The death benefit of life insurance policies is usually given to the beneficiary. This is a person or organization that has been determined by the policyholder to get the benefits.
An insurance claim is a formal request you or your beneficiaries make to your insurer when something happens that is covered by your life insurance plan. This includes filing necessary paperworks and proofs in order to receive your insurance benefits.
This is the one or two year span (from when your policy is approved) where insurance companies can review or dispute claims. This is a time where they would investigate claims to make sure that there’s no evidence of fraud involved.
A death benefit is the lump sum that a life insurance policy pays to your beneficiaries upon your death. This is paid tax-free.
These are things that will not be covered under a life insurance policy. If you make a claim for the things included in the exclusions, the insurance company has the right to refuse them.
Also known as the death benefit. This is the total amount your beneficiary/ies will receive upon your death.
This is a time frame given to new policyholders during which they may choose to return the purchased policy-if they don’t agree to its terms and conditions.
This is an extension time given by the insurance company before they cancel a policy due to unpaid premiums. During the grace period, your insurance will remain in place even if you have not yet made your payment (usually lasts for 15-30 days from the due date).
Life Assured or Life Insured
The person whom the insurance is for. Life Assured may or may not be the policyholder.
When your policy reaches maturity, this means that your policy period is over.
The one who owns a life insurance policy, pays the premium and has complete control over the insurance plans. The policyholder may or may not be life assured (see life assured).
The amount that you pay for an insurance policy. Premiums can be paid monthly, quarterly or annually.
This refers to additional benefits you can purchase with your life insurance policy if you wish to have more financial protection. These can include:
- Critical Illness Rider
- Hospital Cash BenefitsRider
- Accidental Death Rider’
- Disability Income Rider
- Children’s term rider
- Waiver of Premiums Rider
Before adding a rider, it is best to consult with an insurance specialist to ensure that the riders you are going to purchase are the ones that fit your needs.
If a policyholder decides to discontinue life insurance before the maturity age, the amount paid by the insurer is called the surrender value.
But, not all insurance companies offer surrender value so it is wise that you understood the terms and conditions of your policy.
A policy term is the duration of time that your insurance plan is active.
An underwriter is a licensed insurance professional who evaluates your insurance applications. An insurance underwriter works on behalf of insurance companies and assesses the risks involved to help you find the insurance plan that fits your needs.