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M

Material Misrepresentation
A statement made to the underwriter before acceptance of risk, which is material to his decision in accepting and rating the risk.

Mature
When an insurance policy's guaranteed cash value equals the initial death benefit, it is said to "endow" or mature. Whole Life contracts typically endow at the insured's age 100.

Maturity Date
The date which the policy endows for its total face amount.

Maturity Value
The amount payable under a Whole Life insurance policy if the insured person lives to the last age on the mortality table on which the values of the contract were based.

Medical Examination
A medical history and exam completed by a doctor that the insurer may require of the applicant during the underwriting process – typically, paid for by the life insurer underwriting the application.

Medical Information Bureau (MIB)
A data pool service that stores confidential reports on the health histories of persons who, in the past, have applied for insurance from other member companies. Most insurers subscribe to this bureau to get more complete underwriting information.

Misrepresentation
Act of making, issuing, circulating, or causing to be issued or circulated any written or verbal statement that does not represent the correct policy terms. Also, use of a name or title for any policy or class of policies that does not reflect its true nature.

Moral Hazard
Hazard arising from any nonphysical, personal characteristic of a risk that increases the possibility of loss or may intensify the severity of loss for instance, bad habits, low integrity, poor financial standing.

Mortality
The frequency of deaths in proportion to a specific population.

Mortality Rate
The number of deaths in a group of people, usually expressed as deaths per thousand.

Mortality Table
A table showing how many members of a group, starting at a certain age, will be alive at each succeeding age. It is used to calculate the probability of dying in, or surviving through, any period, and for the valuation of an annuity. To be appropriate for a specific group, it should be based on the experience of individuals having common characteristics, such as sex or occupation.

Mortgage Protection Insurance
A type of Term Life policy which pays off the balance of a mortgage upon the death of the insured. Typically, the death benefit decreases according to a schedule that fits the declining payoff requirements of the mortgage.

Multi-Year Premium Mode
A premium payment option where future annual premiums are paid in advance at a discount.

Mutual Insurance Company
An insurance company in which the ownership and control is vested in the policy holders and a portion of surplus earnings may return to policy holders in the form of dividends. No capital stock exists.

Mutual Fund
Pooled money from shareholders that is invested in a variety of securities, including stocks, bonds and money market securities. Mutual funds offer the individual investor the advantages of diversification and professional management.

N

Net Cost
The out-of-pocket cost of owning any particular life insurance policy.

Non-Contributory
A term applied to employee benefit plans under which the employer bears the full cost of the benefits for the employees. One hundred percent of the eligible employees must be insured.

Non-Forfeiture Option
One of the choices available if the policy holder discontinues premium payments on a policy with a cash value. This, if any, may be taken in cash, as extended term insurance or as reduced paid-up insurance.

Non-Medical Insurance (Non-Med)
Life insurance issued based on the insured's statement of health with no medical examination required.

Non-Medical Limit
The maximum face value of a policy that a given company will issue without the applicant taking a medical examination.

Non-Participating Policy
A life insurance policy in which the company does not distribute to policy holders any part of its surplus. Note should be taken that premiums for nonparticipating polices are usually lower than for comparable participating polices. Note that some nonparticipating polices have both a maximum premium and a current lower premium. The current premium reflects anticipated experience that is more favorable than the company is willing to guarantee, and it may be changed from time to time for the entire block of business to which the policy belongs.

Nonresident Agent
An agent licensed to write insurance in a state in which he or she does not live.

Non-Tobacco Status
No cigarette or tobacco usage based upon company guidelines.

O

Occupational Hazards
Occupations which expose the insured to greater than normal physical danger by the very nature of the work in which the insured is engaged, and the varying periods of absence from the occupation, due to the disability, that can be expected.

Operating Ratio
The sum of expenses and losses expressed as a percent of earned premium.

Ordinary Life Insurance
Life insurance usually issued in amounts of $1,000 or more with premiums payable on an annual, semi-annual, quarterly or monthly basis.

Ordinary Life
Permanent insurance that provides for the payment of proceeds at death or at policy maturity (if the insured is still living at that time). Also known as Whole Life Insurance.

Other Insured Rider
Rider which provides coverage to an eligible business or family member other than the insured.

Overhead Expense Insurance
Insurance for business owners to help offset continuing business expenses if the owner is disabled

Overriding Commission
Commission payable in addition to the original commission.

(some definitions taken from the National Association of Insurance Commissioners' Life Insurance Buyers Guide)