Life Settlement Glossary

U

unbundled contracts

For life insurance, universal life type policies where the elements of mortality, expenses, and interest are fully disclosed to the policyowner.

underwriter

The individual within a life insurance company who is responsible for reviewing personal and medical information in order to assign a risk class for new life insurance applicants.

underwriting

The process of evaluating, classifying, and pricing life insurance or life settlements.

underwriting department

The department within a life insurance company or life settlement provider that is responsible for carrying out the underwriting function.

underwriting impairments

Factors uncovered during the life insurance underwriting process that result in the payment of substandard premiums.

underwriting requirements

A list of the essential information that is needed to properly evaluate, classify, and price a proposed insurance risk.

unearned premium

The portion of an insurance premium that applies to the unexpired part of the policy period. Even though premiums are paid at the beginning of a policy period they are not completely earned by the company until the end of the period. For some life insurance policies, however, unearned premiums are still retained by the insurer even if a policy is cancelled mid-term.

uninsurable risk

A life insurance risk that cannot be covered for any amount at any cost.

universal life insurance

Otherwise known as flexible premium adjustable life insurance, an unbundled life insurance product consisting of guaranteed and non-guaranteed mortality costs, expenses, and interest earnings.