AmericaDirect terms

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Insurance Terms
You'll find everything you need to know about life insurance here. Our Research Center is different because we only offer material which is explained in "Plain English".

To get started, let's take a look at common Insurance terms, and make it easy to understand what they mean:

These definitions are courtesy of the American Council of Life Insurers

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Accelerated death benefit A benefit that allows the policyholder to take out money from the policy on an accelerated schedule if he or she becomes terminally ill.

Accidental death benefit A provision added to a life insurance policy for additional payment if the death is covered by an accident. It's also known as double indemnity.

Actuary a professional trained in the technical aspects of insurance and related fields, particularly in calculation of premiums, reserves, and other mathematical terms.

Adjustable life insurance A type of insurance that allows the policyholder to change the plan of insurance, raise or lower the policy's total face amount, increase or decrease the premium, and lengthen or shorten the protection period.

Agent An authorized representative of an insurance company – also known as a life underwriter or field underwriter – who sells and services insurance contracts.

Annuitant The policyholder whose life expectancy is used as a basis to determine how much the annuity will pay out.

Annuity A financial contract that offers tax-deferred savings and a choice of payout options to meet the owner's retirement needs: income for life, income for a certain period of time, or a lump sum.

Annuity certain A contract that provides an income for a fixed number of years, regardless of life or death.

Annuity consideration The payment, or one of the regular periodic payments, that a policyholder makes for an annuity.

Application A statement of information made by an insurance applicant which helps the insurer assess the acceptability of risk.

Assignment The legal transfer of one person's interest in an insurance policy to another person.

Assume To accept the risk of potential loss from another insurer.

Automatic premium loan A loan provision in a life insurance policy allowing any premium not paid by the end of the grace period (usually 30 or 31 days) to be paid automatically through a policy loan if cash value is sufficient.