MORE SETTLEMENT OPTIONS
o JOINT LIFE INCOME
o FIXED AMOUNT INSTALLMENTS
• NON-FORFEITURE
o CASH SURRENDER VALUE
o REDUCED PAID-UP INSURANCE
o EXTENDED TERM INSURANCE




Joint Life Income
This option is used primarily towards the support of family members such as
parents. Joint Life Income continues in chosen equal monthly installments,
which continue till at least one payee is alive. Hence, in case the insured dies,
monthly payments continue to beneficiaries for the rest of their lives. The
value of these payments depends upon the age of the beneficiaries at the time
they begin to receive benefits, and the policy proceeds. What differentiates
this option is that beneficiaries do not have the flexibility of receiving these
payments as a lump sum amount.
Fixed- Amount Installments
The amount of payments, and the frequency of these payments, is chosen by the
beneficiary; proceeds that are held by the insurance company earn interest. If the
payments exceeds the interest earned, the proceeds held by the insurance
company decreases until the total proceeds are paid out. However, the
beneficiary does have the option to withdraw the unpaid balance at any time. In
the event of the beneficiary’s death before the payments are completed, the
balance is paid to the beneficiary’s estate.
Non-Forfeiture Options
In case the policy owner is unable to continue premium payments, non-forfeiture options
are included in insurance polices. The following are the five options currently available:
1. Cash Surrender Value
2. Reduced Paid up Insurance.
3. Extended Term Insurance.
4. Automatic Loan Provision.
5. Dividend Accumulations to Avoid Lapse.

1. Cash Surrender Value

A policy owner has the option to surrender the policy; with a request to be paid
the cash surrender value. Usually, a policy will have a cash value only after the
policy has been held for two to three years. The component of the cash value
that is paid to the policy owner is the original cash value plus the value of paid up
additions and dividends. This value can be reduced in the event of any
outstanding loans and accrued interest on these loans. Cash surrender value is
normally paid in a single lump sum.

2. Reduced Paid-up Insurance

If a policy owner wishes to have a reduced amount of paid-up insurance in force
under the same policy, he/she may request the insurance company to use the
cash value of the original policy for this purpose. The policy will have a reduced
face value, but will continue to earn cash value and dividends, if applicable.

3. Extended Term Insurance

The policy’s cash surrender value is used to calculate how long the face value of
the policy will remain in force after premiums are discontinued. The length of time
that this can happen is calculated by taking the policy’s cash surrender value and
the insured’s age and sex at the time the premium payments were discontinued
into the account. This cash surrender value is then used to purchase term
insurance for a specified time.