A life insurance policy rider that allows the policy owner to receive a portion of the policy's death benefit while still living, providing the insured person is inflicted with a terminal illness and has a limited life expectancy. Also referred to as a living benefits rider.
A type of coverage that pays benefits, sometimes including reimbursement for loss of income, in case of sickness, accidental injury, or accidental death.
A form of health insurance that provides payment in the event of death or loss of one or more bodily members (such as hands or feet) or the sight of one or both eyes as a result of an accident.
A benefit in addition to the face amount of a life insurance policy, payable if the insured dies as the result of an accident. Sometimes referred to as "double indemnity".
Income that has been earned but not yet received. For instance, if you have a non-registered Guaranteed Investment Certificate (GIC), Mutual Fund or Segregated Equity Fund, growth accrues annually or semi-annually and is taxable annually even though the gain is only paid at maturity of your(...)
The time between the first premium payment and the first benefit pay out under a deferred annuity, or a specified period of time (eg. 90 days) during which the insured person must incur eligible medical expenses at least equal to the deductible amount in order to establish a benefit period(...)
The actual cash value is usually the cost of replacing the property with something of like kind and quality, minus an allowance for depreciation. A deductible may apply.
An arrangement under which an insurance carrier or an independent organization will, for a fee, handle the administration of claims, benefits and other administrative functions for a self-insured group.
A method of calculating income tax that disallows certain deductions, credits and exclusions. This was intended to ensure individuals, trusts and estates that benefit from tax preferences do not escape all federal income tax liability. People must calculate their taxes both ways and pay the(...)
Paying an interest-bearing liability by gradual reduction through a series of installments, as opposed to one lump-sum payment.
Paying an interest-bearing liability by gradual reduction through a series of installments, as opposed to one lump-sum payment.
Individual on whose life the contract depends.
A contract that provides an income for a specified period of time, such as a certain number of years or for life. An annuity is like a life insurance policy in reverse. The purchaser gives the life insurance company a lump sum of money and the life insurance company pays the purchaser a(...)
A signed statement of facts made by a person applying for life insurance and then used by the insurance company to decide whether or not to issue a policy. The application becomes part of the insurance contract when the policy is issued.
An estimate of the value of the property offered as security for a mortgage loan. Usually completed by an independent accredited appraisal firm.
The process of repositioning assets within a portfolio to maximize return for a given level of risk. This process is usually done using the historical performance of the asset classes within sophisticated mathematical models.
The legal transfer of one person's interest in an insurance policy to another person.
Health insurance plans designed for members of a professional association or trade association. Members may be protected under a group health insurance policy or by individual franchise policies.
Assuming or taking over the existing mortgage on the property being purchased. Depending on the terms within the mortgage document this can be done either with or without a qualifying process.
Legislation under which interest, dividends, or capital gains earned on assets you transfer to your spouse will be treated as your own for tax purposes. Interest or dividends relating to property transferred to children under 18 also will be attributed back to you. The exception to this rule(...)
Cash borrowed from a life insurance policy's cash value to pay an overdue premium after the grace period for paying the premium has expired.
A Bank or brokerage house department not directly involved in selling or trading; sees to accounting records, compliance with government regulations and communication between branches.
This term refers to the simultaneous issue of a life annuity with a non-guaranteed period and a guaranteed life insurance policy (usually whole life or term to 100). The face value of the life insurance would be the same amount that was used to purchase the annuity. This combination of life(...)
A procedure for making the effective date of a policy earlier than the application date or for changing the effective date of an investment.
A short-term negotiable (transferable) debt instrument issued by a non-financial company but with principal and interest guaranteed by a bank, issued at a discount with a fixed term, usually 30 to 60 days.
When the stock market appears to be declining overall, it is said to be a bear market.
A certificate not registered in the name of any investor, where the holder is considered the owner of the security.
An individual, institution, trustee, or estate which receives, or may become eligible to receive, benefits under a will, insurance policy, retirement plan, annuity, trust, or other contract.
The amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss covered by the policy.
A period of time typically one to three years during which major medical benefits are paid after the deductible is satisfied. When the benefit period ends, the insured must then satisfy a new deductible in order to establish a new benefit period.
A method of repayment where principal and interest remain constant in their amount.
A certificate issued by a government or corporation as evidence of a debt. The issuer of the bond promises to pay the bondholder a specified amount of interest for a specified period and to repay the loan on the expiration (maturity) date.
The purchase price minus accounting depreciation.
An agent for buying /selling securities who charges a commission for services rendered.
A securities firm that is acting as a broker or intermediary and/ or dealer or principal in a transaction; most securities firms act in both capacities.
When the stock market appears to be advancing overall, it is said to be a bull market.
Life insurance purchased by a business enterprise on the life of a member of the firm. It is often bought by partnerships to protect the surviving partners against loss caused by the death of a partner, or by a corporation to reimburse it for loss caused by the death of a key employee.
This is an agreement entered into by the owners of a business to define the conditions under which the interests of each shareholder will be bought and sold. The agreement sets the value of each shareholders interest and stipulates what happens when one of the owners wishes to dispose of his/(...)
A loan that may be terminated at any time by the lender or borrower; used to finance the purchase of securities.
A Canada Education Savings Grant (CESG) is a grant offered by the Government of Canada to encourage parents, family and friends to save for a child’s education after high school. A CESG is paid by Human Resources and Skills Development Canada directly into an RESP in which the child is a named(...)
Better known as CDIC, this is an organization which insures qualifying deposits and GICs at savings institutions, mainly banks and trust companies, which belong to the CDIC for amounts up to $100,000 and for terms of up to five years. Many types of deposits are not insured, such as(...)
Profit realized on the sale of securities. An unrealized capital gain is an increase in the value of securities that have not been sold.
A licensed insurance agent who sells insurance for only one company.
This is the amount available to the owner of a life insurance policy upon voluntary termination of the policy before it becomes payable by the death of the life insured. This does not apply to term insurance but only to those policies that have reduced paid up values and cash surrender values.(...)
Lines of insurance, such as automobile, liability, aviation, bonding and theft.
A statement of coverage issued to an individual insured under a group insurance contract, outlining the insurance benefits and principal provisions applicable to the member.
The internationally recognized designation awarded in Canada by Financial Planners Standards Council (FPSC). CFP professionals must meet the FPSCs standards in education, experience, examination and ethics. CFP professionals must also have 30 hours of continuing education every year and agree(...)
One who has passed exams given by the Canadian Association of Insurance and Financial Advisors and who has been determined to be a financial planner with advanced knowledge in life and health insurance and employee benefits.
A request for payment of a loss that may come under the terms of an insurance contract.
Person who settles claims; an agent, company adjustor, independent adjustor, adjustment bureau, or public adjustor.
Rate-making method in which similar insureds are placed in the same underwriting class and each is charged the same rate. Also called manual rating.
The arrangement where assets in an account are held in the individual’s name rather than a nominee’s name.
A mortgage agreement that does not provide for prepayment prior to maturity without some form of prepayment penalty.
Canada Mortgage and Housing Corporation. A high ratio mortgage insurer.
In medical insurance, the insured person and the insurer sometimes share the cost of services under a policy in a specified ratio, for example 80% by the insurer and 20% by the insured. By this means, the cost of coverage to the insured is reduced.
An asset (securities, funds or a holding cheque) held by a lender as a guarantee until a loan (pledge) is repaid.
The part of an insurance premium paid by the insurer to an agent or broker for his services in procuring and servicing the insurance.
This letter is the lenders commitment to provide mortgage financing within a specified time and according to the terms and conditions contained therein.
The securities that represent ownership in a corporation and carry voting privileges.
Interest earned on an investment at periodic intervals and added to principal and previous interest earned. Each time new interest earned is calculated it is on a combined total of principal and previous interest earned. Essentially, interest is paid on top of interest.
Continuance provision of a health insurance policy under which the company cannot cancel the policy during its term but can refuse to renew under certain conditions stated in the contract.
An option under which an employee may elect to receive, under certain conditions, a reduced amount of annuity with the same income, or a specified fraction, to be paid after his death to another person designated as his contingent annuitant, for that person’s lifetime. The contingent annuitant(...)
An individual who is entitled to receive the benefits of an insurance policy if the primary beneficiary dies before the life insured.
This is the person designated to become the new owner of a life insurance policy if the original owner dies before the life insured.
The right given to an insured person to convert their current policy to an alternate form of insurance without evidence of medical insurability.
Term life insurance products are offered as non-convertible or convertible to a certain time in the future. The conversion right has a time limit, usually to a specific policy holder age. This right means that the policyholder has the right to convert their existing policy to another specific(...)
The mechanism used in group health insurance to designate the order in which the multiple carriers are to pay benefits and to prevent duplicate payments.
Benefit that can be added to a life insurance policy under which the policy owner can purchase one-year term insurance equal to the percentage change in the consumer price index with no evidence of insurability.
The scope of protection provided under a contract of insurance; any of several risks covered by a policy.
A person or company that holds and administers securities and financial instruments on behalf of others.
An investment broker acting as a principal or agent in a securities transaction.
A payment made to a designated beneficiary upon the death of the employee annuitant.
Statements in an insurance contract that provide information about the property or life to be insured and used for underwriting and rating purposes and identification of the property or life to be insured.
A form of life insurance policy in which the policy's death benefit decreases over the term of the plan.
An amount that a policyholder agrees to pay, per claim or per accident, toward the total amount of an insured loss.
Under certain circumstances, taxation rules assume that a transfer of property has occurred, even though there has not been an actual purchase or sale. This could happen upon death or transfer of ownership.
An annuity providing for the income payments to begin at some specified future date.
A plan where benefits are predetermined by a formula and employer contributions depend on the cost of the benefit minus the employee's contributions, if any.
A plan where contributions by employees and the employer are fixed and the benefits depend on the contributions and their earnings.
Individual or group plan that helps pay costs of normal dental care as well as damage to teeth from an accident.
An optional life insurance policy rider that provides term insurance coverage on the life of each of the policy owner's children.
A feature added to some life insurance policies providing for waiver of premium, and sometimes payment of monthly income, if the policyholder becomes totally and permanently disabled.
Insurance that pays you an ongoing income if you become disabled and are unable to pursue employment or business activities. There are limits to how much you can receive based on your pre-disability earnings.
A form of health insurance that provides payment in case of loss by bodily injury of one or more body members (such as hands or feet) or the sight of one or both eyes.
Investing so that all your eggs are not in the same basket. By spreading your investments over different kinds of investments, you cushion your portfolio against sudden swings in any one area. Segregated equity funds have become a popular and secure way for average investors to get the(...)
An amount of paid-up insurance purchased with a policy dividend and added to the face amount of the policy.
A way of smoothing out your investment deposits by investing regularly. Instead of making one large deposit a year into your RRSP, you make smaller regular monthly deposits. By spreading out your purchases, you don't have to worry about buying at the right time.
The date on which an individual member of a specified group becomes eligible to apply for insurance under the (group life or health) insurance plan.
A specified length of time, frequently 31 days, following the eligibility date during which an individual member of a particular group will remain eligible to apply for insurance under a group life or health insurance policy without evidence of insurability.
This term refers to (1) the conditions which an employee must satisfy to participate in a retirement plan, one such condition begin the completion from 1 to 3 years of service with the employer, another the attainment of a specified age, such as 25, or (2) conditions which an employee must(...)
A specified number of days at the beginning of each period of disability during which no disability income benefits are paid. The elimination period may be as short as a few days or as long as one year or more.
Life insurance payable to the policyholder, if living at the end of a specified period, called the maturity date, or to a beneficiary if the life insured dies prior to that date.
Investments in the form of ownership of property, usually common stocks, as distinguished from fixed income bearing securities, such as bonds or mortgages.
Insurance coverage purchased by the agent/broker that provides protection against loss incurred by a client because of some negligent act, error, oversight, or omission by the agent/ broker.
The assets and liabilities of a person left at death.
Developing a plan to transfer your property from one generation to the next or within a generation.
Proof, usually in the form of a medical examination, that a person can be insured for life or disability insurance.
Specific conditions or circumstances listed in the policy for which the policy will not provide benefit payments.
An agent who is employed by one and only one insurance company and who solicits business exclusively for that company.
A person named by the probate courts or the will to carry out the directions and requests of the decedent.
The process of determining the premium rate for a group risk, wholly or partially on the basis of that group's experience.
A provision in most group policies for the return of premium to the policyholder because of lower than anticipated claims.
A form of health insurance that provides, in one policy, protection for hospital and medical expenses not covered by government programs. Also called "major medical expense insurance".
The amount stated on the face of the policy that will be paid on the death of the life insured or at the maturity of the policy. It does not include additional amounts payable under accidental death or other special provisions or acquired through the application of policyholder dividends.
A life insurance policy providing insurance on all or several family members in one contract, generally whole life insurance on the principal breadwinner and small amounts of term insurance on the other spouse and children, including those born after the policy is issued.
A pension plan formula that bases retirement benefits on earnings during recent years of employment.
An investment professional who assists individuals with long- and short-term financial goals.
This means that there are two or more life insured on the same policy but the death benefit is paid out on the first death only.
Annuity whose periodic payment is a guaranteed fixed amount.
A type of schedule in group insurance under which everyone is insured for the same benefits regardless of salary, position, or other circumstances.
A life insurance policy or annuity under which the policyholder or contract holder may vary the amount or timing of premium payments.
A life insurance policy that combines the premium flexibility feature of universal life insurance with the equity-based benefit feature of variable life insurance.
Amounts contributed on behalf of terminated, non-vested participants. In a pension plan, such amounts must be applied to reducing future employer contributions. In a profit-sharing plan, such amounts may be allocated to the accounts of remaining participants.
A form of insurance in which individual polices are issued to the employees of a common employer or the members of an association under an arrangement by which the employer or association agrees to collect the premiums and remit them to the insurer.
A plan under which funds are set aside in advance to provide expected benefits.
A specified period of time that a policy owner has to pay renewal premiums without the policy being lapsed (canceled).
This is the total cost of housing payments (this includes principal, interest, taxes, and sometimes heat and maintenance) divided by the family's total gross income Generally this ratio should not exceed 32%.
A contract of insurance made with an employer or other entity that covers a group of persons identified as individuals by reference to their relationship to the entity.
Life insurance provided to debtors by a lending institution to provide for the cancellation of any outstanding debt should the borrower die. Normally term insurance limited to the amount of the loan.
Insurance issued, usually without medical examination, on a group of people under a master contract. It is usually issued to an employer for the benefit of employees. The individual members of the group hold certificates as evidence of their insurance.
This is a very common form of life insurance that is found in employee benefit plans and bank mortgage insurance. In employee benefit plans the form of this insurance is usually one-year renewable term insurance. The cost of this coverage is based on the average age of everyone in the group.
A deposit instrument requiring a minimum investment at a pre-determined rate of interest for a stated term; most commonly available from banks and trust companies.
Benefit that can be added to a life insurance policy permitting the insured to purchase additional amounts of life insurance at specified times in the future without requiring evidence of insurability.
A contract that the insured person or entity has the right to continue in force by the timely payment of premiums for a substantial period of time, during which period the insurer has no right to make unilaterally any change in any provision of the contract, while the contract is in force,(...)
Health and welfare trusts are employer-funded trusts established to provide certain health and welfare benefits for employees — for example, a group accident or sickness plan, a private health services plan, a group term life insurance policy or any combination thereof. Employer contributions(...)
Insurance against financial losses resulting from sickness or accidental bodily injury.
Technique for transferring the risk of unfavorable price fluctuations to a speculator by purchasing and selling options and futures contracts on an organized exchange.
A package of insurance providing homeowners with a broad range of property and liability coverage.
For purposes of life insurance, the present value of the family's share of the deceased breadwinner's future earnings.
This is a tax minimization strategy of arranging for income to be transferred to family members who are in lower tax brackets than the one earning the income, thus reducing taxes.
Life policies provide that, except for non-payment of premiums and certain other circumstances, the policy shall be incontestable after the policy has been in force for two years during the lifetime of the insured.
This clause in regular life insurance policy provides for voiding the contract of insurance for up to two years from the date of issue of the coverage if the life insured has failed to disclose important information or if there has been a misrepresentation of a material fact which would have(...)
Compensation to the victim of a loss, in whole or in part, by payment, repair, or replacement.
This is a provincial government licensed independent businessperson who usually represents five or more life insurance companies in a sales and service capacity and who is paid a commission by those life insurance companies for sales and service of life insurance products.
Adjusting of values over time to reflect the impact of inflation.
Insurance purchased on an individual basis, covering only one person or, in some cases, members of his or her family as well.
Having insufficient financial resources (assets) to meet financial obligations.
The class of professional investor who is an indirect market participant; includes banks, mutual funds, pension funds and other entities that participate in the market only on behalf of the members/ participants.
A condition in which the person applying for an insurance policy and the person who is to receive the policy benefit will suffer an emotional or financial loss if the event insured against occurs. Without the presence of the insurable interest, an insurance contract is not formed for a lawful(...)
The conditions that make a risk insurable are: the peril insured against must produce a definite loss not under the control of the insured, there must be a large number of homogeneous exposures subject to the same perils, the loss must be calculable and the cost of insuring it must be(...)
A system under which individuals, businesses, and other organizations or entities, in exchange for payment of a sum of money (a premium), are guaranteed compensation for losses resulting from certain perils under specified conditions.
An insured mortgage protects only the mortgage lender in case you do not make your mortgage payments.
The person on whose life the policy is issued.
The concept of using Universal Life Insurance to tax shelter earnings that can be used to generate tax-free income in retirement.
Coordination of the disability income insurance benefit with other disability income benefits, such as Canada and Québec Pension Plans.
The periodic payments borrowers (issuers) make to lenders for the use of their money prior to maturity and principal repayment.
This means dying without a will, in which case the provincial laws of the province in which the death occurred apply to the manner in which assets will be distributed.
A professional who is licensed to sell securities by one of the provincial securities, provided he or she passed the Canadian Securities Course.
The person responsible for the securities portfolio of an individual or institutional investor.
Beneficiary designation allowing no change to be made in the beneficiary of an insurance policy without the beneficiary's consent.
A trust in which the creator does not reserve the right to reacquire the trust property.
A contract that provides income periodically, payable during the longer lifetime of two persons. The amount payable may decrease at the death of one or the other.
Insurance designed to protect a business firm against the loss of income resulting from the death or disability of a key employee.
A policy terminated because of non-payment of premiums. This phrase sometimes is limited to a termination occurring before the policy has a cash or other non-forfeiture value.
This means that there are two or more life insured on the same policy but the death benefit is paid out on the last person to die. The cost of this type of coverage is much less than a first to die policy and it is generally used to protect estate value for children where there might be(...)
A premium that remains unchanged throughout the life of a policy.
This is a type of insurance for which the cost is distributed evenly over the premium payment period. The premium remains the same from year to year and is more than actual cost of protection in the earlier years of the policy and less than the actual cost of protection in the later years.
A form of life insurance in which the death benefit remains the same throughout the term of the plan.
A contract that provides an income for life.
An annuity which pays an income to the annuitant for as long as he or she lives, but if death occurs within 10 years after the annuity payments begin, payments are continued to a named beneficiary for the remainder of the 10 years.
Commonly known as a LIF, this is one of the options available to locked in Registered Pension Plan (RPP) holders for income pay out as opposed to Registered Retirement Savings Plan (RRSP) holders choice of pay out through Registered Retirement Income Funds (RRIF).
Insurance providing for the payment of benefits upon the death, whether by accident or otherwise, of the life insured.
A benefit to help replace income lost by an insured person as long as he/she is totally disabled, even for a lifetime.
Permanent life insurance that pays a benefit on the death of the life insured whenever that occurs, and for which premiums are payable for a specified number of years, or until the death of the life insured if this occurs before the end of the specified period.
One that covers only specified accidents or sicknesses.
This is a will that specifically expresses the testator's desire not to be kept alive on life support machines, should the occasion arise.
Range of medical and/or social services designed to help people who have disabilities or chronic care needs.
Insurance issued to an employer (group) or individual to provide a reasonable replacement of a portion of an employee's earned income lost through serious and prolonged illness or injury during the normal work career.
Health insurance to finance the expense of major illness and injury. This insurance, above an initial deductible, reimburses the major part of all charges for hospital, doctor, private nurses, medical appliances, prescribed out-of-hospital treatment, drugs, and medicines. The insured person as(...)
Coverage for a professional practitioner, such as a doctor or a lawyer, against liability claims resulting from alleged malpractice in the performance of professional services.
The price at which a security can be bought or sold at any particular time.
See market price.
The date on which a bond or other obligation is due to be repaid.
This benefit provides top-up coverage for health, dental, and vision expenses that are limited or not covered under the standard terms of your group contract. It can be offered to all employees or to specific classes of employees, such as managers. There is no monthly premium, only an(...)
A false, incorrect, improper, or incomplete statement of a material fact, made in the application for a policy.
The frequency with which premiums are paid monthly, quarterly, semi-annually, or annually.
This is the process by which "dirty money" generated by criminal activities is converted through legitimate businesses into assets that cannot be easily traced back to their illegal origins.
A security with a maturity date of less than one year from the current date (treasury bills, bankers' acceptances, commercial paper, etc.) where transactions usually settle the same day in DCS.
Hazard arising from any non-physical, personal characteristic of a risk that increases the possibility of loss or may intensify the severity of loss for instance, bad habits, low integrity, poor financial standing.
These are statistical tables used by life insurance companies showing the probability of disease of male and females at all ages.
This is a statistical table used by life insurance companies showing the probability of death of male and females at all ages.
An investment instrument that represents ownership of an undivided interest in a group of mortgages. Principal and interest from the individual mortgages are used to pay principal and interest on the MBS.
A form of reducing term insurance recommended for the borrower. In the event of the death of the owner or one of the owners, the insurance pays the balance owing on the mortgage. The intent is to protect survivors from losing their home.
An entity which uses its capital to invest in other companies. The range of mutual funds is extensive and includes funds based on bonds, blue-chip stocks, mortgage-backed shares, common shares and international stocks and currencies.
The MFDA is the mutual fund industry's self-regulatory organization for the distribution side of the industry. It is responsible for regulating all sales of mutual funds by its Members in Canada.
Coverage in a property policy that provides protection against loss from only the perils specifically listed in the policy rather than protection from physical loss. Examples of named perils are fire, windstorm, theft, smoke, etc.
Net family income is the net income of the beneficiary’s family used to determine eligibility for the Canada Child Tax Benefit. Check your Canada Child Tax Benefit notice to find out your net family income.
A person or entity named to act on behalf of another person or entity (e.g., beneficial owner), usually to facilitate the processing of transactions.
An individual policy which the insured person has the right to continue to force until a specified age by the timely payment of premiums. During this period, the insurer has no right to unilaterally make any changes in any provision of the policy while it is in force.
A health insurance contract provision where the insurance company can neither cancel coverage nor vary the premium rate specified in the contract.
A pension plan where the entire cost of the plan is borne by the employer and no employee contributions are required.
One of the choices available if the policyholder discontinues premium payments on a policy with a cash value. This, if any, may be taken in cash, as extended term insurance or as reduced paid-up insurance.
This is the maximum value of a policy that an insurance company will issue without the applicant taking a medical examination, although medical questions are invariably asked during the application process.
One that provides off-the-job coverage only; it does not cover loss resulting from accidents or sickness arising out of or in the course of employment or covered under any workers’ compensation law.
Plan of insurance under which the policyholder is not entitled to share in the dividend distribution of the company.
Most life insurance companies offer discounts to those who have been non-smokers at least 12 months prior to applying for coverage. Savings to non-smokers can be up to 50% of regular premium depending on age and insurance company.
Occupations which expose the insured to greater than normal physical danger by the very nature of the work in which the insured is engaged, and the varying periods of absence from the occupation, due to the disability, that can be expected.
A mortgage that permits prepayment in whole or in part of the principal balance without notice or bonus.
Synonymous with Whole Life, this is a type of policy which continues during the whole of the insured’s life and provides for the payment of amount insured at this death.
A type of short-term disability income contract that reimburses the insured person for specified, fixed monthly expenses, normal and customary in the operation and conduct of his/ her business or office.
A policy that remains active without any further requirement of premium payments.
Physical examination of an applicant by a trained person other than a physician.
A benefit sometimes found in disability income policies providing for the payment of reduced monthly income in the event the insured cannot work full time and/ or is prevented from performing one or more important daily duties pertaining to his occupation.
One under which the policy owner is entitled to receive shares of the divisible surplus of the insurer. Such shares are commonly called dividends.
A plan established and maintained by an employer, group of employers, union or any combination, primarily to provide for the payment of definitely determinable benefits to participants after retirement.
A form of life insurance that provides lifetime coverage to the policy owner. This type of policy also provides a savings element that builds a cash value in the policy.
The degree to which policies stay in force through the continued payment of renewal premiums.
The person or persons controlling the money or property contributed to the plan, usually designated in the plan agreement.
A contract of insurance.
This is an administrative fee that is part of most life insurance policies. It ranges from about $40 to as much as $100 per year per policy. It is not a separate fee. It is incorporated in the regular monthly, quarterly, semi-annual or annual payment that you make for your policy.
A loan made by a life insurance company from its general funds to a policyholder on the security of the cash value of a policy.
The person who owns an insurance policy.
The measure of the funds that a life insurance company holds specifically for fulfillment of its policy obligations. Reserves are required by law to be so calculated that, together with future premium payments and anticipated interest earnings, they will enable the company to pay all future claims.
The person who owns an insurance policy.
The transfer of pension rights and credits when a worker changes jobs.
A physical and/or mental condition of an insured which first manifested itself prior to the issuance of his/her policy or which existed prior to issuance and for which treatment was received.
A provision in the insurance policy that stipulates that benefits will not be paid for any injury or sickness that occurred prior to issuance of the policy, until the insured person has been covered under the policy for a specified period of time.
Insurance companies offer better rates that go beyond simply looking at gender or smoking habits. Other health related factors such as physical build, lifestyle, avocation and personal and family health history indicating longer life expectancy can add up to significant cost savings to new(...)
Payments made by the policy owner to the insurer for the insurance policy.
A policy loan made for the purpose of paying premiums.
This term relates to participating whole life insurance and the use of the dividend to reduce or completely eliminate the need for future premiums.
The sale of a bond or other security directly to a limited number of investors.
Probate represents judicial certification of the validity of a Will and judicial confirmation of the authority of the personal representative who is to administer the Will.
A period from the policy date to a specified time, usually 15 to 30 days, during which no sickness coverage is effective. It is designed to eliminate a sickness actually contracted before the policy went into effect.
Documentary evidence required by an insurer to prove a valid claim exists. It usually consists of a claim form completed by the insured and the insured's attending physician. For medical expense insurance itemized bills must also be included.
Insurance providing financial protection against the loss of, or damage to, real and personal property caused by such perils as fire, theft, windstorm, hail, explosion, riot, aircraft, motor vehicles, vandalism, malicious mischief, riot and civil commotion, and smoke.
A part (clause, sentence, paragraph, etc.) of an insurance contract that describes or explains a feature, benefit, condition, requirement, etc. of the insurance protection afforded by the contract.
The period during which the insured must be totally disabled before becoming eligible for residual disability benefits.
Sometimes called an extra-risk policy, this is an insurance policy issued at a higher than standard premium rate.
A provision in some health insurance policies which specifies a length of time during which the recurrence of a condition is considered to be a continuation of a previous period of disability or hospital confinement.
A Registered Education Savings Plan is a special savings plan that can help you, your family, or your friends save for education after high school. RESPs are registered by the Government of Canada to allow savings for education to grow tax-free until the person named in the RESP enrolls in(...)
Commonly referred to as an RRSP, this is available to individuals to defer tax on a specified amount of money to be used for retirement. The holder invests money in one or more of a variety of investment vehicles which are held in trust under the plan. Income tax on contributions and earnings(...)
The payment of the expenses actually incurred as a result of an accident or sickness, but not to exceed any amount specified in the policy.
This is the restoration of a lapsed life insurance policy. The life insurance company will require evidence of continuing good health and the payment of all past due premiums plus interest.
The purchase of insurance by an insurance company from another insurance company (reinsurer) to provide it protection against large losses on cases it has already insured.
Term insurance that can be renewed at the end of the term, at the option of the policyholder and without evidence of insurability, for a limited number of successive terms. The rates increase at each renewal as the age of the insured increases.
Continuance of coverage under a policy beyond its original term by the insurer's acceptance of the premium for a new policy term.
Termination of an insurance contract by the insurer on the grounds of material misstatement on the application for insurance.
A trust that can be terminated or revoked by its creator.
A special policy provision or group of provisions that may be added to a policy to expand or limit the benefits otherwise payable.
At the death of one co-owner of property, that person's interest in the property automatically passes to the surviving joint tenant or tenants.
This is a very important rule to know. The rule is that the number 72 divided by the rate of return of your investment equals the number of years it takes for your investment to double
Seg-funds are insurance industry investment products that offer unique features including ability to bypass probate and maturity/death benefit guarantees that limit potential losses.
The date on which a buyer of securities must pay for a purchase or a seller must deliver the securities sold.
The provision to pay benefits to a covered disabled person as long as he/ she remains disabled up to a specified period not exceeding two years.
A form of health insurance providing benefits for loss resulting from illness or disease.
The split dollar concept is usually associated with cash value life insurance where there is a death benefit and an accumulation of cash value. The basic premise is the sharing of the costs and benefits of a life insurance policy by two or more parties. Usually one party owns and pays for the(...)
This is an RRSP owned by the spouse of the person contributing to it. The contributor can direct up to 100% of eligible RRSP deposits into a spousal RRSP each year. Contributing to a spouses RRSP reduces the amount one can contribute to one's own RRSP, however, if the spouse is a lower income(...)
Payments to the surviving spouse of a deceased employee, usually in the form of a series of payments upon meeting certain requirements and usually terminating with the survivor's remarriage or death.
A person who, according to a company's underwriting standards, is entitled to purchase insurance protection without extra rating or special restrictions.
A portion of corporate earnings paid to common and preferred shareholders in the form of stock, rather than cash, increasing the number of shares each holder owns, but not altering a shareholder's proportional ownership of the company.
Whole life insurance on which premiums are payable for life.
Personal injury claims used to be settled merely by exchanging a sum of money for a release of the claim. In contrast, a Structured Settlement goes beyond an immediate cash payment and provides future payments "structured" over time to meet a person's ongoing financial needs.
Process by which one insurance company seeks reimbursement from another company or person for a claim it has already paid.
A risk that cannot meet the normal health requirements of a standard health insurance policy. Protection is provided in consideration of a waiver, a special policy form, or a higher premium charge. Substandard risks may include those persons who engage in certain sports and persons who are(...)
Generally, a suicide clause in a regular life insurance policy provides for voiding the contract of insurance if the life insured commits suicide within two years of the date of issue of the coverage.
An agreement between a life insurance company and a policyholder or beneficiary by which the company retains the cash sum payable under an insurance policy and makes payments in accordance with the settlement option chosen.
An amount retained by the issuer of a life insurance policy when a policy is cancelled, typically assessed only during the first five to ten years of a policy.
A policy terminated because of non-payment of premiums, for which there is a cash value or other non-forfeiture value available.
Temporary insurance coverage is available at time of application for a life insurance policy if certain conditions are met. Normally, temporary coverage relates to free coverage while the insurance company that is underwriting the risk goes through the process of deciding whether they will(...)
Life insurance payable to a beneficiary only when an insured dies within a specified period.
This is the total cost of housing payments plus all other instalment payments divided by the family's total gross income.
An illness or injury that prevents an insured person from continuously performing every duty pertaining to his/her occupation or engaging in any other type of work.
The date on which a trade/bargain is executed.
A limited contract covering only accidents while an insured person is traveling, usually on a commercial carrier.
A short-term security with a maturity of one year or less issued at a discount from face value.
This is the person at the insurance company's head office who reviews your application for coverage to determine whether or not the insurance company will issue a policy to you.
The process by which an insurer determines whether or not, and on what basis, it will accept an application for insurance.
A rating structure in which one premium applies to all insureds, regardless of age, sex, or occupation.
One not acceptable for insurance due to excessive risk.
A flexible premium life insurance policy under which the policyholder may change the death benefit from time to time (with satisfactory evidence of insurability for increases) and vary the amount or timing of premium payments. Premiums (less expense charges) are credited to a policy account(...)
An annuity contract in which the amount of each periodic income payment may fluctuate. The fluctuation may be related to securities market values, a cost of living index, or some other variable factor.
Life insurance under which the benefits relate to the value of assets behind the contract at the time the benefit is paid. The amount of death benefit payable would, under variable life policies that have been proposed, never be less than the initial death benefit payable under the policy.
A provision that a pension participant will, after meeting certain requirements, retain a right to all or part of the accrued benefits, even though the employee may leave the job before retirement.
Viatical Settlement means the selling of one's own life insurance policy to another in exchange for an immediate percentage of the death benefit. The person or in many cases, group of persons buying the rights to the policy have high expectation of the imminent death of the previous owner.
A provision in some policies to relieve the insured of premium payments falling due during a period of continuous total disability that has lasted for a specified length of time, such as three or six months.
A plan of insurance for the whole of life. It includes straight life on which premiums are payable until death.
The legal statement of a person's wishes concerning the disposal of his or her property after death.
This is a form of term life insurance that may be renewed annually without evidence of insurability to a stated age.
