For the general public, understanding common insurance terminology may be an overwhelming journey. American Online Benefits Group wants to make navigating health insurance a less scary road to travel by sharing with you often used words and their definitions.
Accident Insurance– coverage that assists with medical and out-of-pocket expenses after an accident occurs. These expenses can include hospitalization, emergency treatment, medical exams, and over expenses incurred. The reimbursement is provided as one lump sum.
Beneficiary– the person on a life insurance policy deemed to receive benefits in the event of the policy holder’s death. The trustee can be one, two or more people with a contingent beneficiary listed should the primary beneficiary(s) be deceased.
Copayment– a fixed amount established by an insurance plan, payable by the policy holder for health care services. The amount of a co-pay can vary for different services including doctors’ visits, prescriptions, preventative services, and more.
Critical Illness Insurance– coverage paid out in one lump sum should the policy holder suffer a major medical event including heart attack, stroke, organ transplants, coronary bypass and more. Critical Illness Insurance is used to cover costs not otherwise covered by a traditional insurance plan.
Deductible– an amount of money set forth on an insurance claim the insured must pay for healthcare services before an insurance company will begin paying towards medical bills. Deductibles can be set per claim or per annual amount.
Healthcare Indemnity Plan– a “fee-for-service” plan that allows the insured to visit almost any hospital or doctor with a set portion of charges to be covered by the insurance provider. The policy holder may still be responsible for a co-pay or meeting a deductible.
Life Insurance– a lump-sum of money paid out to the beneficiary(s) upon the death of the insured person. The insured makes premium payments for a policy with a designated amount for payout depending on the needs and goals of the policy owner.
Open Enrollment Period– the time between November 1st and December 15th that individuals and employees can enroll for major medical health insurance. A special enrollment period is triggered by a life-changing, qualifying event (ex. marriage, divorce, birth of a child, and more.)
Out-of-Pocket Costs– the expenses paid by the insurer for medical services that are not otherwise covered by insurance. This includes deductibles, coinsurance, and other services, with an amount paid in before insurance will begin to cover expenses.
Pre-existing Condition– a medical illness, injury, disease, mental or medical disorder, or ailment that is present before the date of starting a new insurance policy, in which prior medical treatment has been provided.
Premium– the amount of money that an individual or business pays for an insurance policy. At times, premiums can be paid monthly, semi-annually, or the entire premium may be required to be paid in full before coverage begins.
Short Term Medical Insurance– an insurance policy providing limited, yet affordable benefits, that cover unforeseen accidents and incidents for a short period of time (typically 6 to 12 months). This type of insurance is ideal for those who are between jobs or waiting on a major medical health insurance plan to begin.
Urgent Care– medical attention needed right away, however does not require emergency care at a hospital. Urgent Care Facilities are free-standing, walk-in clinics, bridging together physicians and emergency rooms.
Vision Care– health and wellness plan providing reduced cost routine preventative eye care (eye exams) with discounted prescription eyewear or contact lenses. The insured may also receive discounts on elective vision correction surgery.