Resources
Insurance glossary
The words in your policy, explained in plain language.
A
- Activities of daily living
- Bathing, dressing, toileting, transferring, continence and eating. Many long-term care policies trigger benefits when a person needs help with some of them, as the policy defines it.
- Annuity
- An insurance contract that, depending on its terms, can be used to accumulate over a period of time or to receive periodic payments in retirement.
B
- Beneficiary
- The person or organisation that receives the insurance payment when the covered event happens, for example when the insured dies.
- Benefit period
- In disability insurance, the maximum length of time the benefit is paid.
C
- Cash value
- The value some permanent life policies build up under the contract. Loans or withdrawals can reduce it, along with the death benefit.
- Claim
- A formal request to the insurer to pay for a covered event.
- Coinsurance
- The share of a medical service's cost you pay after meeting the deductible; the insurer pays the rest.
- Copay
- A fixed amount you pay for a specific service, such as a doctor visit or a prescription.
- Coverage
- The risks, services or expenses the policy protects.
- Coverage limit
- The most the insurer will pay for an event or over a period.
D
- Death benefit
- The amount a life insurance policy pays to the beneficiaries when the insured dies.
- Deductible
- What you pay out of pocket before the insurer starts covering costs.
E
- Enrolment period
- The dates in the year when you can sign up for or change a plan, as with Medicare or Marketplace (ACA) plans.
- Exclusion
- A situation or expense the policy does not cover.
G
- Grace period
- The days you have to pay an overdue premium before the policy lapses.
I
- Insured
- The person whose life, health or property the policy protects.
L
- Limited benefits
- Coverage that pays defined or fixed amounts for specific events or services, such as an accident or a hospital stay. It is not comprehensive health insurance.
M
- Medicare Supplement (Medigap)
- Policies that help pay some costs Original Medicare does not cover. They are not the same as supplemental health insurance.
O
- Out-of-pocket maximum
- The most you will pay in a year for covered services; once you reach it, the plan covers the rest of those services under its rules.
P
- Policy
- The contract between you and the insurer that sets out what is covered, on what terms and at what price.
- Premium
- What you pay for your insurance, monthly, quarterly or yearly.
- Provider network
- The doctors, hospitals and pharmacies that have an agreement with a health plan; using them usually costs less.
R
- Rider
- An optional add-on to a policy that extends its protection.
S
- Sum insured
- The amount a life policy or a property is insured for.
U
- Underwriting
- The process an insurer uses to assess risk and decide whether to approve a policy and at what price.
W
- Waiting period
- The time that must pass before certain coverage or benefits begin, depending on the policy. In disability insurance it is counted from the start of the disability.
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