Protection Glossary

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Accident, Sickness and Unemployment (ASU)

Accident, Sickness and Unemployment is a type of insurance policy that will pay out if a mortgage holder is made redundant, has a serious accident or is unable to work or due to illness. The types of illness and accidents covered will vary between insurers. The money paid out is in instalments rather than a lump sum and covers the time spent out of work. Money paid out usually meets mortgage repayments. 

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Convertible Term Life Insurance

Convertible Term Life Insurance is type of life insurance policy that offers flexibility and the chance to change the policy during its term. Changes could include upgrading an insurance policy that lasts longer or one that lasts for the whole of the poly holders life.

Critical Illness Cover

Critical Illness Cover is a type of insurance policy that pays out a lump sum should the holder contract a serious illness.

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Death Certificate

A death certificate contains the details about a person's death including cause, time and place of death. A death certificate can only be issued after these details have been confirmed by a doctor or a coroner. Life insurance firms usually require a copy of a death certificate to pay out a life insurance policy.

Decreasing Term Insurance

Decreasing Term Insurance is a type of life insurance that lasts for the term of the mortgage. The money paid out decreases as the mortgage is paid off each year, so if the policy holder dies, the mortgage can be cleared.

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Family Income Benefit

 Family income benefit is a type of life insurance policy offers the holder's beneficiaries an alternative form of payment to a lump sum. Instead beneficiaries of a family income benefit will receive a regular income for the rest of the policy. This can be cheaper than a life insurance policy that pays out a lump sum.

Financial Ombudsman

The Financial Ombudsman Service is a body set up by the Government to settle disputes between financial services providers including insurers and their customers.

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Guaranteed Insurability Option (GIO)

Guaranteed Insurability Option, is usually added free to most term life insurance policies and means details of the cover can be altered without the need to reapply and provide details of your medical history.

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Income Protection

Income Protection is a type of insurance policy that guarantees you receive a regular income, which can include mortgage repayments, if you are unable to work due to injury or illness. 

Income Replacement Insurance

Income replacement insurance is another term used to describe an income protection insurance policy. 

Increasing Term Insurance

Increasing Term Insurance is a type of life insurance policy where the potential amount paid out increases each year. This is a more expensive form of term assurance than level term insurance, where the pay out stays the same throughout the mortgage term or a decreasing term insurance, where the sum paid out falls gradually as the mortgage is paid off. This is more popular in times of high inflation.

Insurance Broker

An insurance broker is a type of independent adviser who helps find customers the best policy by comparison. Insurance brokers are representatives of customers rather than insurance companies.

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Level Term Insurance

 Level Term Insurance is a type of life insurance policy where the amount paid out in the event of death remains the same throughout the term of a policy. This is a more expensive form of insurance than decreasing term assurance, where the sum paid out decreases during the life of the mortgage term.

Life Assurance

Life assurance is another term to describe life insurance. Life insurance is where an insurer pledges to pay out a sum of money in the event of the policy holder's death. This could be during the term of a mortgage only or cover the rest of the holder's life.

See our blog: What is the difference between Life Insurance and Life Assurance?

Life Insurance

Life insurance is where an insurer pledges to pay out a sum of money in the event of the policy holder's death. This could be during the term of a mortgage only or cover the rest of the holder's life. Another term to describe life insurance is life assurance.

Long Term Disability Insurance

Long Term Disability insurance is a type of income protection insurance policy that guarantees a regular income if the policy holder is unable to work due to developing a long term disability.

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Maturity

When an insurance policy comes to an end it is said to have reached its maturity or matured. This is usually the end of mortgage term.

Mortgage Protection

Mortgage protection is a generic term used to describe level term assurance, decreasing term assurance, income protection on accident, sickness and unemployment cover.

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Non-disclosure of Information

Non-diclosure of information is where an insurance policy holder withholds information relevant to their insurance policy such as medical details. Non-disclosure of information is the most common reason for a life insurance company not paying a claim.

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Policy Holder

A policy holder is the person or people that have an insurance policy from an insurer.

Premium

An insurance premium is the amount paid by the insurance policy holder to ensure they are covered. The premium can either be paid in monthly or annual installments or a premium can be a one off payment.

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Reasonable Evidence Test

A reasonable evidence test is an investigation carried out by insurers when a life insurance claim cannot be fulfilled following a death because there is no death certificate. The insurer will examine the circumstances surrounding a death during a reasonable evidence test, to assess whether it is reasonable to assume that death occurred, even if there is no body or a death certificate.

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Sum Assured

The amount the insurance provider pays out in the event of a claim.

Term Assurance

 Term assurance is a form of life insurance that is linked to the term of a mortgage. Money will be paid out if death occurs during the mortgage term.

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Whole Of Life Insurance

Whole of Life Insurance is policy which pays out the sum assured whenever the death of a policy holder occurs.

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