Glossary

Cafeteria Plan
A type of employee benefit arrangement that allows employees to pick and choose the benefits they want from an array of offerings (as one selects foods when going through a cafeteria line). This contrasts with employee benefit plans in which every employee receives the same benefits, regardless of individual needs or situations.

Capital Gain (Loss)
An increase (decrease) in the value of your investment realized upon a sale or an amount received (lost) by a mutual fund for selling securities above (below) their cost. Any net captial gains earned by mutual funds are distributed to shareholders annually and reported on Form 1099-DIV. If you sell or exchange your fund shares for more or less than your cost basis, you will realize a capital gain or loss. All capital gains, whether earned by the fund or from the sale of fund shares, must be reported on your tax return. Different tax rates may apply depending on how long assets were held, when they were sold, and other factors. Any capital losses from the sale of fund shares must be reported on your tax return and may be used to offset capital gains.

Carrier
Another name for an insurance company, which "carries" the risk loss.

Cash Refund Annuity
Any type of annuity which guarantees that, should the annuitant die prior to receiving payments equal to the premiums paid to establish the annuity, the difference will be refunded to the named beneficiary in a lump sum. New York Life and its subsidiaries continues payments until the total amount paid out equals the premium paid, called "Life with Guaranteed Total Amount."

Cash Value
In a cash value (also called "permanent") life insurance policy, this is the money that can accumulate in the policy. This money usually accumulates on a tax-deferred basis. As the policyowner, you can access the available cash value at any time and for any purpose. Some people borrow cash values for down payment on a home, to help pay college bills, or to provide supplemental income in retirement. Note that borrowed cash values will reduce the death benefit of your policy or otherwise negatively impact overall policy values.

Cash Value Policy
A "permanent" life insurance policy that offers the potential for cash value accumulation and life-long protection provided premiums are paid. This contrasts with term life insurance, which does not accumulate cash value and generally expires at the end of the term without value. For an annuity, this means the current gross value of the policy.

Certificate of Insurance
If you are covered under a group insurance plan, your certificate summarizes the benefits and principal provisions of the master policy.

Change of Beneficiary Provision
A life insurance policy provision allowing you to change the beneficiary whenever desired (unless the beneficiary has been designated as irrevocable). It is recommended that you review your policy beneficiary designations periodically to make sure they reflect your current situation and wishes.

Chartered Financial Consultant (ChFC)
A professional designation (achieved by passing a series of examinations) demonstrating the successful completion of financial courses involving insurance, investments, taxation, accounting, estate planning, and more. The ChFC designation indicates a knowledge of financial planning, as well as the features, benefits and uses of various insurance and financial products.

Chartered Life Underwriter (CLU)
A professional designation (achieved by passing a series of examinations) demonstrating knowledge of life insurance products and their potential uses to meet business, estate planning, retirement planning, and other objectives.

Class (Classification)
A class is a group of insureds having similar characteristics and exposure to a peril, and who are eligible for comparable insurance rates. For example, non-smokers as a group generally pay lower rates for life insurance than do tobacco users.

Client
A policy owner or a person who has an account with New York Life or a New York Life subsidiary. For example, a client is the person who has the rights of ownership for a NYLIFE Securities account or the owner of a New York Life Insurance policy.

Client ID Number
In Account Summary, you, as the owner of the products and/or accounts listed herein, have been assigned a client identification number with New York Life and its subsidiaries.

Collateral Assignment
The legal transfer of one person's interest in a policy to a creditor as security for a debt. Under a collateral assignment, the creditor is entitled to be reimbursed out of policy proceeds for the amount owed. The beneficiary is entitled to any excess of policy proceeds over the amount due the creditor in the event of the insured's death.

Commercial Lines
Insurance for businesses and commercial establishments.

Commission
In insurance, a percentage of the premium paid to an agent or broker by the insurer as compensation.

Conditional Temporary Receipt
In life insurance, evidence of temporary coverage if you pay the initial premium at the time your application is taken; and meet the conditions spelled out in the receipt. This gives the applicant temporary coverage during the period when the insurer is processing the application.

Contestable
In insurance, this refers to the right of the insurance company to question or challenge the accuracy of information provided by the applicant. This right is not unconditional, but expires after two years (known as the contestable period) in most cases, after which the policy cannot be contested.

Contestable Period
The period of time (generally up to two years after date of issue) during which the insurer has the legal right to contest the validity of a life insurance policy because of misleading or incomplete information furnished by the applicant. This is a safety feature for beneficiaries, since it places the burden of discovering misleading or false information to the insurance company. Once the contestable period expires, even if erroneous information is later discovered, the company is generally required to pay policy proceeds to the beneficiary at the insured's death.

Contingent Beneficiary
A secondary or alternate beneficiary.

Contract
In insurance, this is another name for the policy. With the completed and signed application attached, the issued life insurance or annuity policy forms a legally binding contractual agreement between the insurance company and the policyowner.

Conversion Privilege
A provision that allows the policyowner, before expiration of a term policy, to elect to have a new permanent policy issued that will continue the insurance coverage, without needing to provide evidence of insurability. Conversion may be effected at attained age (premiums based on the age attained at time of the conversion) or at the original age (premium based on age at time of original issue). If original age is selected, the policyowner must pay the difference in premiums between the old and the new policies and any interest due for the time and the old policy has been in force. The conversion privilege also generally is included in group insurance. It permits employees of company's whose group policies who are terminated for any reason to convert their certificates to permanent insurance at their attained ages.

Cost Basis
The amount you pay for your mutual fund shares including commissions and any reinvested dividends or capital gain distributions, less any nontaxable distributions or returns of capital. When you redeem shares, you subtract the cost basis of your shares from the redemption amount to determine any capital gains or losses.

Cross Purchase Agreement
In business, an agreement that specifies the terms and conditions for the surviving co-owner(s) to buy a deceased's interest in the business. Life insurance on the owners is often used to provide the funds to purchase the share from the deceased owner's estate. An insured cross purchase agreement helps assure that the business is transferred successfully to the surviving owners and that the deceased owner's beneficiaries receive a fair price for their interest.

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