Accident insurance 

– covers the medical expenses as the result of a bodily injury

or death. This does not cover self-inflicted injury, intentional harm from another
person, homicide, sickness or death from natural causes.
Accumulation period – timeframe within a policy period in which deductible
amounts are calculated.
Actuarial valuation – a review of insurance and calculation that an insurance
company makes to determine the premium, rate, and reserves based on the
expected expenses of issuing coverage.
AD&D – Accidental death and dismemberment insurance.
Affiliation of Health Providers – a partnership of health care providers who
collectively offer health care coverage to a specific group.
After care – the care, follow-up treatment or therapy needed by a patient who has
recently undergone surgery, been involved in an accident or has had an illness
requiring hospitalization.
Agency of record – the agency that is recognized by the customer as the person
who will handle insurance transactions on their behalf.
Attachment – a rider or modification added to a policy that makes changes,
restrictions or clarifications to the coverage.
Beneficiary – the person named in a life insurance policy to receive the proceeds.
Benefit plan – the services offered to the employees of a company which include
health insurance, vacation time off and may include life insurance, dental and vision
insurance, disability insurance and other services.
Binder – an agreement to provide insurance prior to a policy being issued, many
times used as a temporary policy until a permanent policy has been issued.
Blanket coverage – a policy that covers an entire group of people and issues
specific medical insurance to all of them.
Broker – a licensed, legal representative of the policyholder who negotiates with
insurance underwriters on behalf of the insured, but is paid a commission from the
insurance company.
Cash value – the amount a life insurance policy is worth if it is canceled prior to
maturity.
Catastrophe insurance – covers major medical expenses in the case of major
illnesses such as cancer.
Claim – a formal request for payment or services covered by the insurance policy.
COB – Coordination of Benefits – provisions made to avoid duplication of payments
from more than one policy, in which one insurer is designated as the primary
insurer over all others.
COBRA – Consolidated Omnibus Budget Reconciliation Act – a federal law enacted
in 1985 that requires an employer to extend health insurance to a former employee
and his dependents.
Coinsurance – the amount of a claim not covered by the insurance policy which the
policyholder is responsible to pay.
Comprehensive major medical insurance – combines the coverages of basic and
major medical insurance to include a wide array of medical expenses. Typically this
is provided as group insurance and is subject to either a deductible amount and
coinsurance restrictions.
Co-Pay – a set fee paid by the policyholder for medical expenses upon each
occurrence, such as a doctor’s office visit, pharmaceutical purchase, and other
medical services.
Death benefit – the amount of money paid to the beneficiary when the insured, in
a life insurance policy, dies.
Deductible – the amount that the policyholder must pay within a specified
accumulation period before the insurance company will pay for coverage.
Dental insurance – health insurance that covers specific dental services.
Disability insurance – insurance which provides income to employees that
become disabled by sickness or injury which is not related to their employment.
Discounted premiums – an insurance premium that is reduced or given credits
because it was paid prior to the date it was due.
Dismemberment benefits – the amount of money paid to a person who has
permanently lost the use of a part of their body or has a member of their body
permanently severed.
Double indemnity – a life insurance policy that pays double the benefit if death is
caused by accident.
DRG – Diagnostic Related Group – a cost commitment schedule developed by
Medicare whereby medical services providers set a uniform payment for specific
services.
EEOC – Equal Employment Opportunity Commission – a federal commission that
oversees employment discrimination, including physical disabilities and handicaps.
Effective date – the date which an insurance policy becomes eligible to pay for
claims.
Eligibility period – the limited timeframe in which an employee can request to be a
part of a group plan without having to prove their insurability (such as taking a
physical exam).
Elimination period – a waiting period after a disability in which no claims are paid.
ERISA – Employee Retirement Income Security Act or the Pension Reform Act – a
1974 federally enacted law that requires employers to protect the assets of pension
funds set up as employee benefits.
Evidence of insurability – proof of ones physical condition and occupation.
Exclusion – a condition or circumstance that is not covered by the insurance policy.
Experience – actuarial gains and losses based on the claims of a group or an
individual policyholder.
Extended health insurance – health coverage for retirees to supplement Medicare
and any retirement health insurance.
Face value – life insurance amount to be paid upon death of the insured or on the
maturity of the policy.
Family deductible – a health insurance deductible that is based on the medical
expenses of the collective members of a family rather than one individual. See
deductible.
Family health plan – health insurance that covers a family as a small group rather
than multiple individuals.
Fee for service – traditional health insurance that puts no restrictions on choice of
doctors, hospitals or medical services providers regardless of network affiliation.
First dollar coverage – coverage that pays the entire amount covered without the
use of a deductible.
First loss – insurance policy that pays claims before other policies that cover the
same loss.
First named – the insured that is named first on the declarations of an insurance
policy. This is the person the insurance company will notify with all
correspondence.
Flexible benefit plan – a benefits package that allows the employee to choose
certain benefits, a range of deductible amounts, and to designate specific benefits
as pre-tax benefits.
Flexible spending account – Section 125 plan – provides tax savings by reducing
employee medical premiums from your gross salary prior to calculation of federal
income and social security taxes, as allowed under Internal Revenue Code (IRC)
Section 125.
Free-look period – typically a 10 day period where a newly insured policyholder
can cancel a policy and receive a full refund of the premium.
Full coverage – insurance policy without a deductible.
General agent – an independent agent that represents one or more insurance
companies.
Group insurance – an insurance program designed to offer health insurance to
persons belonging to a group (business, association, professional group, etc.) and
their families. As a group, premiums are typically less expensive and choice of
benefits broader than purchasing individual health policies.
Guaranteed insurability – a provision in some policies that guarantees the
insured the right to purchase additional coverage without providing proof of
insurability.
Guaranteed renewable – a provision in some policies in which the insurance
company guarantees the right of the insured to renew without changing any of the
terms, conditions or benefits of the policy except the rates, which must be applied
to all in the class and not single out an individual. There are time restrictions placed
upon guaranteed renewables.
Health indemnity plan – a group plan that reimburses the insured for covered
medical expenses, less deductibles and co-payments, after they have paid the
health care provider.
HMO – Health Maintenance Organization – an organization that maintains a system
that provides health care in a geographic location. The HMO sets limits on the
services performed by health care facilities. It is offered to a group of persons who
may enroll voluntarily in the organization and who pre-pay for the service in regular
intervals irregardless of the amount of actual services rendered.
Hospital income insurance – hospital confinement insurance – a policy that pays
the insured while being hospitalized for a specified period. This benefit is paid
regardless of other insurance or medical expenses.
Hospitalization insurance – reimbursement for specified expenses while being
hospitalized due to illness or injury.
HRA – Health Reimbursement Arrangement – an IRS approved tax-favored benefit
that reimburses employees for qualified medical care expenses not reimbursed by
an employer’s health plan.
HSA – Health Savings Accounts – a tax advantaged savings plan (a financial account
with various restrictions) available to taxpayers in the United States to cover current
and future medical expenses. It allows money to be put in before tax is paid on it
and then to withdraw the money tax free for qualified medical expenses. A person
must be covered by a High Deductible Health Plan (HDHP) to be eligible for an HSA.
The premium for a HDHP generally is less than the premium for traditional health
care coverage. Money saved on insurance premiums might be put into the Health
Savings Account, or employed for other purposes.
Impaired risk – an applicant who has pre-existing poor health or is in substandard
physical condition, is engaged in dangerous activities, or has a hazardous
occupation.
Impairment exclusion – a rider added to an insurance policy that excludes paying
for claims due to a pre-existing condition.
Insured – the policyholder. Sometimes referred to as the assured.
Insurer – the insurance company.
IRA – Individual Retirement Account – a tax-deferred savings plan for individuals
who are not covered under an employer’s retirement plan.
Keogh – a qualified retirement plan for self-employed persons.
Key employee insurance – a policy purchased by an employer that pays the
employer should a key person within the organization become ill, disabled or die.
Lapse – termination of an insurance policy for nonpayment of the premium.
Limited health service plan – a policy that covers only specific types of services,
illnesses or medical specialties.
Limited risk health insurance – a policy that has very low limits and benefits.
Often used as a supplement to Medicare.
Living benefits – in the case of a terminal illness, the proceeds of a life insurance
policy are paid to offset medical expenses prior to the death of the insured.
Long-term disability insurance – a policy that pays income to the insured during
illnesses, injuries or disabilities that last longer than 90 days.
Loss – the amount the insurance company is required to pay on a claim.
Loss experience – the history of claims paid by an insurance company on a specific
policy over a period of time.
Major medical insurance – a policy that covers most serious medical expenses up
to a maximum limit, usually after a deductible and coinsurance have been met.
Managed care – a plan that puts limits on the number and types of treatments as
well as the health care service providers and facilities that are covered. Each
recognized provider agrees to a negotiated fee structure for health care
procedures, thus lowering costs for both the insurance company and the insured.
Managing physician or primary physician – in a HMO or PPO, the program-
approved health care provider whom the insured must contact first with all medical
concerns.
Master policy – in a group insurance, the insurance policy that guarantees
coverage to all members of the group.
Medicaid – federal program offering government assistance for the medical needs
of the needy.
Medical expense insurance – a policy that pays for medical, surgical and
hospitalization expenses.
Medical service plan – a plan that is offered by a group of participating physicians
that limits the insured to only the services provided within the group.
Medicare – the federal governmental program offering hospitalization and
supplemental medical coverage to U.S. citizens over the age of 65.
Medigap – supplemental health insurance designed to cover the expenses and
services not covered by Medicare.
Military service exclusion – a provision that excludes coverage for injuries,
illnesses, disabilities or death while performing active service in the military.
Misrepresentation – lying or misleading an insurance company about the facts
affecting a policy. Misrepresentation is grounds for voiding a policy.
Morbidity rate – a mathematical calculation that shows the ratio of occurrence of
illnesses and diseases to a specific classification of people.
Mortality rate – a mathematical calculation that shows the ratio of occurrence of
death to a specific classification of people.
Named insured – the person designated on the policy as the insured or
policyholder.
Net cash value – in a life insurance policy, the cash value minus any outstanding
loans plus the dividends.
Nonrenewable – when an insurance company chooses not to renew a policy upon
or after its expiration date. There are state laws regulating how a nonrenewable
coverage is to be handled by the insurer.
Open enrollment – the designated period of time when eligible members can
subscribe to a health insurance plan.
Optional renewable contract – a group plan contract that gives the insurance
company the right to renew or terminate coverage for the group during each
renewal period.
Partial disability – inability to perform one or more, but not all of the duties of
one’s job due to illness or injury.
Participant – any individual who is eligible for benefits.
Permanent total disability – the inability to perform any job due to illness or
injury.
Policy year – the year beginning with the effective date or the renewal date of a
policy.
Policyholder – the insured who is named on the insurance policy.
Premium – the amount of money an insurer charges to provide coverage.
Proceeds – in life insurance, the policy benefits that are payable upon the maturity
of the policy or death of the insured.
Qualified retirement plan – an employee benefits plan whereby contributions by
an employer are tax deductible as business expenses, as defined by IRS code.
Employee contributions are treated as tax-deferred income and are not subject to
federal taxes until they are dispersed after retirement.
Renewal – a policy issued to replace one that has expired.
Rider – an attachment or endorsement added to a policy.
Self Administered Plan – an employer-funded and administered benefits plan.
SEP – simplified employee pension plan, designed for small businesses.
Short-term insurance – similar to flex-term medical coverage. Short-term medical
coverage is a major medical plan designed to protect you in the event of an illness
or injury during “gaps” in your traditional medical coverage — when you are
between jobs or plans, a recent graduate, on strike, etc. Short-term plans are not
meant to cover routine exams and preventive care; if you are looking for a choice of
plan types and the ability to renew your plan beyond one year, a traditional medical
plan, while typically more expensive, may be a better fit for your health insurance
needs.
Standard Industrial Classification (SIC) – a series of number codes that attempts
to classify all business establishments by the types of products or services they
make available. Establishments engaged in the same activity, whatever their size or
type of ownership, are assigned the same SIC code. These definitions are important
for standardization. Insurance companies use SIC codes to determine specific rates
for various industries.
Term life insurance – life insurance that covers the insured person for a specific
period of time and pays a death benefit only if the insured dies during that term.
This type of insurance does not build up a cash value.
Underwriters – insurance company employees who are responsible for identifying
and classifying the degree of risk represented by a proposed insured.
Underwriting – the process of identifying and classifying the degree of risk
represented by a proposed insured.
Universal life insurance – a flexible premium life insurance policy under which the
policyowner may change the death benefit from time to time (with satisfactory
evidence of insurability for increases) and vary the amount or timing of premium
payments. Premiums (less expense charges) are credited to a policy account from
which mortality charges are deducted and to which interest is credited at rates
which may change from time to time.
Urgent care – urgent care is appropriate when a medical urgency arises which
necessitates immediate care, but has not reached the level of extreme emergency.
Most managed care plans require you to seek urgent care at a participating urgent
care facility or hospital.
Usual, customary and reasonable fee – the maximum dollar amount of a covered
expense that is considered eligible for reimbursement under a major medical
policy.
Well baby care – the goals of well baby care are 1) to immunize; 2) to provide
parents with reassurance and counseling on safety, nutrition and behavioral
problems; and 3) to identify and treat physical and developmental problems.
Whole life insurance – a basic type of permanent life insurance which can provide
lifetime protection at a level premium. Premiums must generally be paid for as long
as the policy is in force.
*Note: I am not the creator of this vocabulary list.

Insurance Vocabulary Worksheets

Insurance Vocabulary

term meaning

actuary n. a person who calculates risks for insurance companies

Maggie loves maths so she's thinking of becoming

an actuary.

Assessor n. a person who calculates the value of something [eg: a

building, car etc]
‫اساسر‬
َ

The assessor said our house is worth over $200,000.

claim n. an application for payment under an insurance policy - to

make a claim v.

How long have we got to make a claim if the house burns

down?
term meaning

commission n. money earned each time you sell a product

Every time they sell a policy, insurance brokers get paid

a commission.

comprehensive n. [of an insurance policy] all-inclusive; providing more

complete protection

Comprehensive car insurance covers damage from things

besides accidents, like floods, fire, vandalism, etc.

consequential loss n. a loss that happens as a consequence of or as a result of

another loss

Are consequential losses like my loss of earnings while I'm

in hospital also covered?

coverUK n. the protection given by an insurance policy [eg: public

liability cover]

If you're going to the US, you'll need extra cover for

hospital bills.
term meaning

employer's n. liability or responsibility of a firm for damage caused to

liability one of its employees

We've got workers' compensation insurance, so why do we

need employer's liability insurance as well?

goods in transit n. property, merchandise or any goods in the process of

being transported

Who usually pays for insuring goods in transit?

insurance broker n. agent who arranges insurance; middleman between

insurer and policyholder

Good insurance brokers find the best deals for their clients,

and bad ones find the highest commissions.

liability n. 1 the state of being liable 2 anything for which a person is
liable

The company did all it could to avoid liability for the

damage it caused.
term meaning

liable adj. legally obliged to pay for damage, injury etc;

responsible - liability n.

Her doctor was held liable for botching the operation, but

his insurance covered him.

loss n. death, injury, damage etc that is the basis for a claim - to
lose v.

Does the policy cover loss of property due to floods and

other natural disasters?

loss adjuster n. a person who assesses the amount of compensation arising
from a claim

I don't trust the insurer's loss adjuster, so I've got my own

loss assessor checking everything.

policy n. a contract of insurance [eg: a product liability policy]

Read everything very carefully before signing any

insurance policy.
term meaning

policyholder n. the person to whom an insurance policy is issued

To maximize their profits, insurers will minimize payments

to policyholders.

premium n. a payment, usually monthly, yearly etc, for an insurance

policy

I didn't realize they'd increase my insurance premium every

year.

product liability n. liability or responsibility of a firm for damage caused by

one of its products

Some product liability rules protect gun manufacturers

more than consumers or people hurt by their products.

public liability n. responsibility of a firm for damage caused to a member of

the public

If a customer is injured in your shop, public

liability insurance will cover you.
term meaning

reinsurance n. the insuring of risk by one insurance company with

another - to reinsure v.

Insurance companies protect themselves by

purchasing reinsurance contracts.

risk n. 1 chance or possibility of injury, loss etc 2 person or thing

causing risk

If you build a house in a forest, the risk of fire is higher

than normal.