Definitions of Insurance Agency terms as used by Trent Advisors in The Villages, FL. 22 terms defined.
The Annual Enrollment Period (AEP) runs from October 15 to December 7 each year, allowing Medicare beneficiaries to change their health or prescription drug coverage. Decisions made during this window take effect on January 1 of the following year.
An annuity surrender charge is a fee assessed when funds are withdrawn from an annuity before the end of the contract's surrender period. These charges typically decline over a set number of years and are designed to discourage early withdrawals.
A beneficiary designation names the individual or entity that will receive proceeds from a life insurance policy, annuity, or retirement account upon the owner's death. These designations override instructions in a will and should be reviewed after major life events.
A fiduciary advisor is legally and ethically required to act in the client's best interest when providing financial advice. This standard is higher than the suitability rule and helps minimize conflicts of interest related to product recommendations and fees.
Final Expense Insurance is a small whole life policy designed to cover end-of-life costs such as funeral services, burial, and outstanding medical bills. Coverage amounts typically range from $5,000 to $25,000 and often require minimal underwriting.
A Fixed Indexed Annuity is a contract with an insurance company that credits interest based on a market index's performance, while protecting principal from market losses. These products are often used in retirement planning for guaranteed lifetime income options.
Flood insurance is a standalone policy that covers damage caused by rising water, which is excluded from standard homeowners insurance. Coverage is available through the National Flood Insurance Program (NFIP) and private carriers, with typical waiting periods of 30 days before activation.
Golf cart insurance provides liability, collision, and comprehensive coverage for low-speed vehicles used on streets, paths, and courses. In communities where carts are a primary mode of transportation, this coverage protects owners from theft, accidents, and bodily injury claims.
A Guaranteed Issue Right is a federal protection that requires insurance companies to sell a Medigap policy regardless of health status in certain situations, such as losing employer coverage. These rights have strict time limits, often only 63 days from the qualifying event.
An HO-6 policy is a form of homeowners insurance specifically designed for condominium owners. It covers the interior of the unit, personal property, and personal liability, while the condo association's master policy typically covers the building's exterior and common areas.
A hurricane deductible is a separate, often percentage-based deductible that applies to home insurance claims caused by named hurricanes. In Florida, these deductibles typically range from 2% to 10% of the dwelling coverage limit and apply per calendar year.
Indexed Universal Life (IUL) is a permanent life insurance policy that ties cash value growth to a stock market index like the S&P 500. It offers a floor to protect against losses while capping potential gains, blending death benefit protection with tax-advantaged accumulation.
Long-Term Care Insurance helps cover the cost of services such as nursing home stays, assisted living, and in-home care that traditional health insurance and Medicare typically do not pay for. Premiums are generally lower when policies are purchased at younger ages.
A Medicare Advantage Plan, also known as Part C, is a type of health coverage offered by private insurers approved by Medicare. These plans bundle Original Medicare benefits and often include prescription drug coverage, dental, vision, and hearing services in a single plan.
Medigap, or Medicare Supplement Insurance, is a private policy designed to cover out-of-pocket costs that Original Medicare does not pay, such as copayments, coinsurance, and deductibles. These policies are standardized and labeled by letters like Plan G or Plan N.
A Qualified Charitable Distribution (QCD) allows individuals age 70½ or older to transfer up to $105,000 annually directly from an IRA to a qualified charity. The distribution counts toward the RMD and is excluded from taxable income, offering meaningful tax savings.
A Required Minimum Distribution (RMD) is the minimum amount that must be withdrawn annually from traditional IRAs and most employer-sponsored retirement plans starting at age 73. Failing to take the RMD can result in significant IRS tax penalties on the shortfall.
A Roth Conversion is the process of moving funds from a traditional IRA or 401(k) into a Roth IRA, paying income taxes on the converted amount in the year of the transfer. Future qualified withdrawals from the Roth grow and distribute tax-free.
A Special Needs Trust is a legal arrangement that holds assets for a person with disabilities without disqualifying them from government benefits like Medicaid or SSI. It can be funded by family members, settlements, or life insurance proceeds for ongoing care.
Tax-loss harvesting is an investment strategy that involves selling securities at a loss to offset capital gains and reduce taxable income. The proceeds are typically reinvested in similar, but not identical, assets to maintain the portfolio's target allocation.
Term life conversion is a policy feature that allows a term life insurance holder to switch to permanent coverage without a new medical exam. Conversion options are valuable for individuals whose health has changed since the original policy was issued.
Umbrella insurance is an extra layer of liability coverage that kicks in once the limits of underlying auto, home, or boat policies are exhausted. It is commonly used to protect personal assets from major lawsuits, judgments, or catastrophic claims.