Health insurance - Insurance

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Here are the five definitions that we think you'll find most helpful.

Legal Expenses Cover

Insurance against any fees you might incur for consulting or hiring a lawyer, or other expenses from legal proceedings. This is usually offered as an optional cover, but may be included in your basic policy. Legal expenses cover is frequently offered with home or motor insurance.

Excess

The amount of an insurance claim that will be paid by you and is normally subtracted from the claim amount by your insurer. For example if your mobile phone is stolen and a replacement costs £250 and your excess is £100, your insurer will pay you £150. A standard or minimum excess applies to most types of insurance policy and aims to reduce the cost of cover by limiting claims for small amounts. You could be able to specify a higher excess, known as a voluntary excess, in order to reduce your premium further.

Policy

The terms upon which cover is offered by your insurance company. Your policy documentation should clearly state how much your premium is and how often you should pay it, your excess amount, the terms under which you can claim, how long the cover lasts and any other conditions, endorsements or exclusions.

Premium

The payment(s) that you make in return for your insurance cover. This may be paid as a lump sum up front or in monthly instalments, depending on the policy. Single trip travel insurance, for example, is generally paid in full but your home or motor insurance may give you the choice. With regular payments, failure to continue to pay the premium may result in your policy being cancelled.

Voluntary excess

You may be able to specify a higher excess, known as a voluntary excess, in order to reduce your premium. The excess is the amount of an insurance claim that will be paid by you and is normally subtracted from the claim amount by your insurer.

Need other terms explained? See our Insurance Jargon Buster