When the loan value is so small that it will not even cover a monthly premium, nonforfeiture
benefit options will apply.
1) The cash value of the policy is also known as the nonforfeiture
value since this is the least amount the insurer can pay to a surrendering policyholder.
For example, if the plan had used higher interest rates or a mortality table with shorter life expectancies to determine the annuity amount, then the amount that exceeded the benefit derived would have been subject to the nonforfeiture
rules and would have been included in the employee's annual benefit.
provision shall be appropriately captioned;
State laws specify standard nonforfeiture
options that companies must offer to policyholders, while the Internal Revenue Code offers certain tax advantages for policy ownership.
The charity may find that the life settlement is a better alternative to either surrendering the policy or exercising one of its other nonforfeiture
values: Those values or benefits in a life insurance policy that by law the policyowner does not forfeit, even if he or she chooses to discontinue payment of premiums.
provisions (cash surrender, extended term and paid up insurance);
benefits--Some policies offer this benefit, which is designed to allow a policyholder to stop paying premiums into the policy without losing all benefits and coming away from the situation having paid premiums but having no current coverage.
A policy may also offer optional benefits, including different nonforfeiture
benefits that return some value in the event of termination due to discontinued payment of premiums.
benefit option provides a shortened benefit period if the policy lapses after three years due to nonpayment of contributions.
Among the improvements to the policies offered in California are the removal of the mental health exclusion from the Preferred Advantage product series, the revised nonforfeiture
benefits that provide for a minimum nursing facility benefit after three years of premium payment, and the redefined simple and compound inflation computations.