Financial Glossary


Back Office
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.
Back To Back Annuity
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 annuity providing the highest pay out of all types of annuities, along with a guaranteed life insurance policy allowed an uninsurable person to convert his/ her RRSP into the best choice of annuity and guarantee that upon his/ her death, the full value of the annuity would be paid tax free through the life insurance policy to his family members. However, in the early 1990's, the Federal tax authorities put a stop to the issuing of standard life rates to rated or uninsurable applicants. Insuring a life annuity in this manner is still an excellent way to provide guaranteed tax free funds to family members but the application for the annuity and the application for the life insurance are separate transactions and today, most likely conducted through two different insurance companies so that there is no suspicion of preferential treatment given to the life insurance application.
A procedure for making the effective date of a policy earlier than the application date. Backdating is often used to make the age of the consumer at policy issue lower than it actually was in order to get a lower premium.
Bankers' Acceptance (BA)
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.
Bear Market
When the stock market appears to be declining overall, it is said to be a bear market.
Bearer Security
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.
Benefit Period
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.
The amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss covered by the policy.
Blended Payments
A method of repayment where principal and interest remain constant in their amount. Blended Mortgage: If your mortgage is portable - and you need extra funds the new mortgage can be added to the old and the rate/term is blended. Some lenders also offer Split Mortgages so you can take a new term for the extra funds.
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.
Book Value
the purchase price minus accounting depreciation
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.
An agent for buying /selling securities who charges a commission for services rendered.
Bull Market
When the stock market appears to be advancing overall, it is said to be a bull market.
Business Life Insurance
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.
Buy/Sell Agreement
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/ her interest during his/ her lifetime, as well as disposal of interest upon death or disability. Life insurance, critical illness coverage and disability insurance are major considerations to help fund this type of agreement.