Life insurance glossary

The language of life insurance can be confusing, so here’s a simple guide to some of the key terms.

A-Z terms

A

Age limits

The maximum or minimum age at which an insurer will issue a policy or renew an existing one. You must be between the ages of 18 and 77 to apply for our life insurance, and between the ages of 50 and 80 to apply for our over-50 cover.

Applicant

The person applying for the insurance policy.

Application

Once you've received a quote, you can apply for life insurance by filling out an application online or by phone. As part of your application, you'll usually be asked questions about your health and lifestyle.

B

Beneficiary

The person or organisation that will receive the insurance policy pay-out if you pass away or have a terminal illness within the policy term, and the claim is successful.

Benefit

The amount of money paid to the beneficiary when the insured person passes away. The pay-out is sometimes called the death benefit.

C

Cash-in value

Some life insurance policies include a savings feature that allows the policyholder to receive the policy's cash-in value if the policy is cancelled early. We do not provide cash-value life insurance policies.

Claim

When you apply for a pay-out from the insurer that held the life insurance policy of the person who died or was diagnosed with a terminal illness during the policy term.

Cover amount

This is how much the life insurance will pay out when a claim is successful. Our life insurance calculator can assist you in determining how much coverage you require.

Critical illness

Critical illness cover provides financial support in the form of a tax-free lump sum if you're diagnosed with a specific medical condition. This can assist with expenses such as medical bills and treatment costs. Life insurance and critical illness cover are separate policies that can be obtained together to cover different things. At our company, we offer them as separate policies, and you have the option to add critical illness cover when applying for life insurance if you want both.

D

Death in service benefits

This is part of an employer's benefits package and provides your beneficiary with a tax-free lump sum if you die while working for the company. It is usually free, but if you leave your job for any reason, you may lose the benefit.

Decreasing term life insurance

The value of your policy gradually decreases over time until it reaches zero with decreasing term life insurance, but your premiums remain constant. This is typically used to cover a mortgage or loan repayment.

EF

Estate

The property and money left by someone who has passed away.

Executor

When you die, a person or company named in your will is in charge of managing your estate and carrying out your wishes. Their responsibilities include planning the funeral, dealing with assets, paying bills that have not been paid, and distributing the estate to beneficiaries.

GH

Guaranteed life insurance

A type of life insurance that you can get regardless of your health. So, you won't be denied, and there will be no medical exam.