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For your convenience, we have provided a list of commonly used group insurance terminology. |
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Accidental death and dismemberment insurance A benefit in a life insurance policy that provides payment in the event of death or loss of or loss of use of one or more bodily members (such as hands or feet) or the sight of one or both eyes as a result of an accident. Adjudicate The decision making process whereby a claim is determined eligible or not and what amount is covered, if any. Adjudicator The person who adjudicates a claim and is almost always an employee of the insurer. Administrative Services Only (ASO) Plan A financial arrangement under which an insurance carrier or an independent organization will, for a fee, administer a health benefit plan and settle claims. This is also commonly referred to as 'self-insured'. Advisor See 'Broker'. Agent A sales and service representative of an insurance company. In a life insurance company, an agent is also often called a life underwriter. Association group plans Insurance plans designed for members of a professional association or trade association. Members may be protected under a group policy or by individual franchise policies. Beneficiary The person who is to receive the insurance proceeds at the death of the insured. Benefit The amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss covered by the policy. Broker Independent insurance agent who can sell products from multiple insurance companies. Claim A demand to the insurer by the insured person for the payment of benefits under a policy. Coinsurance A provision in an insurance contract by which the insurer and insured share, in a specific ratio, the covered expenses under a policy. For example, the insurer may reimburse the insured for 80 per cent of covered expenses, the insured paying the remaining 20 per cent of such expenses. Coverage effective date The date coverage becomes effective based on your date of hire, and the average number of hours you work each week or each year, and the waiting period selected by your employer, and the date your application is received by us. Covered expenses Specified hospital, medical and miscellaneous health care expenses that will be considered in the calculation of benefits due under a health insurance policy. Critical illness insurance A form of health insurance designed to protect people against the economic hardship that can result from serious health problems. Typically, these policies cover a variety of serious illnesses (such as heart attack, stroke, life-threatening cancer, kidney failure, blindness, deafness and multiple sclerosis) and pay a lump sum to the policyholder 30 days after diagnosis of one of the specified conditions. Deductible The amount of covered expenses that must be incurred and paid by the insured before benefits become payable by the insurer. Dental An insured benefit that covers some or all dental work for the insured persons. Dependent Any of the following persons for whom coverage is provided under this Plan: one Spouse, and any child, stepchild, legally adopted child, or legal ward who is unmarried, living with you, and accepted as your Dependent under the Income Tax Act. Dependent Life Life insurance covering the lives of the spouse and children. Disability A physical or mental condition that makes an insured person incapable of performing one or more duties of his or her occupation. Disability Waiver benefit A benefit added to some life insurance policies providing for waiver of premium and sometimes payment of a monthly income, if the insured becomes totally and permanently disabled. Elimination Period The number of days between the date of disability and when the benefit coverage begins. Excess Coverage Any eligible amount of insurance coverage above the non-evidence maximum. Extended health care insurance A form of health insurance that provides, in one policy, protection for hospital and medical expenses not covered by government programs and usually other health care expenses, such as prescribed drugs, medical appliances, ambulance, private duty nursing, etc.. The policy may contain a deductible amount, coinsurance and high maximum benefits. Also called "major medical expense insurance". Face amount The amount stated on the face of the policy that will be paid on the death of the life insured or at the maturity of the policy. It does not include additional amounts payable under accidental death or other special provisions, or acquired through the application of policyholder dividends. Also called the "sum insured". Grace period The period (usually 30 or 31 days) following the premium due date, during which an overdue premium for a life insurance policy may be paid without penalty. The policy remains in force throughout this period. Group insurance Insurance issued, usually without medical examination, on a group of people under a master contract. It is usually issued to an employer for the benefit of employees. The individual members of the group hold certificates as evidence of their insurance. Guaranteed renewable policies A health insurance contract provision in which the insurance company must renew the policy, but premiums may be raised by class. This means that the increase applies to all policyholders in a particular group, rather than to one individual policyholder. Health evidence Written and physical evidence that may be required to approve someone for insurance coverage above the non-evidence maximum. Health insurance Insurance providing for the payment of benefits as a result of sickness or injury. Includes various types of insurance, such as accident insurance, disability income replacement insurance, medical expense insurance, and accidental death and dismemberment insurance. Often includes government hospital-medical plans. Health Spending Account (HSA) A health spending account works like a special savings account. Every year, a credit amount is posted in each employee's health spending account by the employer. The employees use the credited amounts to cover a broad range of medical and dental care costs incurred for themselves or their dependents. To be eligible, all care must be medically necessary and eligible for income tax credits as specified in the Income Tax Act. Individual insurance Insurance purchased on an individual basis, covering only one person or, in some cases, members of his or her family as well. Insurer The party to the insurance contract who promises to pay losses or benefits. Also, any corporation licensed to furnish insurance to the public. Lapsed policy policy terminated because of non-payment of premiums. This phrase sometimes is limited to a termination occurring before the policy has a cash or other non-forfeiture value. Late Applicant An applicant for group insurance who did not apply within 31 days of completing the waiting period. Life insurance Insurance providing for the payment of benefits upon the death, whether by accident or otherwise, of the life insured. Life insured The person on whose death or disability the insurance proceeds will become payable. Limited policy A health insurance policy that covers only specified accidents or sicknesses. Long term care insurance A form of health insurance that provides assistance with payment of a continuum of broad-ranged maintenance and health services for individuals who can no longer function independently due to a physical or cognitive impairment and/or aging. Services may be provided on an inpatient (e.g., rehabilitation facility, chronic care facility, nursing home, etc.), outpatient, or at-home basis. Long term disability insurance Insurance providing for the payment of benefits upon disability and continuing until expiration of the benefit term or the individual's return to work. Non-evidence maximum The maximum amount of insurance for which you are eligible without providing evidence of your insurability. Non-profit insurers Bodies organized under provincial laws to provide hospital, medical or dental insurance on a co-operative basis. They are exempt from certain types of taxes. Non-taxable benefit A benefit which is not classified on an employee's personal tax return as income. Optional Life Additional Life Insurance above and beyond the standard group contract. Health evidence is commonly required. Paramedicals Medical services commonly included in Extended Health Benefits. Examples: chiropractor; physiotherapist; psychologist. Usually with finite dollar limits per year per practitioner type. Partial disability benefit A benefit sometimes found in disability income policies providing for the payment of reduced monthly income in the event the insured cannot work full-time or is prevented from performing one or more important daily duties pertaining to his or her occupation. Policy The legal document issued by the insurer to the policyholder that outlines the conditions and terms of the insurance. Also called the contract. Policyholder The person who owns an insurance policy. Also called the "insured". In life insurance, the policyholder is usually the "life insured" but not always. Premium The payment, or one of the periodic payments, a policyholder is required to make for an insurance policy. Salary Your regular monthly salary, not including bonuses, overtime , or commissions, unless you are a commissioned employee. In this case, Salary means your commissions averaged over the previous 24 months, not including bonuses or overtime. Short term disability insurance Insurance providing for the payment of benefits upon disability and continuing until expiration of the benefit term or the individual's return to work. Spouse Your legal spouse or a person who has been living with you in a common-law relationship for at least one full year and who is publicly represented as your spouse. Taxable benefit A benefit which an employee must claim as income when filing a personal tax return. Termination Age The age at which your benefit coverage terminates. This varies depending on the benefit. Underwriting The process by which an insurer determines whether or not, and on what basis, it will accept an application for insurance. Waiting Period The waiting period is the number of months of continuous employment with you which an Employee must complete before becoming eligible for coverage. |
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