Insurance Glossary
Beneficiary: The person or persons named in the life insurance policy that receive the life insurance proceeds at the time of the insureds death.
Benefit: Amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss.
Beneficiary: The person or persons named in the life insurance policy that receive the life insurance proceeds at the time of the insureds death.
Brand-name drug: Prescription drugs marketed with a specific brand name by the company that manufactures it, usually the company which develops and patents it. When patents run out, generic versions of many popular drugs are marketed at lower cost by other companies. Check your insurance plan to see if coverage differs between name-brand and their generic twins.
Carrier: The insurance company or HMO offering a health plan.
Cash Surrender Value: The dollar amount that is available in the form of cash for loans and that may be available for withdrawals. Accessing the Cash Surrender Value may reduce the death benefits paid by the insurance company and may increase the risk of the policy terminating.
Certificate of Insurance: The printed description of the benefits and coverage provisions forming the contract between the carrier and the customer. Discloses what it covered, what is not, and dollar limits.
Claim: A request by an individual (or his or her provider) to an individual's insurance company for the insurance company to pay for services obtained from a health care professional.
Co-Insurance: Co-insurance refers to money that an individual is required to pay for services, after a deductible has been paid. Co-insurance is easily confused with co-payment.
Co-Payment: Co-payment is a predetermined (flat) fee that an individual pays for health care services, in addition to what the insurance covers. For example, some HMOs require a $10 "co-payment" for each office visit, regardless of the type or level of services provided during the visit. Co-payments are not usually specified by percentages.
COBRA: Federal legislation that lets you, if you work for an insured Ohio employer group of 20 or more employees, continue to purchase health insurance for up to 18 months if you lose your job or your coverage is otherwise terminated. For more information, visit the Department of Labor.
Convertible Term Life Insurance: Term insurance which can be converted, as the option of a policy owner and without new evidence of insurability, for a permanent type life insurance policy.
Credit for Prior Coverage: This is something that may or may not apply when you switch employers or insurance plans. A pre-existing condition waiting period met under while you were under an employer's (qualifying) coverage can be honored by your new plan, if any interruption in the coverage between the two plans meets state guidelines.
Deductible: The amount an individual must pay for health care expenses before insurance (or a self-insured company) covers the costs. Often, Ohio insurance plans are based on yearly deductible amounts.
Dividend: A return of part of the premium on participating insurance that is based on the insurer's investment, mortality, and expense experience. Dividends are not guaranteed.
Effective Date: The date your insurance is to actually begin. You are not covered until the policies effective date.
Exclusions: Medical services that are not covered by an individual's insurance policy.
Face Amount: The face amount is the dollar amount that will be actually be paid in case of the insureds death. It does not include additional dollar amounts payable under riders such as accidental death or other special policy provisions.
Generic Drug: A "twin" to a "brand name drug" once the brand name company's patent has run out and other drug companies are allowed to sell a duplicate of the original. Generic drugs are cheaper, and most prescription and health plans reward clients for choosing generics.
Group Insurance: Coverage through an employer or other entity that covers all individuals in the group.
Health Maintenance Organizations (HMOs): Health Maintenance Organizations represent "pre-paid" or "capitated" insurance plans in which individuals or their employers pay a fixed monthly fee for services, instead of a separate charge for each visit or service. The monthly fees remain the same, regardless of types or levels of services provided, Services are provided by physicians who are employed by, or under contract with, the HMO. HMOs vary in design. Depending on the type of the HMO, services may be provided in a central facility, or in a physician's own office.
HIPAA: A Federal law passed in 1996 that allows persons to qualify immediately for comparable health insurance coverage when they change their employment or relationships. It also creates the authority to mandate the use of standards for the electronic exchange of health care data; to specify what medical and administrative code sets should be used within those standards; to require the use of national identification systems for health care patients, providers, payers (or plans), and employers (or sponsors); and to specify the types of measures required to protect the security and privacy of personally identifiable health care. HIPPA stands for Health Insurance Portability and Accountability Act of 1996.
In-network: Providers or health care facilities which are part of a health plan's network of providers with which it has negotiated a discount. Insured individuals usually pay less when using an Ohio in-network provider, because those networks provide services at lower cost to the insurance companies with which they have contracts.
Individual Health Insurance: Health insurance coverage on an individual, not group, basis. The premium is usually higher for an individual health insurance plan than for a group policy, but you may not qualify for a group plan.
Insurability: Insurability is the acceptability of the applicant to the company for which a application for insurance has been submitted.
Insured: The person whose life is insured through the insurance policy.
Lifetime Maximum Benefit (or Maximum Lifetime Benefit): the maximum amount a health plan will pay in benefits to an insured individual during that individual's lifetime.
Limitations: a limit on the amount of benefits paid out for a particular covered expense, as disclosed on the Certificate of Insurance.
Network: A group of doctors, hospitals and other health care providers contracted to provide services to insurance companies customers for less than their usual fees. Provider networks can cover a large geographic market or a wide range of health care services. Insured individuals typically pay less for using a network provider.
Out-of-Plan (Out-of-Network): This phrase usually refers to physicians, hospitals or other health care providers who are considered nonparticipants in an insurance plan (usually an HMO or PPO). Depending on an individual's health insurance plan, expenses incurred by services provided by out-of-plan health professionals may not be covered, or covered only in part by an individual's insurance company.
Out-Of-Pocket Maximum: A predetermined limited amount of money that an individual must pay out of their own savings, before an insurance company or (self-insured employer) will pay 100 percent for an individual's health care expenses.
Outpatient: An individual (patient) who receives health care services (such as surgery) on an outpatient basis, meaning they do not stay overnight in a hospital or inpatient facility. Many insurance companies have identified a list of tests and procedures (including surgery) that will not be covered (paid for) unless they are performed on an outpatient basis. The term outpatient is also used synonymously with ambulatory to describe health care facilities where procedures are performed.
Paid-up Insurance: Life Insurance that will remain in force with no more requirement to pay any more additional premiums.
Pre-existing Conditions: A medical condition that is excluded from coverage by an insurance company, because the condition was believed to exist prior to the individual obtaining a policy from the particular insurance company.
Preferred Provider Organizations (PPOs): You or your employer receive discounted rates if you use doctors from a pre-selected group. If you use a physician outside the PPO plan, you must pay more for the medical care.
Permanent Life Insurance: Any form of life insurance except term insurance. Such as Universal Life and Whole Life policies.
Policyowner: The person who owns the life insurance policy. This is usually the insured, but it may also be a relative or a business partner.
Premiums: Money paid to the insurance company to purchase a policy and to keep it in continous force.
Primary Care Provider (PCP): A health care professional (usually a physician) who is responsible for monitoring an individual's overall health care needs. Typically, a PCP serves as a "quarterback" for an individual's medical care, referring the individual to more specialized physicians for specialist care.
Provider: Provider is a term used for health professionals who provide health care services. Sometimes, the term refers only to physicians. Often, however, the term also refers to other health care professionals such as hospitals, nurse practitioners, chiropractors, physical therapists, and others offering specialized health care services.
Reasonable and Customary Fees: The average fee charged by a particular type of health care practitioner within a geographic area. The term is often used by medical plans as the amount of money they will approve for a specific test or procedure. If the fees are higher than the approved amount, the individual receiving the service is responsible for paying the difference. Sometimes, however, if an individual questions his or her physician about the fee, the provider will reduce the charge to the amount that the insurance company has defined as reasonable and customary.
Renewable Term Insurance: Term insurance which can be renewed at the end of the term period without any evidence of insurability.
Rider: A modification made to a Certificate of Insurance regarding the clauses and provisions of a policy (usually adding or excluding coverage).
Short-Term Medical: Temporary coverage for an individual for a short period of time, usually from 30 days to six months.
Small Employer Group: Generally means groups with 1-99 employees. The definition may vary between states.
Term Insurance: Life insurance that does not build up cash value and will only be in force for a specific period of time.
Underwriter: The company that assumes responsibility for the risk, issues insurance policies and receives premiums.
Universal Life Insurance: A flexible premium life insurance plan which will allow the policyowner to change the death benefit from and vary the amount of the premium.
Usual, Customary and Reasonable (UCR) or Covered Expenses: An amount customarily charged for or covered for similar services and supplies which are medically necessary, recommended by a doctor, or required for treatment.
Waiting Period: A period of time when you are not covered by insurance for a particular problem.
Whole Life: A permanent form of life insurance which can provide lifetime protection for the insured at a level premium expense.