Glossary

Natural Death
Death by means other than accident, murder or suicide.

Net Cash Value
In Account Summary, the net amount payable to the policyowner if the policy is surrendered to the Company on the specified "as of" date. This value includes any dividends, interest or investment gain/loss credited to date, and is reduced by any outstanding policy loans and loan interest due, any policy charges due and any surrender charges which may apply. A surrender may result in a taxable gain that may be subject to federal and state withholding.

Net Cost
The total, out-of-pocket cost of owning a life insurance policy. There are different methods of calculating this. A simplified method of calculating it is to reduce the total premium paid by dividends returned, and then subtract the cash value from that figure. (Example: If you paid a total of $10,000 in premiums, had $1,200 returned in policy dividends and had accumulated a cash value of $2,000, your net cost for the policy would be $6,800.) This simplified method does not account for the time value of money.

Net Premium
In insurance, the total premium minus dividends.

Net Worth
The value of a business or an individual. It is calculated by subtracting total liabilities from total assets.

New York Life Insurance Company
A mutual life insurance company founded in 1845, and operating continuously ever since in all 50 states and the District of Columbia.

Non-Admitted Company
An insurance company not licensed to do business in a particular state.

Non-Cancellable
An insurance policy which the insured has the right to continue in force (by the timely payment of premiums as set forth in the contract) for a specified period of time. During that time, the insurance company cannot alter or cancel the policy.

Non-Contributory
In business, a type of employee benefit plan or insurance coverage in which the employer pays the full cost for all eligible employees. The employees do not contribute.

Non-Convertible
A term life insurance policy that cannot be converted to a permanent policy.

Nonforfeitable Benefit
In pension plans, a vested benefit that belongs, unconditionally, to the participant.

Nonforfeiture Values
Cash values in a life insurance policy to which the policyowner has a right, even if he or she elects to stop paying premiums. These can be taken under one of three possible nonforfeiture options: (1) surrender for full cash value; (2) use of the cash value to purchase reduced paid-up life insurance; and (3) use of the cash value to purchase extended term insurance in the full face amount of the original policy for as long as the cash value will pay net premiums.

Non-Participating
A life insurance policy which is not eligible for dividend distributions from the company's surplus. (Literally, the policy does not "participate" in the dividends).

Non-Qualified Plan
A retirement plan that does not qualify for the federal tax advantages received by qualified plans, but which, in turn, is subject to fewer restrictions regarding participants and contribution limits.

Nursing Home Maximum Daily Benefit (NHMDB)
The maximum amount that will be paid for eligible charges for each day the insured is confined in a nursing home or other approved facility. Applicable to Long-Term Care Insurance policies.

© 2002-2003 New York Life Insurance Company. All rights reserved