Life Insurance Glossary

Life Insurance Glossary

Accidental Injury Benefit
Some Life Insurance policies will advance the Death benefit if you suffer a listed injury
 
Accidental Death Cover
A limited policy that only pays claims if you die in an accident. Find out more about accidental death insurance.
 
Adviser (financial adviser)
Authorised by the Australian Securities and Investments Commission to provide advice and sell financial products, including life insurance products.
 
Agreed Value Policy
The payment you would receive in the event of claim on an Income Protection Insurance policy is agreed at a set amount (you provide financial evidence during the application). This is particularly useful for people with varying salaries, e.g. selfemployed people and you can read more on our agreed value section.
 
Benefit Payment
The amount of money your insurance product pays, either as a lump sum, or a regular instalment.
 
Benefit Period
Feature of Income Protection Insurance, and is the period over which the insurance pays you in the event of a longer term claim, e.g. a 5 year benefit would mean you would continue to receive payments for 5 years in the event you were unable to work for that period. For further information see our benefit period page.
 
Broker (life insurance broker)
Authorised by the Australian Securities and Investments Commission to provide advice and sell financial products, including life insurance products.
Claim
To apply for funds because an event you have experienced qualifies you to receive a benefit payment.
 
Cooling off period
A short period immediately after you have purchased a policy, during which you can cancel the policy without any financial penalty (usually 28 days).
 
Cover Amount
The amount of money you will receive should you make a claim.
 
Death Benefit
The amount of money a Life Insurance policy is set to pay your nominated beneficiaries in the event of your death.
 
Duty of Disclosure
Your duty to provide complete and honest answers to all the questions the insurer asks you when you apply for a life insurance product.
 
Exclusions
Some policies exclude certain events or conditions, e.g. Life Insurance will have a suicide exclusion for the first 13 months.
 
Expiry Ages
Some policies expire when you reach a specified age, for Life Insurance this is usually age 99.
 
Funeral Expense
Most Life Insurance policies provide an immediate payment to cover funeral expenses.
 
Future insurability
Permits you in increase your amount of insurance cover in the future without any medical requirements. Typically the increase is tied to personal events, e.g. at the birth of a child you can increase cover without medical requirements.
 
General Insurance
Insurance for assets like cars, homes, travel, and home contents.
 
Health Insurance
Insurance for private hospital stays and medical procedures not covered by Medicare.
 
Income Protection
Insurance that provides a regular monthly payment to you in the event of a claim, additional resources can be found at the income protection informat
ion
page
 
Increasing Claims
An optional and crucial feature of Income Protection Insurance policies. In the event of a claim the amount you receive each year is increased in line with inflation. Without this feature during a long term claim your income would not increase and affect your standard of living.
 
Increasing Cover wih Inflation
All life insurance policies have a feature that automatically increases the benefit payment with inflation.
 
Indemnity Style Policy
With Income Protection Insurance this means in the event of a claim you must prove your income (rather than during the application). Further information is available on our indeminty income protection page.
 
Inflation protection
Some life insurance policies have a feature that automatically increases the benefit payment with inflation. (See increasing cover with inflation).
 
Insurance benefit
Same as ‘benefit payment’.
 
Interim Cover
As soon as an application for insurance is lodged interim cover will be in place. With Life Insurance this will mean accidental death cover is in place while the application is underwritten.
 
Life insurance
Both a class of products and a type of product - see Types of Life Insurance and the Term Life Insurance sections.
 
Life insured
The person insured under the policy.
 
Product Disclosure Statement (PDS)
Law requires insurers to include all the terms and conditions of the insurance product in a single document, known as the product disclosure statement (PDS). Always read this document carefully before buying insurance.
 
Plan Exclusions
See ‘exclusions’.
 
Policy
The insurance contract with the insurer, provided to the policy owner.
 
Policy Owner
Owner of an insurance policy.
 
Premium
The monthly, quarterly, or annual fee for the insurance policy.
 
Premium Waiver
In the event of a claim the premiums on the policy are not payable.
 
Terminal Illnes Benefit
A feature of Life Insurance policies, if you are diagnosed with a terminal illness and have less than 12 months to live you can claim on your Life Insurance policy.
 
Total and Permanent Disablement
Insurance that pays a lump sum in the event that you are unable to work and likely to never return to work again. Additional information on total and permanent disablement.
 
TPD Insurance
This is simply an abbreviation of Total and Permanent Disablement insurance.
 
Trauma Insurance
Insurance for specific medical events, see the trauma insurance section
 
Upgrade Guarantee
This is a feature of some life insurance policies, that automatically updates the policy with new features or benefits incorporated after the policy was established.
 
Waiting Period
For Income Protection Insurance this is how long you must be unable to work due to sickness or injury before the Income Protection Insurance payments begin. E.g. with a 30 day waiting period, you would have to be unable to work for 31 days before being able to receive any benefits. For additional information please see our waiting period page.

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