Insurance Vocabulary You Should Know

When it comes to finding an insurance company, learning the language and vocabulary that get thrown around so often can enable you to be on top of the game in finding a good plan. With so many different types of insurance and plans that have special incentives, you want to make sure that you don't miss out on getting a good deal.

Term Life Insurance

Term life insurance is a type of life insurance in which a designated time period is set for the coverage. After the designated period of time is over, the insurance is no longer valid and you must renew the plan or get a new one. Term life insurance usually comes in periods of 1 year, 5 year and 10 year plans.

Variable Life Insurance

This is a type of life insurance that changes depending on how valuable the dollar is at the time you are paying for the plan. It can either go up or down depending on the economy. Things like interest rates are thus not set in stone and can change without warning.

Broker

The person who sells you the insurance plan. The broker you have should be able to answer any and all questions you may have about your insurance plan.

Elimination Period

The elimination period is the amount of time that goes by before a person can get the insurance money after a claim has been issued.

Replacement Cost

The replacement cost is the amount of money it costs to replace damaged or broken items that are under your insurance policy.

Policy

The policy is the exact plan that you have signed on and agreed to pay for with your insurance company. The policy is the written contract and includes all of the details of your plan.