Archives: Glossary Terms

In a collective or group life insurance policy, it defines the amount of life insurance that the policy grants to each insured person of the group.

(1) In convertible temporary life insurance policies, the policyholder is allowed to change (convert) the temporary insurance policy to a permanent insurance plan without having to present evidence that the insured is an insurable risk. (2) The right that collective life insurance policies grant a group’s insured person whose coverage ends due to a specific reason, to convert their collective insurance coverage into a permanent individual insurance policy, without having to present evidence of insurability.

These correspond to premiums payable after the initial premium or consideration.

When the insurance company receives the first payment for a life or health insurance contract.

The sum of money the insurer needs to provide the benefits corresponding to the policy.

A specific amount of money on a monthly, quarterly, semi-annual, or annual basis that an insurance company receives in exchange of its promise to offer the policy benefit when a specific loss occurs.

Loan guaranteed by a mortgage, deed, trust, or any other instrument that constitutes a lien or encumbrance on real property and which is granted by a Mortgage Creditor, in the form of first and second mortgages. The loan amortization period must be higher than 5 years, but must not exceed 30 years. Personal loans with mortgage guarantee granted by the mortgage creditor are included, provided the amortization period is higher than 5 years, but not exceeding 30 years, and there is a lien on the real property for the loan amount.

Modified premium whole life policy that requires three or more annual premium payment tiers—for instance, each three years—until the sum to be paid as a uniform premium for the rest of the policy’s period of enforcement is reached.

Practice under which the insurance company accepts to reinstate a temporary insurance policy that has lapsed and changes the effective date.

A policy through which the policyholder does not participate of the insurer’s surplus.