Glossary- Life Insurance, Health Insurance, Retirement

Accelerated payment of basic cover

This occurs when the basic cover amount is paid earlier than death or maturity. For example the policy may provide for the full payment of the death benefit in the event of total and permanent disability.

Accident

The term accident is sometimes defined in the policy document as follows - the accident must be caused by violent, external and visible means and cause of the injury or injuries solely and independently of any other means.

Accidental death benefit

Benefit, which provides for the payment of an additional sum (usually equal to the sum insured of the basic policy) in the event of death by an accident.

Amount Payable

This refers to the amount that is payable according to the terms and conditions of the insurance policy to the legal owner of the insurance policy.

Annuitant

The person whose lifetime is used to measure the contractual period over which annuity payments will be made.

Annuity

Annuity contract is an agreement under which the insurance company, in return for the payment of a certain sum, makes a series of agreed payments at regular intervals from a fixed date. This continues until the death of the individual on whose life the annuity is bought.

Annuity Period

The time span between each of the annuity income benefit payments made under the annuity contract. Typically annuity income benefits are paid monthly or annually.

Anticipated Endowment

An endowment where you do not have to wait for the maturity date before receiving part of the maturity amount.

Applicant / owner / life of another

The applicant is the person on whose life insurance cover is sought. Owner is the person who has the legal title to the policy. Life of another on whose life he or she has an insurable interest.

Application for reinstatement

This refers to an event when a policy has lapsed or terminated by the policy owner owing to a non-payment or late payment of a premium. The company will consider a reinstatement of the contract in the event of an application being made as prescribed by the company in terms of the outstanding premium, interest or administration fees (if any) and evidence of good health. The reinstatement and terms are at the discretion of the company.

Appreciation

The increased value of one asset held by the policy, or by the total assets held by the policy over a period of time.

Ask or offer price

The price at which units or shares can be purchased. The asked or offering price means the current net asset value (NAV) per share plus sales charge, if any. For a no - load fund, the asked price is the same as the NAV.

Asset allocation

A system method of investing that distributes assets to a broad array of investments.

Assets

The current rupee value of the pool of money shareholders have invested in a fund.

Assignments

This is the process by which, the owner of the rights under the policy known as the assignor transfers the right to another person known as the assignee by executing a deed of assignment.