Glossary

Face Amount
The initial death benefit payable on your life insurance policy, as indicated on the face page. Note that this is not necessarily the same as the actual death benefit payable. The death benefit may be higher if dividends were used to purchase additional coverage; it can be lower if loans against the policy were taken and were not re-paid.

Fiduciary
An individual or entity holding the funds or property of another in a position of trust. An example of a person having a fiduciary responsibility is an executor of an estate.

Field Representative/Underwriter
Field representative and field underwriter were other terms used to describe insurance agent. Note that an agent has underwriting responsibilities to the company in terms of reporting information accurately and completely to the home office for underwriting consideration.

Final Expenses
These are costs associated with one's death that must be settled prior to distribution of that person's estate. Final expenses may include funeral and burial costs, existing debts, taxes and other outstanding expenses.

First-Year Premium
This is the life insurance premium falling due during the first year the policy is in force. Premiums paid in subsequent years are known as renewal premiums. In an annuity, first year premiums are any payments used to initially purchase the policy or that are paid during the first year.

Fixed Amount Option
A life insurance proceeds settlement option whereby the amount of monthly payment is set or fixed by the policyowner. The number of payments is determined by the amount of proceeds. (An example would be electing to receive $1,000 a month for as long as the proceeds last.)

Fixed Annuity
An annuity that earns a fixed, guaranteed rate of return on cash values and provides fixed payments during the payout period, regardless of other economic conditions. This contrasts with a variable annuity, which features accumulation or loss based on the performance of investment funds selected by the contract owner.

Fixed Period Option
A life insurance proceeds settlement option whereby the number of payments is fixed by the policyowner. The amount of each payment is determined by the amount of proceeds. (An example would be electing to receive benefits for a specified period of time, such as ten years; the amount of each payment is then based on the amount of principal and projected earnings.)

Flexible Premium Adjustable Life
(See "Universal Life Insurance.")

Flexible Premium Annuity
A type of deferred annuity allowing flexible premium payments after the initial premium has been paid.

Flexible Premium Policy
A life insurance policy in which the policyowner has the option to pay more or less than the scheduled premium. Such policies include variable universal life and universal life insurance. This contrasts with whole life, whereby the premium is fixed at the time of policy issue. Note that, with flexible-premium policies, there may be a risk that the policy may consume its own policy values and eventually terminate without value if premiums being paid are lower than the scheduled premium or if loans or withdrawals are made.

Frequency
In Account Summary, the scheduled mode (e.g. monthly, quarterly, etc.) for the payment of Income Amounts, as set forth in the annuity policy.

Front Load
The practice of deducting sales and marketing expenses from a premium or contribution before crediting the remainder to the investment or policy.

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