Glossary of Terms

  • Assured: The term refers to a person who is insured as per the terms of an insurance policy.
  • Benefit: The term indicates the money offered to the policyholder when a claim is made.
  • Bid Price: Bid price refers to the actual selling price or cash-in value of your unit holdings.
  • Bonus: The term associates to a with-profits policy. It is actually the amount of money added to the benefit payable under the policy. This amount depends on the profits made by the insurance company.
  • Convertible term assurance: This is a term insurance policy that offers you the option to convert your current policy to a whole-life or endowment insurance policy, that too without having to take further medical examinations.
  • Critical illness insurance: As per this policy, the insurance company pays out a lump sum on the diagnosis of life threatening illness as mentioned in terms of the plan.
  • Decreasing term: Under this scheme, the death benefit decreases each year as per your policy. Premiums however remain the same.
  • Endowment insurance: This type of a policy pays a stated amount of a stipulated period or upon the death of the insurance in case it occurs within that period.
  • Family income benefit: The dependents of the life insured get an amount for a set period.
  • Guaranteed Bond: Here, both principal & interest are assured by an entity.
  • Increasing Term: Here the cover & the payable amount get an increment each year.
  • Investment Bond: This bond is a combination of investment & life cover. The investments you make towards insurance policy are actually invested in the insurance company’s with profits of unit-linked funds.
  • Life fund: The term refers to unit linked investment funds run by life assurance or pension companies and used for individual holding life assurance policies to invest in.
    Maturity: The term refer to an agreed date when an endowment policy ends & the proceeds are payable.
  • Offer price: The buying price of fund units.
  • Premium: Amount paid to insurance company.
  • Proprietary: A life insurance company responsible for issuing its profits to its shareholders.
  • Qualifying Policy: A savings plan based on life assurance that is supported to be written for a minimum of 10-years & requires to meet certain qualifying policy criteria.
  • Renewable Term: Term insurance that may be renewed for another term without evidence or insurability.
  • Single premium policy: Here only one lump sum is paid for an insurance policy.
  • Sum Insured: The guaranteed amount of money that is pay under an insurance policy prior to any bonuses added to it.
  • Surrender value: The amount entitled to an insurance policyholder on discontinuation of the coverage. The term is not applicable to all types of life insurance policy.
  • Terminal bonus: A extra bonus determined upon a death or maturity claim payment. The amount depends on the profits made by the company.
  • Utilized with profits fund: The policy can be invested in UK & overseas shares, property, fixed interest securities & cash.
  • Unit-linked: Also known as unitized, the term refers to a state where some of your money is utilized towards purchasing ‘units’ in a fund.
  • Whole life insurance: The insurance offers a death benefit to the policyholder as it builds up cash value.
  • Without profits: The term indicates the amount of money paid out when a policy reaches maturity or upon the death of policyholder.
  • With profits: Associates to insurance policies that combine investment with protection.
  • With profits bond: Under this policy your lump sum is often invested in a unitized with profits fund.