This glossary is intended as a general aid to help you understand some of the commonly occurring phrases and jargon used in the insurance world.  If you have any questions about the use or meaning of a term or expression in any particular product or literature, you should raise them with the provider concerned.

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Absolute owner
This is the only owner of an item such as a building, vehicle or a piece of equipment.
An unexpected or unplanned event or incident often causing damage or injury such as a road traffic accident.
Accidental damage
Unexpected or unplanned damage or harm caused to property or a person.
Accidental death
A death caused by an unexpected or unplanned event or incident.
Accidental death benefit
Some life policies will make an additional payment, over and above the original sum insured, if the policyholder dies as a result of an accident.
To build up or accumulate.
Act of God

An event that is not the fault of any individual, such as a natural disaster.

Most insurance policies do not contain an exclusion for acts of God. The policy will set out what is insured and what the main exclusions are. If loss occurs from an event covered, then the insurer will pay out, in accordance with the policy terms and conditions.

A professional person who is qualified to calculate risks and probabilities relating to insurance and pensions.
An additional piece of information added on to a policy.
Additional premium
An additional amount on top of agreed premium payments as a result of a change to the existing policy.
A written statement sworn to be true in front of a third party, such as a solicitor.
Someone who acts as a third party to help customers buy insurance or providers sell insurance.
Aggregate limit of indemnity
The maximum amount an insurer will pay for all claims over a set time frame.
Allocation rate
When money is being paid into a fund (like a pension fund), the allocation rate is the percentage of the money left which can be invested after the charges have been taken off. For example, if the charges were 2% then the allocation rate would be 98%.
Annual allowance
The maximum amount that can be saved by you or on your behalf in a pension scheme each year while still getting tax relief. This allowance may be reviewed and changed by government, and it is currently £40,000. Some people may have a higher allowance.
Annual management charge
A yearly charge made by fund managers. It is usually a percentage of the value of the funds that are being managed.
Annual payment
A sum of money paid out every year, such as an annuity.
Annual percentage rate
This tells you how much you will be charged as a percentage when you borrow money.
Annual premium
This is the amount you pay an insurer each year for a policy you have taken out.
A person who receives a regular income from an annuity.
An annuity (also called lifetime annuity or pension annuity) converts money from your pension fund into a regular taxable income in your retirement. There are different types to suit your circumstances, but most annuities guarantee to provide you with an income until you die. Generally, you cannot change or cash in your annuity.
Annuity protection
An option you can choose when you take out an annuity. If you die, your nominated or chosen beneficiary will receive a lump sum payment or a percentage of the value of your pension fund (the annuity income you took from your pension fund while you were alive will be deducted). (Also known as value protection).
Annuity rate
This is the amount of regular retirement income you can buy from an annuity provider with your pension fund. It is dependent on factors such as your life expectancy, expected returns on your investment, and the type of annuity you choose. Annuity rates vary between providers, so it is important to shop around before buying an annuity.
Appointed representative
third party who is appointed to sell insurance and investment products.
Things that you own such as buildings, vehicles, stocks, shares and money in the bank.
This is cover for an event that is certain to happen, such as death. This is different from insurance which protects from an event that might happen.
Authorised insurer
An insurance company given permission to provide insurance in the UK and supervised by the Financial Conduct Authority.