Each life insurance policy has ownership rights. Assignment refers to the transfer of these rights from a named beneficiary to another individual.
The current age of a person in years, months, and days. Attained age is one of the primary factors used to calculate life insurance premiums, with older individuals being assessed a higher premium than that of younger ones.
An individual who is entitled to receive benefits from a life insurance policy when the holder of said policy passes away.
A document typically given to an insured individual when an initial application is made. This document serves as a temporary proof of coverage until a permanent policy can be issued.
A mortgage loan which places restrictions on how high the interest rate can go. This is often during an introductory period or until a specific date has passed. A capped mortgage may not restrict the interest rate indefinitely, as the interest often increases once the restricted period is over.
A formal process in which an insured or beneficiary notifies the insurance company that he or she is due a specified payment according to the terms laid out in the policy agreement.
Term life insurance which can be switched to a whole life plan or savings account at a future date. This type of policy is normally only paid on if the insured dies during the specified term.
The type of loss against which the policy is written or (2) The monetary amount for which the insured obtains coverage.
An illness which is generally recognised by medical professionals as being life-threatening in most situations. Some examples of these include stroke, cancer, and heart attack. Instances in which a patient needs a major organ transplant or heart by-pass surgery or suffers from kidney failure may also be considered critical illnesses under many policies.
Critical Illness Only
A type of life insurance designed to pay a monetary sum only if the insured is diagnosed with a particular critical illness.
Death Benefit Only
A policy whereby a beneficiary is paid only in the event of an insured’s death.
Death or Earlier Critical Illness
A policy that is designed to pay out a sum of money if the insured passes away or is diagnosed with an approved critical illness.
Decreasing Term Assurance
A life insurance policy that runs for a specific time period or until an individual reaches a particular age. This type of policy decreases in value each year and has no value whatsoever when the specified term expires. It is often used to guarantee mortgages and may be referred to as a mortgage protection assurance policy.
Discounted Rate Mortgage
A mortgage whereby the lender reduces his or her standard interest rate for a certain time period. Once this period has expired, the borrower usually assumes the standard interest rate that is in effect at that time.
Certain conditions or hazards under which benefits for a particular policy will not be paid.
Happens when a life insurance policy comes to the end of its coverage period and is then terminated.
Family Income Benefit
A policy designed to pay out annual, semi-annual, quarterly, or monthly amounts to beneficiaries in the event an insured person is diagnosed with a critical illness or dies during a particular time period.
Fixed Rate Mortgage
A mortgage whereby the interest rate does not change for a particular time period.
A period of time beyond a premium’s due date. This time period allows policy holders who must make late payments to do so without losing coverage.
A renewable term life insurance that is effective for a specified period of time and cannot be terminated unless the insured fails to make timely payments.
A policy that allows for an increased amount of benefits to be adjusted each year. This adjustment is normally made to keep up with inflation.
The termination of a life insurance policy due to a lack of payment even after the grace period has expired.
Level Term Insurance
A type of life insurance in which coverage is specified for a period of time. It can also be promised until an insured reaches a particular age. Once the level term life insurance coverage period is over, the policy expires and does not contain any value.
How many years of age a person can expect to live based upon his or her age and mortality rate.
A document proving that an applicant has undergone a physical examination which states whether or not a person should be insured and giving evidence to justify denial of a claim or an individual’s insurability.
A plan which pays a sum of money over a certain time period and used to repay a capital and interest payment mortgage. It is usually only used whenever an insured passes away or is critically ill.
A life insurance policy which is underwritten based on an applicant’s affirmation of good health without requiring a medical exam or medical records review.
A certain condition which is characteristic of a particular occupation or industry which increases the risk of an employee becoming critically ill, having a debilitating accident, or their death.
Cost of a policy which may be assessed in annual, quarterly, or monthly payment amounts.
Product Type Term
A term life insurance policy which pays a lump sum in the event an insured is critically ill or dies during the period specified in the policy.
A company to which premium amounts are paid by an insured. This company also assumed the responsibility for making sure the terms of the policy are adhered to. An underwriter is also an individual who calculates and approves a particular risk factor and is also used to refer to the agent who sells a life insurance policy to an applicant.
Unit Linked Policy
When premiums are paid, the amount of these premiums is placed into an investment fund. The investment fund is then divided into individual units which fluctuate in value. As a result, the value of a unit linked policy also fluctuates in value based upon the value of the investments associated with each unit.
Waiver of Premium
A clause which allows for the waiver of premiums in the event an insured cannot work in his or her normal job occupation after a specified illness or injury.
Whole of Life Insurance
A type of life insurance which covers a person’s entire life rather than a fixed period of time. It is typically an investment-based policy whereby premiums are used to purchase shares in a trust fund or other type of investment. Whole of life insurance policies are typically reviewed at regular intervals and the premium rates adjusted according to the individual’s age and value of the policy.