Glossary

Retirement, pension and insurance terms explained.

A

Ability to pay: The ability of a firm to pay a given level of wages or benefit cost increase while remaining profitable. Dependent upon a firm’s ability to be competitive in its market it is a frequent issue in contract negotiating.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Absolute assignment: A life insurance policy assignment under which the assignee receives full control over the policy and full rights to its benefits. As a general rule when a life insurance policy is assigned to secure a debt the insured retains all rights in the policy in excess of such debt even though the assignment is absolute in form. Absolute Assignment is also known as assignment and collateral assignment. Note: For Approved Superannuation Funds and Approved Retirement Schemes neither the contributions in the plan nor the payment of annuity benefits can be assigned.Source: The Insurance Dictionary, 3rd Edition
Absolute beneficiary: A beneficiary designation that cannot be changed by the insured without the consent from the beneficiary. An absolute assignment is also known as irrevocable beneficiary. Note: It is not customary for persons who become Members of an Approved Superannuation Fund or Approved Retirement Schemes to select an irrevocable beneficiary.Source: The Insurance Dictionary, 3rd Edition
Accident insurance: Replaces a part of earned income that has been lost due to disability caused by accidental injury. May also pay medical expenses caused by accidental injury as well as an indemnity for death or loss of sight or limbs suffered through accident.Source: The Insurance Dictionary, 3rd Edition
Accidental death: Death as a result of accidental bodily injury; that is injury which is unintended unexpected and unusual. Contrasted with death by accidental means which means that the cause of the accident itself must be accidental (slipping off a ladder etc.). Thus a broken neck as a result of an intended safe dive into a swimming pool is accidental but not accidental means.Source: The Insurance Dictionary, 3rd Edition
Accidental death and dismemberment benefit: A life insurance policy provision that pays a stated benefit in case of death or the loss of limbs or sign as a result of an accident.Source: The Insurance Dictionary, 3rd Edition
Accidental death benefit: A payment for loss of life due to an accident that was the direct cause of death. A provision added to a life insurance policy for payment of an additional benefit related to the face amount of the basic policy when death occurs by accidental means as defined in the policy. This is often called double indemnity when the additional benefit equals the face of the policy.Source: The Insurance Dictionary, 3rd Edition
Accidental death insurance: A form of insurance that provides payment if the death of the insured results from accident. Accidental death insurance is often combined with dismemberment insurance in a form called accidental death and dismemberment.Source: The Insurance Dictionary, 3rd Edition
Accidental dismemberment: Often defined as ¨the severance of limbs at or above the wrists or ankle joints or the entire irrevocable loss of sight.¨ Loss of use in itself is not usually considered to be dismemberment.Source: The Insurance Dictionary, 3rd Edition
Accidental means: An unforeseen unexpected unintended cause of an accident. The means that causes the mishap must be accidental for any claim to be payable.Source: The Insurance Dictionary, 3rd Edition
Accrual Basis: accounting method whereby income and expense items are recognized as they are earned or incurred even though they may not have been received or actually paid in cash. The alternative is Cash Basis accounting.Source: Dictionary of Finance and Investment Terms
Accrue: To accumulate. When a right is vested in a person that right is said to accrue to the benefit of that person.Source: The Insurance Dictionary, 3rd Edition
Accrued benefit: the amount of retirement benefit that has been accumulated on behalf of a participating employee. In the case of a defined benefit plan an employee's accrued benefit would be expressed as the amount he or she could expect to receive at normal retirement age if no future funds were contributed to the plan. In the case of a defined contribution money purchase plan or profit-sharing plan a participant's accrued benefit means the balance presently accrued in his or her individual account.Source: The Insurance Dictionary, 3rd Edition
Accrued future service benefit: that portion of determining pension benefits costs under which the actuarial costs are based directly upon benefits accrued to the date of cost determination. Such benefits are determined either by the terms of the plan or by some assumed allocation of total prospective benefits to years of service. When the annual cost of the plan for a given year is calculated the method assumes that a precisely determinable unit of benefit is associated with that year of a participant's credited service.Source: The Insurance Dictionary, 3rd Edition
Accumulation period: In retirement and annuity plans the period when funds re accumulated for later disbursement. This is in contrast to the income period when the accumulated funds are disbursed in the form of an annuity or pension benefits.Source: The Insurance Dictionary, 3rd Edition
Acid test ratio: Cash Marketable Securities and Accounts Receivable divided by Current Liabilities.
Act of God: An accident or event resulting from natural causes and beyond human control or influence such as flooding lightening earthquake or hurricane.Source: The Insurance Dictionary, 3rd Edition
Active Management: A style of investment management that seeks to attain above-average risk-adjusted performance. Active managers buy and sell frequently.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Active Member: means a Member who makes contributions to an approved Superannuation Fund or approved Retirement Scheme or on whose behalf contributions are made.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Actively employed: A requirement placed on full-time employees for participation in a retirement or medical plan. It is a protective underwriting measure that presumes that if employees are healthy enough to be on the job they are healthy enough to be covered.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Activities of daily living (ADL): Getting out of bed bathing dressing and moving around indoors. A measure for rating an individual's level of disability and for predicting long term care utilization.Source: The Insurance Dictionary, 3rd Edition
Actuarial assumptions: the assumptions about uncertain future events or experiences used in actuarial calculations such as future claim rates expenses and earnings. (See also: actuarial present value)Source: The Insurance Dictionary, 3rd Edition
Actuarial cost: A cost derived through the use of actuarial present values.Source: The Insurance Dictionary, 3rd Edition
Actuarial cost method: In pensions plans a technique for establishing the amount and incidence of normal costs supplemental costs and actuarial liabilities pertaining to benefits and expenses. Actuarial cost methods involve valuation techniques used to determine the proper charges against annual operating techniques and to measure the liabilities of the pension plan at any given date.Source: The Insurance Dictionary, 3rd Edition
Actuarial equivalent: the mathematical equal of something else. Amount of annuity or pension which can be provided at the same cost as a specified annuity of a different type payable at the same age or as an annuity of the same or a different type payable at a different age.Source: The Insurance Dictionary, 3rd Edition
Actuarial experience gains or losses: in approved retirement savings plans the effects on actuarially calculated costs of deviations between actual prior experience and the actuarial assumptions used.Source: The Insurance Dictionary, 3rd Edition
Actuarial liability: under an approved retirement savings plan the excess of the present value of total prospective benefits of the plan (plus administrative expenses if included in the normal cost) over the present value of future normal cost accruals determined by the actuarial cost method in use.Source: The Insurance Dictionary, 3rd Edition
Actuarial present value: the current worth of an amount payable or receivable in the future where each such amount is discounted at an assumed rate of interest and adjusted for the probability of its payment or receipt.Source: The Insurance Dictionary, 3rd Edition
Actuarial report: a report containing certain required actuarial information about an approved retirement savings plan and provided by an actuary. The actuarial report must contain information on number of participants contributions received normal costs accrued liabilities current value of assets and liabilities and certificate of the contributions necessary to provide the benefits.Source: The Insurance Dictionary, 3rd Edition
Actuarial valuation: an examination of an approved retirement savings plan to determine if it is actuarially sound. A plan is actuarially sound if funds are accumulating at a rate sufficient to provide the promised pension benefits when due. This involves a determination Astor composition of the work force earning levels turnover interest earned mortality and any other factors affecting cost to determine if they are consistent with the assumptions on the basis of which the plan was established. Generally used in connection with self-administered trustee split-funded or deposit administration plans since under group annuity plans the insurance carrier guarantees the payment of all benefits.Source: The Insurance Dictionary, 3rd Edition
Actuarial value of assets: The value of cash investments and other property belonging to a pension plan as used by the actuary for the purpose of an actuarial valuation. The statement of actuarial assumptions should set forth the particular procedures used in determining this value.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Actuarially reduced annuity: an annuity payable to an employee who retires before normal retirement age. The amount is less than would have been payable at normal retirement age since contributions will have been paid and interest accumulated for a shorter period. Starting the payments at an earlier age will increase the probable number of annuity payments. (See also actuarial equivalent)Source: The Insurance Dictionary, 3rd Edition
Actuarially sound: an approved retirement savings plan is considered to be actuarially sound when the amount of money in the fund and the current level of contributions to the fund are sufficient (on the basis of assumptions on interest mortality and employee turnover) to meet the liabilities that have accrued and that are accruing on a current basis.Source: The Insurance Dictionary, 3rd Edition
Actuary: means a person who-(a) is a fellow of such professional organization of actuaries as may be prescribed; and(b) satisfies such other requirements as may be prescribed and includes a firm of such personsSource: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Administrative Manager (Employee Benefit Plans): Firm or individual providing professional administrative services to an employee benefit plan. May be compensated under either a salaried or contract arrangement.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Administrative Services Only (ASO): An arrangement in which a plan hires a third party to deliver administrative services to the plan such as claims processing and billing; the plan bears the risk for claims. Common in self-funded health care plans.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Administrator: means a company which is licensed pursuant to section 7 (1)(a) to administer an approved Superannuation Fund or approved Retirement Scheme;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Administrator pension plan: Any pension or institution designated as administrator in a pension plan instrument; or if an administrator is not being so designated the plan sponsor; or in the case of a plan in which an administrator is not designated and the plan sponsor cannot be identified any person who the secretary of labour may describe by regulation. (in the case of Jamaica any person who the FSC may describe by regulation).Source: The Insurance Dictionary, 3rd Edition
Adult: A legal determination referring to one who has reached maturity; a person who has reached the age of legal capacity.Source: The Insurance Dictionary, 3rd Edition
Adult Day Care: Provision during the day on a regular basis of a range of services that may include health medical psychological social nutritional and educational services that allow a disabled or elderly person to function in the home or at a centre.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Advance Funding: An approach to funding retirement or other benefits whereby the employer sets aside monies for each employee or for the group of active employees as a whole on some systematic basis during their working years. An employer sets aside funds on a systematic basis to provide pension benefits; involves periodic contributions on behalf of the active employee group.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Advisor: means any person on whose skill and judgement a trustee in the exercise of his duties places reliance including the actuary auditor banker and attorney-at-law of the fund or schemeSource: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004 (Governance) Regulations 2006, s2
After-care: Continued contact that will support and increase the gains made to date in a health treatment process and prevent relapse.Source: International Foundation of Employee Benefit Plans (ifebp.org)
After-tax contribution: A portion of a person’s income that has already been taxed by the IRS (USA)(In Jamaica Income Tax Department - also known as TAAD)that is contributed to a qualified plan. After-tax contributions are not as tax efficient as contributions with before-tax income.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Agent: means any individual firm or body corporate not being an employee of an insurer-(a) appointed by that insurer to solicit applications for insurance or negotiate insurance on its behalf (otherwise than through an agent);(b) other than a broker authorized by the insurer to effectuate and countersign insurance contracts on its behalf.Source: The Insurance Act 2001, s2
Agent of Trustees: means any person who performs any part of the functions or discharges any part of the duties or responsibilities of the trustees and includes the investment manager administrator or nominees of the trustees.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004 (Governance) Regulations 2006, s2
Aggressive Growth Fund: A mutual fund that aims to provide maximum long-term capital growth primarily from stocks of smaller companies or narrow market segments.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Aggressive Portfolio: A securities portfolio containing issues held primarily on the assumption that they will appreciate in value as opposed to securities that provide greater yield or have good defensive qualities. Compare with Defensive Portfolio.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Allocated Funding instrument: A pension funding instrument by which contributions are assigned to provide benefits for specific employees. Examples are individual insurance and annuity contracts group permanent contracts and group deferred annuity contracts.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Allocation: In a pension plan an accounting method for spreading income or expense but not necessarily on a time basis. For example allocation of an expenditure between current expense and capital accounts.Source: The Insurance Dictionary, 3rd Edition
Alternative Dispute Resolution (ADR) Procedure: A procedure designed to settle disputes and avoid costly litigation. It involves a written complaint, an automatic appeal to arbitration in termination cases, and a final and binding decision in all cases.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Alternative Medicine: Also known as Complimentary and Alternative Medicine. Includes non-traditional medical practices such as acupuncture chiropractic herbal medicine homeopathy massage therapy and yoga that focus on the entire person not just the physical and on the innate healing power within. Alternative medicine stresses quality of life use of natural substances being healed as opposed to being cured and energy flow.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Amendment: (General) An addition deletion or change in a legal document. (Employee Benefit Plans) A change in the terms of an existing plan or the initiation of a new plan. A plan amendment may increase benefits including those attributed to years of service already rendered. (Insurance) A formal document changing the provisions of an insurance policy signed jointly by the insurance company officer and the policyholder or his or her authorized representative. See also Retroactive Benefits.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Amortization: The act or process of extinguishing a debt or other liability usually by equal payments made at regular intervals that will reduce the outstanding debt to zero at the end of a given period of time.Source: The Insurance Dictionary, 3rd Edition
Ancillary benefit: means a benefit other than a pension or a pension benefit that may be provided by an approved Superannuation Fund or an approved Retirement Scheme being a disability or death benefit or such other benefit as may be approved by the Commission.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Anniversary date: The annual recurrence of the policy date of issue.Source: The Insurance Dictionary, 3rd Edition
Annual benefits statement: A report containing specific information about the status of a participant’s projected pension income or account balance. Can include a description of the value and cost of health and welfare benefits and is often distributed to employees to promote awareness and appreciation of benefits.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Annual Contributor: this refers to tax-deductible and tax-deferred contributions to an approved retirement savings plan during the months of January to December.
Annual report: An insurer's published statement to its policy owners giving pertinent financial information and reviewing the year's activities and results.Source: The Insurance Dictionary, 3rd Edition
Annual return: An IRS (in Jamaica - an Income Tax form) form required yearly of every employer who maintains a pension annuity or profit-sharing plan including a Keogh that contains information with respect to the qualification financial conditions and operations of the plan.Source: The Insurance Dictionary, 3rd Edition
Annuitant: One to whom an annuity is payable or a person who receives an annuity for life or for a specified period.Source: The Insurance Dictionary, 3rd Edition
Annuity: a contract which is sold by life insurance companies that guarantee a fixed or variable payment to an Annuitant (individual) at some time in the future - usually for disability old age and upon death a lifetime income to your heirs. An annuity is sometimes referred to as 'an individual receiving a pension'. For example Miss Jones or Mr. Smith is receiving a pension is the same as if you had said they were receiving an annuity payment. When an annuity is being purchased the annuitant has the option to purchase a contract which provides for Immediate or Deferred income payments. All approved retirement savings Plans such as Superannuation Funds Retirement Schemes Retirement Benefits Scheme Public Sector Pension Plans and National Insurance Scheme (NIS) must pay the benefits for disability old age and upon death to the beneficiaries in the form of an annuity. There are 3 main classes of annuities. These are Straight Variable Instalment Refund Flexible and Indexed. For each type there are options to choose from such as joint and survivor last survivor etc. Before you purchase an annuity you should review your own monthly expenses needs and select the OPTION that best meets YOUR needs.
Annuity consideration: The payment or one of the regular periodic payments an annuitant makes for an annuity.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Annuity contract: A contract in which an insurance company unconditionally undertakes a legal obligation to provide specified pension benefits to specific individuals in return for a fixed consideration or premium. An annuity contract is irrevocable and involves the transfer of significant risk from the employer to the insurance company. Annuity contracts are also called allocated contracts.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Annuity Fixed: An annuity that provides fixed payments during the annuity period.Source: The Insurance Dictionary, 3rd Edition
Annuity Joint and Survivor: A pension plan provision in which based on the age of a designated survivor (usually one’s spouse) a reduced pension is paid as long as one of the two parties is living.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Annuity starting date: The first day of the first period for which an amount is received as an annuity.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Annuity Straight: Also known as an annuity life. An annuity contract that agrees to pay a guaranteed income for life but makes no provision for the return of the unused portion after death. Note: This type of annuity is based on a payment to the annuitant ONLY and therefore no beneficiary data is required at the time of completing an application.Source: The Insurance Dictionary, 3rd Edition
Appeal Tribunal: means the Appeal Tribunal established under the Financial Services Commission ActSource: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Appointed day: means the day Appointed under section1Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2
Approved fund: means a fund constituted in a manner approved by the Minister for purposes so approved and declared by the Minister to be an approved fund:Provided that no sum in respect of which no income tax is payable by reason of its being part of an approved fund shall be used for any purposes other than purposes approved by the Minister.Source: The Income Tax Act 1955, s2
Approved Retirement Scheme: means a Scheme, not being a specified pension scheme- (a) to which persons who are self-employed or who are not active members of an approved Superannuation Fund- (i) make contributions toward a pension; (ii) transfer their pension benefit
Approved Superannuation Fund: means a fund, not being a specified pension fund - (a) whereby contributions toward pensions are made by employers on behalf of employees; and (b) which is approved and registered by the Commission;
Auditor: means a person who -(a) is a registered public accountant as defined in section 2 of the Public Accountancy Act; and (b) satisfies such other requirements as may be prescribed and includes a firm of such personsSource: The Pensions (Superannuation Funds and Retirement Schemes) Act 2004, s2

B

Bull Market: An advancing stock market. The opposite of bear market.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Business Continuation Insurance: When a partner dies or is disabled the remaining partners are provided with the funds to purchase that partner’s interest in the firm. See also Key Employee Insurance.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Business cycle: Four basic stages of the U.S. economy as follows: Expansion--The economy strengthens as business activity accelerates. Peak--The economy overheats causing inflation and interest rates to rise. Recession--Higher interest rates lead to waning business activity and a contracting economy. Trough--Declining inflation and interest rates spark the beginnings of an economic rebound.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Business judgement rule: A judicial doctrine offering protection to corporate officers and directors from personal liability for their actions as long as they were taken in good faith and with reasonable care.Source: International Foundation of Employee Benefit Plans (ifebp.org)

C

Call centre: A telephone call centre used to provide on-demand tracking routing and reporting of employee benefit questions. Computer telephony integration can instantly provide relevant information about the caller and speech recognition allows callers to verbalize their requests. The latest developments in call centres include systems for e-mail management. See also Employee Self-Service.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Call date: The earliest date on which a bond may be redeemed before maturity at the option of the issuer.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Call option: An option to buy a specified number of shares at a definite price within a specified period of time.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Call price: The price at which a corporation or other obligor is permitted to redeem securities containing call provisions. To compensate for this privilege a price above par is usually paid.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Career Average Pay Formula/ Career Average Plan: A career average pay formula is a defined benefit plan formula that bases benefits on the employee’s compensation over the entire period of service with the employer. A career average pay plan is a plan with such a formula.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cash Flow: The reported net income of a corporation plus amounts charged off for depreciation depletion amortization and extraordinary charges to reserves which are a bookkeeping deduction and not paid out in actual dollars and cents.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cash Refund Annuity: A form of annuity under which any excess contributions and interest over the total of annuities actually paid are refunded after the annuitant’s death to a designated beneficiary of his or her estate. Two types are cash refund annuity (unliquidated purchase price is refunded in a lump sum at the time of the annuitant’s death) and installment refund annuity (monthly payments are continued to the beneficiary until the full cost has been received).Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cash Surrender Value: Generally the net proceeds after applicable charges available from the termination or cancellation of an insurance or deferred annuity contract.Source: International Foundation of Employee Benefit Plans (ifebp.org)
CERES Principles: A ten-point environmental reporting and accountability code previously called the Valdez Principles and now named after the Coalition for Environmentally Responsible Economies (CERES). The ten principles are intended to expand the concept of socially responsible action with an emphasis on environmental issues.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certificate of Deposit: A short-term interest-bearing debt instrument offered by banks and savings and loan associations. The bank or savings and loan association offers a written certification that a fixed dollar amount has been deposited with it for a certain period of time at a predetermined rate of interest. Early withdrawal of the money is penalized.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certificate of Need: A certificate issued by a governmental body to an individual or organization proposing to construct or modify a health facility acquire new medical equipment or offer a new health service. CON is intended to control expansion of facilities and services by preventing their excessive or duplicative development.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certification: The process by which a governmental or non-governmental agency or association evaluates and recognizes a person who meets predetermined standards; sometimes used with reference to materials or services. Certification is usually applied to individuals and accreditation to institutions.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certified Employee Benefit Specialist: A designation granted jointly by the International Foundation of Employee Benefit Plans and the Wharton School of the University of Pennsylvania to individuals who complete eight college-level courses and examinations in the areas of compensation and design and operation of employee benefit plans and who pledge to a code of ethical standards and continuing education. In Canada the program is presented jointly by the International Foundation of Employee Benefit Plans and Dalhousie University of Halifax.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certified Pension Consultant: A designation awarded by the American Society of Pension Actuaries. Holders must combine required experience with passing three examinations covering employee benefits fundamentals.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Certified Public Accountant (CPA): A professional license granted by the various states to persons meeting certain educational experience and examination requirements. These requirements vary from state to state but typically they include a college degree with accounting and auditing course work and qualifying experience. The examinations include passing the Uniform CPA Examination covering accounting theory and practice auditing and business law.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chargeable Income: means the aggregate amount of income of any person from all sources remaining after allowing the appropriate deductions and exemptions under this Act;Source: The Income Tax Act 1955
Charitable Remainder Trust: A living trust that allows a donor to a charity to receive income from the assets donated while any remaining assets in the trust transfer to the charity when the donor dies.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chartered Financial Analyst (CFA): Awarded by the Institute of Chartered Financial Analysts. Holders must combine required experience and education with passing three examinations covering ethical and professional standards securities laws and regulations financial accounting and so on.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chartered Financial Consultant (Ch.F.C): A designation granted by the American College to individuals who complete a ten-course program in the areas of personal financial and retirement planning and who pledge to a code of ethical standards and continuing education.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chartered Life Underwriter: A designation granted by the American College to individuals who complete a ten-course program in the areas of insurance and estate planning and who pledge to a code of ethical standards and continuing education.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chemotherapy: Treatment of internal disease by chemical reagents (including drugs) primarily involved in the treatment of cancer.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chiropractic: A system of medicine based on the theory that disease is caused by malfunction of the nerve system and that normal function of the nerve system can be achieved by manipulation and other treatment of the structures of the body primarily the spinal column and pelvis. A practitioner is a chiropractor Doctor of Chiropractic (DC).Source: International Foundation of Employee Benefit Plans (ifebp.org)
Chronically Ill: A person unable to perform two of six activities of daily living for at least 90 days or who is severely cognitively impaired is said to be chronically ill. Under this term qualification for long-term care expenses is determined.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claim: An itemized statement of services rendered by a health care provider for a given patient. The claim is submitted to a health benefits plan for payment. A request for payment under an employee benefit plan (pension or health and welfare) or insurer by a plan participant or beneficiary for the payment of certain benefits. The right to any debts privileges or other things in possession of another; also the titles to anything which another should concede to or confer on the claimant.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claim Administrator: Any entity that reviews and determines whether to pay claims to enrollees or physicians on behalf of the health benefit plan. Claim administrators may be insurance companies or their designated claims review organizations self-insured employers management firms third-party administrators or other private contractors.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claim Form: The form used to file for benefits under a health plan.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claimant: Plan participant who files a claim for benefits. See also Beneficiary.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claims Experience: The frequency cost and types of claims insured employees file to receive benefits. One of the primary factors used in calculating insurance premiums.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claims Procedure: Under ERISA (in the USA) each plan is required to provide a claims procedure which must be explained to plan participants and beneficiaries. The denial of a claim made under the claims procedure must be in writing with an explanation of the reasons for the denial.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Claims Reserve: A sum set aside by an insurance company or self-funded plan to assure the fulfillment of commitments for future claims.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Classified employment: means employment in respect of which by virtue of regulations made under paragraph (c) of subsection (3) of section 3 of the Act an insured person is treated as a self-employed person;Source: National Insurance (Self-Employed Persons' Wage-Related Contributions) Regulations 1973
Cliff vesting: Full 100% vesting after x years of service with no gradation of vesting before that time. Benefits must be 100% vested after five years. If participants leave the company or are terminated prior to the vesting date no partial benefits are received. See also Graded Vesting; Vesting.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Collector: means a Collector of Taxes.Source: National Insurance (Self-Employed Persons' Wage-Related Contributions) Regulations 1973
Commission: means the Financial Services Commission established under section 3 of the Financial Services Commission Act;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Commissioner of Taxpayer Appeals: means the Commissioner of Taxpayer Appeals appointed under section 1lB of the Revenue Administration Act;Source: The Income Tax Act 1955
Commuted Value: means for the purpose of determining the lump sum amount that is equivalent to a pension an ancillary benefit or a pension benefit the value calculated by an actuary in the prescribed manner and as of a fixed date;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Company: means any company incorporated or registered under any enactment in force in the Island and any company which though incorporated or registered outside the Island carries on business or has an office or place of business therein;Source: The Income Tax Act 1955
Compensation: An approach to assigning a monetary value to work performed by employees. Compensation may include wages salary base pay overtime pay profit sharing vacations and all benefits employees receive in return for their work.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Compound Interest: The interest upon principal that is being increased or augmented periodically by interest paid on the previous amount of principal. Interest may be compounded daily monthly quarterly semi-annually or annually.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Compounding: The arithmetic process of finding the final value of an investment or series of investments when compound interest is applied. That is interest is earned on the accrued interest as well as on the initial principal.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Compulsory Contributions: means contributions which are made by or on behalf of an active member as a requirement for participation by that member in an approved superannuation fund or approved retirement scheme.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Compulsory Retirement: When the employee must retire when he or she reaches a given age. Now prohibited under ADEA if based solely on age except for certain executives or where public safety outweighs individual protection (e.g. airline pilots). Also known as automatic or mandatory retirement.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Computer Language: A group of symbols numbers letters words or a combination of these that can be used to communicate with the computer and cause it to perform desired operations for processing data.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Conflict of Interest: A situation that provides potential for self-dealing. For example a trustee has a conflict of interest if he or she has an interest in a construction project to be financed by the plan the trustee represents.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Consultant: A person or firm offering expert business professional or technical advice to an organization for a salary or fee.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Consumer Price Index: The name given in the United States and Canada to the series of numbers whose ratios measure the relative prices at various times of a fixed market basket of goods and services that typify those bought by urban families. The CPI is a measure of inflation.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Contingent Annuity Option: An option under which an employee may elect to receive under certain conditions a reduced amount of annuity with the same income or a specified fraction to be paid after his or her death to another person designated as his or her contingent annuitant for that person’s lifetime. The contingent annuitant is usually the husband or wife. See also Automatic Survivor Coverage; Joint and Survivor Annuity.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Continuous Service: All creditable service rendered by a member without a break in service including periods of absence for which salary is paid or for military service.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Contract: A promissory agreement between two or more persons that creates modifies or destroys a legal relation. In general it must have the following elements: creates an obligation competent parties subject matter legal consideration mutuality of agreement mutuality of obligation must not be so vague or uncertain that terms are not ascertainable and generally is in writing signed by both parties.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Contribution: means a periodic payment to an approved superannuation fund or approved retirement scheme by a member or a sponsor.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Contribution year: for the purposes of these Regulations means the income tax year;Source: National Insurance (Self-Employed Persons' Wage-Related Contributions) Regulations 1973
Core Competencies: Integrated skill and knowledge sets that distinguish an organization and deliver value to customers.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cost-of-Living Adjustment: An across-the-board increase (or decrease) in wages or pension benefits according to the rise (or fall) in the cost of living as measured by some index often the consumer price index (CPI).Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cost-of-Living Allowance: In expatriate compensation the amount by which base pay is increased or decreased to adjust for a geographic area’s cost of living.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Cost/Benefit Analysis: A comparison of the cost of an action with the economic benefits it produces through elimination of other direct and indirect costs.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Credited Earnings: The maximum taxable income for each year that forms the basis for contributory Public benefits - National Insurance Scheme (NIS) and National Housing Trust (NHT).
Credited Service: A period of employment before or after the effective date of the plan that is recognized as service for one or more plan purposes such as determination of benefit amounts entitlement to benefits and/or vesting.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Critical Care: Health care provided to acutely ill patients during a medical crisis usually within a critical care area such as an intensive care unit or coronary care unit.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Currency Devaluation: Action by the government or by the marketplace to reduce the value of a currency in relation to the currencies of other nations.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Currency Exchange Rate: The price of one currency stated in terms of another currency by bankers dealers and financial markets. (Compensation) The rate of pay at which labour demand and labour supply functions intersect in the external market.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Current Assets: Those assets of a company that are reasonably expected to be realized in cash or sold or consumed during the normal operating cycle of the business. These include cash U.S. government bonds receivables money due (usually within one year) and inventories.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Current Liability: Money owed and payable by a company usually within one year.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Current Service Benefit: The annuity payable for each year of participation in the plan after its adoption. That portion of a participant’s retirement benefit that relates to his or her credited service in a contemporary period (usually a year).Source: International Foundation of Employee Benefit Plans (ifebp.org)
Current Value: Fair market value where available. Otherwise it is the fair value as determined in good faith by a trustee or a named fiduciary pursuant to the terms of the plan and in accordance with regulations of the secretary of labour assuming an orderly liquidation at the time of such determination.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Current Yield: Annual bond interest divided by market price per bond.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Curtailment: A reduction of future benefits or augmenting of eligibility requirements in a qualified plan that causes a partial termination of the plan.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Custodial Care: General assistance in performing the activities of daily living as well as board room and other services generally provided on a long-term basis and that do not include a medical component.Source: International Foundation of Employee Benefit Plans (ifebp.org)

D

Database: A collection of numeric data or textual information that is processed in computer-readable form and stored electronically in a computer’s memory for later electronic publishing or distribution.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Day Care (Adult): Provision during the day on a regular basis of a range of services that may include health medical psychological social nutritional and educational services that allow a disabled or elderly person to function in the home or at a center.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Death Benefit: The payment made to designated beneficiaries upon the death of a participating employee. This could be the employee’s or employer's share in the investment fund the life insurance purchased for him or her or both.
Death Rate: The proportion of persons who die within a year usually expressed as so many per 1000.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debenture: An unsecured long-term debt backed only by the integrity of the borrower not by collateral. An example is an unsecured bond.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debenture Bonds: Bonds backed by the general credit of the issuer but not secured by a specific lien on property.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debt: Something owed by one person to another. Debt securities are loans at a specified rate of return for a specified period of time.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debt Limit or Ceiling: The maximum debt that can be legally created by a state or local government.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debt Service: The sum of money required periodically to make the payments necessary to amortize a debt and interest charges the principal and interest payments.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Debt-to-Equity Ratio: A measure of the relative amount of funds provided by lenders and owners. Debt/Equity Ratio = Long-Term Debt Stockholder’s EquitySource: International Foundation of Employee Benefit Plans (ifebp.org)
Dedicated Bond Portfolio: Portfolio designed to meet a specific set of future benefit payments with the cash flow from the bonds held in a portfolio. The most common application of the dedicated portfolio concept is in funding benefits due to retired employees. Ideally the cash flow from the portfolio exactly matches each future payment both in amount and timing. If this exact matching is achieved the funding of future payments will not depend on the level of interest rates in the future. The actuary may then raise the actuarial assumption to a market rate of interest. This reduces the actuarial liability of the plan and could substantially lower its annual funding costs.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deductible: The amount of out-of-pocket expenses that must be paid for health services by the insured before becoming payable by the carrier. Most common in major medical policies but also found in basic policies. See also Family Deductible; First Dollar Coverage.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deed: A written instrument by which lands tenants and hereditaments are transferred which instrument is signed sealed and delivered by the grantor.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Defensive Industry: An industry relatively unaffected by business cycles such as the food industry or the utility industry.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Defensive Issues: Issues of established companies in industries relatively unaffected by business cycles.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Defensive Medicine: The practice by physicians of authorizing medically unnecessary tests and procedures increasing hospital admissions and extending lengths of stay in an attempt to limit their exposure to malpractice suits.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Defensive Portfolio: A portfolio consisting mainly of short-maturity bonds preferred stocks or other securities that are unlikely to fluctuate much in either direction. Compare with Aggressive Portfolio.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deferred Annuity: Annuity contract providing for the initiation of payments at some designated future date or age. Contrast with Immediate Annuity.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deferred Benefits: Noncash compensation to which an employee may be entitled at a later date following employment assuming he or she has enough credited years of service for vesting (e.g. pension plans 401(k) savings plans stock options etc.).Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deferred Payments: Compensation or benefit payments to be made at a future time.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Deferred Vested Pension: For terminating employees a plan offering a pension usually deferred until retirement. Benefits are determined when employment is terminated.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Defined Benefit Plan: means an arrangement which is not a defined contribution plan.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Defined Contribution Plan: means an arrangement whereby benefits for a member are determined solely as a function of the amount that can be provided by-(a) contributions made by the employer on behalf of the member; and(b) interest earned and other gains and losses allocated to the member's account in the fund;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

E

Emoluments: includes in relation to any office or (a) all salaries fees wages all provision or payment as the case may be in respect of living or other accommodation entertainment utilities domestic or other services and other benefits perquisites and facilities whatsoever (whether or not similar to any of the foregoing and whether in money or otherwise); and(b) without prejudice to the provisions of section 13 all sums paid to any person by an employer in respect of expenses whether reimbursable or not;(c) all annuities pensions superannuation or other allowances payable in respect of past services in any office or employment of profit whether legally due or voluntary and including lump sums paid in commutation or in lieu of a pension or other periodical superannuation payment and any payment of money made or other valuable consideration given to any person being the holder or past holder of any office or employment of profit in consideration for or otherwise in connection with the termination of the holding of that office or employment (otherwise than by death) or any change in its nature or terms or any undertaking given by that person as to his future conduct whether the payment is made to that person or to his relative or dependant (in which case it shall retreated as made to that person unless he is dead when it shall be treated as made to the recipient thereof);Source: The Income Tax Act 1955
Employee: means a permanent part-time or contract worker.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

I

Incapacitated person: means any infant person of unsound mind idiot or insane person;Source: The Income Tax Act 1955
Income Tax year: means an income tax year commencing on the first day of January in any year;Source: National Insurance (Self-Employed Persons' Wage-Related Contributions) Regulations 1973

J

Jamaica Stock Exchange: means a body of persons which the Minister has certified to be the Jamaica Stock Exchange;Source: The Income Tax Act 1955

M

Member: means a person who meets the eligibility requirements for and joins an approved superannuation fund or approved retirement scheme and has accrued benefits in that kind or scheme.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

N

Non-vested Member: means a person designated as such-(a) in the case of an approved superannuation iI) fhd in the Trust Deed and Plan Rules;(b) in the case of an approved retirement scheme in the Master Trust Deed and who is not entitled to receive a pension at retirement.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Normal Retirement Age (NRA): means the age specified as such in the Trust Deed and Plan Rules of an approved superannuation fund or the Master Trust Deed of an approved retirement scheme.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

P

Pension: means a periodic payment payable to a member on retirement at least annually for the lifetime of that member.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Pension benefit: means in relation to a member of a pension plan the entitlement of a member or of another person upon the death of the member to the periodic amounts provided under the pension plan.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Pension plan: means an arrangement by which pensionsor pension benefits are provided to persons who are members or to the beneficiaries of such members.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

R

Relative: as respects any person means his or her husband or wife or brother sister uncle aunt nephew niece or lineal ancestor or descendant (the Sch. stepchild or adopted child of any person being taken into account as a relative or to trace a relationship in the same way as that person’s child);Source: The Income Tax Act 1955

S

Specified pension fund or specified pension scheme: means- (a) a superannuation fund or retirement scheme that is established by law;(b) such other superannuation fund or retirement scheme as may be prescribed;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Sponsor: means-(a) in relation to a superannuation fund an employer who-(i) establishes the superannuation fund or causes it to be established;(ii) participates in the superannuation fund; or(iii) accepts the obligations of the former sponsor of the superannuation fund;(b) in relation to a retirement scheme a person who satisfies the prescribed requirements for being a sponsor of a retirement scheme and-(i) establishes the retirement scheme or causes it to be established; or(ii) accepts the obligations of the former sponsor of the retirement scheme;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Spouse: includes-(a) a single woman who has lived and cohabited with a single man as if she were in law his wife for a period of not less than five years immediately preceding the date of his death;and (b) a single man who has lived and cohabited with a single woman as if he were in law her husband for a period of not less than five years immediately preceding the date of her deathSource: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Statutory income: (i) in relation to any income tax year means the statutory income computed pursuant to the Income Tax Act as Wig the statutory income for that year whether or not such computation is by reference to income received in that year or in any other year and other expressions have the same meaning as in the Act.- National Insurance (Self-Employed Persons' Wage-Related Contributions) Regulations 1973.(ii) “statutory income” means subject to section 6 the 4/1986aggregate amount of income of any person from all ’.sources remaining after allowing the appropriate deductions and exemptions under this Act;Source: The Income Tax Act 1955
Substantial investment: means-(a) one per cent of the fair value of assets of the approved superannuation hnd or approved retirement scheme; or(b) one million dollars or such greater amount as may be prescribed whichever is the greater but does not include such categories of investments as may be prescribed.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Surplus: means an excess of the value of the assets of a pension hnd over the value of its liabilities as determined-(a) by an actuary in accordance with generally accepted actuarial principles; or(b) in the prescribed manner.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

T

Trustee: means a person who is registered as a trustee of an approved superannuation find or approved retirement scheme pursuant to section 9 (1) (a);Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

V

Vested member: means a member who is entitled to receive a pension at retirement;Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006
Voluntary contributions: means contributions which an active member elects to make in order to supplement the benefits payable under an approved superannuation fund or approved retirement scheme.Source: The Pensions (Superannuation Funds and Retirement Schemes) Act 2006

W

Working Capital: Found by subtracting current liabilities from current assets.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Workstation: An electronic computing device, for example, a laptop or desktop computer, or any other device that performs similar functions and has electronic media stored in its immediate environment.
World Trade Organization (WTO) (International Benefits): An international organization that supervises all agreements and arrangements concluded under the auspices of the Uruguay Round of multilateral trade negotiations. The WTO agreement was signed by nearly 100 nations in 1995 and is the successor to GATT. See also General Agreement on Tariffs and Trade (GATT) and Uruguay Round Agreements Act of 1994.Source: International Foundation of Employee Benefit Plans (ifebp.org)
World Wide Web: A full-color, multimedia database of information on the Internet. The World Wide Web is a universal mass of Web pages connected through links. Users access the Web by means of Web browsers.

Y

Yield to call: The rate of return on an investment that accounts for the cash difference between a bond’s acquisition cost and its proceeds calculated to the earliest date that the bonds can be called in by the issuing corporation.Source: International Foundation of Employee Benefit Plans (ifebp.org)
Yield to Maturity: The yield or return provided by a bond to its maturity date; determined by a mathematical process usually requiring the use of a “basis book.” For example a 5% bond pays $5 a year interest on each $100 par value. To figure its current yield divide $5 by $95--the market price of the bond--and you get 5.26%. Assume that the same bond is due to mature in five years. On the maturity date the issuer is pledged to pay $100 for the bond that can be bought now for $95. In other words the bond is selling at a discount of 5% below par value. To figure yield to maturity a simple and approximate method is to divide 5% by the five years to maturity which equals 1% pro rata yearly. Add that 1% to the 5.26% current yield and the yield to maturity is roughly 6.26%.Source: International Foundation of Employee Benefit Plans (ifebp.org)