What are Nonforfeiture values?

Nonforfeiture Values — in whole life insurance policies, benefits that accrue to the insured when the policy lapses from nonpayment of premium. These benefits are usually either an amount of paid-up term life insurance or a cash surrender value.

What is a Nonforfeiture clause?

A non-forfeiture option. (or clause) is a provision included in certain life insurance policies stipulating that the policyholder will not forfeit the value of the policy if the policy lapses after a defined period due to missed premium payments.

What is an example of Nonforfeiture option?

Life insurance policyholders can select one of four nonforfeiture benefit options: the cash surrender value, extended term insurance, loan value, and paid-up insurance.

What are the 3 Nonforfeiture options?

There are three nonforfeiture options: (1) cash surrender; (2) reduced paid- up insurance; and (3) extended term insurance. If a policyowner chooses, he/she may request a cash payment of the cash values when the policy is surrendered.

What does the Nonforfeiture clause give the policy owner?

A nonforfeiture clause is an insurance policy clause that is included in standard life insurance and long-term care insurance. It stipulates that a policy owner will receive partial or full benefits or a refund of premium paid towards a whole life insurance policy if the policy lapses due to non-payment.

What is an example of a Nonforfeiture value?

noun Insurance. any benefit, as cash or other form of insurance, available to a life-insurance policyholder who discontinues premium payments on the policy.

What is the purpose of Nonforfeiture options?

A nonforfeiture option is a clause in your policy that allows you to receive full or partial benefits from your life insurance if the policy lapses or you want to cancel the plan. Reduced paid-up insurance is a nonforfeiture option that is included with your life insurance coverage.

What is an incontestable clause?

In insurance: Other provisions. Perhaps the best-known is the incontestable clause, which provides that if a policy has been in force for two years the insurer may not afterward refuse to pay the proceeds or cancel the contract for any reason except nonpayment of premiums.