Life Insurance Jargon Buster.
Our Life Cover is designed to bring you award winning cover and it is important for us that you understand all the features of your policy.
We design products that protect you and your family as part of our aim of #Making Life Better and we want to help you choose the best option for your needs.
So we’ve put together a Life Insurance Jargon Buster to explain the most common terms and to help you understand what you are buying when you purchase one of our life insurance policies.
Jargon buster for common terms
We hope this will help you when reading through our web pages to find the best life insurance policy:
Accidental Death Benefit
We know that you might need to be protected from the day you apply for cover. So whilst we process your application we give you free Accidental Death Benefit.
It covers you if you die within 90 days following an accident.
We will either pay out a sum equivalent to the amount you applied for on your policy (that is the total amount of all applications) or £300,000, whichever is lowest. Read more about Accidental Death Benefit.
This is another term to describe the protection provided by your policy. It’s important to know what you will be covered for, and what is excluded, and you can find these details in your policy documents, which you'll receive when you purchase a policy. See the section on Policy Documents further down this list.
Critical illness cover
Critical Illness Cover can be added at an additional cost when you take out life insurance. It's designed to pay out a cash sum if you're diagnosed with one of our specified critical illnesses during the length of your policy.
Decreasing Life Insurance
Decreasing Life Insurance is designed to help protect a repayment mortgage so the amount of cover reduces roughly in line with the way a repayment mortgage decreases. It could pay out a lump sum if you die during the length of the policy.
Guaranteed Insurability Option
Guaranteed Insurability Option lets you increase the amount of cover you're insured for without the need to provide any further medical evidence.
You might need to do this at certain key points of your life, for example, if you become a new parent or decide to move to a bigger house. These types of events usually mean that you need more protection.
You can exercise the option to increase cover without further medical evidence if you apply for it within six months of one of the following events occurring:
- birth of a child or legal adoption of a child
- you get married or enter into a registered civil partnership
- you receive a salary increase due to a new job or promotion
- you increase your mortgage because you're moving home or undertaking major home improvements.
This means that your premiums won't go up, unless you alter your policy, so you'll always know how much you're paying.
Life insurance, Life assurance, Life Cover, Level term assurance
There are a number of different terms for life cover – it can be known as Level Term Assurance, life insurance, life assurance or referred to as a life policy.
Free life cover with Mortgage Life Insurance
When you take out our Mortgage Life insurance you get Free Life Cover added at no extra cost (terms and conditions apply).
You'll get Free Life Cover if you die between exchange of contracts and completion of your property purchase. Free Life Cover will be the amount of your chosen sum assured, the amount of your loan, or £300,000, whichever is lowest.
In Scotland we provide the free cover from when you complete missives for your chosen property until the date of entry. We cover you for 90 days from when you exchange contracts (or in Scotland complete missives).
You can take out a plan so it covers you and another person. The policy will pay out only once following a claim and then it ends.
These are the documents we send to you once your policy has started. They include:
- The Policy Schedule
- The Policy Terms and Conditions
- Details of the cover
- Details of the premium
Please read them all carefully as they form the contract between you and us. They also give details of what you are covered for, and what is excluded by your policy.
The Policy Schedule explains what cover is provided under the policy – including who is covered, what the sum insured is, and what cover is provided.
It will outline any exclusions or additions that apply to your policy. It is usually a summary and you should also read the Policy Wording or Policy Booklet which explains cover in more detail.
The Policy Terms and Conditions set out the contract between you and your insurer. You should also read these carefully.
The amount you'll regularly pay us for providing cover. You can pay your premiums monthly or annually. If you pay annually you'll get a 4% discount!
Terminal illness cover
Terminal Illness Cover is provided at no extra cost and means that your policy could pay out upon diagnosis of a terminal illness.