Glossary of Insurance Terms

A federal law was signed on March 23, 2010. Designed to expand health insurance coverage, eliminate pre-existing conditions, and require specific benefits and protections in health coverage.

A policy feature might be available with a life insurance policy to let you access your death benefit early if you�re diagnosed with a serious illness or need help with daily activities. The company will deduct the accelerated amount from the death benefit owed to your beneficiaries when you pass away.

Provides an additional life insurance payout if you die due to an accident. For example, if you have a policy with a $50,000 death benefit and an accidental death rider for $50,000, your beneficiary would receive $100,000 if you die in an accident.

The maximum amount a plan will pay for a covered health care service. If your doctor or hospital charges more than the allowed amount, you may have to pay the difference.

A contract in which you pay money to a life insurance company for investment. Most people use annuities to provide an income for retirement or to build savings. They can also provide money for your heirs. Annuities are best for long-term income, not short-term income.

A licensed advisor who manages your insurance policy, assists with service issues, and offers guidance on plan choices. Signing an AOR Letter replaces your current advisors without altering your insurance plan.

When a doctor or hospital bills you for the remaining balance not covered or paid by your plan.

The person, people, or entity who receives the payout from a life insurance policy or annuity.

A request sent to your insurance company asking them to pay for a covered service.

The percentage of a medical bill you pay after meeting your deductible. For example, if your plan�s allowed amount for an office visit is $100 and you�ve met your deductible, your coinsurance payment of 20% would be $20. The health insurance plan pays the remaining allowed amount.

The other person or people who will get paid by a life insurance policy if the primary beneficiary dies before the person whose life is insured.

A set amount you pay for a covered health care service (such as a doctor visit or prescription).

The portion of healthcare costs you pay, including deductibles, copays, and coinsurance. It does not include premiums, balance billing amounts, or the costs of services not covered by your plan.

The amount paid to the beneficiary of your life insurance policy after your death.

The amount you must pay out of pocket before your insurance begins to pay.

A spouse or child who is covered under your insurance plan.

Coverage that replaces part of your income if you cannot work due to illness or injury.

A list of generic, brand-name, and specialty prescription drugs covered by your health plan. Use the drug formulary to see which drugs are covered and your level of cost-sharing.

The date your insurance coverage officially begins.

An employee qualifies for coverage under a group health plan if they meet certain requirements. Usually, you need to work full-time, typically at least 30 hours a week, to enroll in a group plan.

Medical care for serious conditions that require immediate treatment.

Health care Services that your insurance plan does not cover.

An EPO plan gives you access to a network of doctors and hospitals, but does not require referrals to see specialists. However, you must stay within the network for coverage unless it is an emergency. It offers a balance between cost savings and flexibility.

A statement from a health insurance company explaining how a medical claim was processed, including what services were billed, what the insurer paid, and what the patient may owe. An EOB is not a bill.

A employer-sponsored, tax-advantaged account that allows employees to set aside pre-tax dollars from their paycheck to pay for qualified medical, dental, vision, or dependent care expenses. Using pre-tax funds, employees lower their taxable income and decrease out-of-pocket costs.

A plan where an employer pays a fixed premium and the insurance company takes on the financial risk.

A policy that must be offered regardless of your health status.

An HMO is a type of health plan that requires you to see doctors and use hospitals within a specific network. You usually need to select a primary care doctor and get referrals before visiting specialists. These plans generally have lower premiums but less flexibility.

A tax-free medical savings account available to individuals enrolled in high-deductible health plans. Funds must be used for qualified medical expenses and can roll over from year to year if not spent.

Health insurance purchased by an individual, not through an employer.

A doctor or facility that has agreed to lower rates with your insurance plan.

A hybrid plan where employers pay a fixed monthly amount but can share in savings if claims are low .

The total dollar amount a health care plan will pay over a policyholder�s lifetime. After a lifetime limit is reached, the insurance plan will no longer pay for covered services.

Health insurance policies that offer a very limited and specific set of benefits, paying fixed, predetermined dollar amounts for particular medical events instead of covering comprehensive medical expenses. Often called mini?meds, fixed indemnity, or hospital cash plans.

Coverage for services like nursing homes or in-home care.

The process insurers use to assess your health for coverage or pricing decisions involves underwriting. Companies that use underwriting review your health questionnaires, request your medical history, and examine GRX (prescription use).

Health care services or treatments that are appropriate and necessary to prevent, diagnose, or treat an illness, injury, condition, or disease.

The group of doctors, hospitals, and providers contracted with your insurance plan.

The specific time each year when people and employees can enroll in, modify, or cancel their health insurance plans without requiring a qualifying life event.

Health care services from a doctor who isn't contracted with your insurer

The most you will pay in a year before your insurance covers 100% of eligible costs.

Approval required from your insurer before certain services are covered.

A PPO plan offers the most flexibility. You can see both in-network and out-of-network providers without referrals. Staying in-network costs less, but you still have coverage if you go outside the network. These plans often come with higher premiums.

A tax credit helps lower the cost of health insurance purchased through the marketplace, making it more affordable for you to get health coverage. If you qualify based on income, the credit can reduce your monthly premium or provide a refund when you file your taxes.

Health care services such as routine physical exams, immunizations, and screenings that are designed to prevent illnesses before they develop.

Your main doctor who manages your overall care. HMOs generally have you choose a PCP when you enroll and require a written referral from your PCP before visiting a specialist.

A life change, such as having a child, getting married, or losing health coverage, that might enable you to enroll in health insurance plans outside the open enrollment period.

A written order from your primary care doctor to see a specialist or receive certain medical services. In many health maintenance organizations (HMOs), you need a referral before getting medical care from anyone except your primary care doctor. If you don�t get a referral first, the plan may not cover the services.

A plan where the employer pays employee claims directly instead of using an insurance carrier.

A clear summary for comparing health plans based on costs, benefits, and features. You'll receive the "Summary of Benefits and Coverage" (SBC) when shopping for coverage, renewing, changing plans, or requesting it from the insurance company.