applicant
The party applying for an insurance policy.

application
A form that must be completed by an individual or other party who is seeking insurance coverage. This form provides the insurance company with much of the information it will need to decide whether to accept or reject the risk.

COBRA
The Consolidated Omnibus Budget Reconciliation Act of 1985, commonly known as COBRA, requires group health plans with 20 or more employees to offer continued health coverage for you and your dependents for 18 months after you leave your job. Longer durations of continuance are available under certain circumstances. If you opt to continue coverage, you must pay the entire premium, plus a two percent administration charge.

coinsurance
The amount you are required to pay for medical care in a fee-for-service plan or preferred provider organization (PPO) after you have met your deductible. The coinsurance rate is usually expressed as a percentage of charges. For example, if the insurance company pays 80 percent of the claim, you pay 20 percent.

coinsurance provision
A stipulation found in most health insurance policies that requires an insured to pay a stated percentage, in excess of the deductible, of all eligible medical expenses.

combination company
A life and health insurance company that sells both industrial and ordinary insurance products.

combination clause
A clause in a disability income contract that specifies a point at which the definition of total disability will no longer be based on an insured's inability to perform his or her "own occupation" but on the insured's inability to perform "any occupation."

combination dental plan
A dental plan which contains features of both scheduled and nonscheduled plans. Typically, combination plans cover preventive and diagnostic procedures on a nonscheduled basis and other services on a scheduled basis. See also nonscheduled dental plan and scheduled dental plan.

copayment
A cost sharing arrangement in which a person pays a specific charge for a specific medical service -- say $10 for an office visit or $5 for a prescription.

dental maintenance organization
An organization like an HMO which provides only dental care.

dentist-consultant
A licensed dentist who understands the underwriting intent of dental plan language as well as the accepted standards of dental practice, and who advises insurers as to the appropriateness of dental treatment.

grace period
The length of time (usually 31 days) after a premium is due and unpaid during which the policy, including all riders, remains in force. If a premium is paid during the grace period, the premium is considered to have been paid on time.

health insurance
Insurance covering medical expenses or income loss resulting from injury or sickness. Health insurance is a general category that includes many different types of insurance coverage, including hospital confinement insurance, hospital expense insurance, surgical expense insurance, major medical insurance, disability income insurance, dental expense insurance, prescription drug insurance, and vision care insurance. See also disability income insurance and medical expense insurance.

health maintenance organization (HMO)
Prepaid health plans in which you pay a monthly premium and the HMO covers your necessary medical treatment. You must choose a primary care physician from within the network to coordinate all of your care. All specialty referrals need to be authorized by your primary care physician.

hospital confinement insurance
A type of health insurance that provides a predetermined flat benefit amount for each day an insured is hospitalized. The benefit amount does not vary according to the amount of medical expenses the insured incurs, although some policies provide higher benefit amounts if the insured is in an intensive or cardiac care unit. Also called hospital indemnity insurance.

insurance
A system of protection against loss in which a number of individuals agree to pay certain sums of money, called premiums, to create a pool of money which will guarantee that the individuals will be compensated for losses caused by events such as fire, accident, illness, or death.

insurance agent
A representative of an insurance company who sells insurance. An insurance agent locates prospective insurance customers, determines the insurance needs of each customer, and assists the customer in applying for insurance. Typically, an insurance agent will deliver the policy when the application is approved, will collect the initial premium, and will provide customer service to policyowners. Also called an agent, a field underwriter, or a life underwriter.

integrated dental plan
A dental plan which is part of a major medical policy.

major medical insurance
A type of medical expense insurance that provides broad coverage for most of the expenses associated with treating a covered illness or injury.

managed care
An organized way to manage costs, use, and quality of the health-care system. The major types of managed care plans are health maintenance organizations (HMOs), point-of-service (POS) plans, and preferred provider organizations (PPOs).

Medicaid
A joint federal-state health insurance program that is run by the states and covers certain low-income people (especially children and pregnant women) and disabled people.

medical application
An application for insurance in which the proposed insured is required to undergo some type of medical examination. The results of the medical examination are then reported to the insurance company.

medical expense insurance
Any of several types of health insurance designed to pay for part or all of an insured's health care expenses, such as hospital room and board, surgeon's fees, visits to doctors' offices, prescribed drugs, treatments, and nursing care. See also hospital confinement insurance, hospital-surgical expense insurance, major medical insurance, and specified expense coverage.

Medicare
The federally sponsored health insurance program of hospital and medical insurance primarily for people aged 65 and older.

Medicare supplement
Medical expense coverage that provides benefits for certain expenses not covered under Medicare. This coverage is available only to individuals who are covered by Medicare and can be purchased by individuals or by employers to cover retired employees.

nonscheduled dental plan
A dental plan which pays benefits for procedures based on the dentist's actual charges, as long as the charges are usual, customary, and reasonable.

point-of-service (POS) plan
A type of managed care plan combining features of health maintenance organizations (HMOs) and preferred provider organizations (PPOs), in which individuals decide whether to go to a network provider and pay a flat dollar copayment (say $10 for a doctor's visit), or to an out-of-network provider and pay a deductible and/or a coinsurance charge.

policy
A written document that serves as evidence of an insurance contract and contains the pertinent facts about the policyowner, the insurance coverage, the insured, and the insurer.

preferred provider organization (PPO)
A network of health-care providers with which a health insurer has negotiated contracts for its insured population to receive health services at discounted costs. Health-care decisions generally remain with the patient as he or she selects providers and determines his or her own need for services. Patients have financial incentives to select providers within the PPO network.

premium
The monthly amount you or your employer pays in exchange for insurance coverage.

primary care physician
Usually your first contact for health care under a health maintenance organization (HMO) or point-of-service (POS) plan. This is often a family physician, internist, or pediatrician. A primary care physician monitors your health, treats most health problems, and authorizes referrals to specialists, if necessary.