Glossary

Accident: An event or occurrence causing damage/injury to an entity, and is unforeseen and unintended. Age limits: Stipulated minimum and maximum ages below and above which the company will not accept applications or may not renew policies. Agent: An insurance company representative licensed by the state who solicits, negotiates or effects contracts of insurance, and provides service to the policyholder for the insurer. Annuity: It is a scheme where certain amount is paid at yearly/half yearly/quarterly/monthly intervals. Annuitant: Annuitant is the person who receives certain amounts at yearly/half yearly/quarterly/monthly intervals. Assignee: Assignee is the person to whom the benefits under a life policy are assigned. Assignor: Assignor is the person who holds the right/title under the policy and who can make a valid assignment. Beneficiary: The person(s) or entity(ies) (e.g. corporation, trust, etc.) named in the policy as the recipient of insurance proceeds upon the death of the insured. Bonus: Bonus is the amount added to the basic sum assured under a with-profit life insurance policy. Claim Amount: It is the amount payable by the insurer under a policy on a claim arising Coverage: The scope of protection provided under a contract of insurance; any of several risks covered by a policy. Dating Back: Dating Back or Back Dating is an option to the life assured to get the advantage of lower age wherein the policy is commenced from a date earlier than the date of signing of proposal form. However backdating is limited to one year. Deferred Annuity: An annuity plan where the first annuity payment becomes payable after a chosen period that exceeds one year. Deferment date: It is the date on which the deferment period ends. Deferment period: Deferment period is the period from the date of commencement of the policy to the date of commencement of risk on the child's life under a Children's Deferred Endowment Assurance policy. EPDB: Extended Permanent Disability Benefit Exclusions: Specific conditions or circumstances for which the policy will not provide benefits. Family insurance: 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 Female lives: Category I: Women with income earned by Virtue of their employment in any reputed organisation or institution eligible for Non Medical Special Schemes. Professions such as Medicine, Law, Charted Accountancy etc. and lady career agents of LIC. CategoryII: Women with unearned income attracting payment on income tax or women holding sizeable personal properties/investments yielding income attracting assessment for income tax. First Class Life: An Individual is categorised as First Class Life if is eligible to have insurance coverage at normal rates of premium. First Unpaid Premium (FUP): First unpaid premium refers to the first default in paying premium by the policy holder. On payment of the due premium a receipt is issued and this receipt indicates the date of next due. If this due premium is not paid that date becomes the date of FUP. Guaranteed Insurance Sum (GIS): Guaranteed Insurance Sum is equal to purchase price paid for a pension along with final Jeevan Akshay Bonus. Gross Insurance Value Element (GIVE): Gross Insurance value element is the amount payable on death of a policy holder under a Jeevan Dhara Policy. Guaranteed Addition: Guaranteed additions are calculated at a rate per every thousand of sum assured. They are added to the basic sum assured and are payable on admittance of claim. This benefit is allowed only for each year for which premiums are paid. Insurability: All conditions pertaining to individuals that affect their health, susceptibility to injury and life expectancy; an individual's risk profile. Insured: The person whose life is covered by a policy of insurance. Life Assured: Life Assured refers to the person whose life is being insured. Last Birth Day (l.b.d): Age at last Birthday Lien: In some cases extra risk is expected to decrease over a period of time. In such cases proposal is considered and accepted with lien. Lien operates through out the period, on a decreasing basis. In the event of death during the lien period full sum assured is not payable. Eg: If 25% decreasing lien is imposed for 5 years. It is understood that in first year risk cover (sum assured payable) is only upto 75%, second year-80%, third year-85%, fourth year 90%, fifth year 95%, and from sixth year onwards lien is not operative. Loyalty Additions: Under certain life policies loyalty additions are given as an additional benefit to the policy holder. The rate of addition depends on the LIC's performance and is allowed only if the policy is in full force. Moral Hazard: Moral Hazard is said to exist in the case where we notice the absence of a genuine need for a life insurance or when a proposal for insurance is submitted by an individual beyond his means. Near Birth Day (n.b.d): Age on nearest birthday Nominee: Nominee is the person who is nominated to receive the amount under a policy and to give a valid discharge to the insurer on settlement of claim under a life insurance policy. Non-Standard Life: Any individual, who cannot be granted a policy under normal rates of premiums but can be granted with an extra premium over normal rates of premium, is considered as a Non-Standard Life. Paidup Value: Paidup value is the reduced amount of sum assured paid by the insurer in case of discontinuation of the payment of premiums after paying the full premiums for the first three years. PDB: Permanent Disability Benefit Premium: Premium is the amount paid to secure an insurance policy. Proposal Form: It is a form, which is to be completed for securing an insurance policy. Proposer: Proposer is a person who proposes the insurance policy. Premium Waiver Benefit (PWB): Premium waiver benefits are the benefits which can be availed under children's policies, wherein the future premiums payable upto vesting date are waived in the event of death of the proposer. Sum Assured: Sum assured is the amount that an insurer agrees to pay on the occurance of an event. Surrender Value: Surrender value is the amount payable to the policyholder on his surrendering his right under a policy and terminating the contract of insurance. Target Pension: Target pension is the amount of pension which one wishes to receive under a pension policy. Term: Term is the period for which insurance coverage is given. Vesting Date: This is the date from which the life assured ie., child becomes the absolute owner of the policy. Vesting Bonus: It is the bonus, which the insurer declares after evaluating its assets and liabilities, and that is added to the sum assured under a policy. Waiting Period: It is the period starting from date of commencement of a policy to the date of commencement of risk under a Jeevan Kishore Policy.