Health insurance
A plan for sharing the risk of high medical costs resulting from injury or illness
group insurance
Common type of health insurance in which all those insured have the same coverage and pay a set premium
COBRA
A law that allows people who leave employment to continue their health insurance under the company plan for a limited period of time
Coordination of benefits
A group health insurance provision that specifies how the insurers will share the cost when more than policy covers a claim
Flex 125 Plan
An employee benefit program that allows employees to set aside money, pretax, to help pay deductibles, copayments, and other health expenses
Basic health coverage
Includes medical, hospital, and surgical costs
Major medical coverage
Provides protection against the catastrophic expenses of a serious injury or illness
Stop-loss provision
An insurance clause that caps or sets a maximum that the insured has to pay during any calendar year
HSA
A health savings account used in association with a medical plan that carries a high deductible
HMO
A group plan offering prepaid medical care to its members (health maintenance organization)
PPO
A group of health care providers who band together to provide health services for set fees (preferred provider organization)
Disability Insurance
An insurance plan that makes regular payments (usually monthly) to replace income lost when illness or injury prevents the insured for working
Life insurance
Provides funds to the beneficiaries when the insured dies
Portability
The feature that allows a group policy to be converted into an individual policy. When you leave your employer, you are able to continue paying the premiums and convert your group policy into an individual policy
Incontestable clause
A provision of a life insurance policy stating that once the policy has been in effect for a stated period of time, the insurer may no longer question items on the application in order to deny coverage
double indemnity
The beneficiary is paid double the face amount of insurance policy
temporary life insurance
Life insurance that only lasts for a specified period
term life insurance
The most common form of temporary life insurance. It remains in effect for a specified period of time. The policy only has value the covered risk occurs while the policy is in effect
permanent life insurance
Life insurance that remains in effect for the insured's lifetime and builds a cash value
cash value
The savings accumulated in a permanent life insurance policy that you would receive if you can canceled your policy
HIPAA
Law that limits the pre-existing conditions that group plans may exclude. It also makes it illegal for an insurer to deny coverage based on health status
Unmanaged care plans
(Traditional fee-for-service) Allow participants to choose any doctor and to be reimbursed for a portion for a portion of the expense incurred after a deductible is met. This plan is often most expensive.
Point of Service Plan
Medical insurance plan that is a hybrid of an HMO and a PPO. It gives people more choice and control over medical services, but is designed to encourage participants to stay within the plan
Medicare
Government-sponsored health insurance for people 65+. It is funded by the Social Security Administration and funded by employee payroll deductions
Medicaid
Government-sponsored health insurance for people with low incomes and limited resources
Guaranteed renewability
Provision that protects you against cancellation if your health declines
Rider
A small insurance policy that modifies the coverage of the main policy
Waiver of premium
Rider that allows you to stop paying premiums and keep your coverage in force if you become disabled and cannot work
Guaranteed insurability
Rider that gives you the right to renew a policy or buy additional coverage regardless of changes in health
Decreasing term insurance
Temporary life insurance in which the amount of coverage decreases each year while the premium remains the same
Level term insurance
Temporary life insurance in which the amount of coverage remains constant from beginning to end
Credit life
Temporary life insurance that can only be used to repay a debt should the borrower die before doing so
Renewable term insurance
Temporary life insurance that gives the policyholder the right to renew each year, without having to pass a physical exame
Whole life
Permanent life insurance in which you pay fixed premiums throughout your life and the policy pays a stated sum at death to your beneficiary
Limited-pay life
Permanent life insurance in which premiums are limited to a specific number of years or until age 65. You remain insured for life, and the company will pay the face value of the policy at your death
Universal life
Permanent life insurance that combines a savings plan with a death benefit. The premiums and death benefits can be changed. The interest rate earned changes with the economy.
Variable life
Permanent life insurance that combines a death benefit with investment options. The death benefit and cash value rise or fall with the investment results. The premiums may or may not be fixed.