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MI Pre-Insurance Lic
D-G - Vocabulary Words
| Term | Definition |
|---|---|
| Death Benefit | Life insurance policy proceeds paid to the beneficiary upon death of the insured. |
| Decreasing Term Insurance | A type of term insurance, associated with a debt or loan. i.e. a mortgage. Protects the lender if the insured dies. |
| Deductible | The amount of loss paid by the policyowner before the health insurance policy pays the claim. |
| Deferred Annuity | Annuity contract that will not pay income benefits until a later date, usually age of retirement. |
| Disability | A physical or mental impairment caused by sickness or accident that limits a persons ability to work. |
| Disability Buy-Sell Agreement | A type of business continuation plan that gives remaining bus. owner the legal right to purchase disabled owners interest - predetermined price. Proceeds come from a disability income policy. |
| Disability Income Insurance | A type of health insurance policy that replaces the insured's income if he or she becomes disabled/unable to work. AKA - loss of income insurance |
| Dividend | A policyowner's share of divisible surplus (profit after expenses have been meet) paid by participating policy. AKA policy dividends |
| Dividend | Participating policyowners have choices with regard to policy dividends: cash, reduction of future premiums, additional paid-up insurance, accumulate with interest. |
| Divisible Surplus | Extra money resulting from the insurance company's savings in mortality, interest earnings and/or reductions in operational expenses which can be divided equitably among the company's policyholders or stockholders. |
| Do Not Call List | Consumers register private phone numbers with national registry in an attempt to stop telemarketing calls. Exemptions include an establish relationship between a business & consumer. |
| Domestic Insurer | An insurance company organized and incorporated in a state & selling policies to residents of that state. |
| Dread Disease Policy | A health insurance policy that provides coverage only for a specified named illness, i.e. a cancer policy |
| Effective Date | The date the insurance policy begins or goes into effect. |
| Eligibility Period | The time which employees enroll in the group insurance plan w/out providing evidence of insurability. After an employer probationary period has been met. |
| Elimination Period | With a disability income policy, it's the period of time beginning with the insured's disability and the start of disability income benefits paid. A waiting period to receive policy benefits. |
| Employee Retirement Income Security Act (ERISA) | Federal Law - protects the interest of employees (& beneficiaries) in employer sponsored benefit plans. |
| Endorsement | An attachment or rider to a policy that alters coverage (restricts or increases). The terms take precedent over the policy. |
| Endowment Policy | A type of permanent life insurance that provides for a death benefit if the insured dies during the term or pays the proceeds at the end of the term as a living benefit. |
| Entire Contract | A policy provision - the application, policy & any attached riders constitutes the entire contract between the insurer & policyowner. |
| Equity-Indexed Annuity | A type of fixed or guaranteed annuity that offers excess interest based on the insurance company's investment of premium compared to a stock index, such as the S&P 500 index. |
| Evidence of Insurability | A statement, or proof of physical condition or occupation, that the proposed insured is insurable. |
| Exclusion Rider | A health insurance rider that takes away coverage that the policy would normally provide because of a preexisting condition. |
| Exclusions | A list of conditions not covered by the policy. |
| Extended Term Insurance | A nonforfeiture option, allows the policyowner to use cash value of lapsed permanent policy - as a net premium to purchase term insurance with the same amount of protection as the lapsed policy. |
| Face Amount | The principal sum of the insurance contract. AKA - death benefit of a life insurance policy. |
| Fair Credit Reporting Act | Federal Law - protects the consumer when their credit rating is examined with an insurance application. Law requires disclosure of credit inspection. |
| Federal Insurance Contribution Act (FICA) | Mandatory payroll tax to the SS program made by employers and employees to fund present and future SS benefits |
| Fee-For-Service | A payment system were the medical provider is paid at the time the service is rendered. |
| Fiduciary | A person, in a position of trust, responsible for someone else's money. i.e producer receives check for premium. |
| First Dollar Coverage | A health insurance policy that does not have a deductible. The company pays first when a claim is submitted. |
| Fixed Amount Settlement | A life insurance settlement option that pays the policy proceeds in periodic installments of a fixed dollar amount (as opposed to a lump sum) |
| Fixed Annuity | Guarantees the interest rate on premiums & the amount of payments received. Does not guarantee to keep pace with inflation. |
| Fixed Period Settlement | A life insurance settlement option that pays the policy proceeds in periodic installments for a stated number of payments. |
| Flexible Premium | A premium method that allows the amount and timing to vary upon the policyholder's discretion. |
| Flexible Spending Account (FSA) | Employees pick from a selection of qualified benefits. Employee pays into the FSA via payroll deductions. |
| Foreign Insurer | An insurance company organized & incorporated in a state selling policies to residents of other states. |
| Fraud | The deliberate attempt to deceive another for financial gain. |
| Free Look | A provision that gives the policyholder the right to review the policy for a stated number of days, usually 10, and receive a full refund if the policy is returned to the insurance company. |
| Fully Insured | A status of eligibility under SS that provides for complete benefits. |
| Gatekeeper | An arrangement were a primary care physician coordinates all healthcare for the HMO member. |
| General Account | The insurance company's account for investing policyholder premiums in safe and conservative investments. |
| Government Insurer | Social insurance programs, i.e. Medicare and Medicaid - provided by federal or state government. |
| Grace Period | A period of time after the due date of a premium were the policy remains in force |
| Gross Premium | The amount paid by a policyowner that was calculated by an actuary using 3 factors: risk + operating expense (Loading) - investment income. |
| Group Insurance | Policy that covers persons with a common affiliation of interest, such as an employer group, under one master policy. |
| Guaranteed Insurability | An option or rider that allows the policyowner to purchase additional coverage without evidence of insurability. |
| Guaranteed Renewable | A health contract that allows the policyowner to continue the policy for a substantial period of time by paying the premium. Continued coverage is guaranteed, premium rate can change. |
Created by:
Rosemj42
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