Life Insurance Jargon Buster
Acronyms And Phrases You Should Know
Do you know the difference between a dual and joint life policy or a decreasing policy compared to a level term policy? If not read our A - Z of key phrases used when talking about life cover.
- Assigning Your Policy
- A bank or mortgage lender will often require you to sign over your policy to them for the life of the mortgage. This will involve you presenting the lender with your policy document and signing a Notice of Assignment which the bank will give to you. They will also send a copy to the insurer to note on their files.
- Decreasing Policy
- The sum assured on this policy decreases each year for the life of the policy.
- Dual Life Policy
- This type of insurance policy covers two people, though independently. It is effectively like having two single policies where cover will pay benefits on the death of both insured.
- Health Questionnaire
- From time to time an insurer will require more detail on a medical condition you currently have or have had in the past. This questionnaire will ask a number of questions around the condition, so the insurer can confirm any risk involved with giving cover.
- Independent Medical
- Depending on the amount of cover you are applying for or your medical history, the life company may require you to attend an independent doctor who will run a few standard tests such as blood pressure, cholesterol, height measurement and a weight check .
- Joint Life Policy
- This type of policy covers two people. Joint cover will pay benefits on the first death of either insured person.
- Loading On A Premium
- This may happen if a life company feels the client applying for cover has a medical history which creates a higher risk for them in taking on the cover.
- This is usually done as a percentage of the premium e.g. 50% loading would mean half of the premium will be added on to your quoted premium at the outset.
- Non Medical Limits
- Depending on your age and the cover you are applying for the life company may not request any medical information if your proposal form has no medical issues noted on it.
- Non Standard Terms
- These will need to be signed and dated by the lives assured if the premium is loaded or increased in anyway. A client will sign them agreeing to the increase in premium.
- Nurse Medical
- The life company may ask a nurse to call to you at a time and place that is convenient to do a quick medical. This is very standard and usually takes about 20 minutes to complete.
- This is a medical report sent by the life company to your doctor; you don’t need to attend the doctor as it is completed from your file and sent straight back to the life company.
- Proposal Form
- This is the application form that the life company will require you to complete to apply for the cover.
- Single Life Policy
- This type of insurance policy covers one person.
- Standard Terms
- When a company approves your policy and advises there is no change to the original premium quoted a case is accepted at standard terms which can also be known as ordinary rates.
- Sum Assured
- This is also known as the policy benefit/cover and is the amount of money you could receive if you have a successful insurance claim. With a life insurance or serious illness policy, you choose the sum assured.
- Term Assurance
- This is an insurance policy with a set term and does not decrease over the life of the policy. The sum assured stays level and it can be used for personal cover, interest only mortgages and the more common decreasing mortgage. If this type of policy is selected for mortgage cover any balance will be paid to your estate. This type of policy is slightly more expensive than a decreasing life policy.
- A trust is a way of ensuring your life insurance policy sum assured goes to the people you want it to when you die. If the policy isn't owned under trust it automatically becomes part of your estate.
If you feel that there is anything that we have left out, or if you require more information, we’d love to speak to you. So call our Life insurance team on 01 400 3400.