Glossary of Insurance Terms
Backdating: A procedure used to make the effective date of a policy earlier than the application date. Backdating is commonly used to make the insurance age of the insured at policy issue lower than it actually is in an effort to receive a lower premium. Most policies can be backdated up to six months. Backdating is also commonly referred to as Saving Age.
Beneficiary: A person(s) designated by the policy owner to receive the proceeds of an insurance policy upon the death of the insured.
Benefit: For life insurance, it is the amount of money specified in a life insurance contract to be paid to the beneficiary upon the death of the insured. It is commonly referred to as the Death Benefit. For health insurance, it is the amount of money payable by a health plan for the cost of covered services, as defined in the Certificate of Coverage.
Benefit Period: The maximum length of time for which benefits will be paid under the terms of the insurance policy.
Blood Chemistry Panel: A series of blood tests that an Insurance company may require of applicants during the underwriting process.
Broker: A licensed representative who sells and services insurance policies. Brokers represent their customers and are usually contracted to offer insurance products from several different insurance companies.
Burial Insurance: A life insurance policy designed to provide Just enough Insurance to cover funeral and burial expenses.
Business Life Insurance: Life insurance purchased for business rather than personal purposes. Examples are Insurance owned by a business on the life of a key employee and Insurance owned by a business partner on the life of another partner.
Buy Sell Agreement: An agreement for the transfer of business ownership to the remaining owners at the death or retirement of an owner. The transaction is typically funded through a life insurance policy carried on the lives of each individual owner.