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Sometimes referred to as "living benefits", Accelerated Death Benefits are payments given to life insurance policy holders with a catastrophic or terminal illness in advance of their death. While provisions can vary depending on the life insurance policy, payments are often up to 80% of the amount that would be paid after death, and payments can be received up to two years before the policy holder's death is predicted. |
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The total value of an annuity including the initial investment and the interest earned. |
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An individual who receives annuity benefits, usually the holder of a life annuity. |
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The process of converting an annuity investment into an annuity payment or payments. |
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A tax-deferred financial product consisting of an individual's investment which can be structured to return a series of payments with interest at a later point in time. Typically used to ensure a steady income for retirees, an annuity contract can provide annuity payments for any number of years after annuitization or for the entire life of an individual. |
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Guaranteed periodic payments to the owner of an annuity. |
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A written agreement between an insurance company and the annuity holder stipulating the terms of the annuity. |
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A contract which allows the annuitant to delay receiving annuity payments, usually in order to receive more favorable rates. |
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The party that issues an annuity, i.e. an insurance company. |
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The party or parties who hold an annuity and are legally entitled to withdrawal money, designate a new beneficiary, or change the terms of the contract. |
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A period of time, stated in an annuity contract, during which the annuity owner can receive payments. |
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The date set in an annuity contract for annuity payments to begin. |
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The legal transfer of one party's interest in an annuity to another. |
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A legal state wherein individuals or companies with outstanding debts can seek protection from their creditors by reorganizing their available assets for repayment through a federally regulated process. |
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A form of bankruptcy protection in which an individual with a steady source of income may retain some or all of their assets and repay their creditors under the terms of a court-ordered plan. |
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A form of bankruptcy in which an individual's assets are liquidated in order to repay their creditors. |
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A trial before a judge without a jury. Also called a court trial. |
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The cash value of a life insurance policy payable to the owner if surrendered to the issuing company. |
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The cash amount payable to the owner of a life insurance policy if said policy is canceled or terminated. |
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Ongoing periodic payments paid to the legal guardian of one's child, usually a former spouse after separation or divorce, intended for financial support of the child. |
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A legal document specifying an amount an individual owes for child support. |
A legally binding ruling, written by a judge or another entrusted officer of the court. |
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An attorney who files a petition for a court order. |
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An amount paid out to the beneficiary of a life insurance policy at the end of the life of the insured person. |
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In U.S. tax policy, a deduction is a dollar amount subtracted from an individual's gross income for a legally eligible expense. |
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A annuity in which payments are delayed until a specified time in the future. |
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A type of deferred annuity where the annuity owner specifies a fixed amount of income guaranteed during the income phase. |
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A person who relies on another individual for financial support. In U.S. tax law, a dependent entitles a taxpayer to deduct a certain amount from his or her income taxes. |
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The interest rate calculated to determine the present value of future cash flows. |
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The present value of future payments, calculated by discounting future payments to their present worth. |
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A legal document prepared by a court stating the names of the divorced parties, the date of divorce, the divorce case numbers, and the terms of the divorce. |
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An arrangement in which a trusted third party holds money or documents according to established terms. |
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The sum of an individual's worth, including money, property, debts and obligations. |
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The process of arranging for the administration, management and distribution of an estate, in preparation for an individual's death. |
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A tax assessed on the estate of a deceased person, to be imposed during transfer of his or her estate to its inheritors. |
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The stated amount in an insurance policy, to be paid in case of the death of the insured, or upon maturity in an investment. |
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A claim by the federal government against the property of an individual, in order to repay delinquent taxes. |
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A complete statement of income from all sources, assets, liabilities and monthly expenses. |
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An annuity in which a specific sum of money is paid at a fixed rate of interest for a specified period of time. |
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An annuity contract under which the amount and frequency of premium payments may vary prior to annuitization. |
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The complete sale of a structured settlement or annuity. |
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The transfer of money from one account into another account. |
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A federal or state tax imposed on an assets given as a gift to an individual. |
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A sum paid to the owner of a structured settlement upon sale, prior to any transfer fees or other reductions in the final settlement price. Also known as a gross purchase price. |
Annuity payments to be made regardless of whether the annuitant is living or deceased. Also known as guaranteed benefit.
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An individual legally entitled and obligated to financially support and manage the affairs of another person, usually a minor or an individual incapable of taking care of his or herself. |
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Also sometimes referred to as an income annuity or a payout annuity, usually begins to payout immediately or can begin its payout up to one year from the date it was purchased. |
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Formerly known as Washington Square Structured Settlements, Imperial Funding Corp. is a financial services company based in Chicago specializing in the purchase of structured settlements and annuities. As of August 2010, Imperial's own government filing reported that the annual interest rates they charge to customers average at 17%. |
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A payment, from an insurance company to an insured person, which settles an insurance claim. Any monies paid by the insurance company must first meet the pre-determined contractual guidelines as stated in the insurance policy. |
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The person or persons who are listed as insured on an insurance policy. |
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The company that offers insurance coverage, a contract of insurance or an insurance policy, as a promise to reimburse the insured in case of a loss. |
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All insurance policies require that the insured person, most likely the person who actually purchases the insurance, also have an "interested party" or "additional insured" on the policy. The "interested party" or also any assigned beneficiaries, oftentimes stand to receive payments in the event of the death of the insured person, as well as any other person with rights or interests in the insurance contract. |
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A financial services company based in Bryn Mawr, Pennsylvania that purchases structured settlements and annuities. In June of 2009, J.G. Wentworth entered into Chapter 11 bankruptcy and laid off 60% of its employees. |
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A designated person, (or persons) other than the insurance policy holder, who is eligible to receive a monthly annuity payment. |
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Insurance purchased to protect a business from a financial loss, in the event of the disability or death of any employee considered crucial to the company. This is also known as either key man insurance or key executive insurance and usually applies to an individual who possesses a highly valued skill in management, technical ability or a specialized expertise. |
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The discontinuation of insurance coverage or termination of an insurance policy due to non- payment. |
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An individual who is legally authorized to act on the behalf of another individual, and can sign or execute a contract. |
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The statistically expected number of years of life remaining for any given individual. Some of the life expectancy determining factors include a person’s current age and their state of health. |
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A financial transaction that occurs when the owner of an insurance policy chooses to sell an unnecessary policy, to a 3rd party or life settlement company, for more than the cash value of the policy, but less than the actual face value. Life settlements are usually done on the policy of a senior citizen or on policies where the insured has a shortened life expectancy. When the death of the insured occurs, the benefit is paid to either the 3rd party or the life settlement company. |
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Insurance or settlement payments to an individual as long as that person continues to live and, of course, as long as the insurance company stays in business. These payments stop immediately upon the death of said individual. |
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A lifetime payment is a guarantee of a pre-determined amount to be paid for the rest of one’s life. With an annuity, the fixed payment is limited to a period of time. |
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The ability to convert a given asset into cash, often with the goal of doing so without any reduction in price. |
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A single payment of the total amount of monies due as opposed to a periodic payment schedule. |
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An annuity that is structured as a single payment, to be paid out on a specified date or, as a an arrangement of balloon payments at designated dates. |
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A single, large payment made in one lump. |
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The total amount of monies paid in advance, less any mutually agreed upon fees which could include transfer costs, or any other expenses related to the transaction. |
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The total amount of the death benefit paid, minus any outstanding loans or additional withdrawals, that are to be paid out upon the death of the insured. |
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A mathematical formula, which utilizes very specific calculations, that is based on the value of cash today and giving that amount an equivalent value for the future. |
Same as a net advance amount, whereby monies are paid in advance, less any additional expenses or fees, as agreed to by all parties prior to payment. |
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The remaining value of an estate, once all outstanding debts have been paid. |
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An annuity that is purchased by an individual and with after-tax dollars, as opposed to an annuity that is sponsored by the employer and considered to be part of a qualified retirement paln. |
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A legal certification used to determine that a signature on a legal document has been witnessed by an authorized notary. |
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When only a portion of the client's annuity or structured settlement is sold. |
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The person who gets paid. The name of the person to whom the annuity issuer will make the payments. |
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Periodic payments that are received from an annuity or structured settlement. |
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The period of time that either a structured settlement or income payments from an annuity will be made, regardless if the annuitant becomes deceased before the end of the payment period. |
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Payments that are sent and received, in accordance with a regular monthly or quarterly schedule. |
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Any injury to a person’s body, health or well being that is the result of an accident. |
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The person or party who brings a law suit to a court, against a person or party who will then have to defend themselves. |
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The payment amount that is due, by the purchaser of insurance, to keep the insurance policy active. |
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The requisite payment to maintain an insurance policy, a premium is meant to act as a safety net, being large enough to protect the insurer in case of a realized insurance risk. |
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The premiums tax refers to the taxation of all insurers within a given state. Life insurance is generally not considered for this purpose. |
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The current worth of a given amount of money. Regarding annuities, present value refers to a series of equivalent payments to be made at a later date. Leveraging present value against future value serves as a demonstration of the ‘time value’ of money: receiving a payment today as opposed to in, say, one year is preferable because of its added chance to accrue interest in one’s savings account. |
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The purchase price of a given asset refers to whatever amount is actually paid by the investor. Defined subjectively from the investor’s point of view, purchase price fluctuates until a purchase is actually made and becomes a fixed quantity afterward. |
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After a successful court case that establishes the plaintiff’s right to a payment, either in lump sum or regular payment format, an arrangement known as a qualified assignment is made in which the defendant assumes legal responsibility for future payments and all constants such as amount-per-month or whether the payment is subject to taxation are decided upon. After a qualified assignment comes to an end, no further payment or service is required of the defendant in question. |
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A stated price for a given asset or service used singly or collectively as one’s precedent to establish the value of a similar or identical article. |
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Regarding structured settlements, a responsible administrative authority is any governmental entity granted sole jurisdiction over a settled claim resolved through a structured settlement. |
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A contract signed between a married couple when they are legally separated or have agreed to live apart while considering a divorce. This agreement should ideally settle any unresolved concerns with property, debt, alimony, child custody, visitation rights, insurance, tax, and child support that may lie between them. |
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A tort or worker’s compensation claim becomes a settled claim once it is resolved by a structured settlement. |
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When a court settlement is reached, a settlement agreement is created in the form of a document that contains all details of the settlement. Once all involved parties have signed the agreement, it becomes a legally binding contract. |
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The agreed-upon date when all funds necessary for the completion of a transaction are transferred to the rightful party. |
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The conferral of this power gives its recipient authority to act as an attorney under specific circumstances that may pertain to a single subject or individual. |
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The party or parties to which one is currently bound in marriage. |
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Being that a lien is a legal claim meant to secure one’s property, a state tax lien encompasses all of said property that is currently located in a specific state. The value of claimed property should equal the balance of one’s unpaid state taxes. |
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Whenever a stipulation is made, parties in a judicial proceeding arrive at an agreement or concession that is relevant to the business currently before the court. |
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A periodic series of equal payments one receives from an annuity or structured settlement. |
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Procedure in which a claim or lawsuit is settled by means of one party receiving periodic payments. |
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A document that outlines all terms within a given structured settlement. It includes, but is not limited to, the rights of its beneficiary to periodic payments. |
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Party that is obligated by law to, under a structured settlement or qualified assignment, render periodic payments to a specific payee. |
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When an individual cancels their life insurance policy without advance warning, they are obligated to pay a surrender charge equal to the expense associated with taking out the policy in the first place. |
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A surrender schedule contains the number of years and percentage amount of surrender charges applied to all withdrawals stemming from a specific annuity contract or life insurance policy. |
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A type of life insurance policy taken out on two or more parties simultaneously. When all policyholders have died, the benefit is paid. |
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A procedure through which one may postpone the payment of their current taxes until a specified future date. |
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Tax-Deferred Interest refers to interest that is not currently being taxed. |
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An insurance annuity that is meant to dole out regular payments of fixed size for a set time frame to its recipient. |
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Life insurance policy that has a fixed ending date. If the policyholder is still alive on this date, the policy does not come to fruition and a payment is not released. |
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The time in which an insurance policy remains active. For term life insurance, it is during this period only that protection is available upon the policyholder’s death. |
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An agreement containing the terms of the structured settlement agreement, the annuity contract, any qualified assignment agreement and any order or approval of any court, responsible administrative, or government authority that authorizes or approves of said structured settlement. |
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A body of law established to allow an injured party to receive compensation from the injuring party. When such injury is received, either through intentional assault or negligence, a court may demand that the guilty party surrender an amount of monies sufficient to instill an equivalent amount of suffering to that caused by their injurious action. |
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An insurer to which one pays premiums and upon which responsibility is placed for fulfilling all terms of the policy contract. |
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A life insurance policy that is at once term and lifelong insurance through paying out separate balances -- though one must die before the given date to gain the full amount, some assets are guaranteed to remain available until one’s actual death. |
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A contract between one and one’s insurer that establishes a variable insurance policy, rendering a flexible payment based upon the performance of a group of stocks rather than an agreed-upon amount. J.G Wentworth, however, does not presently purchase variable annuities. |
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A type of life insurance that renders a flexible payment based upon the performance of a group of stocks rather than an agreed-upon amount. Variable Life Insurance can be paid for in a single lump sum or through periodic payments, and they contain death benefits for policyholders who die before receiving payment. J.G Wentworth, however, does not presently purchase variable life insurance policies. |
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The selling or reassignment of a given life insurance policy. |
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A tax form released by the United States government which contains the taxpayer identification number of a given individual. |
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Monetary compensation that covers the expense associated with work-related injuries. If a worker should obtain such injuries, they are entitled to receive worker’s compensation, so as to protect their health and interests in the absence of pay. |
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Any and all death that is attributable to the negligent or intentional actions of an individual or a group, a wrongdoing entity. |
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Glossary
