it is called an annual rate of interest). The rate is derived by dividing the dollar amount of interest by the amount of principal borrowed.

Irrevocable Beneficiary
A beneficiary designation that cannot be changed.

Irrevocable Trust
A trust that cannot be altered, amended, revoked, or terminated by the settler.

J

Joint Life Expectancy
The probability that two people will live to specific ages according to a mortality table.

Judgment
Decision by a court of law ordering someone to pay a certain amount of money.

K

Kassebaum-Kennedy
(see HIPPA) requires all health plans to be guaranteed renewable. Coverage can be canceled for other reasons unrelated to health status.

Key Person Insurance
Insurance on the life or health of a key individual whose services are essential to the continuing success of a business and whose death or disability could cause the firm a substantial financial loss.

L

Lapse
The expiration of a right or privilege when one party does not live up to its obligations during the time allowed.

Level Term Policy
This is a type of insurance that pays a level benefit in case of death during the term of the policy. The premium is also level.

Liabilities
A claim on the assets of a company or individual to satisfy a debt.

Life Annuity
An annuity that makes regular (e.g., monthly, quarterly, etc.) income payments for the life of a person (the annuitant). The annuitant cannot outlive the payments. Upon his/her death, however, all income payments cease and there are no beneficiary benefits.

Life Expectancy
The number of years a person is expected to live as determined by actuaries using mortality (actuarial) tables. This information is used to calculate annuity payments, life insurance premiums, and annual minimum distributions from IRAs.

Life Expectancy Tables
Mortality tables that are used to calculate life expectancy figures.

Life Insurance
A policy that will pay a specified sum to beneficiaries upon the death of the insured.

Liquidity
The ability to buy or sell an asset quickly, or to convert an asset to cash quickly, and in large volume without substantially affecting the price of the asset.

Living Benefits Program
In the event of a terminal illness where medical and long term care costs occur, life insurance benefits that are payable to the insured prior to death through the use of an accelerated death benefit rider (ADBR). Accelerated or 'living' benefits paid will reduce the amount of death benefits payable to the beneficiary upon the insured's death.

Living Trust
A revocable or irrevocable trust created during the life of the grantor that is also known as an inter vivo trust.

Loan Value
The amount which can be borrowed at a specified rate of interest from the issuing company by the policyholder, using the value of the policy as collateral. In the event the policyholder dies with the debt partially or fully unpaid, then the amount borrowed plus any interest is deducted from the amount payable.

Long-Term Care Insurance
Coverage that, under specified conditions, provides skilled nursing, intermediate care, or custodial care for a patient (generally over age 65) in a nursing facility or his or her residence following the occurrence of a medical condition.

Look Back
The maximum length of time, immediately prior to enrolling in a health plan, that can be examined for evidence of preexisting conditions.

Loss
A reduction in the quality or value of a property, or a legal liability.

M

McCarrian-Ferguson
Federal law signed in 1945 in which Congress declared that states would continue to regulate the insurance business. Grants insurers a limited exemption from federal antitrust legislation.

Medicaid
A federal/state public assistance program created in 1965 and administered by the states for people whose income and resources are insufficient to pay for health care.

Medicare
Federal program for people 65 or older that pays part of the costs associated with hospitalization, surgery, doctors' bills, home health care, and skilled-nursing care.

Medigap/Medsup
Policies that supplement federal insurance benefits particularly for those covered under Medicare.

Mortality (Actuarial) Table
A statistical table showing the rate of death at each age in terms of the number of deaths per thousand, indicating the probability of a certain number of people from a group dying in a given year. Insurance companies and the IRS use mortality (actuarial) tables to establish premiums for different age groups, to base life estates, and annuity valuations.

N

Net Worth
A person's net worth is equal to the total value of all possessions, such as a house, stocks, bonds, and other securities, minus all outstanding debts, such as mortgage and revolving credit lines.

Nursing Home Insurance
A form of long-term care policy that covers a policyholder's stay in a nursing facility.

O

Ordinary Life Insurance
A life insurance policy that remains in force for the policyholder's lifetime.

P

Pension Plans
Also known as defined benefit retirement plans, these provide a specified amount of money after retirement following a set number of years of service (in other words, the benefit is "defined" in advance). Once one retires, the amount received is fixed and usually does not increase with inflation.

Permanent
In the insurance context, permanent life insurance is ordinary life insurance such as whole life as opposed to term life insurance which expires unless renewed at the end of each term.

Policy
The written contract of insurance.

Policy Loan
The amount that the owner of a life insurance policy can borrow, at an interest rate set by the company, from the insurer up to the cash surrender value. If interest is not paid when due it is deducted from any remaining cash value. At the death of the policyholder any outstanding policy loans and interest due are subtracted from the death benefit.

Policy Period
Time period during which an insurance policy is in force.

Post Mortem
After death.

Power of Attorney for Health Care
A durable power of attorney for health care. Allows a representative to make medical decisions only for an individual who is seriously ill or incapacitated. Also called a health care proxy.

Power of Attorney
A written document that authorizes an individual to perform certain acts on behalf of the person signing the document. The document, which must be witnessed by a notary public or some other public officer, may bestow either full power of attorney or limited power of attorney and it becomes void upon the death of the signer.

Premium
For insurance, the premium is the amount paid for an insurance policy.

Premium Financing
A policyholder contracts with a lender to pay the insurance premium on his/her behalf. The policyholder usually agrees to repay the lender for the cost of the premium, plus interest and fees.

Premiums Written
The total premiums on all policies written by an insurer during a specified period of time, regardless of what portions have been earned. Net premiums written are premiums written after reinsurance transactions.

Present Value
Value today of a future payment, or stream of payments, discounted at some appropriate compound interest or discount rate.

Principal
The amount borrowed or unpaid on a loan.

Principal
The applicant for or subject of insurance. The one from whom an agent derives his or her authority.

Q

Qualified Retirement Plan
A retirement plan that permits contributions by both the employee and the employer and enables the employee to defer both contributions and any earnings from taxes until the employee withdraws money from the plan. A 401(a) and 401(k) are examples of qualified plans.

Quote
An estimate of the cost of insurance, based on information supplied to the insurance company by the applicant.

R

Rate
Cost per unit of insurance. When used to calculate a premium, it must be adequate enough to pay expected losses according to frequency and severity, reasonable to the point that insurers do not earn an excessive profit and not discriminatory or inequitable. Based on the amount of coverage needed, an individual will purchase the appropriate number of units of insurance with the total cost reflected in a premium payment.

Rated Policy
A policy for which the insured pays a higher-than-standard premium because of a higher risk due to a physical impairment, past medical condition, hazardous occupation, or a hazardous hobby. This type of policy is sometimes called an extra-risk policy.

Rating Agencies
Six major credit agencies determine insurers' financial strength and viability to meet claims obligations. They are A.M. Best Co.; Duff & Phelps Inc.; Fitch, Inc.; Moody's Investors Services; Standard & Poor's Corp.; and Weiss Ratings, Inc. Factors considered include company earnings, capital adequacy, operating leverage, liquidity, investment performance, reinsurance programs, and management ability, integrity and experience. A high financial rating is not the same as a high consumer satisfaction rating.

Reinstatement
The restoring of a lapsed policy to full force and effect. The reinstatement may be effective after the cancellation date, creating a lapse of coverage. Some companies require evidence of insurability and payment of past due premiums plus interest.

Rider
Usually known as an endorsement, a rider is an amendment to the policy used to add or delete coverage.

Rollover IRA
An Individual Retirement Account can hold money distributed from an employer's qualified or 403(b retirement plan.

Roth IRA
An individual retirement account which permits account holder's capital to accumulate tax free under certain conditions.

S

Short-Term Liquidity
The ability to convert an asset into cash relatively easily. This concept also is simply known as "liquidity."

Solvency
Insurance companies' ability to pay the claims of policyholders. Regulations to promote solvency include minimum capital and surplus requirements, statutory accounting conventions, limits to insurance company investment and corporate activities, financial ratio tests, and financial data disclosure.

Split Dollar Life Insurance
Life insurance policy in which premiums, ownership rights, and death benefit proceeds are split between an employer and an employee.

Standard & Poor's 500 index (S&P 500)
The S&P 500, a registered trademark of the Standard & Poor's Corporation, is a widely recognized, unmanaged index of common stocks.

Suicide Clause
Limitation in life insurance policies to the effect that no death benefits will be paid if the insured commits suicide during a specified initial period.

Surrender
To terminate or cancel a life insurance policy before the maturity date. In the case of a cash value policy, the policyholder may exercise one of the nonforfeiture options at the time of surrender.

Surrender Charge
Many annuities impose a surrender charge.

T

Tax-Deferred Retirement Plans
A retirement plan that allows someone to not pay current income taxes on pre-tax money invested or any earnings in an account until withdrawn from the plan.

Tax-Free Exchange
Section 1035 of the Internal Revenue Code provides that certain exchanges of life insurance contracts, annuity contracts, and modified endowment contracts so long as IRS conditions are met.

Term Insurance
Protection against premature death that comes in a form of life insurance. It pays a benefit only when an insured dies within a specified period, and a designated beneficiary receives the death benefit. If the insured lives beyond the specified period, the beneficiary receives nothing.

U - V - W

Underwriting
The process of selecting applicants for insurance and classifying them according to their degrees of insurability so that the appropriate premium rates may be charged. The process includes rejection of unacceptable risks.

Universal Life Insurance
A flexible premium policy that combines protection against premature death with a savings account that typically earns a money market rate of interest. Premiums can be changed during the life of the policy within limits and the policy will lapse if there isn't enough money to cover mortality and administrative costs.

Valued Policy
A policy under which the insurer pays a specified amount of money to or on behalf of the insured upon the occurrence of a defined loss. The money amount is not related to the extent of the loss. Life insurance policies are an example.

Variable Annuity
While a fixed annuity offers a return guaranteed by the issuing insurance company, a variable annuity offers a chance to increase the return through a portfolio of underlying investments, typically stocks, bonds, and money markets. 

Waiver
The surrender of a right or privilege which is known to exist.

Waiver of Premium
A clause or rider on a life insurance, disability, or long-term care insurance policy that cancels the premium payments the insured must make if he or she is disabled longer than a certain time period (usually six months) and as long as he or she continues to be disabled. The policy remains in force even though the insured is no longer paying the premiums.

Whole-Life Insurance
The insurance policy offers protection in case the insured dies, but it also builds up cash value over time. Under normal circumstances, the policy remains active for the lifetime of the insured or for until a specified age. The insured usually pays a level annual premium, and the earnings on the cash value in the policy accumulate tax-deferred. 

Write
To insure, underwrite, or accept an application for insurance.