An Endowment Contract is an agreement with an insurance company which provides for a payout especially based on the life expectancy of the insured, and might be payable in full in a single payment during their lifetime.
Life expectancy refers to the average age a person is expected to live based on actuarial calculations, which consider several factors including sex, heredity, and health habits. This metric is crucial for insurance companies in projecting benefit payouts and determining rates through actuarial analysis.
A mortality table, also known as a life table or actuarial table, is a statistical chart used to represent the probability of death of individuals in various age groups within a given population. It shows the rate of death at each age in terms of the number of deaths per thousand people.
Preferred risk refers to an insured, or an applicant for insurance, who has a lower expectation of incurring a loss than the standard applicant. For instance, a non-smoker applying for life insurance may receive reduced premium rates due to a longer life expectancy.
A type of life insurance policy that allows the insured to renew the coverage without providing evidence of insurability, regardless of physical health.
In the context of underwriting risks, 'unique impairment' refers to specific factors that differentiate an applicant from a standard applicant, and may include conditions or characteristics that adversely impact life expectancy or risk profile.
