This glossary is arranged in alphabetical order. Click on a letter in left column or scroll down to search.
< F >
The amount stated on the face of the policy that will be paid in case of death. It does not include additional amounts payable under accidental death or other special provisions, or acquired through the application of policy dividends. It is usually stated on the first page of the policy.
Fair Market Value:
The sale price at which a property would change hands between a willing buyer and willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts. Also known as FMV
Expenses incurred at the time of a person's death. These include funeral costs, court expenses associated with probating his or her will, current bills or debt, and taxes. Depending on their circumstances, the survivors may also want to pay the outstanding balances of mortgage and loans
A long-term, tangible asset held for business use and not expected to be converted to cash in the current or upcoming fiscal year, such as manufacturing equipment, real estate, and furniture. also called plant
A Family Trust is an Inter Vivos Trust and is frequently established to hold shares of a corporation owned and controlled by an individual. The Trust is always discretionary in nature, meaning the income earned by the Trust can be divided or sprinkled among several beneficiaries as the trustee, in his/her discretion, decides. The beneficiaries are invariably the trustee and spouse and children of the individual trustee. The Trust is used to purchase shares of a company owned by the individual, which must be an active business. Because the individual is actively involved in the business, he knows the venture is a profitable one
The duty that arises when one individual acts on behalf of, or for the benefit of those whos assets they are managing on behalf of someone else, to do so in a prudent manner and in accordance with the interests of the person(s) they represent.
Deceitful conduct designed to manipulate another person or company (i.e. insurance company) to give something of value by (1) lying, (2) by repeating something that is or ought to have been known by the fraudulent party as false or suspect or (3) by concealing a fact from the other party which may have saved that party from being cheated. The existence of fraud will cause a court to void a contract and can give rise to criminal liability.
According to common law, a false statement which meets the following three criteria: (1) the party that makes the statement is aware that it is not true or disregards whether it is true; (2) the party that makes the statement does so in order to induce another party to enter into a contract; (3) the other party does enter into a contract as a result of the statement and suffers a loss because of the contract. In insurance it is most frequently found in the intentional misrepresentation of a risk to obtain insurance or in proof of loss after the loss occurs.
Is the income from investments such as CDs, Social Security benefits, pension benefits, some annuities, or most bonds that is the same every month.
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