Frequently Used Auto Insurance Terms

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• Collision

  • When a vehicle strikes or is struck by another object or vehicle or rolls over. This does not include accidents with animals. Collision insurance insures against loss caused by this type of accident.

• Comprehensive Coverage

  • Comprehensive coverage pays for loss not caused by collision. It pays for loss caused by breakage of glass, fire, explosion and colliding with a bird, animal, missile or falling object.

    If you have a Comprehensive deductible and your windshield is repaired instead of replaced, the deductible, if any, will be waived. If the repair fails, your windshield will be replaced, however, the Comprehensive deductible, if any, will be applied.

• Deductible

  • A portion of a covered loss that is subtracted from the amount the insurer is obligated to pay.

• Liability Insurance

  • Insurance concerned with legal liability for bodily injury and/or property damage to others.

Frequently Used Life Insurance Terms

• Accelerated Death Benefit

  • Benefits payable under a life insurance contract to a policy owner during the lifetime of the primary insured when the primary insured is diagnosed as terminally ill, payable as defined in the policy.

• Beneficiary, Primary

  • The person first designated by the policy owner to receive the proceeds of the policy upon the death of the insured.

• Beneficiary, Contingent

  • A secondary beneficiary, designated to receive the proceeds of the policy if the primary beneficiary does not survive the insured. (Must be named in the beneficiary designation.)

• Beneficiary, Irrevocable

  • A named beneficiary whose status as beneficiary cannot be changed without his or her permission, except by his or her death.

• Cash Surrender Value

  • The amount that may be available in cash for loans and/or withdrawals in a permanent life insurance policy. Accessing cash surrender value may reduce the death benefit and may increase the risk of lapse. Withdrawals may be subject to surrender charges and could have a permanent effect on the cash value. Loans reduce the cash value and death benefit by the amount of the loan outstanding plus interest. If the policy is surrendered, the cash surrender value is paid to the policy owner.

• Death Benefit

  • The policy proceeds to be paid upon the death of the insured.

• Decreasing Term Insurance

  • Term life insurance under which the amount of coverage starts out at a certain face amount, and then gradually decreases until the expiration date of the policy.

• Dividends

  • The amount of money returned to the owner of a participating policy determined by past experience of the company in investment, mortality and expenses when compared to the pricing assumptions of the policy. Dividends are not guaranteed and subject to change.

• Term Insurance

  • Life insurance which normally does not have cash accumulation or “cash value” and is issued to remain in force for a specified period of time, following which it is subject to renewal, convertibility, or termination as per policy provisions.

• Participating Policy

  • A life insurance policy that is eligible for the payment of dividends, if declared by the company.

• Permanent Insurance

  • A form of life insurance, excluding term life insurance that accumulates cash value. Permanent Insurance includes policy types such as whole life and universal whole life. Coverage can generally last a lifetime.