Life insurance terms, explained

What these terms mean when they appear on life insurance. Each definition describes the term itself, not what to do about it.

Beneficiary: The person or entity you name to receive the death benefit.
Cash value: A savings component in some permanent policies that grows over time and can be borrowed against. Term policies have none.
Claim: A request you make to your insurance company to pay for a covered loss.
Contestability period: An early window, often two years, during which the insurer can investigate and deny a claim for misstatements on the application.
Coverage: A part of your policy that pays for a specific kind of loss, up to a limit.
Death benefit: The amount paid to your beneficiaries when the insured person dies, as long as the policy is in force.
Deductible: The amount you pay out of your own pocket on a claim before your insurance starts paying.
Endorsement: An add-on or change to your policy that adds, removes, or adjusts coverage. Also called a rider.
Exclusion: Something your policy specifically does not cover.
In force: Active and providing coverage, because the policy is current and paid.
Insured: A person or thing your policy protects.
Level term: A period during which your premium and death benefit stay the same. Premiums often rise sharply after it ends.
Liability: Coverage that pays for injury or damage you are responsible for causing to someone else.
Limit: The most your policy will pay for a covered loss.
Out-of-pocket: Money you pay yourself, that your insurance does not cover.
Policyholder: The person who owns the insurance policy.
Premium: The amount you pay for your insurance, usually each month or once a year.
Rider: An optional add-on that changes or extends coverage, such as a waiver of premium or an accelerated death benefit.
Sub-limit: A smaller, separate cap inside a coverage that applies to certain items or losses.
Sublimit: A smaller, separate cap inside a coverage that applies to certain items or losses.
Underwriting: How an insurer decides whether to cover you and at what price, based on the risk.

Other policy types

These are general definitions. Your own policy is what governs your coverage, and the same term can be defined differently from one policy to the next. Read your own policy to see what these terms say in your document, cited to the page.