- CIET 1961
- See Commissioner's Industrial Extended Term Mortality Table, 1961.
- CLU
- See
Chartered Life Underwriter.
- CREF
- See College Retirement Equities Fund.
- CSI 1961
- See
Commissioner's Standard Industrial Mortality Table, 1961.
- CSO
- See Commissioner's
Standard Ordinary.
- Cash Refund Annuity
- A form of annuity contract which provides
that if at the death of the annuitant installments paid to him have not totaled
the amount of the premium paid for the annuity, the difference will be paid to
a designated beneficiary in a lump sum.
- Cash Surrender Value
- The amount of cash
due an insured who surrenders Cash Value Life Insurance. Such surrender, with
consequent termination of all insurance benefits, is sometimes called "cashing
out" or "cashing in" a policy. See also Nonforfeiture Values.
- Cash Value
- See
Cash Surrender Value.
- Cestui Que Vie
- The person whose life measures the duration
of a trust, gift, estate, or insurance contract. Thus, in Life and Health
Insurance it is the person on whose life or health the policy is written,
commonly called the insured, policyholder, or policy owner.
- Chartered Life
Underwriter (CLU)
- A designation granted by the American College of Life
Underwriters upon successful completion of a series of examinations.
- Chicago
Plan
- See Financed Insurance.
- Classified Insurance
- Life or Health Insurance on
risks which do not meet the standards for the regular manual rate. See also
Substandard.
- Cleanup Fund
- A commonly used term to designate policies whose
express purpose is to pay final expenses of death.
- Collateral Assignment
- Assignment
of a Life Insurance policy or its value as security for a loan. In the event of
default, the creditor would receive proceeds or values only to the extent of
his interest.
- Collection Book
- The debit agent's record book showing the amount
collected on each policy, the week of the collection, and the policy period for
which the premium has been paid.
- Collection Commission
- A percentage of premiums
collected which is paid to an agent as the commission on his collections of
Debit Life Insurance premiums.
- Collection Fee
- An Industrial Life Insurance
agent's fee allowed as his compensation for making policy premium collections
for which he is not being paid a commission.
- College Retirement Equities Fund
(CREF)
- A separate organization affiliated with the Teachers Insurance Annuity
Association. It introduces and sells a variable annuity to college and
university personnel.
- Collegia
- Groups of associations in ancient Rome that were
influential historically in the development of Life Insurance and pensions.
They were the forerunners of mutual benefit societies or friendly societies.
- Combination
- A
term used to describe an agent, agency or insurer that sells both Industrial
Life Insurance and Ordinary Life policies.
- Combination Plan
- In pensions this is
a term applied to the combining of Life Insurance contracts with a fund called
a side fund or auxiliary fund. The purpose is to increase the amount of money
available for a pension or annuity at some future date.
- Combination Plan
Reinsurance
- A form of combined reinsurance which provides that in consideration
of a premium, which is a fixed percentage of the ceding company's subject
premium on the business covered, the reinsurer will indemnify the ceding
company for the amount of loss of each risk in excess of a specified retention
and subject to a specified limit and, after deducting the excess recoveries on
each risk, the reinsurer will indemnify the ceding company against a fixed
quota share percent of all remaining losses.
- Combined Annuity Mortality Table
- A
mortality table which was published in 1928 for use in determining rates for
group annuities.
- Commissioners' Disability Table
- A morbidity table approved by
the National Association of Insurance Commissioners in 1964 for use in setting
legal minimums for Disability Income Insurance policy reserves.
- Commissioners'
Industrial Extended Term Mortality Table, 1961 (CIET 1961)
- An industrial
mortality table approved by the NAIC for evaluation and computation of Extended
Term Insurance in Industrial policies, where additional mortality margins are
deemed necessary. This is a companion table to the CSI 1961.
- Commissioners'
Standard Industrial Mortality Table, 1961 (CSI 1961)
- An industrial mortality
table approved by the NAIC as a standard for evaluation and for computation of
nonforfeiture values for Industrial policies.
- Commissioners' Standard Ordinary
(CSO)
- A mortality table approved by the NAIC in 1958 as a standard for
evaluation and for computation of nonforfeiture values for Ordinary Life
policies. The CSO 1941 tables superseded the long-used American Experience
Table, compiled in 1868, and the American Men Table, published in 1918 but
never as widely used as the American Experience Table. The CSO 1958 superseded
the CSO 1941 and is now required as a minimum basis for use by all companies.
- Common
Accident
- An accident in which two or more persons are injured.
- Common Disaster
- A
situation in which the insured and the beneficiary appear to die simultaneously
with no clear evidence of who died first.
- Common Disaster Clause
- A clause
sometimes added to a Life Insurance policy that provides a means for the
insurer to distribute the proceeds of the policy in the event of a common
disaster.
- Commutation Rights
- The right of a beneficiary to receive in one sum
the unpaid payments remaining under an installment option which was selected
for the settlement of the proceeds or values of a Life Insurance policy.
- Conditional
Binding Receipt
- This is the more exact terminology for what is often called a
binding receipt. It provides that if a premium accompanies an application, the
coverage will be in force from the date of application or medical examination,
if any, whichever is later, provided the insurer would have issued the coverage
on the basis of the facts revealed on the application, medical examination and
other usual sources of underwriting information. A Life and Health Insurance
policy without a conditional binding receipt is not effective until it is
delivered to the insured and the premium is paid.
- Conditional Vesting
- A form of
vesting in a contributory pension plan under which entitlement to a vested
benefit is conditional upon nonwithdrawal of the participant's contribution.
See also Vesting.
- Consumer Credit
- A trade association for insurers of Credit
Insurance in the areas of Life and Health.
- Contestable Clause
- A provision in an
insurance policy setting forth the conditions under which or the period of time
during which the insurer may contest or void the policy. After that time has
lapsed, normally two years, the policy cannot be contested.
- Contingent
Beneficiary
- A person(s) named to receive policy benefits if the primary
beneficiary is deceased at the time the benefits become payable.
- Contributory
- A
general term used to describe a plan of employee coverage in which the employee
pays at least part of the premium.
- Control Provision
- A policy provision found
most frequently in juvenile contracts, providing that ownership control is to
be exercised for a stated or indefinite duration by a person other than the one
whose life is insured.
- Conversion Privilege
- This is the right of an individual
to convert a Group Health or Life policy to an individual policy should the
individual cease to be a member of the group. Usually this can be done without
a physical examination.
- Convertible
- A policy that may be changed to another form
by contractual provision and without evidence of insurability. Most Term
policies are convertible into permanent insurance.
- Coordination of Benefits
(COB)
- A group policy provision which helps determine the primary carrier in
situations where an insured is covered by more than one policy. This provision
prevents an insured from receiving claims overpayments.
- Corridor
- In Universal
Life insurance, it is necessary to maintain a certain level of pure insurance
protection in excess of the accumulation value in order to qualify as life
insurance for income tax purposes. This portion of the pure insurance
protection is called a "corridor."
- Cost of Insurance
- The amount a policy owner
pays to an insurer, minus what he or she gets back from the insurer. This
expression is used when determining the true cost of permanent forms of Life
Insurance to a policy owner. It considers the fact that premiums are paid in
but also that an actual cash value is being built up, which is the portion that
the insured will get back from the insurance.
- Cost of Insurance Charge
- Another
term to describe the charge for the pure insurance protection element of a life
insurance contract. It is also known as the Mortality Charge.
- Cost-of-Living
Rider
- Designed to adjust policy benefits in relation to the change in the
economic climate. The majority of such riders are tied to changes in the
Consumer Price Index (CPI). The amount of insurance may be automatically
increased, without evidence of insurability, at predetermined periods for a
maximum amount.
- Coupon Policy
- A Life Insurance policy, usually 20-Pay Life or
some other limited payment period, with attached coupons that may be cashed in
for a specified amount at the time of the payment of each annual premium.
- Credit
Life Insurance
- A group life insurance contract whereby a creditor is protected
in the event of death of the insured prior to the indebtedness being paid in
full.
- Cross Purchase
- A form of Business Insurance in which each party to a
mutual agreement (usually to buy out a disabled or deceased co-owner) insures
each of the other parties.
- Crude Death (or Mortality) Rate
- The ratio of total
deaths to total population during any given period. See also Mortality Rate.
- Current
Disbursement
- The funding and disbursement of pension benefits as they become
due. Also known as "pay-as-you-go." In the long run, this is the most costly
method of funding pension plans.
- Current Future Service
- The amount of pension
payable for each year of future participation in the pension plan.
- Current
Service Benefit
- The portion of a participant's pension benefit that relates to
his credited service in a contemporary period, usually 12 months.
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