• Accidental death benefit

    money paid to the beneficiary if the person insured dies accidentally

  • Accumulation annuity

    an investment for a certain period of time at a guaranteed interest rate

  • Additional insured

    other people covered by the insurance policy

  • Adjudicate

    the insurance company makes a decision about a claim

  • Additional insured

    other people covered by the insurance policy

  • Adjuster

    claim reviewer

  • Adjustment

    an increase or decrease to the amount to be paid out for a claim

  • Advance premiums

    premiums charged at the beginning of the policy

  • Agent of record

    agent on the policy

  • Amortization period

    period during which regular payments are made to pay off a debt/loan

  • Annuity

    a policy that pays out money regularly for the rest of the life of the person covered or for some other period of time

  • Annuity, survivorship

    annuity that goes to the spouse of the person covered if the person dies before the annuity period is over

  • Appraiser

    person who estimates the value of things

  • Assigner

    a person who transfers assets to another

  • Assignment


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  • Beneficiary

    person who receives the money from an insurance policy or investment account

  • Beneficiary, contingent

    back-up beneficiary; person who receives the money from the life insurance policy if the first beneficiary dies

  • Beneficiary, irrevocable

    a beneficiary who can’t be changed without his or her permission

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  • Capital gain

    profit on the sale of an investment

  • Cash (surrender) value

    the amount of money the policy is worth as it grows to its full value; the insurance company pays this money back to the policyholder if he or she asks to end the policy (the insured person can also borrow money from this amount instead of ending the policy)

  • Cessation

    quitting, stopping

  • Claim

    an insured person asking the insurance company to pay him or her back for medical costs or other costs covered by the policy; or a beneficiary asking the insurance company to pay a death benefit under a life insurance policy

  • Coinsurance

    insurance where the insured person pays part of a bill and the insurance company pays the rest

  • Collateral insurance

    insurance to repay the insured person’s business loans upon his or her death

  • Common shares

    shares of ownership in a company that allow a person to vote at the company’s annual general meeting

  • Company risk

    the risk that the individual companies invested in won’t perform as well as expected

  • Compulsory insurance

    insurance required by law

  • Contingent owner

    person who will own the life insurance policy if the current owner dies before the policy ends

  • Conversion right

    right to change a policy (to a different kind of policy)

  • Co-payment

    the amount of money the insured person pays for certain services or products; the insurance company covers the rest

  • Coupon rate

    bond’s interest rate

  • Credit or default risk

    the chance that a company invested in will go bankrupt or have its credit rating downgraded, making it more expensive for the company to borrow money

  • Currency or exchange risk

    changes in the value of the Canadian dollar affecting one’s investments

  • Cut-off clause

    time limit for making a claim

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  • Death benefit

    money paid to the beneficiary when the person covered by the insurance dies

  • Decreasing term insurance

    temporary life insurance in which the amount to be paid when the insured person dies goes down every year

  • Deductible

    the amount of expenses related to a claim that an insured person must pay before the insurance company will pay the rest of the claim

  • Deferred premium payment plan

    plan that lets an insured person pay the premium over time

  • Depreciation

    loss of value

  • Designate

    choose, set, label

  • Disburse

    pay, pay out

  • Discount brokerage

    a company that makes trades on behalf of investors, charging a lower commission, but not offering all the services a regular brokerage has (for example, advice)

  • Dismemberment

    loss of a body part

  • Double insurance

    two policies covering the same risk

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  • Effective date

    start date

  • Eligible

    allowed, qualified

  • Endorsement

    addition (to a policy)

  • Endowment policy

    life insurance policy that will be paid out to the insured person if he or she is still alive when it ends

  • Estate

    assets and liabilities (of a person who died)

  • Estate plan

    plan to transfer the insured person’s assets and liabilities when he or she dies

  • Excess limits premium

    premium to cover a risk that is more costly than what the policy normally covers

  • Exclusion

    something that is not covered

  • Executor

    estate manager, person (named in a will) to manage the estate of a person who has died

  • Executor de bonis non

    replacement estate manager

  • Expiration notice

    warning of policy end

  • Extended term insurance

    a type of life insurance that will stay active even if the insured person does not pay the premiums, but only if there is enough money accumulated under the policy so far to pay for the premiums and other fees

  • Face amount or face value

    coverage amount, amount of insurance

  • Face of policy

    cover page

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  • Grace period

    length of time that the policy will stay valid if the premium has been charged but not paid; or be specific about how long the insured person has grant give

  • Group insurance

    insurance through a group, often a workplace

  • Guaranteed insurability

    the ability to increase one’s coverage regardless of one’s health

  • Guaranteed investment certificate

    an investment for a certain period at a guaranteed interest rate

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  • Incontestability clause

    a clause in a policy that says after two years, the insurance company cannot say the policy is invalid unless there was fraud at the time of sale

  • Inflation risk

    the chance that an investment won’t grow enough to cover the increase in prices over time (meaning today’s money won’t be worth as much in the future as it is worth now)

  • Insurable interest

    something worth insuring

  • Insured

    you, person covered by the insurance, insured person

  • Interest rate risk

    the risk that changes in the interest rate will affect your investment

  • Intermediary

    agent, negotiator, representative

  • Intestate

    without a will, not having a will

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  • Lapsed

    ended, ended and not continued, cancelled

  • Living benefit

    money paid in advance (out of the death benefit amount) if the person covered by the insurance is deathly ill

  • Longevity risk

    the chance that a person will live longer than his or her income can support him or her

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  • Management expense ratio

    the portion of a mutual fund’s expenses, including the fund manager’s pay, that are charged by a fund company before any returns are paid to investors

  • Market risk

    changes in market prices affecting an investment

  • Maturity date

    the date the bond issuer must repay the value of the bond

  • Minimum retained premium

    minimum premium kept on cancellation of a policy

  • Mortality


  • Mortgage life insurance

    life insurance that, when a person dies, pays the company that holds his or her mortgage

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  • Named insured

    person mentioned in the policy and covered by the policy

  • Net asset value per share

    the value of one unit in a mutual fund

  • Non-concurrent insurance

    insurance covering different risks

  • Non-disclosure

    not giving important information

  • Non-insurable risk

    a risk the insurance company does not insure

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  • Occupational accident

    work accident

  • Occupational disease

    disease from work

  • Optional settlement clause

    a clause that allows a person to choose how he or she wants the claim paid out

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  • Participating insurance

    life insurance that pays out a dividend (money) to its policyholders if the company has surplus earnings related to life insurance; often referred to as “par insurance”

  • Payee

    the person paid

  • Payer

    the person paying

  • Percentage participation

    clause in a health insurance policy that says the percentage of a claim that the insurance company will pay out

  • Permanent life insurance

    provides lifetime coverage even though the insured person pays premiums for only a pre-determined period of time. As long as the premiums are paid, the life insurance stays in effect, no matter what the insured person’s age or health is

  • Permanent partial disability

    partly disabled for life

  • Permanent total disability

    totally disabled for life

  • Physical hazard

    physical danger

  • Policy anniversary

    the same month and day, every year, that a policy started

  • Policy fund

    where payments earn interest based on the investment account options chosen

  • Policy limit

    the maximum amount of money that the insurance company will pay out in claims under a policy

  • Policy provisions

    policy details

  • Power of attorney

    power to act for someone else

  • Pre-existing condition

    physical condition that existed before the beginning of the policy

  • Preferred rates

    a person gets lower premiums if he or she is less risky to insure (healthy, non-smoker)

  • Preferred shares

    shares of ownership in a company that do not give voting rights but do pay dividends (money)

  • Premium

    the monthly or annual payments in exchange for a life insurance policy

  • Premium discount plan

    getting a discount for paying premiums ahead of time

  • Presumptive disability

    considering the loss of an eye or limb or the ability to talk to be total disability

  • Principal (or face value)

    the amount “borrowed” by someone issuing a bond

  • Principal sum

    the amount to be paid, in one payment, on the insured person’s death or accidental dismemberment

  • Probationary period

    the time from the first day of illness or disability until a health insurance policy starts paying

  • Prohibited list/risk

    list of risks the insurance company doesn’t insure

  • Pro rata cancellation

    cancelling a policy and getting back the premiums paid for coverage of time that has not passed yet

  • Pro rata clause

    clause that gives the costs for changing or cancelling a policy

  • Prorating

    adjusting benefits paid because of a mistake or because other insurance covers the same thing

  • Protection


  • Provisional premium

    temporary premium or one-time premium

  • Proxy

    someone acting for someone else

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  • Rate of return

    the gain or loss you make as a percentage of the total amount invested

  • Reformation of a policy

    rewording of a policy

  • Remoteness of damage

    how indirect the cause of the damage is

  • Renewal premium

    new premium

  • Restoration premium

    premium to bring a policy back to its original worth (after a claim)

  • Retroactive restoration

    clause in a policy that automatically brings it back to its original value after a claim

  • Return premium


  • Rider

    addition to a policy

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  • Short rate cancellation

    cancelling a policy before its end

  • Stock company

    a company that issues shares

  • Straight life insurance

    life insurance without any savings tied to it

  • Surrender

    to cancel a policy before its end, with both the person insured and the insurance company agreeing

  • Surrender charge

    fee the policyholder must pay if he or she cashes out the policy

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  • Tax-deferred

    taxed later (for example, upon withdrawal)

  • Term insurance benefit

    gives the policyholder the ability to add term insurance to a permanent or universal life policy to protect someone for a temporary need

  • Testate

    having a will

  • Testator

    person making a will

  • Trust

    an account holding assets for a beneficiary

  • Trustee

    person managing a trust

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  • Underwrite


  • Underwriter

    the insurance company

  • Universal life insurance

    combines permanent life insurance plus the ability to make investments that grow without tax within the policy

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  • Valuation

    estimate of value

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  • Waiver

    to abandon a right

  • Waiver of premium

    the policyholder does not have to pay the premiums

  • Warranty

    a statement in a contract that, if broken, usually entitles the other party to compensation

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