Glossary of Insurance Terms

Annuities

An Annuity is an interest-bearing financial contract that combines the tax-deferred savings and investment properties of retirement accounts with the guaranteed-income aspects of insurance. There are several types of annuities available today, including Life Annuities, Deferred Annuities and Immediate Annuities.

Cancer Insurance

Cancer Insurance is designed as a supplement to a comprehensive health insurance plan to cover the high cost of treating cancer, costs not associated with standard health insurance, including deductibles, out-of-network specialists, travel and lodging when treatment is far from home, child care and household help, and normal living expenses including car payments, mortgage/rent and utility bills. Benefits are paid directly to you regardless of any other insurance.

Critical Illness

Critical Illness Insurance is an insurance policy that pays benefits when the policyholder is diagnosed with the critical illnesses listed in the policy. Examples of covered illnesses may be stroke, heart attack, cancer, loss of hearing, loss of speech, loss of vision, major transplants, and paralysis. The policy helps to ease the financial fears of lost income from a serious illness.

Dental Insurance

Dental Plans generally pay for a portion of the cost of preventive dental care including an annual examination and dental cleaning. Reimbursement amounts vary, however most policies cover a percentage of the cost of non-surgical tooth extractions, root canals and fillings.

Group Health Insurance

Group health insurance is a type of policy where a designated group of policy holders pay premiums in advance of needing medical services. The purpose of this insurance is to limit out-of-pocket expenses for serious medical needs.

Health Savings Account

A Health Savings Account, often referred to as an HSA, is a tax-advantaged account that helps cover medical expenses and is designed to be combined with high-deductible health insurance plans. The deposit to your HSA account as well as the withdrawals you make to pay for medical expenses are tax-free.

Hospital Indemnity

Hospital Indemnity Insurance is used to fill the gaps in major health insurance plans and pays for expenses related to a hospital stay but not covered by medical insurance. Benefits from this type of policy are paid as a fixed lump sum per each covered hospital confinement, outpatient surgery, or skilled nursing home stay. Benefits are normally paid directly to the policyholder and can be used for whatever needs might arise, including co-pays, deductibles and travel expenses to and from the hospital.

Individual Health Insurance

Individual health insurance is health insurance one purchased by individuals from an insurance company or insurance agent, versus group insurance which is typically received through an employer. It is often the health insurance choice of early retirees, self-employed individuals, new employees during their probationary period and those on COBRA.

International Medical Insurance

International Medical Insurance provides you with health insurance coverage in a country outside your home country. International Medical Insurance is used by people who frequently travel or live out of their home country, including business travelers, expatriates, vacationers, missionaries, and students traveling abroad. In addition to the cost of medical care, policies may cover multilingual services for translations, coordination of medical and emergency international treatment and currency conversion to help eliminate costly conversion fees and expedite funds.

Life Insurance

Life Insurance provides a monetary benefit to the beneficiary selected by the policyholder when the insured party dies. There are many types of Life Insurance, including term life, whole life, variable life, universal life and final expense policies.

Long Term Care Insurance

Long Term Care Insurance is insurance that provides for the cost of care for those who are unable to perform activities of daily living including eating, bathing, dressing, toileting, continence and transferring. Long term care insurance generally covers home care, assisted living, adult day care, respite care, nursing home and Alzheimer’s facilities.

Medicare Advantage Plan (Part C)

A Medicare Advantage Plan (Part C) is health insurance offered by private companies who are approved by Medicare. Advantage Plans cover all the services that Original Medicare covers. In addition, Advantage Plans may offer extra coverage, such as vision, hearing, dental, health and wellness programs. Many Plans include prescription drug coverage (Part D).

Out-of- pocket costs may vary from plan to plan. In addition to Part B premiums, policyholders may pay an additional premium for Part C coverage. The out of pocket costs will vary depending on the design of the plan. Enrollment in an Advantage Plan is limited to certain times during the year and in most cases policyholders are enrolled in an Advantage Plan for a year.

Medicare Plan D Prescription Coverage

Medicare offers prescription drug coverage to everyone with Medicare. It is designed to help make prescriptions drug costs more predictable and affordable. Most drug plans charge a monthly fee that varies by plan. Many Medicare Advantage Plans include Medicare drug coverage.

Medicare Supplement

A Medicare Supplement (sometimes referred to as Medigap) is health insurance sold by private insurance companies to provide coverage for medical expenses not covered or partially covered by Medicare Parts A and B. These companies are required to offer the same benefits for each plan that they offer. A person must be enrolled in part A and B of Medicare before they can enroll in a Supplement Plan. Medicare Supplements are not compatible with Medicare Advantage Plans.

Short Stay Nursing Home

Short Stay Nursing Home Insurance helps to cover the cost of a nursing home stay of less than one year for an insured who is unable to perform two out of the six, activities of daily living. These include eating, bathing, dressing, toileting, continence and transferring. Many policies offer flexible coverage, permitting you to choose between maximum coverage or reducing the overall cost by adding an elimination period.

Vision Plan

Vision Plans generally provide partial benefits for eye care, including the cost of an annual eye exam and a portion of the cost of corrective eyeglasses, contact lenses and or Lasik surgery.