The Collaborative International Dictionary of English v.0.48:

Tontine insurance \Ton*tine" in*su"rance\ (Life Insurance)
   Insurance in which the benefits of the insurance are
   distributed upon the tontine principle. Under the old, or

   full tontine, plan, all benefits were forfeited on lapsed
      policies, on the policies of those who died within the
      tontine period only the face of the policy was paid
      without any share of the surplus, and the survivor at the
      end of the tontine period received the entire surplus.
      This plan of tontine insurance has been replaced in the
      United States by the

   semitontine plan, in which the surplus is divided among the
      holders of policies in force at the termination of the
      tontine period, but the reverse for the paid-up value is
      paid on lapsed policies, and on the policies of those that
      have died the face is paid. Other modified forms are
      called free tontine, deferred dividend, etc.,
      according to the nature of the tontine arrangement.
      [Webster 1913 Suppl.]

WordNet (r) 3.0 (2006):

tontine insurance
    n 1: a form of life insurance whereby on the death or default of
         a participant his share is distributed to the remaining
         members [syn: tontine, tontine insurance]