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Agency
agreement
A contract between
St Andrew's and a client that outlines all terms and conditions of our
relationship.
Association
of British Insurers (ABI)
A trade association
of over 450 insurance companies that, between them, transact over 96%
of UK insurance business. St Andrew's is an ABI member.
Automated
Direct Debit Instruction Service (AUDDIS)
Electronic transmission
of direct debit instructions. AUDDIS is needed to operate paperless direct
debits.
Banks
Automated Clearing System (BACS)
The
system used to collect premiums from a customer's bank account by direct
debit and to pay benefits into a customer's account by direct credit.
Baseline
The standard for MPPI
policies agreed by the ABI, CML and Government as part of the SHO initiative.
Benefit
period
The length of time
that benefits are paid during a claim. Most payment protection policies
will pay out a maximum of 12 consecutive monthly benefits.
Bill
Payment Protection (BPP)
Protection for household
bills, generally ASU cover.
Bordereau
(plural: bordereaux)
A method of claim
or premium reporting where the insurer simply receives an outline report
showing summary information without individual customer details. Credit
card and catalogue schemes are often reported in bordereau form.
Council
of Mortgage Lenders (CML)
A trade association
whose members arrange 98% of UK residential mortgage lending.
Credit
Card Repayment Protection (CCRP)
Protection for repayments
on a policyholder's credit card balance, generally LASU cover. The monthly
benefit will be a fixed percentage (usually 2% to 10%) of the card balance
at the start of a claim.
Credit
Protection Insurance (CPI)
Another name for payment
protection.
Critical
Illness
A product that pays
a lump sum if a customer suffers a serious illness such as heart attack,
cancer, stroke, kidney failure, major organ transplant or coronary artery
bypass surgery.
Demands & Needs (D&N)
Summarises the questions that a customer may potentially ask and explains the products suitability.
Domestic
Helpline Protection (DHP)
DHP covers emergency
repairs following damage caused by unforeseen home emergencies such as
a failure of the domestic water supply or central heating, gas or electricity
supply, drains and sewers. Also, the property is made secure following
lost keys, damaged locks or forced windows.
Excess
period
The period of time
at the start of a claim for which no payment is made. For MPPI, the baseline
standard is 60 days, i.e. no benefit is payable for the first two months
of a claim.
Financial
Services Authority (FSA)
The regulator responsible
for investment business and the supervision of banks in the UK. Regulatory
reform will eventually lead to the FSA becoming the single regulator for
all financial products in the UK.
Financial Services Compensation Scheme (FSCS)
The UK's statutory fund for customers to claim compensation, if a financial firm is unable to pay claims against it.
GAP
A product that pays
the shortfall between the amount paid by the motor insurer in the event
of a vehicle write-off and the amount owing under the credit agreement
taken out to pay for the vehicle.
General
Insurance Standards Council (GISC)
The General Insurance
Standards Council is a new body to regulate the selling of general insurance
products in the UK. It is a self-regulating, rather than a statutory,
body. Our links page includes a link to the GISC website.
Income
Support for Mortgage Interest (ISMI)
State help with mortgage
repayments for sick or unemployed borrowers. For mortgages arranged since
October 1995, borrowers get no help for the first nine months.
Initial Disclosure Document (IDD)
Provides information to the customer on the provider of the product.
Insurance
Ombudsman Bureau (IOB)
An independent body
for resolving disputes between policyholders and insurers. St Andrew's
is an IOB member.
Insurance
Premium Tax (IPT)
A tax levied on general
(i.e. non-life) insurance. From 1/7/99, this increased to 5% of gross
premium.
Jobseekers
Allowance (JSA)
A benefit paid by
the Employment Service to the unemployed. It is means-tested after six
months (or from day one if the claimant has paid insufficient National
Insurance contributions).
Keyman
and Keyman Plus
Keyman is life insurance
taken out by a business on a person whose death would adversely affect
the business. Keyman Plus adds accident and sickness cover to this life
cover and Critical Keyman includes critical illness cover.
(Life),
accident, sickness and unemployment (L) ASU
Cover to protect repayments
on a personal loan, mortgage, credit card or other regular financial commitment.
Monthly
benefit
The amount paid each
month under an accident, sickness or unemployment claim. This will normally
equal the monthly repayment on the customer's personal loan, mortgage
or credit card.
Monthly
premium
Monthly payments collected
by a lender or insurer to extend cover for a further month, often collected
by direct debit or when credit card statements are produced.
Mortgage
Payment Protection Insurance (MPPI)
Protection against
accident, sickness or unemployment for mortgage borrowers.
No Claims Discount (NCD)
No Claims Discount.
Pay
in lieu of notice (PILON)
Compensation paid
to an employee whose employment is terminated before his contractual notice
period has ended.
Payment
Protection Insurance (PPI)
Protection for repayments
on a personal loan, mortgage, credit card or other regular financial commitment.
Penetration
Tells us what percentage
of customers have cover.
Personal
Accident (PA)
Protection that pays
a lump sum if a customer suffers serious accidental injury, e.g. loss
of a limb, loss of sight or hearing, etc. Often includes benefits for
hospital stays.
Personal
Contract Purchase (PCP)
A credit agreement
generally used to finance vehicles whereby the customer funds only the
depreciation of the vehicle over the period of the loan. At the end of
the period, the customer has the option to pay a lump sum and keep the
car, return the car with nothing to pay or sell the car and put any profit
towards a new vehicle.
Personal
Investment Authority (PIA)
The regulator of almost
all types of investment business conducted with private investors, including
life insurance. Now incorporated into the FSA.
Personal
Loan Protection (PLP)
Payment protection
for personal loans, generally LASU cover.
Policy Summary Document (PSD)
Summary of what the policy does.
Resolicitation
Payment protection
sold to a customer via a mailshot or telephone call. Commonly used to
refer to insurance offers made to uninsured customers whose loans are
already in force.
Single
premium
A one-off payment
made to an insurer to provide cover for a pre-determined period.
Stand-alone
A product that is
not linked to a credit agreement, e.g. Bill payment protection or personal
accident cover.
Sustainable
Home Ownership (SHO)
An initiative between
the ABI, CML and Government to create an improved, stable environment
for owner-occupiership in the UK. This led to the creation of the Baseline
MPPI specification.
Total
Amount Repayable (TAR)
The sum of all instalments
paid to a lender, including interest payments, arrangement fees, etc.
Waiting
period - Franchise
period - Retroactive
period
The number of days
that must elapse before the first monthly benefit is paid.
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