Dictionary of Financial Terms -
- Earned Premium
- The portion of an insurance premium for which protection has
already been provided by the insurer.
- Earnings Cap
- Since 1989 there has been an upper limit on the amount of salary
that can be taken into account when calculating pensions arising from and contributions payable under an approved
arrangement. This is known as the 'earnings cap'. In the current year (1999-2000) the amount is
- Earnings per share
- A widely used indicator of the return on equity investments. Any
figure quoted represents the total amount of a company's earnings (after deductions) divided by the number of ordinary
shares it has issued. (See also P/E)
- Effective Date
- The date on which insurance under a policy will begin.
- Eligibility Date
- The date at which an individual becomes eligible for
- Eligibility Period
- A specified period of time during which potential members of a
group insurance scheme may join without evidence of insurability.
- Eligibility Requirements
- Requirements imposed for eligibility for coverage, usually in a
group insurance or pension plan.
- Eligible Employees
- Employees who meet the eligibility requirements for insurance set
out in a group policy.
- Employee Benefits
- Benefits offered to an employee by an employer and usually paid for
at least in part by the employer. Life, Health and Critical Illness insurance obtained by an employer on a group basis
are examples of employee benefits.
- Employee Declaration
- A medical questionnaire issued to member of a group insurance
scheme when the members benefit level requires the member to provide evidence of good health. This is usually the first
stage of the Medical Underwriting process.
- An amendment of an insurance policy that alters the provisions of
- A life assurance policy related to a mortgage designed to pay off
the amount originally borrowed at the end of the mortgage term. An endowment policy will pay you a fixed amount on a
set date or if you die before that date, in other words it's both a way of saving and life insurance. People often use
endowments to repay interest only mortgages. The drawback of them is that it is often unclear how much you are having
to pay in charges and the plans are often very rigid, so if you start an endowment and then decide to cancel it, you
might not get back what you paid in.
- Endowment Mortgage
- You only pay interest to the lender, but you also have to pay a
monthly premium for an endowment policy that you take out with an insurance company. The endowment policy is designed
to produce a lump sum either at the end of your mortgage term or at your death if earlier, to repay the capital you
borrowed. You must remember though that the amount paid out is not guaranteed and may not be sufficient to repay the
- Executive Pension Plan.
- A shareholding in a limited company. By extension, 'equities'
is generally used to mean the whole range of shares traded on a Stock Exchange
- The amount by which the value of a house exceeds the total of
the loans secured by mortgage(s) thereon.
- Another word for stocks and shares.
- Equity release
- A type of remortgage where you own your home outright but wish to
use it as security for new borrowing.
- Refers to the increase in benefit (usually annual) payable during
the payment term of an insurance claim that is not settled via a lump sum payment. For example, claims under an Income
Protection Policy might escalate annually in line with the Retail Price Index.
- Strictly, an interest in land, but generally used to mean the total
(land, chattels, investments, etc) owned by an individual.
- Ethical Investments
- Shares or similar investments (for example, holdings in unit
trusts) in companies supposed to conform to a particular set of moral or ethical principles. Different ethical values
have led to a proliferation of funds of this nature with different principles & for example, some will avoid
investing in arms manufacture, and others will avoid tobacco companies. There is ongoing debate as to whether the
following of such principles adversely affects the investment performance of ethical funds.
- The European Single Currency.
- Ex Gratia Payment
- Latin for "from favour." A payment by an insurer to an insured for
which there is no liability under the contract.
- Exchange of contracts
- The point at which the buyer and seller have legally committed
themselves to the sale and purchase of the property.
- Execution only
- Where a customer buys a financial product without receiving advice
on its suitability.
- A fixed amount of money which the insured agrees to contribute
toward the cost of a claim under an insurance policy.
- Conditions or circumstances listed in the policy, for which the
insurer will not provide benefits.
- Executive Pension Plan
- An individual occupational pension arrangement that is normally
used for senior employees / executives. The rules of an occupational pension and not those of a personal pension govern
an Executive Pension Plan.
- Exempt Approved Scheme
- An Inland Revenue approved pension scheme, which is established
under an irrevocable trust and hence qualifies for tax advantages relating to contributions, income and capital gains
- Expense Ratio
- The ratio of insurance company operating expenses to
- Experience Rating
- Process of determining the premium rate for a group risk, wholly or
partially on the basis of that group's claims experience to date.
- Express money transfer
- This is a foreign currency payment to an individual or organisation
delivered electronically to a bank. It takes around 2-5 days, depending on the currency and destination.
© APT Finance. All Rights Reserved
| Legal Disclaimer |