TermDefinition
Age Next Birthday Insured's age at a particular time with addition of 1 year. For example, take a person whose birthday falls on 1/1/1980. His age would be 30 on 1/1/2010. His age next birthday would be 31.
Benefits The amount payable by the insurance company to a claimant, assignee or beneficiary under each coverage.
Exclusions Specific conditions or circumstances listed in the policy for which the policy will not provide benefit payments.
Joint Parent The joint parent is the second parent covered by certain benefits under the policy. This is usually referring to juvenile applications.
Life Assured The life assured is the individual upon whose life payment of the benefits under the policy depends.
Policy Document A booklet sent to the policy owner indicating explanation of the benefits covered.
Premium The price of the insurance protection for a specific risk for a specified period of time.
Proposal Form A signed statement of facts made by a person applying for insurance and then used by the insurance company to decide whether or not to issue a policy. The proposal form becomes part of the insurance contract when the policy is issued.
Proposer The proposer is the individual who selects benefits for the life assured. The proposer will be the legal owner of the policy in the event that coverage commences.
Rated Policy Sometimes called an "extra risk" policy, an insurance policy issued at a higher-than-standard premium rate to cover the extra risk where, for example, the insured has impaired health or a hazardous occupation.
Reinsurance Assumption by one insurance company of all or part of a risk undertaken by another insurance company.
Substandard Risk Substandard risk refers to higher risks associated with an insured’s health condition, physical limitations, family history of disease, hazardous occupation/ hobby (avocation), and/or residence, etc (the list is not exhaustive). An Individual with substandard risk does not qualify for a standard insurance rate and may be rejected for insurance application or having a restrictive terms in his/ her policy (refer above on rated policy and/or policy with exclusions).
Underwriter The company employee who decides whether or not the company should assume a particular risk.
Underwriting The process of selecting risks for insurance and determining in what amounts and on what terms the insurance company will accept the risk.
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