| Actuary |
an actuary is somebody who calculates
insurance risks and premiums. |
| Bond |
a form of investment offered by insurance
companies which will be paid back at maturity as a lump sum with interest. |
| Capital |
a lump sum of money. |
| Churning |
this refers to the process involved
when a client surrenders one insurance policy to take another out with a different
insurance company. It is usually inadvisable from the point of view of the consumer
as there is most often financial loss involved. |
| Critical illness cover |
this type of insurance can be bought
on its own or as an additional extra to your life insurance policy and will provide
cover against the risk of you suffering a serious illness. |
| Endowment |
an endowment policy is a combination
of life insurance and savings which will pay out on maturity or in the event of
death. |
| Estate |
this term refers to a person's collective
assets; the combined value of their savings, property and possessions minus any
debts or other financial obligations. |
| FSA |
the Financial Services Authority, the
main organisation responsible for regulating financial services in the UK. |
| Fund |
a type of investment in which investors
pool their money together for a lower risk venture. |
| IFA |
IFA stands for Independent Financial
Adviser. IFAs are completely independent financial experts who can advise objectively
on companies, markets and products. |
| Inheritance tax |
this tax is payable on the estate of
a deceased person if the value of their assets falls above a certain level. Gifts
between spouses are exempt from inheritance tax. |
| Paid up |
this refers to a whole life insurance
policy for which all the necessary premiums have been paid. Some policies are
payable until the policyholder's death, and some will stop when the policyholder
reaches a certain age; it is in this situation that the term is applicable. |
| Qualifying policy |
a qualifying life insurance policy is
one where benefits paid out are not subject to income tax. |
| Term life insurance |
this type of life insurance operates
within a fixed term and will only pay out if the policyholder dies within the
specified period for which the life insurance has been taken out. |
| Unit-linked |
a unit-linked policy is a type of endowment
policy in which profits depend upon the performance of units in an invested fund.
|
| Waiver of premium |
an optional extra that you can take
out with your life insurance that provides cover for you if circumstances make
you unable to carry out your normal occupation. |
| Whole life |
this type of insurance policy runs for
the length of the policyholder's life and will pay out on maturity or in event
of the policyholder's death. |
| Without profits |
the amount for which property is insured
and, consequently, the highest amount that an insurance company will pay out in
the event of a claim. |
| With profits |
this type of insurance does not involve
any kind of investment and will simply pay out the sum insured. |
| Warranty insurance |
a with profits policy gains annual bonuses
on top of the sum insured from investments made by the insurance company. |
