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Actuary
Specialist in risk analysis in relation to insurance. Their job is to analyse risks and to calculate pricing based on that analysis.

Acceptance terms
The terms by which an insurer or lender agrees to accept an application for insurance or home lending.

Advisor
An intermediary sales person who is independent of the insurance, home lending or kiwi saver providers whose products they sell.

Annual premium income (API)
The annual equivalent of the premium payable by the customer e.g. $100 per month is the equivalent of an API of $1200.

BMI (Body Mass Index)
A measurement of obesity. The calculation is weight in kg divided by height in m2 . E.g. weight = 66kgs height = 1.65m BMI = 66/2.72 = 24 Underweight = BMI < 18.5; Average = BMI 18.5 – 24.9, Overweight = BMI 25 – 29.9; Obese = BMI 30 – 35; Morbidly obese = BMI> 35.

Claim
The process by which a demand is made against the proceeds of an insurance policy

Claims ratio
The ratio of claims costs to premiums received for product providers

Commission
The payment made by product providers to agents and brokers for the sale of their products.

Cover also known as sum insured
The amount of protection provided by an insurance policy

Declined
When an insurer or lender refuses to accept an application for its products or where a claim against an insurance policy is turned down by the insurer.

Deferred
When an insurer delays the acceptance of an application for insurance until a current risk reduces to an acceptable level or an unknown risk is able to be quantified

Endorsement
A special condition that applies to an insurance policy for example an endorsement may state that drivers younger than a nominated age are not covered under the policy or it may state that a particular medical condition is not covered e.g. asthma.

Exclusion
Anything that is not covered by the policy. There may be blanket exclusions that apply to all customers and specific exclusions that apply only to specific customers.

Expiry date
The date that a benefit, policy or contract reaches its end date

Free Look Period
By law there is a 15 day 'free look' period for insurance policies whereby the client can cancel and receive all premiums back. Some companies provide a longer period than that required by law. We have 30 day

Group insurance
A single insurance policy which insures a group of individuals. Commonly provided for employees of the same company. A master policy is issued to the company rather than individual policies being issued to the employees.

Insurance and Savings Ombudsman (ISO)
A single insurance policy which insures a group of individuals. Commonly provided for employees of the same company. A master policy is issued to the company rather than individual policies being issued to the employees.

Insured
A person or organisation covered by an insurance policy

Issued
A contract is issued once the application has been accepted by the product provider and all requirements to complete the contract have been received

Lapse
A policy of insurance lapses when premiums remain unpaid for a predetermined period. A lapsed policy provides no coverage during the period it remains lapsed

Life assured
A person covered by a life insurance policy

Loadings
Additional premium charged to an insured who presents and higher risk of claiming than the average insured. Can be expressed as a percentage e.g. +50% which means an additional 50% over and above the standard base rate or as a per mille loading e.g. +$2.00 per mille which means an addition $2.00 per annum for every thousand dollars sum assured

Loss of policy declaration
A policy of insurance lapses when premiums remain unpaid for a predetermined period. A lapsed policy provides no coverage during the period it remains lapsed

Medsafe
Government body responsible for establishing the safety and efficacy of medications. Only medsafe approved treatments are able to be prescribed in NZ

Memorandum of transfer
The legal form required to be completed which enables ownership of a contract to be assigned from one party to another

NTU (not taken up); NPW (not proceeded with); WNC (will not complete)
Where an application for a contract is cancelled or withdrawn before the contract is completed and issued

Outstanding requirements
The requirements needed by a product provider to enable a contract to be assessed, completed and issued

Pending business also known as pipeline
The sum of all applications held by the insurer awaiting requirements to complete or awaiting the completion of the assessment process

Personal medical attendants report (PMAR)
A report of an applicant's complete medical history provided by the applicant's normal attending physician at the insurer's cost. Used for assessing the health risk of an applicant

PHARMAC
Government body responsible for deciding which Medsafe approved medications will be publicly subsidised

Pipeline also known as pending business
The sum of all applications held by the insurer awaiting requirements to complete or awaiting the completion of the assessment process

Policyholder; policy owner
The individual or organisation to whom the proceeds of the policy will be paid and whom has the right to make changes to the policy details subject to the insurance companies normal processes

Policy document
The entire contract terms and conditions

Policy schedule
Included as part of the policy document, the schedule outlines the specific details relating to the insured e.g. name, address, types and amounts of cover, premium payable etc...

Pre-existing condition
A physical defect, medical condition or disease that an applicant has suffered from or is suffering from at the date of an application for life or health insurance benefits

Premium
The total amount payable to an insurer for an insurance policy

Premium rate
The rate charged for each unit of insurance for that client excluding policy fees and loadings

Premium renewal
The new premium calculated each year for insured benefits

Premium review date
Some life insurance contracts provide for a longer period between renewals than the twelve months. The premium review date indicates the date that premiums will next be renewed

Proposal form
An application form for insurance benefits

Rating agency
An agency that rates a product provider on its financial strength and capability to meet claims. Ratings are based on the company's investment performance, liquidity, earnings, reinsurance programs and management experience and integrity

Reinstatement
When an insurance policy has lapsed the insurer may allow those benefits to be put back into force upon receipt of the outstanding premiums. The company may require the insured to be reunderwritten before agreeing to reinstate the coverage

Reinsurance
When an insurance company pays a wholesale insurance company to share the claims risk with them. This helps the insurer to spread the impact of any one type of risk

Sum insured also called cover
The amount of protection provided by an insurance policy

Underwriting
The assessment of the risk posed to an insurer or lender by the individual demographics of the applicant and/or the asset to be insured

Unearned premium
The amount of premium effectively paid in advance by the insured which would be refunded if that the policy was cancelled at that time

WNC (will not complete)
Where an application for a contract is cancelled or withdrawn before the contract is completed and issued

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