Insurance glossary of terms

Provides -those who are insured under the terms of the insurance policy.

Compensation -money paid to the policyholder when the application is made.

Purchase price -the selling price or cash in the value of your unit.

Bonus -refers to the policy with profit. The amount of money added to the benefit due under the rules. The amount is dependent on the profits made by the insurance company. Added bonuses cannot be taken immediately.

Convertible term insurance -term insurance policy, which allows you to convert your current policy to whole life or endowment insurance policy without having to take further medical examinations.

Insurance for critical illness -policy which pays a fixed amount of diagnosis of the threat of diseases referred to in the terms of the plan of life.

Reduction of the term -a form of term life insurance, where the death benefit decreases each year of your rules. Premiums remain level. Often this type of certificate is sold as mortgage insurance. There is no value for this policy.

Endowment Insurance insurance policy that pays that amount at the end of a period of time or after the death of the insured, if it is within that period.

Compensation of income for a family -term insurance, which paid money for the assured life of subsistence for the specified period, not for lump-sum payment.

Guaranteed Bond -bond in which the principal and interest are guaranteed by an entity other than the issuer. Guaranteed bonds may be income or growth.

Increase the term -on the cover and the amount you pay in policy, be increased by a percentage each year, calculated on the original sum insured. Designed as a way to increase the coverage of his life to increase your earnings.

Investment Bond -combines investment with some coverage of life. Payments you make to an insurance policy or investment bond, usually a lump sum, are placed in the insurance company with profits or units of funds (life funds). Different types of bonds include the guaranteed Bond and units of a bond premium. Not to be confused with company or Government bonds, investment, offers a fixed interest rate and the area where your chosen can be invested for life.

Life Fund -usually this refers to unit linked to investment funds. These are from life insurance companies or pension funds. These are used for individuals with life-assurance policies to invest in assets held within the framework of the Fund are divided into several units. When an investor contributes to the life fund units shall be allocated to investors in proportion to their investments.

Maturity -agreed date when complete endowment policies and revenue, including bonuses due.

Mutual -insurance company, which is owned by its policyholders with the profits.

Offer a price -the price at which the Fund is buy units.

Paidpremium -amount of money in the insurance policy.

Non-proprietary -insurance company which issued its profits to shareholders.

Qualification policy -life on savings plan which must be written to at least 10 years and must meet certain qualifying criteria for the policy to ensure that final payment is tax.

Renewable term -term insurance, which may be renewed for a term without proof.

Single Premium policy -when a lump sum shall be paid for the insurance policy.

The insurance amount amount of money that is guaranteed to be paid under insurance policy before you add all of the premiums.

Surrender Value -is not applicable for all life insurance policies. The amount which the insurance policy is entitled to receive when he/she discontinues coverage

The term insurance -provides policy with only protection. Life insurance payable to the beneficiary only when the insured dies within a specified number of years (term). If you live outside of the term does not get any payment. This is considered the most costly type of insurance.

Terminal bonus -this is an extra bonus, based on death or maturity of claim has been paid. The Terminal bonus is paid often only if the policy has been in force for a minimum number of years at the time of the request. The amount is dependent on the profits made by the insurance company.

Unitised with profits Fund -also known as Unit-Linked with profits Fund. Type of life Fund to invest in the United Kingdom and the overseas shares, property, fixed interest securities and cash. When you invest in this Fund through an insurance policy, buy "units". When the annual bonus is declared, or you can get more units or added to the unit price on a daily basis. The addition of the premiums of the unit price does not reflect the value of the underlying investments.

Units -also called Unitised. If the policy is units, some of the money you used to purchase units in the Fund. The value of your rules of maturity will depend on the growth of the Fund, in which rules are invested. Usually refers to policies that offer protection and saving endowment insurance, insurance for the entire life and investment bonds.

A premium bond Unit-Linked -life insurance policy, a total amount, your investment is spread over a number of funds of life.

Insurance for the entire life insurance provides lifetime death benefit to the policyholder, as builds cash value. The policy remains in force for the duration of the life of the insured, premiums shall be paid in accordance with the agreement on the rules. You can choose the insurance that paid in the event of death, the guaranteed amount, the amount plus bonuses, which have been added or amount, plus the additional value of the growth of funds invested in.

Without profit -where the policy has reached maturity or the policyholder dies, the amount paid is the principal sum secured only. You may not be entitled to any bonuses.

With profits -refers to the insurance policies that combine investment protection. This type of policy is entitled to a share of the profits made by the insurance company. Premiums are invested in a Fund, reversionary bonuses will apply on an annual basis, reflecting the growth of investments of the Fund's assets. Death and/or maturity Terminal bonus may be applied to the value of the Fund.

With profits Bond -insurance policy, where the total amount is in most cases, invested in Unitised with profits Fund (which is in the list under the section life funds).

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