Risk Pooling
A basic principle of insurance whereby a large number contribute to cover the losses of a few.
Premium
payment for insurance
Actuaries
statisticians who specialize in estimating the probability of death based on personal characteristics.
Policyholder or Policy Owner
The individual or business that owns the life insurance policy
Beneficiary
person entitled to benefits or proceeds of an insurance policy
Term Insurance
Life insurance that provides coverage for a specified period, such as ten or twenty years, with no cash value.
Whole Life Insurance
the type of life insurance policy that has a premium that stays level, a fixed death benefit, and the ability to withdraw savings
Rider
A special provision that may be added to your policy, which either provides extra benefits to the beneficiary or limits the company's liability under certain conditions
Basic Health Insurance
describes most health insurance, includes a combination of hospital, surgical, and physician expense insurance
Hospital Insurance
insurance that usually pays most or all hospital charges if an illness or injury requires the insured to be hospitalized
Surgical Insurance
insurance that covers all or part of the surgeon's fees for an operation
Physician Expense Insurance
pays for physicion's care that does not include surgery, such as office visits, lab tests and X-rays
Major Medical Expense Insurance
insurance that covers medical costs beyond those covered by basic health insurance
Fee-for-Service or Traditional Indemnity Plan
An insurance plan that provides reimbursement for all or part of your medical expenditures. In general, it gives you a good deal of freedom to choose your doctor and hospital
Managed Health Care or Prepaid Care Plan
An insurance plan that entitles you to the health care provided by a specified group of participating doctors, hospitals, and clinics. These plans are usually offered by health maintenance organizations or variations of them
Coinsurance or Percentage Participant Provision
An insurance provision that defines the percentage of each claim that the insurance company will pay
Co-Payment
Payment that must occur at time of medical procedure (ex. Doctor visit, ER visit, etc.) in addition to any insurance payments
Health Maintenance Organization (HMO)
A prepaid insurance plan that entitles members to the services of participating doctors, hospitals, and clinics
Point-of-Service Plan
A health care plan that allows members to seek health care from both HMO-affiliated doctors and non-HMO affiliated doctors
Preferred Provider Organization (PPO)
An insurance plan under which an employer or insurer negotiates with a group of doctors and hospitals to provide health care for its employees or members at reduced rates
Group Health Insurance
health care coverage available through employers and other organizations; employees usually pay part or all of premium cost.
Individual Insurance Policy
An insurance policy that is tailor-made for you, reflecting your age, health (as determined by an examination), and chosen deductible size
Flexible Spending Account (FSA)
An employer-sponsored medical plan that allows each employee o have pre-tax earnings deposited into a specifically designed account for the purposes of paying health care bills
Disability Insurance
A form of health insurance that provides periodic payments to replace income when the insured is unable to work as a result of illness, injury, or disease-not as a result of a work-related accident or condition
Short Term Disability
A disability policy that provides benefits over a given period, generally 6 months to 2 years
Long Term Disability
A disability policy that provides benefits until the individual reaches an age specified in the contract, generally 65 or 70, or for the insured's lifetime
Elimination Period
The period after the disability during which no benefit occurs
Long-Term Care Insurance
Insurance coverage that provides a daily monetary benefit to people who are chronically ill and who require living assistance either at home or in a residential facility
Deductible
The amount of expenses that the insured must pay before the insurance company will pay any insurance benefits