Accelerated Benefit Provision

A provision in many new policies which will allow policy owner to receive a portion of death benefit early if 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 insured dies from accidental causes.

Certificate

A document provided to a person insured under a group insurance policy that provides evidence that 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 term of policy.

Dependent protection

Where 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 life insurance company keeps confidential, but uses to decide whether policy can be issued and what premiums will be charged.

Face Amount

The amount to be paid to beneficiary when insured dies.

Free Look

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

Grace Period

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

Guaranteed Insurability

An option that permits policyholder to buy additional stated amounts of life insurance at certain times in 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, benefit payable on death increases and is particularly useful to avoid 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 required premium is not paid.

Level Term Life Insurance

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

Loan Value

Life Insurance is insurance that provides protection against economic loss caused by death of person insured. There are several types of Life Insurance, each having different characteristics. Some of key types of Life Insurance are: Term Life, Whole Life, Burial Insurance, Survivorship Life, Universal Life, and Variable Life Insurance. Outlined below is a useful description of each type:

Term Life Insurance

Term Life Insurance is lowest cost and simplest product available. Term insurance is a life insurance contract that provides protection for a limited number of years. The death benefit is only payable if death occurs during agreed-upon term. There are various types of Term Insurance Life Policies:

Level Term Life Insurance

means that your premiums are set at a level at beginning of contract and do not move up or down. The sum assured will remain same throughout term.

Increasing term insurance

This is a fixed term policy where sum assured will increase, either by a set percentage or by Retail price index (RPI) throughout policy term. Your premiums remain level throughout term if sum assured rises by a set percentage, or will rise according to RPI if sum assured does same.

Renewable term insurance

This is policy lasting for a smaller period, usually five years, which can be renewed, although sum assured cannot be increased, whilst premiums will increase with age.

Renewable increasable term insurance

is same as above but provides for an increasing sum assured.

Convertible term insurance