Maturity: The point at which a policy's cash value equals its face amount. For policies satisfying the definition of life insurance under IRC §7702, endowment/maturity can occur no sooner than age 95. (Also see Endowment.)
Maximum Accumulation (Pricing Style): Policies identified as maximum accumulation policies are designed to perform optimally in defined contribution plan designs, where the policy buyer specifies the premium/contribution amount, and the insurer determines both the death benefit, and the cash value that will be accumulated (e.g., for retirement planning, deferred compensation funding, etc.). Maximum accumulation polices are defined as such by a cost structure comprised of both A) premium loads and/or cash-value-based "wrap fees" that are lower than representative averages, and B) cost of insurance (COI) charges and/or fixed administration expenses (FAEs) that are higher than representative averages (where representative average COI Charges, FAEs, premium loads and cash-value-based "wrap fees" are determined by Veralytic benchmarks).
Minimum Premium (Pricing Style): Policies identified as minimum premium policies are designed to perform optimally in defined death benefit plan designs, where the policy buyer specifies the policy face/death benefit amount and the duration of coverage, and the insurer determines the premium necessary to provide that death benefit for the specified period (e.g., for family protection, business continuity financing, estate/transfer tax financing, etc.). Minimum premium policies are defined as such by a cost structure comprised of both A) cost of insurance (COI) charges and/or fixed administration expenses (FAEs) that are lower than representative averages and B) premium loads and/or cash-value-based "wrap fees" that are higher than representative averages, (where representative average COI Charges, FAEs, premium loads and cash-value-based "wrap fees" are determined by Veralytic benchmarks).
Mixed (Pricing Style): Policies identified as mixed are designed to perform well in either defined contribution or defined death benefit plan designs, and as such, are designed to perform optimally where the policy buyer has a need for both traditional life insurance protection (e.g., for family protection, business continuity financing, estate/transfer tax financing, etc.) as well as wealth accumulation (e.g., for retirement planning, deferred compensation funding, etc.).
Mortality and Expense (M&E) Risk Charges: A separate charge made as a percentage of the account value to cover the insurer’s potential deficiencies in the explicit cost of insurance and expense charges. In the absence of poor experience, the M&E risk charge contributes to insurer profits.
Mortality Cost: The cost imposed on the policyholder by the insurance company to cover the amount of pure insurance protection for which the insurance company is at risk. With term insurance, the insurance company is generally exposed to risk of loss for the entire face amount of the policy. With permanent insurance, the net amount at risk for the insurance company is the difference between the policy’s death benefit and the cash value.
Mortality Table: A table that presents expected death rates by individual age. The death rates vary from one mortality table to another depending upon the type of experience on which the data is based. Large insurance companies will often develop their own mortality tables based on experience under their own policies.