Let’s be honest, insurance terminology can get complicated. Since we’re all about simplicity here at Simplified Life, we’ve compiled this handy glossary so that you can understand some of the most commonly used terms in the world of life insurance.
If you’d like clarification on any term you notice on your policy, do not hesitate to contact one of our knowledgeable agents at 1.866.Real.Simple (1.866.732.5746).
The individual whose life is insured by the policy.
Insurance that provides protection against the financial loss caused by the death of the insured.
Term Life Insurance
A life insurance policy which pays a designated benefit in the event an insured dies during a specified period of time. Payments remain constant for the duration of the policy period.
Whole Life Insurance
A life insurance policy which provides coverage for an individual’s whole life rather than a specified time period.
Simplified Issue Term Life Insurance
A form of term life insurance which allows individuals to get approved quickly by answering a few questions about their health history rather than undergoing a medical exam or blood work.
Guaranteed Issue Term Life Insurance
A form of term life insurance which does not require individuals to answer any medical questions or go through a medical exam or blood work. Individuals can apply for coverage regardless of their health with guaranteed issue life insurance.
A process in which an insurance company assesses the risk of a potential policyholder prior to accepting an application. Unlike other policies, simplified issue life insurance does not require a physical exam.
The person or party that the insured has chosen to receive the benefits of the life insurance policy.
The payments made to the insurance company in order to obtain insurance coverage. With simplified issue, payments are fixed.
The document that outlines the insurance contract between an individual and insurance company.
The termination of an insurance policy when premium is not paid by the end of a grace period which is typically 30 days after the premium is due.
A rider is an optional add-on provision to the insurance policy which can provide additional benefits under certain conditions.