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Glossary of Terms
Explore our comprehensive glossary of life insurance terms to better understand your policy and make informed decisions with confidence.
Can I withdraw money from my life insurance policy?
- FAQ
Yes, if your policy has a cash value component, you can make withdrawals or borrow against it.
The people you name on your life insurance policy to receive the lump sum of money — also known as the death benefit — when you die.
The portion of a permanent life insurance policy’s monetary value that grows, tax-deferred, over the life of the policy.
A feature in some insurance policies where the insurer returns a portion of the premiums paid to the policyholder after a specified period of time if no claims are made.
The termination of an insurance policy before its term ends, either by the policyholder or the insurer.
The process of submitting necessary documents to receive the life insurance payout, usually requiring proof of the insured’s death and the beneficiary’s identity.
The date on which an insurance policy becomes effective and coverage starts.
The designated recipient of the death benefit if the primary beneficiary is unable to claim it. In the absence of a contingent beneficiary, a court may decide the disposition of the death benefit.
A serious health condition specified in an insurance policy, such as cancer, heart attack, or stroke, that triggers a lump-sum benefit payment to the insured.
The untaxed lump sum paid to the beneficiary upon the policyholder’s death, also known as the policy’s face value.
An insurance benefit that provides financial compensation to the insured in the event of a disabling injury or illness that prevents them from working.
Specific conditions or circumstances listed in an insurance policy under which the policy will not provide coverage or pay a claim.
A set period after the premium due date during which payment can be made without penalty or lapse of coverage.
A requirement showing that the policy buyer has a financial interest in the insured’s life, typically applicable to family members and business partners.
A professional authorized to sell and service insurance policies on behalf of an insurance company.
An independent agent who represents the buyer, rather than the insurance company, and searches the market for the best policy according to the client’s needs.
The person whose life is covered by a life insurance policy.
The insurance company or entity that provides insurance coverage by underwriting the risk of potential financial losses.
A financial professional who provides advice on investment portfolios and financial planning, often for a fee or commission.
The termination of an insurance policy due to non-payment of premiums within the grace period.
The date on which the life insurance policy expires, and the sum assured, along with any bonuses, becomes payable to the policyholder or beneficiaries.
Failure by the applicant to reveal a relevant fact or circumstance to the insurer during the application process, which can affect the validity of the policy.
A feature in some insurance policies that allows the policyholder to withdraw a portion of the policy’s cash value or benefits before it matures.
A fund established by an employer to facilitate and organize the investment of employees’ retirement funds contributed by the employer and employees.
The legal document that includes the terms and conditions of your life insurance contract.
The person who owns an insurance policy. Usually, this is the same person as the insured.
The payment made to keep the life insurance policy active. Failure to pay the premium can lead to policy lapse.
The interval at which insurance premium payments are made to the insurer, such as monthly, quarterly, semi-annually, or annually.
The duration over which the policyholder is required to pay premiums on an insurance policy.
A benefit that allows for the waiving of premium payments under certain conditions, such as the policyholder’s disability or death, while keeping the policy in force.
A government-managed retirement savings scheme where both employees and employers contribute to a fund, which is then used to provide lump-sum payments to retired employees.
Variables considered by insurers when determining premiums for an insurance policy, such as age, health, occupation, and lifestyle.
The denial of an insurance claim by the insurer, usually due to the claim not meeting the terms and conditions of the policy.
The voluntary termination of an insurance policy by the policyholder before its maturity in exchange for the surrender value.
The amount that a policyholder will receive from the insurer if they decide to terminate the policy before it matures or before the insured event occurs.
A disease or condition that is deemed incurable or fatal and expected to lead to death within a short period, often specified by the insurer.
The process by which insurers assess the risk of insuring a potential policyholder based on factors like health, age, and lifestyle.
An investment fund that offers investors a choice of multiple, distinct sub-funds, each with different investment objectives and strategies, all within a single legal structure.
A clause in an insurance policy that allows for the waiver or removal of certain conditions or requirements.
The initial period at the commencement of the policy during which no benefits are payable for certain conditions or events.
A condition where the insured is unable to continue working due to an injury or illness, typically resulting in the payment of benefits from disability insurance.
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“Understanding insurance terms is vital for consumers to make informed decisions. Our glossary demystifies jargon, empowering you to navigate policies confidently. From premiums to deductibles, clarity ensures you select coverage aligned with your needs, fostering trust and peace of mind in your insurance journey.”