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You can use our glossary
to find the definitions of many terms you will come
across when arranging a secured homeowner loan
Click on a letter A
to Z for terms beginning with that letter
F
Family Income Benefit
Type of term insurance policy. Your dependants would receive a regular income until the end
of the policy term, if you were to die during the term.
FSA (Financial Services Authority)
The main organisation responsible for regulating financial services in the UK.
Fund
A type of investment in which investors pool their money together for a lower risk venture.
G
Guaranteed Bond
A lump sum life insurance policy, which invests in a with-profits fund. As the name
suggests, the insurance company will guarantee to pay you a fixed amount at a stated time. Guaranteed
Bonds can be income or growth.
H
I
IFA (Independent Financial Adviser)
IFAs are completely independent financial experts who can advise objectively on companies, markets and products.
Income Protection Plan
A protection plan which pays a monthly benefit to replace a proportion of income
lost due to illness or disability. Also know as Permanent Health Insurance (PHI).
Increasing Term
Type of term insurance policy. The cover and the amount you pay into the policy are increased
by a specific percentage each year calculated on the original sum insured. Designed as a way to increase your
life cover as your earnings increase.
Indexation
A means to increase the premiums to a plan in order to reduce the effects of inflation.
Premiums are normally increased in line with RPI (Retail Prices Index) or NAEI (National Average Earnings Index).
Inheritance tax
Payable on the estate of a deceased person if the value of their assets falls above a certain
level. Gifts between spouses are exempt from inheritance tax.
Insurable Interest
A legally recognised interest enabling a person to insure another. The insured must be
financially worse off on the death of the life assured.
Investment Bond
Combines investment with some life cover. The payments you make into an insurance policy or
investment bond, usually a lump sum, are invested in the insurance company's
with-profits or
unit-linked funds
(Life Funds). Different types of bonds include the guaranteed bond and unit-linked single premium bond.
Not to be confused with a company or government bond, an investment that offers a fixed rate of interest and
an area where your chosen Life Funds may be invested.
J
Joint Life Second Death
A policy which will only pay out when the last survivor of a joint life policy dies.
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Life insurance guide
