A & H
Accident and Health
Absolute Assignment
Assignment by the policy owner of all control and rights to a 3rd party
Accident
A fortuitous event, unforeseen and unintended
Accidental Death Insurance
Form of health insurance that provides payment if death of insured results from accident.
Dismemberment Insurance, Accidental Death & Dismemberment (AD&D)
What form of health insurance is often combined with Accidental Death Insurance?
Accident & Sickness
Insurance against bodily injury, disability or death by accident or accidental means, or expense against disability or expense resulting from sickness, and the insurance relating.
Accidental Means
The unexpected cause of an accidental bodily injury. If you meant to do whatever caused your injury, there is no coverage, very restrictive. Most Health Insurance policies cover Accidental Bodily Injury, which is much broader and covers accidents regardle
Accumulation at Interest Option
A dividend or settlement option which the policyholder allows their dividends or policy proceeds to accumulate interest with the company. Dividend/Proceeds NOT taxable, Interest Earned is.
Actuary
Person concerned with the application of probability and statistical theory to insurance, utilizing the law of large numbers.
Accidental Death Benefit (ADB)
Rider added to a Life policy that will pay double the face amount if insured dies as result of accident (generally within 90 days of accident). Also known as "Double or Triple Indemnity.
Accidental Death & Dismemberment Insurance (AD&D)
Limited form of Health insurance that covers ACCIDENT ONLY. Is the ONLY type of health insurance that covers Death. Do NOT follow Principle of Indemnity (pays in addition to any other coverage the insured has).
Administrator
Person appointed by a court to settle a deceased's estate, sometimes called an executor.
Adverse Selection
Tendency of poorer risks to want insurance more often than standard risks. Occurs when person who is already sick purchases health insurance, not in favor of the company.
Consumer Rights & Adverse Underwriting Decisions
When an adverse underwriting decision is made, an individual has 90 business days to request information in writing (under Fair Credit and Reporting Act). The institution or producer must furnish specific reasons for the adverse decision and the names and
Patient Protection & Affordable Care Act of 2010 (PPACA or ACA)
Obamacare" signed into Law on March 23rd, 2010. Represents fundamental shift in area of medical expense policies. Designed to enable all U.S. citizens ability to purchase health insurance regardless of their health status. Also eliminates annual limits,
Agent/Producer
Individual appointed by insurance company to solicit and negotiate insurance contracts on its behalf. Represent the company, not the client.
Alien Company
Insurer organized and domiciled in country outside of USA.
Annuitant
Party receiving benefits of an annuity. Usually own the annuity, although you can buy an annuity to benefit another party, who would then be the annuitant.
Annuity
1). Amount of $ payable yearly or at other regular intervals
2). Agreement by an insurer to make periodic payments that continue during lifetime of the annuitant(s) for a specified period.
3). Pays while you're alive, considered to be opposite of life ins
Applicant
The party making application to the insurance company for the policy. Must provide the insurer with the truth to the best of their knowledge ("representations").
Assignee
Person to whom policy rights are assigned in whole or part by the policy owner (the assigner). Two types of Assignment on Life Insurance: 1). Absolute 2). Collateral
Assignment
Transfer of rights in a policy to another party by the policyholder.
Attained Age
Present age of the insured. Upon conversion, premiums are based on the current age of the insured.
Attorney-In-Fact
Person to whom authorization is given by an individual to exchange insurance with other persons.
-Always present in a Reciprocal Insurance Company.
Authorized Company
An insurer permitted to sell insurance within a state.
-Must obtain "Certificate of Authority" from the Director (ie. Insurance Commissioner) for EVERY state they sell in.
Automatic Premium Loan
Rider in a Life policy authorizing the insurance company to use cash value to pay premiums not paid by the end of the grace period.
-ONLY present in Whole Life or Endowment policies, NEVER Term (Term has no Cash Value).
-Rider is FREE but must be selected
Aviation Clause
Limits or excludes coverage when the insured is participating in specified types of air travel. Usually confined to regularly scheduled flights of commercial airlines, often applies to student pilots.
Beneficiary
Person who may become eligible to receive, or is receiving benefits under an insurance plan (other than as a participant). Selected by the policy owner and may be changed at any time, unless "irrevocable.
Blanket Insurance Contract
Health Insurance contract that covers all of a class of persons not individually identified. No certificate issued bc coverage applies to everyone that attends/participates.
-usually applies to cover school children or sports teams
Blue Plan
Generic term for those insurers who are authorized to use the designation "Blue Cross/Shield"
-usually on a service rather than reimbursement basis
Brokerage
Producer who represents an insured in the solicitation, negotiation, or procurement of insurance contracts. Might represent one insurer as a producer and if that insurer declines to write coverage for your client you might try to "Broker" business elsewhe
Business Insurance
Life or Health Insurance written to cover business situations (eg. key person, sole proprietor, partnership, corporations, etc).
Cancelable
Insurance contract that may be terminated by insurance company or insured at any time.
-Can do this with virtually all forms of insurance (unless state law prohibits)
-Excludes Life insurance and those health policies designated as Guaranteed Renewable an
Cancellation
Termination of a contract of insurance mid-term by voluntary act of the insurance company or insured, brought about in accordance with contract provisions or by mutual agreement (rather than at renewal date).
Capital Sum
Maximum amount payable in one sum in event of Accidental Dismemberment.
-On AD&D policy, it is generally 50% of the Principle sum (which is the amount payable for Accidental Death).
Cash Dividend Option
A dividend option under which policyholder receives dividends in CASH.
-NOT subject to tax.
-Mutual insurers issue "participating" policies, which might pay dividends, but not guaranteed.
Cash Surrender Value
The accumulated, guaranteed cash value in a Whole Life or Endowment policy at any given point in time. Synonymous with Cash Value.
-Most contracts do NOT develop a cash value until after the 3rd year.
-On Whole Life, the CV will equal face amount of polic
Certificate
Statement evidencing a policy has been written and stating coverage in general.
-On group insurance, employees receive this while the employer receives the master policy.
Claim
Demand for payment under the insurance policy.
Classification
Grouping of persons for the purpose of determining an underwriting/rating group in which a particular risk must be placed.
-standard, sub-standard, preferred risk rate.
Coinsurance
Provision that the insured and insurance company will shared covered losses in agreed proportion.
-Percentage participation in health insurance, with insurer paying 80% and client paying 20%, up to a maximum of "stop loss" amount.
-Applies after deductibl
Collateral Assignment
Assignment of part of the insurance policy proceeds as collateral to a bank. Used to settle the loan balance that may exist at the insured's death.
Common Disaster Provision
Provision that states the Primary Beneficiary must outlive the insured by a specified period of time in order to receive the proceeds (can be included in a Life contract. If not, the Contingent Beneficiary receives the proceeds.
-Designed to protect the r
Comprehensive Health Insurance
Form of Health Insurance that combines coverage of a Major Medical and Basic Medical Expense contracts into one broad contract.
-Provides coverage for almost all types of medical expense
-Usually subject to Corridor Deductible and Percentage Participation