Definition of the word rollover

The term "rollover" has various meanings across different contexts, but in the context of finance and insurance, it refers to the automatic renewal or continuation of a policy or investment when it reaches maturity or expiration date. This term originated in the 1960s when life insurance policies started using this term instead of "renewal" or "extension". The reason for this change was to simplify the language used in insurance documents and make them more easily comprehensible to customers. The term "rollover" has since been adopted by other financial services, such as savings accounts, bonds, and mutual funds, to indicate the automatic transfer of funds from a maturing product into a similar product. Overall, the use of the term "rollover" helps to provide greater transparency and consistency in financial products and services, making it easier for customers to understand their options and manage their finances.