Glossary

The Ganadian Life lnsurance Course (LLOP)TABLE OF CONTENTS

Glossary ........i

Module 1.' WELCOME TO THE LIFE INSURANCE INDUSTRY.........................1-1

PART 1

Module 2: TIJE LAW AND LIFE INSURANCE....... .....2-lSummary of Key Points ................2-91

^lIodule 2b: TIJ.F" LAw AND LIFE TNSURANCE: Case Studies zb-l

.lIodule 3.'UNDERWRITING AND CLAIMS...a........... ................3-1Summary of Key Points

.r[odule 4.'PROFESSIONALISM.. .....4-lSummary of Key Points ................4-27

.r[odule 5; THE NEED FOR INSURANCE....... ..............5-lSummary of Key Points ................5-25

rlodule 5D; THE NEED FOR INSURANCE: Case Studies ...... 5b-1

LESSON 1: The Mathematical Calculations of lnsurance............ .Sb-2

LESSON 2: Ratios, Compounding and the Rule of 72........ ..........5b-4

LESSON 3: The Time Value of Money .........5b-4

LESSON 4: Matching Needs to Products ............ .........5b-7

LESSON 5: lntegrating Financial Planning with Life and Health lnsurance 5b-13

PART 2

Module 8.. INDIVIDUAL DISABILITY AND ACCIDENT & SICKNESSINSURANC8................;.....,....... ......8-1

Summary of Key Points ................g_4g

\lodule 8r.' HEALTH INSURANCE FOR INDIVIDUALS: Case Studies.......... 8b-L

Module 9.' GROUP INSURANCE ......... ...........................9-1Summary of Key Points ................9_3g

PART 4Modale 10.' INVESTMENT BASICS

Summary of Key Points rc47

Module 10r.'INSURANCE INVESTMENTS .............................. 10b-1Summary of Key Points 10b-50

Module 10c.' INVESTMENTS: Case Studies ........o...10c-1

Module 11.' RETIREMENT .,..........................o...........o.....o.....o....................................11-l

Summary of Key Points

Module 11r.. RETIREMENT: Case Studies 11b-1

Bonus Modulez EXAM PREPARATION ................12-1

Index..... ..............,....o.......... ....I-1

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Glossary

ubsolute ussignment' the transfer of all of the rightsof the original policy owner to another pafty,including the right to appornt a benefictary.

uccelerated death beneJit: a rider that pays all orsome of the face amount of the policy to the lifeinsured thereby reducing the amount of deathbenefit the beneficiary will ultimately receive (alsoknown as a living benefit rider or a terminal illnessbenefit).

accidentul deuth and dismemberment: an accidentaldeath benefit that also provides coverage fordismemberment, such as the loss of a limb.

uccidental deuth bene/it: a payment made, inaddition to the face value of the policy, if the lifeinsured dies in an accident (also known as doubleindemnify).

accident & sickness insurunce: provides all orpartral coverage for medical and dental expensesthat are not covered by provincial health plans.

accrual taxution: tax that is imposed on the growthin afi investment. Accrual taxation is normallyapplied to investments producing returns such as

interest, dividends, and capital gains. Registeredinvestment products and exempt life insurancepolicies are not subject to accrud taxation.

occrued rate annuity: an annuity in which taxes arepaid on an accrued basis resulting in tax decliningannually.

accumuluted vulae: the net amount paid for a

deferred annuity plus interest.accutnuluted fund: the pool of savings built by

deposits to a universal life policy.(rccumulation period: the period between the date a

deferred annuity is purchased and the beginning ofannuity payments during which the value of thedeposit grows.

actively-ut-worlr provision: specifies that if anemployee is absent from work on the day the groupinsurance contract is due to begin, (because ofsickness, injury, or certain other specified reasons)coverage will not begin until the day the employeerefurns to work.

actual uuthorityt the authority given to an agent toperform certain tasks.

adjustable premium: premiums that change over thelife of a whole life policy.

adjusted cost base (ACB).' a dollar representation, fortax pu{poses, of the policy owner's cost of capitalproperty, e.g. the amount spent to buy a cottage.

arljusted cost basis (ACB): a dollar representation,for tax pu{poses, of the policy owner's cost of apolicy, e.g. premiums paid.

adverse selection: the concept of providing insurancecoverage for people because they ate a member ofa group and not because they need coverage.

ugency contruct: the arrangement between theprincipal and the agent.

ullowunce: a monthly benefit paid to residents ofCanada who receive the OAS and have little otherincome.

uvnendment: a document that an applicant must signto indicate that he or she accepts a rated policybefore it is issued.

unnuitant: the person who receives the paymentsfrom arr annuity or the proceeds of a segregatedfund on death or maturity of the fund contr act.

annuitizution: when a pension fund is converted toan annuity.

unnuity certnin' also known as a term certainannuity. Pays annuitant a guaranteed amount foreither a defined period, a period ending at aspecified zga, or a period equal to the number ofyears from annuitants age at the time of purchaseand age 90 or until his or her spouse turns 90.

annuity option' offers the owner or beneficiary threepayment options: monthly installments guaranteedfor life, &S a joint and last survivor annuity for thecontract holder and his or her spouse, ?S a variableannuity, installment refund or cash refund.

unnuity units: the number of units (based on dga,gender, and the prevailing interest rate) paid eachmonth to the contract holder or benefic tary of asegregated fund.

unnuiQ: an investment that pays a sum of moneyannually or at other regular intervals.

any occupotion (uny occ): a definition of disabilifythat means a person is considered disabled if he orshe is unable to work at anyjob.

appurent uuthorityt the implied or suggestedauthortty granted to an agent, even if this was notthe intention of the principal.

assignment: assignments of insurance policies can beabsolute or collateral, and can be made to a person,a chanty, or corporation.

ussuming compuny: the reinsurer who accepts thetransferred risk when the retention limit has beenreached. (

uutomutic premium loun (APL): a non-forfeiturebenefit which automatically charges unpaidpremiums as a loan against the cash surrendervalue of a policy.

uverage monthly pensionoble eurnings (AMPE):used to determine the amount of monthlyretirement pension.

overage tux rate: one of two tax rates, also known as

effective tax rate.bsck-end load: a sales charge that is applied at the

end of a contract.

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back-end surrender charge: a charge that may beapplied tf a policy is surrendered.

busic group AD&D.' can insure different classes ofemployees at rates that can' be a multiple of salary.Premiums are paid by the employer.

basic promise: the promise in the policy thatidentified the life insured, the amount of theinsurance payable, when and where that amount ispayable, and to whom it is payable.

beurer form: the bearer of the bond can sell the bondand collect the interest from the coupon.

beneJiciary: the person who receives all amountspayable when the conffact holder dies.

bene/it' income or payment received by the policyowner.

beneJit period: the length of time an income will bereceived.

beneJit schedule: identifies the amount of lifeinsurance coverage or the method by which theinsurer will determine the amount of coverage.

best earnings pluns: a employer-sponsored pensionbased on the average of the best years ofpensionable earnings. Usually 3 to 5 consecutiveyears.

bond: represents a debt of a government orcorporation to the bondholder.

business overhead policy.' covers business overheadexpenses when the prime revenue earner is unableto produce because of an accident or sickness thatcauses disability.

bay-sell ugreement: a legal contract between theseller (the sole proprietor, partner, or shareholder)and the buyer. These agreements, funded with lifeinsurance, provide the benefictary with sufficientfunds to acquire the deceased's interest in theproprietorship, partnership, or corporation.

culluble bond: can be redeemed by the issuer beforethe maturity date under certain conditions.

Canadu Educution Suvings Grant (CESG).' thecontribution to an RESP made by the federalgovernment.

Cunudu Pension Plan (CPP): a federal governmentretirement and disability pension.

Cunadu Suvings Bonds.' issued by the federalgovernment with regular or compound interest. Aminimum interest rate is guaranteed for one ormore years, depending on the issue.

capitul guins tux: a tax on financial gains made oncapttal prop erty inve stments .

capitul losses: when caprtal property is worth lessthan its purchase price and can be used to offsetcapttal gains.

capitul property.' investments such as stocks, bonds,mortgages, real property, mutual funds, andsegregated funds.

capitul retention approach: the capital required toprovide the annual cash needs of the survivors.Also known as the capital needs approach.

capitulizution of income: based on the calculation ofthe present value of the survivor's share of theincome stream that the deceased person wouldhave received had he or she lived. Also known as

the human tife value approach.capituliT,ed value: dete.rmines how much would have

to be in-vested at a certain rate of refurn to equal theamount of money a person would earn in a year.

coreer average earnings plun: a employer-sponsoredpension plan where the employee receives apension credit in every year of employment basedon employment income for that year.

carry 'forwurd: a feafure of RRSPs that allows aperson to carry forward any unused contributionindefinitely and apply it to subsequent years.

cuse low: another truttta for common law.cush refund unnuity.' guarantees the annuitant an

income for life. If the annuitant dies beforereceiving payments equal to the purchase price ofthe annuity, the difference befween the purchaseprice and the total amount received is paid to eithera beneficiury or the annuitant's estate in a lumpsum.

cush surrender vulue (CSV): the money in the policyreserve which can be accessed by the policy ownerand received in cash. The value of the CSV ispremiums plus interest, less costs.

certfficote of insurunce.' the document or bookletwhich a group plan member receives that outlinesthe benefits and other relevant details regarding themaster contract held by the employer.

children's bene/it: the beneflt a child receives whena palent who was a CPP contributor dies.

churning.' occurs when an agent seeks to replace anin-force policy with an eiisting insurance companywith a new policy from the same company for thepurpose of generating a new commission.

cluim: the application made on behalf of an insuredto recover benefits due as a result of death,disability, or accident.

cluimunt: the person or legal entily that is claimingthe benefit from a life insurance policy.

cluwbuck: a special tax which "claws back" all orpart of the OAS pension from high income earners.

-codes of ethics: ethical conduct guidelines that havebeen established by the Canadian Life and healthInsurance Association (CLHIA) and Advocis.

coercion: intimid attng, threatening, or using undueinfluence to obtain insurance business.

co-insurunce factor.' is expressed as percentage of aninsurance claim that is paid by the insurer.colluteral assignment: when a policy is assigned to a

financial institution as security for a loan.

colluteral lW insurance: a life insurance policyassigned as collateral for a loan.

common law: the law which comprises the bulk oflaw in Canada with the exception of the Provinceof Quebec. Common law is based on custom andusage dating from ancient unwritten laws inEngland and which were collected together and

established as the Common Law of the Realm. Alsoknown as case law.

common mistake: a mistake made in a contract thataffects both parties. Also known as a mutualmistake.

common shares: shares which represent ownershipin a company and which give the holder votingrights. Dividends are paid on common shares ifdeclared by the board of directors of the company.

compounding.' occurs when an person reinvestsdistributions from an investment (e.g. interest), so

that he or she is earning growth on growth (e.g.

interest on interest).conflicting interest: an interest that would likely

have an adverse effect on an agent's judgment,advice, or loyalty to a client or prospective client.

considerution: a part of a contract which indicatesthe exchange of value.

constructive notice: information given by anapplicant to an agent is deemed to have been givento the insurer.

contestable: the policy can be made void within twoyears of its date of issue if mistakes are discoveredby the insurer.

contingent beneficiury: a beneficrary who wouldreceive all or part of the insurance proceeds if theprimary beneficnry is not living when the policymatures.

contract holder'.' the owner of a contract.contruct of adhesion: the term used for a life

insurance contract because the applicant eitheraccepts or declines all of the terms and conditionsof covercge that are set out in the contract. There isno opportunity for negotiation.

contruct: a promise or a set of promises that the lawwill enforce.

contructs under seal: do not require the elements ofoffer, acceptance, and consideration to be

enforceable, but do require a seal.

contributory plun: the group member contributestowards the premium for group insurance.

conversion privilege: a clause that allows convertibleterm policies and policies with term riders to be

converted to permanent life insurance withoutevidence of insurability.

Glossary

coordination of benefits guidelines: guidelinesdeveloped by the Canadian Life and HealthInsurance Association to coordinate extendedhealth cate and dental benefits paid under groupplans to ensure that benefits do not exceed totaleligible expenses.

co-pay.' when the group insured must pay a fixedpercentage of costs. Also called co-insurance.

corporute bond: evtdence of a corporate debt.corporution: an incorporated company. An

incorporated company issues shares andshareholders are entitled to certain rights (e.g. suchas the right to receive financial information aboutthe comp zny, and to attend shareholder'smeetings).

cost illustrutions: point-of-sale tools used to illustratehypothetical policy dividends and other benefitsderived from life insurance products that are notguaranteed.

cost of living udjustment (COLA).' an adjustmentmade to help some incomes keep up withinflation. As an insurance rider benefits willincrease according to the amount of increasespecified in the rider.

coupon bond: interest coupons are attached and canbe presented for payment.

creditor: a person or an institution that is owedmoney by another.

criss-cross flgreement: a buy-sell agreement whichhas all partners or shareholders insuring the livesof each other.

critical illness insurunce (CII): designed to managethe risk associated with contracting certaindreaded diseases.

critical loss: where financial ruin is a possible result.cross-purchuse ugreement: afi agreement that names

the buyer of the business as the policy benefictdry,when the business is a sole proprietorship. When the

owner dies, the buyer receives the face amount ofthe policy. That money is then used to buy thebusiness from the heirs of the deceased.

crystallizution: when a taxpayer dies and all accruedincome, and capttal gains and losses must be

reported in the year of death.current yield: reflects the annual rate of return on an

investment.deuth benelit' the money which is paid to the

benefictary upon death of the insured.debenture: a bond which is supported by the general

credit worthiness of the issuing corporation.debt securities: investments involving a loan given

by an investor in return for regular payments ofinterest plus a repayment of the loan on a

specified date.

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debtor.' a person who owes money.decreasing term insurunce: (infrequently used) term

insurance which provides a level premium over a

long term, a decrease in the face amount each year,and a death benefit paid to the beneficuary for theface amount in force at the time of death of the lifeinsured during the term specified in the policy.

deductible: an amount the insured pays beforepayment is received from the insurer.

deferred unnuity: an annuity that begins at a futuredate. The annuity ean be purchased with either asingle premium or a series of premiums.

deferred profit-shuring plan (DPSP).' a trust createdfor all employees of a company, or one or moreclasses of employees of that company, andregistered with CCRA.

deferred sales charge.' the investor pays a salescharge when all or part of the original investment isredeemed. The sales charge declines over anagreed-upon number of years until, at the end, thecharge is eliminated.

de/ined beneJit plan: a employer-sponsored pensionplan where the employee knows exactly how muchhe or she is going to pay for the pension and howmuch he or she will receive when retired.

deJined contribution plun: pools contributions of theemployer and the employer to provide the pension.Also called a money purchase plan.

dependency period: the time following death duringwhich the surviving spouse must have sufficientincome to provide care for the children until theyoungest reaches the age of eighteen.

dependent ltfe: provides a specified amount in a

lump-sum payment to the group member in theevent that his or her spouse dies.

deposit-based guuruntee: when deposits are made ona periodic basis to a segregated fund, and whencompanies make the maturity date calculation onthe basis of each deposit.

derivutive: a financial product that is derived fromand based upon another financial product, such as a

stock market index, a commodity, etc.

direct writer: the insurer that issues a policy.disability buy-out insurunce: can only be used for

businesses that have buy-sell agreements in place.It allows partners, owners, or shareholders of a

business to purchase the share in the business heldby another partner, owner, or shareholder whobecomes disabled.

disubility income beneJit: a rider that provides a

monthly income, after a waiting period, when thelife insured is totally disabled. This rider can onlybe added to a two-p afi contract.

disabili$ income insurunce: provides a monthlyincome to those unable to work because of arr

accident, sickness, or disability.

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disubility.' as defined in a policy (for example, it maycover a physical impairment but not a mentaldisability); however, the disability must result froman accident or sickness that occurred while thepolicy was in force, and the disability must requiremedical attention.

dispositiorr.' when a life insurance policy is disposedof. Disposition has tax consequences.

distributions: the periodic payments of interest ordividends made by mutual funds or segregatedfunds.

dividends (corporute): a share of profits that havebeen earned by the corporation and distributed toshareholders on a pro-rata basis. Dividendpayments are not guaranteed.

dividends AW insurunce): an overpayment ofpremiums by the participating policy ownerreturned to the policy owner in annual dividendform. They are not guaranteed and there are anumber of ways the dividends can be received. See

special term additions andpremium ffiet.dollur-cost averaging: achieved when the same

amount of money is invested regularly over a

period of time.dread disease beneJit: payable when death is caused

by one of a number of specified diseases, such as

cancer.due diligence: betng able to show that a reasonable

basis exists for the recommendations given.earned income (fo, RR^SP und tux purposes):

income from all sources. Earned income for taxpurposes includes investment income (interest,dividends and capttal gains) whereas earnedincome for RRSP purposes does not includeinvestment income.

eurned income (fo, disubility insurunce): includessalary, wages and commissions, royalties, alimonypayments, net research grants, and net businessincome.

effictive dute.' the date upon which the policy takes

effect and the coverage starts.eliminution period: the time between the occuffence

of the disability and when benefits begin. Thewaiting period during which benefits are not paid.

embezzlement' stealing and using another's money.Embezzlement is a criminal offence.

employee assistance programs: provide professionalconsultation to employees and their families toprovide immedtate support, education, and access

to resources for a wide range of employee needs,

such as counseling for stress and dependencyproblems.

employer-sponsored pension plun: a fundestablished by an employer to provide a retirementincome for its employees. Often, both employersand employees can contribute to the plan.

endowment policy: a variation of a whole life policywhich pays the face amount if the life insured dieswithin a specified period of time (the endowmentperiod).

equiQ: common or preferred shares.errors und omissions insurance (E&O): professional

liability coverage carried by insurance agents andinsurers against lawsuits claiming mistakes inprofessional judgment, andlor failure to properlyexecute the steps of putting a policy into effect.

estute: a term commonly used on a person's death torefer to all of his or her assets.

ethicul conduct: the measure of a life insuranceagent' s business character and his or her adherenceto the codes of ethics established by CLHIA andAdvocis.

evidence of the contruct: the insured's applicationand the insurer's policy.

exclusion rider: a rider that excludes some coverage.exclusions: benefits denied under certain

circumstances.execution portion of policy: the part of the policy

that confirms the date of issue of the policy andwhen signed by the officers of the insurancecompany, finaltzes the contractof insurance.

exempt policy.' provides tax benefits to the policyowner because the growth in the policy is not taxeduntil its disposition.

exemption test: policies last acquired since December2, 1982 must pass an annual test on the renewaldate to determine whether the policy is classified as

exempt or non-exempt.expense louding.' the allocation of part of a premium

toward the payment of the insurer's operatingexpenses.

expiry dute: the day term insurance coverage ends.extended eliminution period umendment: a

limitation in a disability policy that extends theelimination period when a claim arises from a pre-existing condition.

extended term insurance (ETI): an option whichallows a policy owner who stops paying premiumsto keep coverage in force by using the cashsurrender value as a single premium to buy terminsurance.

fuce umount: the amount of the insurance payable.

face pnge: describes the basic components in thepolicy. Also known as the schedule.

failure of others: when others do not fulfillobligations they have made to you and you facerisk resulting from their inaction.

fuir market value.' the value of an item based on theprice if neither the buyer or seller are under duressand both are fully informed about the value of theitem.

Glossary

fo*ily deductible: an amount the insured pays for allfamily members covered under the group planbefore payment is received from the insurer; theamount is reduced if the single deductible is paidbefore the family deductible.

Jidaciary duty: the responsibility of confidentialityand trust.

fidaciury relationship: the relationship between afiduciary (someone having a responsibility ofconfidentiality and trust) and his or her client.

Jinol uveroge enrnings plans: a employer-sponsoredpension based on the final income-earning years.

/inanciul services.' the insurance industry is oneelement of Canadian financial services which alsoincludes banking and securities.

Jiscal policies.' determine how the government willraise income through taxation and how thegovernment will spend that income.

Jixed-term unnuity.' a term certain annuity.IIat beneJit plans: a employer-sponsored pension

plan that specifies the age and the number of yearsof service that are required before the employee iseligible for the benefiL

forgery.' something written or prepared in writing todeceive, such as a false signature. Forgery is acriminal offence.

fruud: a fraudulent misrepresentation intended tocheat or deceive.

fraudulent misrepresentation: a false representationwhich a party makes deliberately, knowing it to befalse, and with the intent of deceiving the otherparty to enter into the contract.

front-end loud: a sales charge that is applied at thebeginning of a fund contract.

fully-insured plan: a group plan where the policyowner pays a premium and the insurer pays allclaims. Under this plan, it is possible for claims toexceed premiums.

fature contructs: contracts that involve acommitment to buy or sell a specific quantity of anasset, at a specific price, for delivery during aspecific period of time.

groce period: the 30 or 31-day period during whichthe policy remains in full force before a policy islapsed for non-payment of a premium.

grundparented policy.' a policy last acquired beforeDecember 2, 1982. The policy owners do not haveto report income accruing for tax pu{poses.

gross premium: the net premium of a policy plus theexpense load.

group creditor life: provided to creditors to insure thelife of their debtors.

group insurunce: pools the risk of individualmembers of the group to provide insurance withoutrequiring evidence of insurability.

The Canadian Life Insurance Course

group retirement suvings plun (GRSP).' providesbenefits similar to those offered by individualRRSPs except the employer administers them on agroup basis. Employees contribute by wagededuction, matched in whole or part by employer.

growth allocation: the process of distributing growthin a segregated fund to each contract holder.

Guurunteed Income Supplement (GIS): monthlybenefits paid to residents of Canada who receivethe OAS and have little other income.

guuranteed insurubility: a benefit that protects thelife insured from becoming uninsurable by givingthe policy owner the right to buy more lifeinsurance at certain times.

Guuranteed Investment Certfficutes (GIC{: afiinterest-paying investment in which principal andinteres t are guaranteed.

guoranteed policies.' whole life policiespremiums and face amounts that arechange over time).

gaoronteed return' ellsures an rnvestor willpredetermined amount of growthinvestment.

hazards.' contribute to perils and can be bothor moral.

receive aon the

physical

health insurunce: sold through accident and sicknesspolicies, it reimburses the insured for out-of-pocketexpenses.

high severity/low frequency risks: risks that have a

low likelihood of occuffence, but that would causesevere losses should they occur.

holding out: how an agent presents himself or herselfto the general public. A licence to sell lifeinsurance must be obtained before a person can beidentified or held out as a licenced life insuranceagent.

home buyer's plan' allows an RRSP plan holder towithdraw up to $20,000 from his or her RRSP forthe purchase of a home under certain conditions.

haman life value upprouch: based on the calculationof the present value of the suryivor's share of theincome stream that the deceased person wouldhave received had he or she lived. Also known as

the capitalization of income.immediute annuity beneJit' purchased with a single

premium. Income begins at the end of the firstannuity period after it is purchased (e.g. if theannuity period is one year, the first payment isreceived one year after the annuity has beenpurchased.

importunt /os,s.' where financial adjustments arerequired that will reduce the standard of living.

in kind: arry assets not in the form of cash but whichhave a cash value.

income payments: cash provided under the cashsurrender value that is received as periodicpayments over a period of time.

income splitting: a term used to describe strategiesused to save taxes by diverting income from a hightax-bracket family member to a family member in alower tax bracket.

incontestable clauses.' clauses that state that a lifeinsurance contract is incontestable by the insurerwhen it has been in effect continually for two yearsafter the issue or reinstatement date.

increosing term insurunce: term insurance whichcovers a life that is increasing in economic value,such as an essential employee whose salaryincreases annually.

individual vuriable insurance contruct QVIC).' thecontract that buys into a segregated fund.

inflution protection: the level of protection againstlosses caused by inflation that an investor requires.

informution folder.' the disclosure document ofsegregated funds which provides the investor withinformation regarding the fund.

innocent misrepresentation: a false representationmade without the intent to deceive the other party.Also known as negligent misrepresentation.

inspection report: detail any hazardous recreationalor occupational activity of the policy applicant, as

well as financial data on both policy holder and lifeinsured.

installment refund annuity.' guarantees the annurtanta set number of payments equal to the purchaseprice. If the annuitant dies before receivingpayments equal to the purchase price of theannuity, the difference between the purchase priceand the total amount received is paid to either a

beneficLary or the annuitant's estate in installments.insuruble interest: when the death of the insured

would be detrimental or cause harm to the persontaking out the insurance.

insured: the person who is the owner (policy owner)of the policy and pays its premium.

insurance regulutors: regulators of the insuranceindustry and segregated funds.

interest rute-sensitive policies.' policies that arelinked to interest rates and react to changes ininterest rates. (Also known as new money plans).

intestate: when a persol dies without leaving a will.investment returns: the refurns (growth in value)

investors receive on their investments.irrevocable beneficiary: the policy holder cannot

change the beneficnry unless the beneficuaryagrees in writing to the change.

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issue and participution limits: designed to protectagainst overinsurance. They consider how muchincome a disabled person is earning from allsources, and provide the difference between theinsured's limit and what is already being received.

joint Jirstflast to die: a contract in which more thanone life is insured and settlement is made to eitherthe survivor (first to die) or the beneficrary (last todie).

joint and last survivor annuiQ.' provides a

guatanteed income during the course of twopeople's lives.

key employee: an important employee whose deathwould cause the business a devastating blow.

key person disubility insurance: insurance used tocover a person who is a key employee. There arethree parties to this contract: the policy owner(business), the insured (employee), and the insurer.

know your client rule: part of the Code of Ethics forlife insurance agents which states that an insuranceagent must make every effort to understand his orher client's needs and financial sifuation.

law of agency.' allows a client to purchase lifeinsurance without direct contact with the insuranceagency.

legal cupacity: a person's legal ability to alter theirrights, duties, or obligations (for example, byentering into a contract or writing a will).

Ievel death benefit plus cumulutive gross premium:the level death benefit of a universal life policyplus the amount of each gross deposit beforepremiuffis, taxes, deductions, and expenses.

level term insurance: term insurance which specifiesin the policy exactly how much the insurance willcost, how much it will pay out, who will receivethe death benefit, and when the insurance expires.

leveraged deferred compensation plon (LDCP):combines the benefits of a universal life insurancepolicy with a loan in retirement.

Ieveraging: when borrowed money is invested.Iiability risk: when a person intentionally or

unintentionally inflicts personal injury on someoneelse, or causes damage to another's property.

IW annuity with u guorunteed number of puyments:provides afi income that is guarafiteed for a

specified period of time or until the death of theannuitant after that period of time. If the annuitantdies before the end of the period, the balance of thebenefits afe paid to the beneficrary until theguarantee period ends. If the annuitant outlives theguatanteed period, payments continue until the lastinstallment before his or her death.

Iife annui$.' makes income payments for the lifetimeof the annuitant.

Glossary

lW income funds (LIF): retirement fund into whichthe accumulated savings in a Locked-in RRSP,LIRA, another LIF, locked-in pension funds, or a

pension fund may be transferred and then paid outto the fund owner as retirement income.

life insurunce: insurance which provides financialprotection against financial loss resulting fromdeath.

life insured: the person whose life is insured by thelife insurance contract.

life retirement income funds (LRIF): a vatiation onthe life income fund (LIF) in which there is norequirement to purchase afi annuity by age 80.

lW struight annuity: pays a gvaranteed income forlife.

Itfelong learning plan: allows an RRSP plan towithdraw up to $20,000 for educational expenses.

limited payment umendment: a restriction in anindividual disability income policy that limits thebenefit period when a claim is made resulting froma pre-existing condition.

limited puyment ltfnt another form of whole lifeinsurance. Premiums on these policies are limitedand only payable for a certain period or to a certainage.

linear reduction method: the adjustment made to asegregated fund contract when there is a

withdrawal that reduces the value of the contract bythe dollar amount withdrawn.

Iiquidity.' the ease with which investments can beconverted to cash or near cash.

loads: sales charges for a mutual or segregated fund.Iocked-in plans: a restriction under the Pension

Benefits Standards Act that prevents a person fromcashing-out pension benefits to ensure that theperson has an income for lift. Pension monies mustbe placed in locked-in plans if the pension planmember wishes to transfer his or her plan out of theemployer- sponsored plan.

Iocked-in income retirement account (LIRA).' a formof Locked-in RRSP into which pension benefitsmay be transferred from an employer's plan whenthe employee leaves the company prior to the age

of retirement.Ioching in: when vested money is locked in to arr

RRSP, a LIRA, or LIF account until the employeeretires or to a date specified in the plan.

long-term cure benefit' payable when the healthcondition of the life insured requires long-termeare, such as in a nursing home.

long-term disubility policy.' has a benefit period offive years or longer. Benefits begin after short-termdisability or government benefits end.

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The Canadian Life Insurance Course

look-see period: the ten days that a policy owner hasto decide whether or not to keep the policy afteracknowledgement of receipt of the policy. (Alsocalled the rescission period).

loss prevention: controlling risk byfrequency of loss.

loss reduction: controlling risk byseverity of loss.

reducing the

reducing the

management expense: fees that cover the cost ofrunning a segregated fund.

marginal tax rute: the rate at which an individual istaxed.

murket risk: investments thf move with the market.If the stock market moves down, the value of theinvestment moves down.

murket value udjustment; when an annuity contractis surrendered, or an early withdrawal made, afladjustment is made to the interest rate on which thefixed benefit annuity is based.

muster contruct: the group insurance policy which isgiven to the policy owner, usually an employer.

muteriul /oss.' where financial adjustments arerequired.

material misrepresentution: a misrepresentation of afact such that, if the truth had been known, a

reasonable insurer would have refused to issue theinsurance or would have charge a higher premiumfor it.

muturity guorantee: provides for the guaranteedreturn of at least 7 5% of the initial deposit to a

segregated fund 10 years after the date the contractis signed by the investor.

muximum tux sctuarial reserve MTAD.' the namegiven to the specified amount used in the annualexemption test to determine whether or not a policyis tax exempt.

meeting of the minds: when the parties have agreedto all the details of a contract.

minors.' individuals who have not reached the age ofmajority as defined in the province where theyreside.

misrepresentation: when one of the parties to a

contract has been induced or persuaded to enterinto the contract through the misrepresentation (orfalse representation) of the other party.

mistake: when a mistake has been made about thedetails of a contract and there has been no meetingof the minds.

modul factor.' arr additional charge factored into thepremium cost to reflect additional costs associatedwith the processing of insurance premiums that arepaid monthly or quarterly, rather than in a singlepayment.

monetary policy.' how the government manages themoney supply.

morbidity experience: the classification byoccupation based on the probability of sickness andirUuty occurring.

mortoliQ churge.' the cost for insurance protection ina universal life policy.

mortulity rutes: the number of people expected to dieat a given dga, based on 1,000 people of the sameage.

mortality tobles: the tables used by underwriters inthe calculation of life insurance premium rates.

municipal bonds: issued by municipalities. Usuallyterm or serial bonds. Most are non-callable.

mutual compunies: companies owned bypolicyholders.

mutuul funds: pools of money managed byprofessional fund managers, funded by investorswith similar investment objectives. The fund'sportfolio may consist of a variety of investments.

mutual mistuke: a mistake made in a contract thataffects both parties. Also known as a commonmistake.

negligent misrepresentation: a false representationmade without the intent to deceive the other party.Also known as innocent misrepresentation.

net usset vulue (LYAV): the net assets in a mufualfund minus liabilities, divided by the number ofunits outstanding.

net cost of pure insurance (IVCPD.' the life insurancecost within the poli.y.

net deuth benejit' the face value of the policy plusany extras the policy owner may be entitled toreceive.

net premium outluy.' the difference betweenpremiums paid and premiums received.

no-load fund: a fund that charges no sales fee butusually compensates by charging a highermanagement expense fee.

nominul rute of return: the "named" rate of refurnfor an investment (i.e. a GIC that pays 4% interest;4% is the nominal rate of return).

non-contributory plan' the group policy owner, oftenthe employer, pays the full premium for the groupinsurance.

non-discriminatory beneJits schedule: all employeesin a group plan receive the same coverage.

non-exempt policy.' the policy owner must report theincome that is accruing in the policy yearly.

non-forfeiture options also called non-forfeiturebenejits.' a benefit or value that allows coverage tocontinue even if premiums are not paid. There arethree non-forfeifure values: automatic premiumloan, extended term insurance, reduced paid-upinsurance.

non-purticiputing policy.' a whole life policy whichdoes not pay dividends.

v111

non-refundable tox credit: the amount of the credit isrefunded only when tax is owed (charitablecontribution).

notional units; theoretical units assigned to investorsin segregated funds so that they can monitor thegrowth of their investment.

occuputionsl classiJicution: the five categories intowhich occupations have been classified based onthe likelihood of a claim being made. Theclassification is based on the hazard inherent in thejob and the likely duration of the disabilrty that willresult from work in that occupation.

offer und ucceptunce: afi essential element of a

contract, also know as mutual assent or bargain.old age security (OAS): a monthly pension payable

to all Canadians or legal residents age 65 and overwho apply for the benefit and meet residencerequirements.

open-ended investment fund: a pooled investment inwhich new units ate continuously sold to newinvestors and existing units are redeemed upondemand by the fund.

option' a contractual right or obligation to buy or sella specific quantity of a security at a specific price,within a stipulated time period

over-contribution: a lifetime and cumulative limit of$2,000 over the RRSP contribution allowed beforea penalty of lo/o per month is charged on the overcontribution.

overhead expenses: expenses incurred in running abusiness.

overinsuronce: paying more to a disabled personthan the person received as earned income.

own occupntion (own occ): a definition of disabilitythat applies to a person who is unable to performthe essential duties of his or her own regular orprevious occupation.

puid-up addition: where dividends are used to buyadditional paid-,rp insurance.

paid-up insurance @UI): an option when a policyowner stops paying premiums to convert the cashsurrender value to a reduced face amount of thesame policy type.

por policy: a whole life participating policy (paysdividends).

purent waiver.' allows all fufure premiums to bewaived if the parent dies or becomes totallydisabled, until the child is a certain age, or until theend of the contract.

purtiul dispositions.' dividends and policy loans madeafter March 31, l9l8 are considered to be partialdispositions.

purticipating policy: a whole life policy which paysdividends.

purtnership debt: the responsibility of a partner forthe debts incurred by the partnership.

Glossary

purtnership interest: a share in the partnership whicha partner is able to sell at a fatr price to the otherpartners, if desired.

partnership property.' property owned by apartnership which a partner may sell at a fair priceto the other partners, if desired.

purtnership: a business entity owned by a group oftwo or more individuals.

pust service pension odjustment' the adjustment anemployer makes to an employee's pension plan forthe years the employee worked for the employerbefore the pension plan was implemented.

past service benefits.' pensions for employees whohave worked for their employer prior to theimplementation of the pension plan by theemployer.

puy-direct plun: the insured is provided with a druginsurance plan card to pay for the drugs and thepharmaey bills the insurer directly.

pecuniury interest.' opportunity to profit financiallyfrom an investment or circumstance.

pension udjustment' the value of benefits accruing ina company-sponsored RPP or a DPSP. Pensionadjustment for any current year must be deductedwhen calculating the allowable RRSP contributionfor the subsequent year.

pensionuble earnings.' the amount of income onwhich the pension contribution is based.

perils: exposure to pure risk that leads to loss.permonent insurance: insurance which insures for

life.personul contruct: a contract in which the insured

and the life insured are the same.personul income needs approach: identifies the

needs of dependents and family members that mustbe met in the event of the loss of a major incomestream.

personul risk: risks that directly affect individualsand their dependents.

policy loun: loans made against the cash surrendervalue of a policy. Most insurers limit loans to 90oA

of the CSV.policy owner.' the owner of a policy, the policyholder.policy reserve: a portion of whole life policy

premiums which accumulate to form a policyreserve.

policy-bused guaruntee: when deposits to asegregated fund are made on afi on-going basis(such as monthly) and the maturity date iscalculated annually, thereby starting anew the ten-year guarantee period.

portfolio: an investor's holdings of stocks, bonds, etc.power of attorneJl: the appointment of a person to

look after financial affairs of someone whobecomes incap acrtated due to sickness, accident, orother mishaps.

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The Canadian Life Insurance Course

precedent: a past or present decision of a judge of acourt that serves as the guiding principle in similarcases in other courts.

pre-existing condition: a disability or illness whichexists at the time of application.

preferred shares: a fype of share that entitles the

owner to a dividend ahead of any dividends paid tocommon shareholders. Preferred shareholders

fypically do not have voting rights.

premium: legally, the consideration for the contract:

in other words, the payment required to bring the

policy into force and to keep it in force.

premium offiet: when dividends from a whole lifepolicy are used to reduce the cost of premiums.

premium portion of policy: part of the face page ofthe policy that sets out the amount and method ofpayment, as well as the frequency and duration ofpremium payments.

premium rebuting.' prohibited by provinciallegislation and association by-laws. Premiumrebating usually occurs when an agent offers to payall or part of the premium required by the policy, itmay also involve a grft, promotion, or inducement.

prescribed annuity.' annuity payments are a blend ofcapttal and interest. The caprtal is spread evenlyover the expected payment period and the balance

of each payment is the interest. The interest portionis subject to tax, while the capital portion is tax-free.

present value of a single sum: a formula used to

illustrate how much money must be invested

presently, in order to grow to a desired amount, at a

specified time in the future.present value of money.' the value of money in

today's terms for money paid in the future.presumptive disubility cluuse.' covers loss of limbs,

sight, hearing, or speech. Full benefits are payable

until the end of the benefit period or for liferegardless of whether or not the person can returnto work.

primary cowier: the insurer of group extended health

and dental plans that determines the benefits firstand then calculates the benefits as though duplicatecoverage does not exist.

principal guoruntee: the maturity guarantee ofsegregated funds and the death benefit.

probutionnry period: the length of time (usually one

to six months) that a new group mernber must waitbefore being eligible to join the group plan.

professional stundurds: rules and regulationsimposed by a wide range of players in the

insurance industry.proper| risk: risk faced by property owners of

having their properfy lost or damaged.

proportional reduction method: the adjustment made

to a segregated fund contract when there is a

X

withdrawal that reduces the value of the contract

according to the number of units surrendered

compared to the number of units prior to

withdrawal.prospectus: publication prepared by mutual fund

companies which provides specific informationregarding the fund.

provincial bonds: issued as a means to fund publicworks and guaranteed by the province.

pure risk: offers no chance of gain.qualtJication period: a period of time after the

accident or illness during which the insured must

be totally disabled, as specified in a policy with a

residual income benefit.qualitative information: information collected by a

life agent that reveals the client's lifestyle choices.quantitative informstion.' information collected by a

life agent regarding a client's assets, income, and

expenditures.

Quebec Pension Plsn (QPP).' the Quebec equivalentof the Canada Pension Plan.

quick puy: when dividends from a whole life policyare used to reduce the cost of premiums.

rated contract: a contract with higher premiumsoffered to applicants identified as special risk orsubstandard risk.

ruted premiums; higher-priced premiums.reudjustment period: financial support needed by

dependents while adjusting to a new standard ofliving after the death of the income earner.

real rate of return: the nominal, or "named" rate ofrefurn on an investment minus the current rate ofinflation.

recurring disability.' if a disability recurs or a newdisability begins within a period of time set out inthe policy's reculrence clause, it is treated as a

continuation of the original claim and not subject to

a new elimination period, but the benefit period isdeemed to begin at the start of the original claim,not the date of the reculrence.

re-entry term insurance: a form of term insurance

which provides guatanteed renewability. Those

who can prove good health will have a lowerrenewal rate than those who are unable to provide

evidence of insurability.registered bond: the owner is identified on the bond

certific ate.

registered educution savings pluns (RESPs): a

savings program developed by the federal

government to encour age parents to save for the

post-secondary education of their children.registered pension plans (RPP) : employer-sponsored

pensions, registered with CCRA, established byemployers for the benefit of their employees.

registered plun: a plan that has been registered withthe Minister of Customs and Revenue as requiredby the Income Tax Act.

registered retirement income funds (RRIF).' a fundregistered with CCRA to receive retirementincome. It is an account to which accumulatedRRSPs can be transferred without incurred tax atthe time of transfer.

registered retirement plun: one that has beenregistered with the CCRA so that tax advantagescan be received by the plan owner.

registered retirement suvings plans (RRSP): a

registered savings plan which is a tax shelter toassist individuals in saving for their retirementyears.

regulur occupation: a definition of disabled thatapplies to a person who is unable to perform theessential duties of his or her regular occupation.

reimbursement plan: the insured pays the cost of themedical service or drugs and is reimbursed by theinsurer.

reinstutement clouse.' a clause in the policy designedto assist when a life insurance contract lapses dueto premium non-payment.

reinsurance: part of the risk that is passed along to areinsurer if the retention limit is exceeded.

renewability: being able to renew an insurancepolicy.

replacement: a term used to describe the act ofsurrendering an insurance policy or part of thecoverage of an insurance policy in order to buyanother policy.

rescission: the right to cancel the policy within tendays of acknowledgment of receipt of the policy.

reset feuture: when investors decide to lock in thevalue of their segregated funds, thereby resettingthe maturity guarantee and maturity date of thecontract.

residual disubility beneJit' the benefit paidproportionate to pre-disability earnings. The lossmust be between 20-80% of pre-disability earningsto qualify for a residual benefit.

retention limit: the cap or upper limit that insurancecompanies place on an individual life.

retiring ullowunce: severance pay, sick leave credits,and court awards for wrongful dismissal that maybe transferred tax-free to an RRSP without usingup annual RRSP contribution limits.

retrocession: the process of sharing the risk amongseveral insurers or retrocessionaires.

revocuble beneJiciary.' the policy owner may changethe beneficrary named in an insurance contract atany time, in writirg.

riders: policy extras. Premiums are higher based onthe riders that are attached to the policy.

Glossary

right of redemption' the issues of the investment canrepurchase or redeem them at a time and price thatis set out in the security itself.

right of withdruwul: the right of unit holders towithdraw their investment by submitting their unitsto the mutual fund.

rights: options granted to shareholders to purchaseadditional shares directly from the company thatissues them.

risk: the probability of suffering harm or loss in thefuture. Another definition is the price volatility ofone type of security compared to the price volatilityof another.

risk uvoidance: the easiest way to reduce risk butavoiding all risk is not possible.

risk control: by loss prevention, which reduces thefrequency of loss, or by loss reduction, whichreduces the severity of loss.

risk Jinuncing: includes transferring risk andretaining risk.

risk frequency.' the probability that a loss will occur.risk munogement: the process of planning for risk.risk retention.' when a person accepts or retains all or

part of a given risk.risk severity.' the dollar cost of a loss.risk tronsfer: shifting some or all of the cost of a

potential loss to a third party.rule of 72: illustrates how long it takes for an

investment portfolio to double in size when itsincome is reinvested.

schedule: describes the basic components in thepolicy. Also known astheface page.

secondary currier.' the insurer of group extendedhealth and dental plans that determines the benefitssecond and then limits its benefits coverage to thelesser of the amount that would be paid by theprimary carrier or I00% of all eligible expensesreduced by all other benefits payable for the sameexpenses by the primary carrier.

segregated funds (seg fand): an investment fundheld by an insurance comp dfry, in which the fundsare separate from the other assets of the insurancecompany.

self-directed plun: the RRSP plan holder's assets areadministered by a bank, trust company, orinvestment dealer. A11 investment decisions aremade'by the plan holder.

self-insured plan: the group policy owner pays allclaims.

settlement: the amount paid to the beneficrary whenthe life insured dies.

settlement options: the options available to thebeneficiaries to settle the contract when the lifeinsured dies.

short-term disubility policy.' has a benefit period oftwo years or less.

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}

The Canadian Life Insurance Course

simple contruct: a contract that can be enforced as

long as there is an offer and acceptance and also aconsideration (an exchange of value) between theparties.

sole proprietorship: a business entity owned and

operated by one person.speciul risk: a rating assigned to some life applicants

who arc at high risk for some reason usually due tohealth, habit, or occupation.

special term additions: a one-year renewable termpolicy that is equal to the cash surrender value ofthe policy at the end of the policy year. Alsoknown as the fifth dividend option.

specialty contruct: does not require the elements ofoffer, acceptance, and consideration but does

require a seal. Also known as contracts under seal.

speculative risk: a risk where someone can achieve a

gain.stundurd group: must have a minimum of 25 people

for group insurance purposes.stock companies: companies owned by shareholders.stock market indices.' statistical tools used to

measure the state of the market or the economy.struight lW: the most cornmon form of whole life

policies. Premiums are paid over the entire lifetimeof the life insured.

stripped bond: interest coupons have been removedand sold separately.

structured settlement annuity.' used to settle largeaccident and liability claims that result in seriouspeffinanent disability.

subrogution: a legal process that allows an insurancecompany to assume the policyholder's right tocollect damages from a third party.

substandurd risk: a rating assigned to some lifeapplicants who are at high risk for some reason.

suicide exclusion cluuse.' suicide is excluded as a

cause of death for which the death benefit is paid ifit occurs up to two years after the policy is issued.

supplementury benefits.' policy extras. Premiums are

higher based on the supplementary benefits that are

attached to the policy.survivor income plan' provides ongoing income for

the spouse and dependent children of a deceased

group life plan member.survivor lW income needs: the period of time, which

may be life long, during which the survivingspouse requires income.

tubles of non-forfeiture: the tables the policy ownercan use to determine the value of the non-forfeitureoptions in the policy.

tux brackets: the division of taxpayers into categoriesbased on level of income.

tax credits: a direct reduction in tax.

tax dedactions: expenses, payments, andcontributions that are allowed to be deducted fromtaxable income.

tax defercal: tax is paid at a later date.

tuxuble beneJit: an employer-provided benefit that istaxed in the hands of the employee.

taxuble income.' income received during the year thatis subject to Canadian income taxes.

temporury insurunce ugreement (TIA): a temporarybut binding contract between the insurancecompany and a prpposed life insured to providecoverage during the underwriting process.

term additiozrs.' uses the whole dividend of a wholelife policy to buy a non-renewable one-year termaddition that will be paid if the life insured diesduring that year.

term certsin annuity: an annuity that pays an incomefor a pre-determined period of time or to a specificage.

term insurunce: life insurance for a specific periodof time.

terminul illness beneJit' payable when the death ofthe life insured will occur within six months as

declared in a doctor's certificate.terminul tax return' the final tax refurn filed in the

year after the death of the taxpayer.term-to-I0| insurance: a hybrid of term insurance

and permanent insurance which provides a term-type policy to age 100. For most people this wouldprovide coverage for life

third party contruct: a contract in which the insuredinsures the life of another person (the life insured).

tied selling.' when a financial institution requires a

client to transact other business with the institutionas a condition of doing business.

time horizon: the length of time avallable for moneyto be invested before it is needed.

time vulue of money: the sum of money receivedtoday is worth more than if the same amount ofmoney is received in the future.

time-weighting.' income based on the length of timenotional units in a segregated fund are held.

tolerunce for risk: the level of risk a person isprepared to take in the purchase securities and

insurance.tort law: designed to compensate a person who has

been harmed for any damage caused by wrongfulcivil behaviour.

totul disobility.' is defined in the insurance policy bythe work the insured may be able to resume.

treusury bills: short-terrn investments issued by thefederal government and some provinces.

xii

trigger dute: a date established in a mandatory bny-out clause of a disability buy-out contract, whichstates when the disabled owner, partner, orshareholder must sell his or her share in thebusiness.

truisting.' when an agent induces a policyholder tosurrender or lapse a policy with one insurer andreplace it with another insurer, to the detriment ofthe policyholder.

unbundling: the listing separately of the cost ofinsurance, the guaranteed interest tate, and theexpense charges of the insurer in a universal lifepolicy.

underwriters: insurance officials who assess risks.underwriting: the process of assessing and

classifying the potential degree of risk that aproposed insured represents to an insurancecompany.

unfuir trude proctices.' the use of coercion, premiumrebating, and gifting to clients.

u nilateral contruct: term used for insurancecontracts because the insurance company is thetrnh' par-ty bound by the contract and is obliged totulfill the contract as long as premiums are paid.

unilateral mistake: a mistake made by one party thatma\. only be remedied if it is an obvious mistakerecoqntzed by the other parfy.

universal life insurunce: an interest rate-sensitiver.-rlicy that is a unique combination of insurance;;ld investment.

,, ttnislting premiums: when dividends from a whole":ie policy are used to reduce the cost of premiums.['an also be done from the account value of a

"nir.ersal life policy.,,"sriable unnuity.' takes the notional units credited to

:::e contract in a segregated fund and converts them: . annuiry units.

', cstrrgr the right of an employee to keep the previous;:riplover's pension contributions when switching. -'ns after, usually, two years of employment.

,,,:fuilteO' group AD&D.' arr option for employees: :,', ered by a basic plan that increases coverage.

*,,ltitirrg period: the period from the time a claim is:,:ule until benefits begin (provided in the policy).

q rr/l'er" of premium: a rider to a policy which ensures,:,rI the premiums on the policy are pard if the life:,sured becomes disabled.

,,1, utrrfint: a certificate that grants the holder the-:r.-\trTunity to buy shares in a company at a stated: :.; e over a specific period.

", h,tl€ life insurance.' perrnanent insurance available* ) straieht life or limited payment life. These:,..rcies are in force for the lifetime of the insured

--,j are guaranteed policies.,t ,x r 's 6as ic exemption (YBE): the amount of income:,: -,",\ uhich CPP contributions are not made.

Glossary

yesr's maximum pensionuble earnings (YMPE).' theamount of income above which CPP contributionsare not made.

yield to maturity: the refurn an investor can expect byholdin g an investment to maturity.

yield: refurn on investment.

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xll1