Insurance Glossary - Allboc Insurance Solutions - Allboc

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GLOSSARY
ACCIDENTAL DEATH BENEFIT - In a life insurance policy, benefit in addition to the death benefit paid to the beneficiary, should death occur due to an accident. There can be certain exclusions as well as time and age limits.

ACT OF GOD - An unpreventable accident or event that is the result of natural causes; for example, floods, earthquakes, or lightning.

ACTVITIES OF DAILY LIVING - Bathing, preparing and eating meals, moving from room to room, getting into and out of beds or chairs, dressing, using a toilet.

AGENT - An individual who sells and services insurance policies. The agents at RRAHealth.com are independent agents representing numberous insurance companies and service clients by searching the market for the most advantageous price for the most coverage.

ATTAINED AGE - Insured's age at a particular time. For example, many term life insurance policies allow an insured to convert to permanent insurance without a physical examination at the insured's then attained age. Upon conversion, the premium usually rises substantially to reflect the insured's age and diminished life expectancy.

BENEFICIARY - The person or party named by the owner of a life insurance policy to receive the policy benefit.

BINDER - A temporary insurance contract providing coverage until a permanent policy is issued.

BENEFIT PERIOD - In health insurance, the number of days for which certain benefits are paid to the named insured and his or her dependents.

CALENDAR YEAR - Earned premiums and loss transactions occurring with the calendar year beginning Jan. 1, irrespective of the contractual dates of the policies to which the transactions relate and regardless of the dates of the accidents.

CAPTIVE AGENT - A representative of a single insurer or fleet of insurers who is obliged to submit business only to that company. At RRAHealth.com you can rest assured that you are not being steered toward any particular plan or company. When possible, we will try and point out the best deals.

CASE MANAGEMENT - A system of coordinating medical services to treat a patient, improve care and reduce cost. A case manager coordinates health care delivery for patients.

CASH VALUE - The savings element of a permanent life insurance policy, which represents the policy owner’s interest in the policy.

CATACLYSM - A great upheaval that causes sudden and violent changes, such as an earthquake, war, great flood, etc.

CATASTROPHIC LOSS - Damage resulting from a catastrophe.

CLAIM - A formal request for payment of the benefits as provided by the policy.

COINSURANCE - The percentage of a medical or drug claim above the deductible that the insured is required to pay.

CONTINGENT BENEFICIARY - The party designated to receive proceeds of a life insurance policy following the insured’s death if the primary beneficiary dies before the insured.

CONVERTIBLE TERM INSURANCE POLICY - A term life insurance policy that gives the policy owner the right to convert the policy to a permanent plan of insurance regardless of an insured's physical condition and without a medical examination. The individual cannot be denied coverage or charged an additional premium for any health problems.

COPAYMENT - A predetermined, flat fee an individual pays for health-care services. For example, some HMOs require a $15 copayment for each office visit, regardless of the type or level of services provided during the visit.

COVERAGE AREA - The geographic region covered by travel insurance.

CREDIT LIFE INSURANCE - Insurance issued to a creditor (lender) to cover the life of a debtor (borrower) for an outstanding loan.

CREDITABLE COVERAGE - An insurance plan with benefits that are at least as good as those defined by the Medicare Part D program.

DEATH BENEFIT - The limit of insurance or the amount of benefit that will be paid in the event of the death of a covered person.

DECLINED RISK - A proposed insured who is considered to present a risk that is too great for an insurer to cover.

DEDUCTIBLE - Amount that the insured pays before the insurance begins to pay.

DISASTER - A natural or man-made event that negatively affects life, property, livelihood or industry often resulting in permanent changes to human societies, ecosystems and the environment.

DISEASE MANAGEMENT - A system of coordinated health-care interventions and communications for patients with certain illnesses.

ELIMINATION PERIOD - The time which must pass after filing a claim before policyholder can collect insurance benefits. Also known as "waiting period."

EVIDENCE OF INSURABILITY - Proof that a person is an insurable risk.

EXCLUSIONS - Items or conditions that are not covered by the general insurance contract.

EXPERIENCE RATING - A method of calculating group insurance premium rates by which the insurer considers the particular group’s prior claims and expense experience.

FACE AMOUNT - The amount of the death benefit payable under a life insurance policy.

FREE LOOK PROVISION - An individual life insurance and annuity provision that gives the policy owner a stated time, usually 10 days after the policy is delivered, in which to cancel the policy and receive a full refund on the initial premium payment.

FUTURE PURCHASE OPTION - Life and health insurance provisions that guarantee the insured the right to buy additional coverage without proving insurability. Also known as "guaranteed insurability option."

GRACE PERIOD - The length of time (usually 31 days) after a premium is due and unpaid during which the policy, including all riders, remains in force. If the premium is paid during the grace period, the premium is considered to have been paid on time.

GUARANTEED ISSUE RIGHT - The right to purchase insurance without physical examination. Preexisting medical conditions are not considered.

GUARANTEED RENEWABLE - A policy provision in many products which guarantees the policyowner the right to renew coverage at every policy anniversary date. The company does not have the right to cancel coverage except for nonpayment of premiums by the policyowner; however, the company can raise rates if they choose.

HEALTH MAINTENANCE ORGANIZATION (HMO) - A health insurance plan that entitles members to the services of participating physicians, hospitals and clinics. Members must use contracted health-care providers.

INCONTESTABILITY PROVISION - An insurance and annuity provision that limits the time within which the insurer has the right to void the contract on the grounds of material misrepresentation in the application for the policy.

IRREVOCABLE BENEFICIARY - A life insurance policy beneficiary who has a vested interest in the policy proceeds even during the insured’s lifetime because the policy owner has the right to change the beneficiary designation only after obtaining the beneficiary’s consent.

INSURABLE INTEREST - The interest an insurance policy owner has in the risk that is insured. The owner of a life insurance policy has an insurable interest in the insured when the policy owner is likely to benefit if the insured continues to live and is likely to suffer some loss or detriment if the insured dies.

LIABILITY INSURANCE - Insurance coverage that offers protection against claims alleging that a property owner’s negligence or inappropriate action resulted in bodily injury or property damage to another party.

LIFE AND HEALTH GUARANTEE ASSOCIATION - An organization that operates under the supervision of a state insurance commissioner to protect policy owners, insured's, beneficiaries, and specified others against losses that result from the financial impairment or insolvency of a life insurer that operates in the state.

MATERIAL MISREPRESENTATION - A misrepresentation that would effect the insurance company’s evaluation of a proposed insured.

MEDIATION - A situation in which parties agree to take part in a structured settlement negotiation through the guidance of a neutral expert. By participating in this process, the parties do not agree that they will actually settle and the mediator does not have the authority to impose such a settlement.

MORTALITY TABLES - Charts that show the death rates an insurer may reasonably anticipate among a particular group of insured lives at certain ages.

ORIGINAL AGE CONVERSION - A conversion of a term life insurance policy to a permanent plan of insurance at a premium rate, based on the insured’s age when the original term policy was purchased.

OUT-OF-POCKET LIMIT - A predetermined amount of money that an individual must pay before insurance will pay 100% for an individual's health-care expenses.

PERMANENT LIFE INSURANCE - Life insurance that provides coverage throughout the insured’s lifetime and also provides a savings element.

POLICY ANNIVERSARY - As a general rule, the date on which coverage under an insurance policy became effective.

POLICY RIDER - An amendment to an insurance policy that becomes part of the insurance contract and either expands or limits the benefits payable under the contract.

POOLING - A method by which each member of an insurance pool shares in each and every risk written by the other members of the pool.

PREFERRED RISK - A proposed insured who presents a significantly less than average likelihood of loss and who is charged a lower than standard premium rate.

PREFERRED PROVIDER ORGANIZATION (PPO) - Network of medical providers who charge on a fee-for- service basis, but are paid on a negotiated, discounted fee schedule. Typically the insured can also obtain services out of network for a higher copayment.

PREMIUM - The dollar amount paid for an insurance policy, typically expressed as $xx.xxx per month.

PRIMARY INSURANCE - The first layer of insurance coverage that provides benefits up to the limits of a policy, regardless of other insurance policies in effect.

QUALIFYING EVENT - An occurrence that triggers an insured's protection.

SUBROGATION CLAIM - A claim, brought by an insurance company which has paid medical bills, against a third party who caused injury to the insured.

SERVICE AREA - In Medicare plans, the area within which a particular plan is offered.

UMBRELLA POLICY - Umbrella coverage is insurance coverage that extends the terms of a regular insurance policy once coverage limits for the regular policy have been reached. Specifically, umbrella coverage is for people who want protection against a large jury award that is not covered in their standard policy.

UNDERWRITING - The process of selecting risks for insurance and classifying them according to their degrees of insurability so that the appropriate rates may be assigned. The process also includes rejection of those risks that do not qualify.

* Contacting us via any of our phone numbers will connect you with one of our employees and/or agents.  Allboc Insurance Solutions is not connected with or endorsed by the United States government or the federal Medicare program.
 
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