Guide to Life Insurance Terms

Listed below is a useful guide to life insurance terms. It is a list of definitions of life insurance terms that may or may not be familiar to you.

Accelerated Benefit Provision

A provision in many new policies which will allow the policy owner to receive a portion of the death benefit early if the insured person is diagnosed with a terminal illness or permanently confined to a nursing home.

Accidental Death Benefit

A provision added to a policy that provides an additional benefit if the insured dies from accidental causes.

Certificate

A document provided to a person insured under a group insurance policy that provides evidence that the coverage exists.

Convertible Term Insurance

These policies allow conversion, without further medical evidence, to a different type of policy from an insurance company's range.

Decreasing Term Insurance

The sum assured decreases each year throughout the term of the policy.

Dependent protection

Where the protection is required on a permanent basis rather than just for a specified term.

Evidence of Insurability

Medical and other information about a person applying for insurance that the life insurance company keeps confidential, but uses to decide whether the policy can be issued and what premiums will be charged.

Face Amount

The amount to be paid to the beneficiary when the insured dies.

Free Look

The right of the policy holder to have a period of ten or more days to examine an insurance policy, and if not satisfied, return it to the company for a full refund of all amounts paid.

Grace Period

A period of time after the premium due date when an overdue premium may be paid without penalty. The policy remains in force throughout the period.

Guaranteed Insurability

An option that permits the policyholder to buy additional stated amounts of life insurance at certain times in the future, without having to provide new evidence of insurability.

Illustration

A document used in life insurance sales presentations showing year-by-year numbers indicating how a policy will work.

Increasing Term Insurance

Under this option, the benefit payable on death increases and is particularly useful to avoid the sum assured being eroded by inflation.

Insured

The person whose life is covered by a life insurance policy.

Lapse

The discontinuation of insurance without cash value when the required premium is not paid.

Level Term Life Insurance

In this form a policy will pay out a fixed sum on death during the term.

Loan Value

The amount which can be borrowed by the policy holder from the company using the value of the policy as collateral.

Mode of Premium Payment

The frequency of premium payments during the policy year. Premium payments can usually be made on annual, quarterly, or monthly basis.

Mortality Table

A statistical table showing the death rate for each age.

Nonforfeiture Options
A provision in the policy that allows the policy holder to choose how the cash value of the policy will be used if the policy is surrendered or lapses due to non-payment of premium.

Ownership

All rights, benefits, and privileges under a policy controlled by the insured.

Paid-Up Insurance

A life insurance policy where all premiums have already been paid, with no further premium payment due.

Policy

The printed document issued to the policy holder by the company stating the terms of the insurance contract.

Policy Year

A one-year period starting on the day and the month the policy was issued. The first policy year starts on the date of issue, and ends on the day before the policy's first anniversary date.

Premium

The payment a policy holder is required to make to an insurance company to purchase insurance coverage and to keep the policy in force.

Rated Policy

A policy issued with an additional premium to cover the extra risk involved if an insured has impaired health, a hazardous occupation or hobby.

Reinstatement

The restoring of a lapsed or surrendered policy to full force and effect.

Renewable Increasable Convertible Term Insurance

This contract combines the options of increasing the sum assured, converting the policy and renewing the contract.

Reviewable Term

Level term assurance with an option to renew the contract at the end of the term, without the need for further medical evidence.

Rider

A provision added to a policy that provides additional benefits.

Settlement Option

The manner in which the insured or beneficiary may choose to have the policy proceeds paid.

Suicide Clause

A policy provision which reduces or eliminates the amount to be paid if the insured dies from suicide.

Surrender

To voluntarily terminate or cancel a policy for its cash value.

Term Life Insurance

This type of policy runs for a specified time period.

Underwriting

The process of evaluating applicants for insurance and classifying them fairly, so the appropriate premium rate may be charged

Waiver of Premium

A provision added to a policy that will waive the premium payments required by an insured during the total disability of the insured.

Jerry Warner writes general finance and loan articles for the Bad Credit Loans Online website at http://www.badcreditloansonline.co.uk

Term Life Insurance and Permanent Life Insurance
Term insurance and permanent insurance are two basic types of life insurance. Term life insurance is temporary, and it covers...

Whole and Term Life Insurance Online Quote - Things You Should Know Before You Commit
When investigating life insurance you will surely come across the terms whole life and term life. Knowing what these life ins...

Your Guide To Home Insurance Exclusions
It is a fact that homeowners insurance is not legally compulsory. However, as the unexpected so often happens these days, it ...

The Different Types of Life Insurance Explained
There are numerous companies existing today that offer life insurance policies. Though the crux of the policy (to ensure a sa...

Life Insurance - An Income Protection Measure
Life insurance is basically an income-protection measure. If the insured person is the sole bread earner of the family and he...

Life Assurance Provides For Survivors
Life assurance is insurance protection purchased in which the insured individual's death results in payout of benefiting to s...

A Free Term Life Insurance Quote Is Very Easy To Obtain
By searching online for life insurance, you can get a free term life insurance quote with no obligation to buy. In order to g...

Compare Life Assurance Options To Get Best Plan
When considering a life assurance plan to provide financial security for family survivors in the event of death, many people ...

Texas Whole Life Insurance vs Term Life Insurance
Before you decide to buy whole life insurance over its counterpart, Term Life Insurance, it is crucial for you to understand ...

Why You Should Be Buying Last To Die Life Insurance
It seems a grissly subject but it's going to happen eventually so we'd best be prepared. So what is last to die life insuranc...

Affordable Life Insurance
Life Insurance is something we usually start thinking about when we have dependents. Life Insurance falls into two broad cat...

Email Marketing - Secrets of the Most Successful Email Marketing Campaigns
A successful email campaign can go a long way. To make your email campaign successful you must be able to persuade your audie...

Life Insurance Basics
It is sometimes said that life is but a span and if something bad happened to you, your family would have to go through a ver...

California Life Insurance Quote
With this simple to follow guide, finding a California life insurance quote will be no problem at all. Many people do not kno...

Online Life Insurance Quotes - Important Factors To Consider When You Compare And Shop Online
The advent of the internet has made is easy to shop, compare and obtain life insurance quotes online. With just a few clicks ...

Life Insurance Coverage
The subject of life insurance can be a confusing one and we spend a lot of time discussing various ways to buy life insurance...

Online Life Insurance Cover Helps for Sorting Options
Online life insurance cover gives customers a great opportunity to more efficiently sort through life insurance products and ...

Do You Want Cheaper Life Insurance Quotes? Then You Mustn’t Miss Great Tips
You must NOT miss great tips if you are serious about enjoying cheaper life insurance rates. And as you get those tips, do yo...

How to Get the Best Term Life Insurance Rate
No one likes to think about life insurance, but as a responsible adult, you need to make sure your family will be financially...

Senior Life Settlement Can Help Retired Individuals In Times Of Need
Every person wants to provide the very best for his or her family and hence, makes various plans to ensure financial stabilit...