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Veralytic Glossary of Terms

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Face Amount:  The death benefit provided by a life insurance policy.  This term most often applies to the amount of insurance specified on the "face" of the policy at the time of issue.  In this case, face amount does not include post-issue changes in total death benefits such as those arising from paid-up additions or death benefit increases caused by growth in account values.  However, some illustrations use face amount to apply to the total policy death benefit at any given time.

Fixed Administration Expenses:  Fixed administration expenses are generally calculated as either a fixed rate per period (e.g., $100 per month) or a fixed rate per $1,000 of policy face amount (e.g., $1.00 per $1,000 of policy face amount), or some combination of the two.  While these rates are generally disclosed in either the policy prospectus, product guide and/or in the footnotes of the illustration, these rates can vary with either the policy face amount and/or the amount of total death benefit if different. As such, fixed administration expenses are dynamic in nature and are dependent on not only the initial policy face amount, but can also be dependent on the manner and timing of any changes in the policy death benefit.

Fixed Premium:  Payments of a fixed, equal amount paid to an insurance company for insurance or an annuity.

Flexible Premium:  For universal life policies, non-fixed payments designed to adapt premiums to the policy holder’s changing needs and financial conditions. (Also see Universal Life.)