Page 2 - Glossary of Terms flipbook

GLOSSARY OF TERMS

annuitant the individual on whose life the annuity is purchased. Also known as the
claimant, plaintiff, measuring life, employee, releasor, injured party.

annuity an insurance contract from which a person receives fixed payments for a lifetime
or a certain period of time.

annuity certain an annuity designed to make payments for a guaranteed period of time.
Payments may be made monthly or annually, immediately or deferred (ie:
beginning 05/01/2003, $1,000 per month for 5 years certain). Also known as a
period certain.

annuity with compounding
benefits an annuity that increases at a fixed percentage computed on the previous year's
payments. It is frequently expressed as an addition to an annuity, for example:
with 3% compounding annually.

assignment company a third-party company who accepts, owns and assumes the obligation for future
periodic payments from the defendant or insurance carrier (assignor). This
company is affiliated with the life insurance company. Also known as the
assignee.

assignment document a legal document which transfers the obligation to make the periodic payments
from the casualty company or self-insured company (assignor) to a third party
(assignee). The most commonly used and/or accepted are the UQA and UQA&R.

assignment fee the cost an assignment company charges to accept the obligation of the casualty
company and ownership of the annuity policy. Also known as the third-party
assignment fee.

assignor the original party obligated to make the future periodic payments outlined in the
settlement agreement. This party transfers its obligations to the third party
(assignee).

beneficiary the individual(s) or estate which will receive the guaranteed payments should
the annuitant die prior to all guaranteed payments being made. Also known as
the contingent payee.

benefit the payments to be received should the annuitant live to his/her normal life
expectancy or the certain only period of time.

cash refund a lifetime annuity with a guaranteed benefit equal to the premium amount.
Commonly used for workers' compensation cases. The beneficiary will be the
casualty company. The balance of the premium, after all payments made have
been deducted, will be returned to the casualty company in a cash lump sum.

casualty company the insurance company who has insured the defendant. They will provide the
premium. Also known as insurance carrier, purchaser, insurer, assignor.

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