Lnsurance Glossary Of Terms
Assured - Those insured under the terms of an insurance policy.
Benefit - The money paid to the policyholder when a claim is made.
Bid Price - The selling price or cash-in value of your unit holdings.
Bonus - Relates to a with-profits policy.
The amount of money added to the benefit payable under the policy. The amount is dependent upon the profits made by the insurance company.
Added bonuses cannot be taken away.
Convertible Term Assurance: A term insurance policy that enables you to instantly switch from your existing coverage to a whole-life or endowment insurance policy. medical examinations.
A policy that pays out a lump sum upon the diagnosis of one of the listed life-threatening conditions is known as critical illness insurance.
Decreasing Term: This type of term life insurance has a death benefit that declines yearly in accordance with your policy.
Premiums remain level.
These certificates are regularly offered for sale as mortgage insurance. For this policy, there is no surrender value.
Endowment insurance is a type of insurance that pays out a certain sum at the end of a predetermined time or, if the insured person dies within that period, upon his or her passing.
Family Income Benefit is a type of term insurance that, as opposed to providing a single sum, makes periodic payments to the life assured's dependents.
Guaranteed Bond - A bond in which principal and interest are guaranteed by an entity other than the issuer.
Guaranteed Bonds can be income or growth.
Increasing Term - The cover and the amount you pay into the policy are increased by a specific percentage each year calculated on the original sum insured. Designed as a way to increase your life cover as your earnings increase.
Bonds with an investing component that also provide some life insurance.
The payments you make to an investment bond or insurance policy, which are often lump sums, are invested in the with-profits or unit-linked funds of the insurance firm (Life Funds).
Different types of bonds include the guaranteed bond and unit-linked single premium bond.
An investment that offers a fixed rate of interest and into which your chosen Life Funds may be placed, not to be confused with a firm or government bond.
Unit linked Investment Funds are typically referred to as life funds. These funds are managed by pension or life insurance companies.
Such funds are used for individuals holding life assurance policies to invest in. The fund's holdings are split up into a variety of divisions.
Units are distributed to investors in proportion to their investment when they make a contribution to a Life Fund.
An endowment policy's maturity is the predetermined day on which the proceeds, including any bonuses, become due and payable.
Mutual: A life insurance company whose policyholders who receive with-profits ownership.
Offer Price: The cost at which units of a fund are purchased.
The sum of money put into an insurance policy is known as the premium.
A life insurance firm that is proprietary distributes its profits to its shareholders.
A qualifying policy is a savings plan based on life insurance that must be written for at least 10 years and meet certain qualifying policy requirements to be eligible.
final payout is tax free.
Term insurance that is renewable without the need for additional proof of insurability.
Single Premium Policy: An insurance policy that is purchased for a single lump sum.
The amount that is guaranteed to be paid under an insurance policy, before any bonuses are added, is known as the "sum insured."
Not all life insurance plans will have a surrender value.
The amount that an insurance policyholder is entitled to receive when he or she discontinues coverage
Term Insurance - Provides policyholder with protection only. Life insurance payable to a beneficiary only when an insured dies within a specified number of years (the term).
If you live beyond the term you do not receive any payment. This is thought to be the cheapest type of insurance.
Terminal Bonus - This is an extra bonus determined when a death or maturity claim is paid.
When a claim is made, the terminal bonus is frequently only paid if the policy has been in existence for the required number of years.
The sum is determined by the insurance company's profits.
Another name for a unit-linked with profits fund is a unitised with profits fund. a specific kind of life fund that allows for cash, fixed interest securities, shares of UK and foreign companies, and real estate investments.
You purchase "units" when you make an insurance policy-based investment in this fund.
When an annual bonus is declared, you can either receive more units or it is added to the unit price on a daily basis. Due to the addition of bonuses the unit price does not reflect the value of the underlying investments.
Unit-Linked - Also called Unitised. If your insurance policy is unit-linked, some of your money is used to purchase 'units' in a fund.
Your policy's value at maturity will rely on how well the fund in which it is invested performs.
Usually refers to financial instruments like investment bonds, whole life insurance, and endowment insurance that provide both protection and savings.
Bond with a single lump sum life insurance premium that is unit-linked and spreads your investment over several life funds.
Whole Life Insurance - Whole life insurance provides a death benefit for the policyholder as it builds up cash value.
The policy remains in force for the lifetime of the insured, as long as premiums are paid according to the policy agreement.
You can choose insurance that pays out on death a guaranteed sum only, the sum plus any bonuses that have been added, or the sum plus any additional value from the increase of the invested funds.
Without Profits: When an insurance matures or the policyholder passes away, only the basic guaranteed payment is paid out.
You would not be entitled to any bonuses.