GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

Vanishing Premium Policy

Synonyms:	decreasing premium insurance policy, decreasing premium policy
Filed Under:	estate-management, insurance
Tags:	insurance, life insurance

vanishing premium policy: 1. A type of whole life insurance policy where dividends are used to pay policy premiums. The eventual goal of a vanishing premium policy is for the amount earned from dividends to increase enough to cover the total cost of premiums.

death benefit (DB) A payment or series of payments made to the beneficiaries of a life insurance policy.
➥ An amount paid to a beneficiary in a life linsurance policy.
dividend Distribution of earnings to shareholders. In credit unions, it's the money paid to members for deposits, similar to the interest banks pay to their customers for deposits.
insurance policy A legal contract between an insurer and entity that specifies what the insurer is required to cover and any benefits the insured entity is entitled to.
life insurance An arrangement where an insurer agrees to pay a benefit to one or more beneficiaries in the event of the policyholder's death.
➥ CanEquity offers life insurance.
permanent life insurance A class of life insurance policies, which include both universal and whole life insurance, with guaranteed death benefits at the end of their terms.
premium A payment made to an insurance company for insurance coverage.
whole life insurance Permanent life insurance with level premiums for the policyholder's entire lifetime.
with-profits policy Insurance that pays the policyholder a portion of the insurer's profits.