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Glossary 

Welcome to our glossary.

We are passionate about making insurance simpler and easier for everyone to understand. So we thought it would be helpful to explain some of the unfamiliar terms that we have to use to ensure we are accurate.

We would love this to become the most comprehensive glossary in the industry so if you spot a term not listed here, please send a note to insurancemadesimple@manulife.com

Simplifying the language we use is critical to our mission. We found that we couldn’t avoid using some technical terms because it’s the language of our industry and changing them might cause confusion. Instead, we have explained each using plain language. This glossary is intended to help you understand insurance terms which may be confusing or complex. It isn’t intended to replace conversations with our agents or partners, who are equipped to help you make the right decisions for your needs.

 
 
 

Attained age 

This is the age at which you're able to take action; for example to withdraw funds or receive benefits. We calculate this as your current age, based on your nearest birthday.

Automatic premium loan 

This feature allows you to stay covered even if you have missed a premium payment. The money and interest are deducted from your cash value, which means that your benefits will be reduced if you don't restart your payments. 

Attained age 

This is the age at which you're able to take action; for example to withdraw funds or receive benefits. We calculate this as your current age, based on your nearest birthday.

Automatic premium loan 

This feature allows you to stay covered even if you have missed a premium payment. The money and interest are deducted from your cash value, which means that your benefits will be reduced if you don't restart your payments. 

Beneficiary

This refers to someone who is entitled to receive money from an insurance policy. There are two main types of beneficiaries - primary and secondary.

For example, Ko Aung takes a life insurance policy. He selects his wife as the primary beneficiary and his only child, Maung Maung, as the secondary beneficiary.

When Ko Aung passes away, his wife is entitled to receive the proceeds of the policy (or the 'death benefit').  If she has also passed away then Maung Maung, the secondary beneficiary, is entitled to the death benefit.

Benefit

A benefit is the amount of money we'll pay according to the terms of a policy. This is typically the reason why you would invest in an insurance policy, allowing you to plan for the future and giving you peace of mind. 

Cash value 

This is the amount of money we will pay you when your policy ends and the policy is eligible. 

We understand that circumstances change and perhaps you need to cancel your policy before it is supposed to end. The cash surrender value (also known as 'surrender value') is the amount of money we'll pay in that situation. Cancelling the policy in the early years might result in penalty charges. This means that the cash surrender value could be smaller than the cumulative amount you've paid into your policy. 

Cover / Coverage

This is the amount of protection under your insurance policy. You pay us a premium to protect you and your loved ones against unexpected events. If these events take place, we fulfil the promise of the policy. 

It is important that you discuss your needs with us before choosing a policy. It's also critical that you read your policy terms and conditions to understand what is included and what is excluded.

Critical illness

This expression has different meanings in different industries. When we refer to 'critical illness', we mean a serious physical or mental health issue (for example cancer, a heart attack or Alzheimer disease).

Different policies will cover different critical illnesses, so it's important that you discuss your needs with us before choosing a policy. It's also important that you read your policy terms and conditions, so you know both what is included and what is excluded.

Death benefit 

A death benefit is typically the reason why you would invest in a life insurance policy, allowing you to plan for the future and giving you peace of mind. When you pass away, your beneficiary will receive the proceeds of the policy, which is called a death benefit.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary.  

Free Look Period

You may cancel your policy by notifying us in writing within resonable amount of time after you receive this policy.

Face Amount

This is the amount you have purchased which can be found on your policy summary. Your benefit is usually express as percentage (%) of the Face Amount. 

It is important that you understand all benefit you are covered and we recommend to discuss with us or your insurance agent if you need any clearity. 

Grace period

This is the amount of time that we continue to cover you if you stop paying your premium. It is really important that you reinstate your premium payments before this period ends so that you continue to be protected. 

Group insurance policy

This type of insurance typically covers groups of people such as employees of a company, or members of an association. This is different from an individual insurance policy, which you would select and pay for yourself. 

Guaranteed insurability offer

This is a hassle-free program that gives insurance cover without having to answer any additional medical questions or provide any additional medical reports, if conditions are met.

Guaranteed renewal.

This means that as long as you pay the premiums on your policy, we'll continue to insure you up to a pre-agreed age.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary.  

Immediate family  

This usually refers to the legally recognised parent, child or spouse of the person insured.

Incontestability provision

If you have made a mistake in your policy details, this clause prevents us from denying a claim after a certain period of time, typically one year.

Individual insurance policy 

This is a personal insurance policy that you choose and pay for yourself. It is different from a group insurance policy which is typically provided to you by your employer.

Initial premium 

This is the first payment made under a new insurance policy.

Insurability 

This refers to how eligible you are for insurance. We take into consideration factors like health, age and risk profile before making a decision.

Insurable Interest

Insurable interest is defined as the reasonable concern of a person to obtain insurance for any individual or property against unforeseen events such as death, losses, etc. A person is expected to have a reasonable interest in a longer life for himself, his family, business and hence is in need of acquiring insurance for these. Therefore, insurable interest is often related to ownership, relationship by law, or blood and possession.

Issue age

This is the age we use as basis for your premium when you buy a policy. This is computed as your age on your nearest birthday when the policy is issued. Typically, the older you are, the higher the premium.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary.  

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

Lapse 

This means that you are no longer covered by your policy. It happens when you stop paying your premium and any potential grace period has expired. If this has happened please contact us immediately.

Level premium 

This is a type of life insurance where premiums stay the same throughout the term of the policy.

Life insurance policy 

Let's face it: life insurance is not fun to think or talk about, but like taxes or visiting the dentist, planning for the future is an essential part of being an adult.

If people depend on you for financial support, then life insurance is an important way of keeping them protected. At Manulife, we've made it our mission to help you make easier decisions, so that we can support you and your loved ones.

Life insured 

This describes a person who is covered by an insurance policy. They may also be the the policyowner.

Maturity date 

This is the pre-agreed date on which a policy term ends. A policy is no longer effective after its maturity date.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

Payout 

This is a fixed amount of money paid to you as the policyholder at regular intervals.

Policy loan 

A life insurance policy loan is just a loan from the 'cash value' of your policy. It is important that you keep up the payments on your loan so that we do not need to reduce the final pay-out.

Policy owner 

A policy owner is a person in whose name the insurance policy is held. Another term for this is 'policyholder'.  So, if you buy an insurance policy under your own name, you’re the policy owner.

As the policy owner, you can add more people to your policy. These would become additional 'people insured' under the policy. 

Policy year 

This refers to every 12-month period, starting from the day the policy becomes effective.

Pre-existing condition 

This is a health condition (either physical or mental) that is diagnosed before your policy becomes effective. It is important that you declare these conditions so that we can confirm whether we can cover them. If you do not declare these conditions upfront, your policy may become invalid. 

Premium 

This is the cost of your insurance policy, which may be paid on a monthly, quarterly, or annual basis. 

Premium paying period 

This is the total number of periods (eg. years) that a policyholder will need to pay premiums. It will vary depending on the type of policy you choose.

Premium rate 

This is the amount of money you need to spend for your policy. This may vary from year to year, depending on the level of cover and your risk profile. Premium rates can be fixed, we call these 'level premiums'.

Policy debt

This refers to: an automatic premium loan and the interest on it; or the cash loan and the interest on it; or both. 

If the policy has net cash value and if you fail to pay a period of grace, we will automatically borrow the overdue premium loan (the 'automatic premium loan').

You may apply for a cash loan (the 'cash loan') net cash-in value is positive. You must use the application form we give you and whether we grant the loan, the maximum amounts of 90% of cash value is allowed.

We will charge you interest on a daily basis on the amount you owe, at interest rates of 15% per annum. Interest will be added to the amount you owe on each policy anniversary. The amount you owe refers to: the automatic premium loan or cash loan, or both (in the policy year where you first take out the automatic premium loan or cash loan or both, or in the policy year where there is no outstanding policy debt at the time you take out the automatic premium loan or cash loan or both); and in future policy years, the amount owed from the previous policy year (which includes interest) and any automatic premium loan or cash loan (or both) taken up in that policy year.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

Rider 

This refers to an additional, optional provision to your insurance policy. A rider increases the level of your coverage and will usually increase premiums.

Surrender  

This simply means to cancel a policy before your policy supposes to end for the purpose of getting a policy's cash value.

Term life insurance

There are two types of life insurance policy: term life and whole life

'Term life' means we cover you for a defined period of time (for example, 25 years) whereas 'whole life' means we cover you for your entire life. 

Underwriting 

This is the process by which we assess how eligible you are for insurance and the level of risk we will take on your behalf.

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

Waiver of premium option  

Under this option you will no longer continue paying your future premium if you are unable to pay for it due to disability or death or other unfortunate events. It's an optional benefit (also known as a rider) that you'll find on several of our plans. It is important that you understand its benefit and we recommend to discuss with us or your insurance agent if you need clarity. 

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

We do not have entries at the moment. If you think we should include any term here, send us a note on insurancemadesimple@manulife.com and we’ll add it to our glossary. 

This glossary has been created for informational purposes and should not be considered as legal or financial advice. Contractual terms and conditions will prevail should any of the content in this glossary conflict with your policy documents. 

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