A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Guaranteed Minimum Pension (GMP)

Minimum pension that a defined benefit scheme must provide as a condition of contracting out for pre-6 April 1997 service. GMP does not apply to money purchase contracted out schemes as the granting of protected rights is the relevant contracting out provision. Where all service is post-5 April 1997 the members’ benefits are protected by limited price indexation (LPI). Where service is pre- and post-5 April 1997, benefits are affected by GMP and LPI respectively.

Guaranteed period

Mininimum period for which the payment of a pension or annuity is guaranteed regardless of the annuitant’s earlier death. If premature death occurs the insurer may be willing to pay the net present value of the annuity payments as a lump sum.

Guaranteed renewable

Clause in an insurance policy that means the insurance company must renew the policy as long as premium payments are made by the insured. However, the premium may be increased when it is renewed if it raises premiums for a particular class such as everyone in a geographic area with the same type of policy. These policies may have age limits of 60, 65, or 70 years or may be renewable for life.
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This term applies to a number of different types of health insurance. Guaranteed renewable policies cannot be canceled by the insurance company as long as premiums are paid on time. Premiums may be increase, however, as long as premiums on all similar policies for the company are also increased.

Guaranteed renewable contract

Insurance policy that means the insured has the right to have the policy in force as long as he or she pays the premiums. However, the insurance company may increase the premium rate when the policy is renewed. These policies may have age limits of 60, 65, or 70 years or may be renewable for life. Also called guaranteed renewable policy .

Guaranteed renewable policy

See: guaranteed renewable contract .
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a policy which the insured has the right to continue in force by the timely payment of premiums to a specified age, during which period the insurer has no right to make unilaterally any change in any provision of the policy while the policy is in force, but may change premium rates by policyholder class.

Guaranteed replacement cost

A form of property coverage in which the insurance company agrees to replace damaged property even if the cost to do so exceeds the limit stated in the policy or the underlying rating basis on which the premium is calculated. This extension may be conditional on an approved appraisal and reporting of improvements to the building(s).