The choices available to an insured as to how the cost value of a life insurance policy will be received - as a lump-sum payment, as extended term insurance, or as reduced paid-up life insurance. These options guarantee that the cash value will not be forfeited by the insured.
Privileges allowed under terms of a life insurance contract after cash values have been created.
The choices available in a life insurance policy to a policyholder if he or she discontinues premium payments on a policy that has accumulated a cash value. The choices are usually to take the cash value in cash, to apply the cash value to purchase "reduced paid-up insurance" or "extended term insurance", or to use the cash value as security for a loan against the policy to pay the premium or premiums due ("automatic premium loan").
This term refers to privileges allowed under terms of the contract after cash values have been created. Four privileges exist: (1) surrender for full cash value; (2) loans up to full amount of cash value; (3) paid-up policy for an amount of insurance which cash value, as a single premium, will buy at net rates; (4) Term insurance for full face amount of original policy or as long a period as cash value will last to pay necessary premiums.
Choices that owners of life insurance policies have regarding the disposition of cash values when they surrender their policies. (See page 11.)
Provision in the policy which allow policy owner to chooses how the cash value of the policy will be used if the policy is surrendered or lapses due to non-payment of premium.