A-Day
6th April 2006, when wide-ranging pension reforms came into effect designed to simplify and streamline the whole UK pension system.
ADR
American depositary receipt, a convenient way for Americans to own shares in foreign companies. They buy them via an ADR rather than direct and purchases, sales and dividends are distributed in US dollars.
AIM
Alternative Investment Market.
Actuary
A person trained and specialising in risk, statistics and finance who advises on insurance and pension business. Responsible for calculations such as premiums, bonus payments, life expectancy, profitability.
Adjuster
A person who investigates and assesses claims on behalf of insurers, often called a claims or loss adjuster.
Allocation rate
The percentage of the premium that is invested after charges have been taken out.
Allocation units
Units in a unit trust where the income from the underlying investments are reinvested in the trust rather than being paid out. This can either be in the form of enhancing the unit price or issuing additional units.
Alteration
Changes to policies. This could include reducing the premium and altering the term.
Annual Management Charge (AMC)
An amount charged each year (usually expressed as a percentage of the value of the investment) to cover running costs of a policy.
Annual bonus
The bonuses which are added to a with profits policy over time.
Annuity
An annuity is a type of policy that gives the policyholder a regular income for the rest of their life, or for a set number of years (temporary).
The term annuity also refers to the regular income payable under annuity policies.
Annuity escalation
An annuity policy can increase each year, either by a fixed amount such as 3% or linked to inflation.
Annuity guarantee period
Annuity policies may include a guarantee which means that the income is paid for a minimum number of years, even if the policyholder dies.
Annuity rates
The rates that determine the amount of income an annuity policy provides.
Anticipated growth rate (also assumed future growth rate)
The rate that it is assumed an investment fund is going to grow by.
Arbitrage
The simultaneous purchase and sale of similar commodities in different markets to take advantage of a price discrepancy.
Articles of Association
The document that determines the governance and running of a company. Covers areas such as the business of the company, shareholder's voting rights etc. They are registered with the memorandum of association when the company is formed.
Asset mix
The type of assets the fund is invested in.
Assets
Investments which include: property; bank deposits (cash deposits); company shares (equities); bonds (type of loan usually issued by the Government or companies, also referred to as fixed-interest investments).
Assignee
The third party to whom ownership has been transferred (assigned).
Assignment
The transfer of entitlement to the benefits under a plan or bond from one person to another.
Assignor
The current holder of a policy who is transferring (assigning) ownership to a third party (assignee).
Association of British Insurers (ABI)
An organisation that represents the interests of the UK’s insurance industry. The association speaks out on issues of common interest, helps to guide debates on public policy and promotes high standards of customer service in the insurance industry.
Assumed bonus rate
The bonus rate that is assumed when estimating the value of an investment.
Assumed final bonus
The final bonus that it is assumed will be paid when estimating the value of an investment.
Assumed regular bonus
The regular bonus that it is assumed will be paid when estimating the value of an investment.
Assurance
In the UK market this is insurance taken out against something that will inevitably happen such as death. Insurance is the term used when something may happen such as house insurance or motor insurance.
Authorised share capital
Total number of shares a company is authorised to issue according to its memorandum of association. Can be less than or equal to the authorised amount but not more.
