Definition of Bond

Bond

Fixed interest security issued by a corporation or government, having a specific maturity date.

Foil-Faced Vapor Retarder

Created by coating a foil-backed paper with a thin layer of asphalt adhesive. The coated side of the foil-backed paper is then applied to the un-faced insulation material. The asphalt adhesive bonds the foil-backed paper and the insulation together.

Glued Laminated Beam (Glulam)

A structural beam composed of wood laminations or lams. The lams are pressure bonded with adhesives to attain a typical thickness of 1 ½" . (It looks like 5 or more 2 X 4's are glued together).

Kraft-Faced Vapor Retarder

Created by coating kraft paper with a thin layer of asphalt adhesive. The coated side of the kraft paper is then applied to the unfaced insulation material. The asphalt adhesive bonds the kraft paper and the insulation together.

Segregated Fund

Sometimes called seg funds, segregated funds are the life insurance industry equivalent to a mutual fund with some differences.The term "Mutual Fund" is often used generically, to cover a wide variety of funds where the investment capital from a large number of investors is "pooled" together and invested into specific stocks, bonds, mortgages, etc.
Since Segregated Funds are actually deferred annuity contracts issued by life insurance companies, they offer probate and creditor protection if a preferred beneficiary such as a spouse is named. Mutual Funds don't have this protection.
Unlike mutual funds, segregated funds offer guarantees at maturity (usually 10 years from date of issue) or death on the limit of potential losses - at times up to 100% of original deposits are guaranteed which makes them an attractive alternative for the cautious and/or long term investor. On the other hand, with regular mutual funds, it is possible to have little or nothing left at death or plan maturity.

Collar Beam

A horizontal tie beam in a roof truss that connects two opposite rafters at a level considerably above the wall plate.

Faced Insulation

Insulation with an attached vapor retarder (kraft paper or foil-backed paper).

Kraft-Faced Vapor Retarder

Created by coating kraft paper with a thin layer of asphalt adhesive. The coated side of the kraft paper is then applied to the unfaced insulation material. The asphalt adhesive bonds the kraft paper and the insulation together.

Polyethylene Vapor Barrier

Plastic film used to prevent moisture from passing through unfaced insulation. Both 4- and 6-mil polyethylene are preferred because they are less likely to be damaged during construction.

Post-And-Beam

Wall construction in which beams are supported by heavy posts rather than many smaller studs.

Un-faced Insulation

Insulation with no attached vapor retarder.

Vapor Retarder

Helps control the amount of moisture passing through the insulation and collecting inside exterior walls, ceilings and floors.

Account Value

The sum of all the interest options in your policy, including interest.

Basement Foundation

A basement is a usable foundation that typically has ceiling heights of 8' and is often finished off as living or storage space.

Bundle

A package of shingles. Normally, there are 3 bundles per square and 27 shingles per bundle.

Canada Mortgage and Housing Corporation (CMHC)

The National Housing Act (NHA) authorized Canada Mortgage and Housing corporation (CMHC) to operate a Mortgage Insurance Fund which protects NHA Approved Lenders from losses resulting from borrower default.

Canadian Deposit Insurance Corporation

Better known as CDIC, this is an organization which insures qualifying deposits and GICs at savings institutions, mainly banks and trust companys, which belong to the CDIC for amounts up to $60,000 and for terms of up to five years. Many types of deposits are not insured, such as mortgage-backed deposits, annuities of duration of more than five years, and mutual funds.

Closing Date

The date on which the sale of a property becomes final and the new owner usually takes possession.

Compound Interest

interest earned on an investment at periodic intervals and added to principal and previous interest earned. Each time new interest earned is calculated it is on a combined total of principal and previous interest earned. Essentially, interest is paid on top of interest.

Crawlspace Foundation

The space between the ground and the first floor of a home, usually no higher than four feet.

Daily Interest Accumulation

Account in which interest is accrued daily and credited to the account at the end of a specified time.

Drive Under

A style of home where the garage is located in a basement.

Escrow account

Most lenders set up this account that receives monthly payments from home buyers to pay for obligations such as insurance, taxes and assessments.

Faced Insulation

insulation with an attached vapor retarder (kraft paper or foil-backed paper).

Fiber Glass Insulation

An energy-efficient glass fiber product manufactured by Owens Corning to ensure the best thermal and noise control performance available.

Fixed-Rate Mortgage

A mortgage for which the rate of interest is Fixed for a specific period of time (the term).

GFI -See Ground Fault Current Interrupter

Ground Fault Current Interrupter

An electrical device used to prevent injury from contact with faulty electrical appliances and faulty wiring
electrical shocks. GFIs should not be confused with AFIs, the later are designed to prevent electrical fires. GFIs are required in new home bathrooms, kitchen, garage, out of doors and in other locations where one might be in contact with a grounded surface or body of water and an electrical appliance. Most GFI's are located in the receptacle itself or a curcuit breaker and can be identified by the presence of a 'test' and a 'reset' button.

Guaranteed Interest Annuity (GIA)

interest bearing investment with Fixed rate and term.

Guaranteed Interest Certificate (GIC)

interest bearing investment with Fixed rate and term.

Insulation Density

Denser insulation products have more fibers per square inch and, therefore, give you greater insulating power through higher R-values.

Insurable Interest

In England in the 1700's it was popular to bet on the date of death of certain prominent public figures. Anyone could buy life insurance on another's life, even without their consent. unfortunately, some died before it was their time, dispatched prematurely in order that the life insurance proceeds could be collected. In 1774, English Parliament passed a law which restricted the right to be a beneficiary on a life insurance contract to those who would suffer an economic loss when the life insured died. The law also provided that a person has an unlimited insurable interest in his own life. It is still a legal stipulation that an insurance contract is not valid unless insurable interest exists at the time the policy is issued. Life Insurance companies will not, however, issue unlimited amounts of coverage to an individual. The amount of life insurance which will be approved has to approximate the loss caused by the death of the individual and must not result in a windfall for the beneficiary.

Interest Option

One of several investment accounts in which your premiums may be invested within your life insurance policy.

Interest Rate

Rate charged or paid for the use of money, normally expressed as a percentage

Interest Rate Differential Amount (IRD)

An IRD amount is a compensation charge that may apply if you pay off your mortgage principal prior to the maturity date or pay the mortgage principal down beyond the prepayment privilege amount. The IRD amount is calculated on the amount being prepaid using an interest rate equal to the difference between your existing mortgage interest rate and the interest rate that we can now charge when re-lending the funds for the remaining term of the mortgage. For more information, click on compensation amounts.

Issue Date

date on which a policy is approved.

Kraft-Faced Vapor Retarder

Created by coating kraft paper with a thin layer of asphalt adhesive. The coated side of the kraft paper is then applied to the unfaced insulation material. The asphalt adhesive bonds the kraft paper and the insulation together.

Life Income Fund

Commonly known as a LIF, this is one of the options available to locked in Registered Pension Plan (RPP) holders for income payout as opposed to Registered Retirement Savings Plan (RRSP) holders choice of payout through Registered Retirement Income Funds (RRIF). A LIF must be converted to a unisex annuity by the time the holder reaches age 80.

Life Underwriter

Insurance Agent.

Maturity

The time when a policy or annuity reaches the end of its span.

Maturity Date

Last day of the term of the mortgage agreement.

Metal Insulation Support

16" or 24" wire rod or crisscrossed wire to hold floor insulation in place.

Money Laundering

This is the process by which "dirty money" generated by criminal activities is converted through legitimate businesses into assets that cannot be easily traced back to their illegal origins.

Non-Smoker Discount

In October 1996 it was announced in the international news that scientists had finally located the link between cigarette smoking and lung cancer. In the early 1980's, some Canadian Life Insurance Companies had already started recognizing that non-smokers had a better life expectancy than smokers so commenced offering premium discounts for life insurance to new applicants who have been non-smokers for at least 12 months before applying for coverage. Today, most life insurance companies offer these discounts.
Savings to non-smokers can be up to 50% of regular premium depending on age and insurance company. Most life insurance companies offering non-smoker rates insist that the person applying for coverage have abstained from any form of tobacco or marijuana for at least twelve months, some companies insist on longer periods, up to 15 years.
Tobacco use is generally considered to be cigarettes, cigarillos, cigars, pipes, chewing tobacco, nicorette gum, snuff, marijuana and nicotine patches. In addition to these, if anyone tests positive to cotinine, a by-product of nicotine, they are also considered a smoker. There are some insurance companies which allow moderate or occasional use of cigars, cigarillos or pipes as acceptable for non-smoker status. Experienced brokers are aware of how to locate these insurance companies and save you money.
Special care should be taken by applicants for coverage who qualify for non-smoker rates by virtue of having ceased a smoking habit for the required period before application, but for some reason, fall back into the smoking habit some time after obtaining coverage. While contractually, the insurance company is still bound to a non-smoking rate, the facts of the applicant's smoking hiatus may become vague over the subsequent years of the resumed habit and at time of death claim, the insurance company may decide to contest the original non-smoking declaration. The consequence is not simply a need to back pay the difference between non-smoker and smoker rates but in reality the possibility of denial of death claim. It is therefore, important to advise the servicing broker as well as the insurance company of the change in smoking habits to make certain that sufficient evidence is documented to track the non-smoking period.

Pension Fund

Assets used to pay the pensions of retirees. An investment institution established to manage the assets used to pay the pensions of retirees.

Policy Date

date on which the insurance company assumes responsibilities for the obligations outlined in a policy.

Punch List

A list of discrepancies that need to be corrected by the contractor.

Quarter Round

A small trim molding that has the cross section of a quarter circle.

Reflective Insulation System

Reflective insulation System is formed by a combination of low emittance surfaces and air spaces that provide reflective cavities, which have low levels of radiant energy transmission.

Registered Retirement Income Fund (Canada)

Commonly referred to as a RRIF, this is one of the options available to RRSP holders to convert their tax sheltered savings into taxable income.

Security

In the case of mortgages, real estate offered as collateral for the loan.

Segregated Fund

A pool of assets held by the insurer, to back a specific liability to a policyholder. Segregated Funds flucuate in value depending on the market value of a specific group of assets the company must maintain separately.

Segregated Fund

Sometimes called seg funds, segregated funds are the life insurance industry equivalent to a mutual fund with some differences.The term "Mutual Fund" is often used generically, to cover a wide variety of funds where the investment capital from a large number of investors is "pooled" together and invested into specific stocks, bonds, mortgages, etc.
Since Segregated Funds are actually deferred annuity contracts issued by life insurance companies, they offer probate and creditor protection if a preferred beneficiary such as a spouse is named. Mutual Funds don't have this protection.
unlike mutual funds, segregated funds offer guarantees at maturity (usually 10 years from date of issue) or death on the limit of potential losses - at times up to 100% of original deposits are guaranteed which makes them an attractive alternative for the cautious and/or long term investor. On the other hand, with regular mutual funds, it is possible to have little or nothing left at death or plan maturity.

Sidelight

A vertical window beside a door or another window.

Slab Foundation

For a slab foundation, the site is leveled off, and a trench is dug around the perimeter of the home site. Gravel is then spread across the site, and concrete is poured approximately four inches thick over wire mesh and a moisture barrier. In areas of load bearing walls, trenches need to be dug to allow for additional thickness at this location. Slab foundations have no piers or floor joists, and the concrete slab is the floor system.

Un-faced Insulation

insulation with no attached vapor retarder.

Underwriter

Person that uses various types of evidence to evaluate the insurability of a client.

Underwriter

This could be the person (broker or agent) who helps you choose the proper type of life insurance or disability insurance and the insurance company for your particular needs. This could also be the person at the insurance company's head office who reviews your application for coverage to determine whether or not the insurance company will issue a policy to you.

Underwriting

Evaluating and classifying potential risk of a client.

Unearned Premium

Premiums paid for coverage not yet provided.

Universal Life

An unbundled Life product with a separate investment component. It typically does not participate in companies profits.

Valuation Date

date on which valuation occurs.

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