Hong Kong

Glossary

Agent

Agent is a person who arranges an agreement on behalf of his insurer with the third party.



Broker

One who advises persons on their insurance needs and negotiates insurance on his/her behalf with insurers.



Claim

A request for payment of insurance policy benefits following the occurrence of a covered loss.



Credit Life Insurance

A type of term life insurance designed to pay the balance due on a loan if the borrower dies before the loan is repaid.



Endowment Insurance

Life insurance that provides a policy benefit payable either when the insured dies or on a stated date if the insured lives until then.



Exclusion

An insurance policy provision that describes circumstances under which the insurer will not pay policy benefits that otherwise would be payable.



Grace period

A specified length of time within which a renewal premium that is due may be paid without penalty.



Individual insurance policy

An insurance policy that is issued to insure the life or health of a named person. Some policies also insure the named person's immediate family or a second named person.



Initial premium

The first premium paid for a new insurance policy.



Insurable interest

The interest an insurance policyowner has in the risk that is insured. The owner of a life insurance policy has an insurable interest in the insured when the policyowner is likely to benefit if the insured continues to live and is likely to suffer some loss or detriment if the insured dies



Insured

The person whose life or health is insured under an insurable policy.



Lapse

The effect on an insurce policy if a renewal premium has not been paid by the end of the grace period.



Life insurance policy

A policy under which the insurance company promises to pay a benefit upon the death of the person who is insured.



Maturity date

The date on which an insurer will pay the face amount of an endowment policy to the policyowner if the insured is still living.



Misrepresentation

A false or misleading statement.



Policy

A written document that contains the terms of the contractual agreement between an insurance company and the owner of the policy.



Policy rider

An amendment to an insurance policy that becomes a part of the insurance contract and that either expands or limits the benefits payable under the contract.



Policyowner

The person or business that owns an insurance policy.



Premium

A specified amount of money an insurer charges in exchange for its promise to pay a policy benefit when a specific loss occurs.



Primary beneficiary

The party designated to receive the proceeds of a life insurance policy following the death of the insured.



Sum Assured

The amount of the death benefit payable under a life insurance policy.



Term life insurance

Life insurance that provides a death benefit if the insured dies during a specified period.



Underwriting

The process of identifying and classifying the degree of risk represented by a proposal insured.



Whole life insurance

Life insurance that provides lifetime insurance coverage at a level premium rate that does not increase as the insured ages.



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