Glossary of Insurance Terms

Capital disability/Total permanent disability

The medically certified total and permanent disablement of the Insured as a result of sickness or injury sustained more than six months after the commencement date and which must have existed for a continuous period of at least 6 months, and resulting in the Insured being unable to pursue the normal occupation in which he was gainfully employed at the time of disablement or any other occupation for gain or reward to which he would be reasonably suited by education, training, status or experience. This benefit will cease when the life assured reaches 70 years age last birthday.

Cedant

Direct insurer, which passes on (cedes) shares of its insured risks to a reinsurer in exchange for a premium.

Cession

A transfer of the assured's interest or ownership to a third party. When you transfer the ownership, you cede the policy to somebody, the cessionary. You must remember that although the cessionary becomes the owner of the policy, you remain the life assured, i.e. the person who has to die, or live till maturity, before the proceeds become payable. A cession overrides the appointment of a beneficiary, so that if you die (or survive to maturity), and the cession is still in force, the cessionary is entitled to the proceeds of the policy.

Child

A child by birth to the insured, including a posthumous child, a stepchild, or an adopted child, providing that proof satisfactory to BLIL is submitted for the latter two (2) categories. All unmarried children under the age of 21 may be covered. Cover is extended to age 25 if the child is registered full time at a recognised educational institution and is still classified as a dependent. Mentally retarded as well as permanent and totally disabled children may be covered under this benefit irrespective of their age; includes an illegitimate child, stepchild or a child adopted in accordance with the Adoption of Children Act, or in accordance with any enactment whatsoever, whether within or outside Botswana, relating to the adoption of children.

Claimant

The person who comes into the office to make a claim. This person must be entitled to this role.

Commencement date

The date on which the cover commences; The commencement date will be the date stated in the policy schedule of this policy document and it means the date that the cover began.

Commission

Is a fee paid to an agent or broker for the their services.

Compulsory Annuity

An annuity purchased from the proceeds of a pension fund. This is compulsory because it is a statutory requirement that a certain portion of pension money be
used to purchase an annuity. In Botswana, at least 2/3 of the pension fund should be applied to purchase an annuity.

Cooling Off Period

Cooling off period refers to the first 90 days in which you may cancel this Policy by advising Botswana life. Botswana life will refund any premiums paid within the Cooling off period and will provide written confirmation that this Policy has been cancelled.

Credit Life Insurance

A single or recurring premium term life assurance policy taken out by borrowers. Its purpose is to cover payment of outstanding loan balances in the event of their
dying, or on the happening of other specified events.

Customer due diligence

Means the process where relevant information about the customer is collected and evaluated for any potential risk of commission of financial offence.

Days of Grace

The period allowed, during which the assured may pay an overdue premium without the policy lapsing.

Death Claim

A requirement for the life insurer to pay benefit as a result of the death of the life insured.

Debit Order

A written, signed authority, given by a policyholder to the assurance company, to deduct the premium amount from his/her bank account.

Dependent

In relation to any person, includes his surviving spouse and any parent, child, and grandchild of his.

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