Glossary of Terms

GLOSSARY


Accelerated benefits – Benefits available in some life insurance policies before death, usually triggered by long-term, catastrophic or terminal illness. Also known as living benefits.

 

Accident – An event or occurrence that is sudden, unforeseen and unintended.

 

Accidental death benefits – A provision added to a life insurance policy for payment of an additional benefit in case of death that results from an accident. This provision is often called double indemnity.

 

Beneficiary – The person or financial instrument (e.g., a trust fund), named in the policy as the recipient of insurance money in the event of the insured's death.

 

Benefit – Amount payable by the insurance company to a claimant, assignee or beneficiary when the insured suffers a loss.

 

Certificate – A statement issued to individuals insured under a group policy, setting forth the essential provisions relating to their coverage.

 

Claim – Notification to an insurance company that payment of an amount is due under the terms of the policy.

 

Conversion – Right given to an insured person under a group insurance contract to change coverage, without evidence of insurability, to an individual policy upon termination of group coverage. The conditions under which conversion can be made are defined in the master policy.

 

Disability – Physical or mental condition that prevents a person from performing one or more occupational duties temporarily (short-term), long-term or totally (total disability).

 

Dismemberment – Accidental loss of limb or sight.

Double indemnity – A provision added to a life insurance policy for payment of an additional benefit in case of death that results from an accident. Also known as accidental death benefits.

 

Effective date – Date when insurance coverage begins.

 

Eligibility period – Time following the eligibility date during which a member of a group may apply for insurance without evidence of insurability.

 

Eligible employees – Employees who meet the eligibility requirements for insurance set forth in a group policy.

 

Evidence of insurability – Under certain circumstances (e.g., late enrollment in a group health plan or enrollment in a high benefit maximum), an employee must provide medical information as proof to the insurance company that he or she is insurable.

 

Exclusions (exceptions) – Conditions or circumstances, listed in the master policy, for which the insurer will not provide benefits.

 

Group life insurance – Life insurance that usually does not require medical examinations on a group of people under a master policy. It is typically issued to an employer for the benefit of employees. The individual members of the group hold certificates as evidence of their insurance.

 

Guaranteed issue amount – The amount of insurance that will be issued to an insured person without evidence of insurability.

 

Insurability – Acceptability to the company of an applicant for insurance.

 

Insured – The person on whose life the policy is issued.

Living benefits – Benefits available in some life insurance policies before death, usually triggered by long-term, catastrophic or terminal illness. Also known as accelerated benefits.

Master policy – A policy that is issued to an employer or trustee, establishing a group insurance plan for designated members of an eligible group.

 

Occupational hazards – Factors inherent in the insured person's occupation that expose him or her to greater-than-normal physical danger.

 

Policy term – The period for which an insurance policy provides coverage.

 

Policyholder – The employer group that owns a life insurance policy.

 

Portability – Right given to an insured person under a group insurance contract to continue coverage, without evidence of insurability, upon termination of employment. The master policy defines the conditions and coverage amounts under which portability can be elected.

 

Premium – The payment, or one of the regular periodic payments, that a policyholder makes to own an insurance policy.

 

Primary insurer – Surency Life & Health Insurance Company directly assumes liabilities by issuing an insurance policy to the insured.

 

Proof of loss – At a minimum, proof of loss requires a claim form and a death certificate.  Depending on the nature of the claim, additional documentation may be necessary. 

 

Supplemental life insurance – Additional insurance protection over the primary insurance coverage.

 

Term life insurance – A plan of insurance that covers the insured for only a certain period of time (term), not for his or her entire life. The policy pays death benefits only if the insured dies during the term.  As the individual gets older, the death benefit decreases (after a certain age) and the premiums increase. It does not accrue any cash value. It is a low cost life insurance option that is meant to cover the beneficiaries in the event of the insured’s death.

 

Waiver of premium – When an individual becomes eligible for benefits (such as disability or long-term care), no further disability premium payments are required as long as benefits are being paid out.

 

 

If you have additional questions, visit our Frequently Asked Questions page.