Insurance documents can be confusing and use a large number of technical terms. It is important that you understand the terms of your policy fully before you buy so we have compiled a short list of some common terms to help you decode your policy:

Beneficiary – The named person who will receive the proceeds of your insurance policy in the event of your death.

Benefits – The amount that an insurance provider may pay you under the terms of your policy.

Excess – The amount of any claim that you must pay before the insurance provider starts paying. Each individual element of your policy will have a specific excess value.

Excess waiver – An extra amount that you may be able to pay on your policy to waive the excess.

Exclusions – These are the expenses that an insurance provider absolutely will not pay for, for example medical expenses due to use of illegal drugs. Exclusions should be stated clearly in your policy.

Expenses – These are the expenses that an insurance provider will consider for payment for example medical expenses due to contracting food poisoning.

Hazardous Activity – Any activity which the insurer believes to have a high level of risk associated with it. Any hazardous activities covered by your policy should be clearly stated.

Indemnity – Payment against losses designed to return you to your original financial position before the loss. This is the technical term for an insurance pay out.

Pre-existing medical condition – Any one for which an individual received care, treatment or medical advice before coverage comes into effect. Cancer, diabetes, pregnancy and heart conditions are examples of pre-existing medical conditions which can effect the cost or eligibility of coverage.

Premium – The cost of your insurance cover.

Primary Coverage – Provides coverage without any reference to any other insurance plans.

Secondary Coverage – Provides only for those expenses not covered by a primary insurance plan. You must hold a primary insurance plan first.

Each insurance provider should provide a clear glossary of the terms used in its policies, with terms such as familytravelling companion and emergency clearly defined. These can differ greatly between providers and it is important that you and your insurance provider have the same understanding of them before you sign anything.