Life Insurance and Life Settlement Terms - T
Tax Sheltered Annuity (TSA)
In the United States, a retirement annuity sold only to companies offering qualified retirement plans under section 403(b) of the U.S. Internal Revenue Code.
Tax-Deferred Basis
Accumulation of investment income on which income taxes are not payable until money is withdrawn from the investment vehicle.
Term Certain Annuity
A kind of annuity that pays out over a fixed period rather than when the annuitant dies.
Term Life Insurance
A kind of life insurance that covers the insured person for a definite period of time, the “term” that is specified in the policy. It pays a gain to a designated beneficiary only when the insured expires within that specified period which can be one, five, 10 or even 20 years. Term life policies are renewable but premiums augment with age.
Territorial Rating
A process of classifying risks by geographic location to set a fair price for coverage. The location of the insured can have a considerable impact on the cost of losses.
Terrorism Coverage
Comprised as a portion of the package in standard commercial insurance policies prior to September 11, 2001 virtually free of charge. Since September 11, terrorism coverage prices have increased substantially to reflect the current risk.
Third-Party Administrator
Outside group that carry out clerical functions for an insurance company.
Third-Party Coverage
Liability coverage bought by the policyholder as a protection against possible lawsuits filed by a third party. The insured and the insurer are the initial and second parties to the insurance contract.
Time Deposit
Funds that are held in a savings account for a predetermined period of time at a set interest rate. Banks can decline to permit withdrawals from these accounts until the period has expired or assess a penalty for early withdrawals.
Time Limit On Certain Defenses Provision
An individual health insurance policy provision that limits the time during which the insurer can contest the validity of the contract on the ground of misrepresentation in the application or can reduce or refuse a claim on the ground it results from a preexisting condition.
Title Insurance
Insurance that indemnifies the proprietor of real estate in the event that his or her clear ownership of property is challenged by the discovery of faults in the title.
Tort
A lawful term denoting a wrongful act resulting in injury or damage on which a civil court action, or legal proceeding, might be based.
Tort Law
The body of law governing negligence, intentional interference, and other wrongful acts for which civil action can be brought, apart from for breach of contract, which is covered by contract law.
Tort Reform
Refers to legislation designed to lessen liability costs through limits on various types of damages and through modification of liability rules.
Total Disability
For disability insurance purposes, an insured’s disability that meets the necessities of the definition of total disability included in the disability insurance policy or policy rider and that meets the criteria for payment of the particular disability benefits.
Total Loss
The condition of an automobile or other property when damage is so wide that repair costs would go beyond the value of the vehicle or property.
Transparencya
The word used to explain the way information on financial matters, like financial reports and actions of companies or markets, are communicated so that they are simply understood and frank.
Travel Insurance
Insurance to cover problems related with traveling, normally including trip cancellation due to illness, lost luggage and other incidents.
Treasury Securities
Interest-bearing duties of the U.S. government issued by the Treasury as a means of borrowing money to meet government expenditures not covered by tax revenues.
Treaty Reinsurance
A standing agreement among insurers and reinsurers. Under a treaty every party automatically accepts specific percentages of the insurer’s business.
Temporary Life Insurance Agreements
Legal agreements among an insurer and a proposed insured that provide a guaranteed amount of temporary life insurance coverage for a specific period of time, usually the underwriting tenure.
Term Life Insurance
Life insurance under which the gain is payable only if the insured excpires during a specified period.
Total Disability
A disability that meets the definition in a disability income policy and that entitles the insured to get complete disability income benefits.
Trust Agreement
In a trusteed pension plan, the contract among the plan sponsor and the trustee that describes the trustee’s authority and responsibilities for investing and administering plan assets. Trust agreements are also found when group insurance is provided during a multiple-employer trust (MET).
Twisting
A prohibited insurance sales practice that happens when an agent induces a policyowner to cancel an insurance policy and use the cash value of that policy to purchase a new policy, when doing so is not in the policy owner’s finest interests.
