Section 1035 Exchange to Surrender Definitions

A B C D E F G H I J K L M N O P R S T U V W Y
S

Section 1035 Exchange: This is a provision in the tax code that allows a person to take the proceeds from an existing life insurance policy and transfer them immediately into another life insurance policy while deferring the payment of taxes on the gain.
Split Dollar Plan: A type of life insurance purchase wherein an employer and an employee split the premiums, ownership and proceeds of an insurance policy.
Standard Risk: For insurance purposes, a person who is considered to have an average risk of loss of life based upon their medical condition and history, avocation and lifestyle.
Substandard Risk: For insurance purposes, a person who is considered to have a more than average risk of loss of life based upon their medical condition and history, avocation and lifestyle.
Suicide Clause: A provision in a life insurance policy that states that the policy will not provide benefits if the insured dies from suicide during a specified period of time, usually the first two years of the policy.
Super-Preferred Risk: For insurance purposes, a person who is considered to have a less than average risk of loss of life based upon their medical condition and history, avocation and lifestyle.
Surrender: A term used to describe the voluntary termination of an insurance policy.