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MI Pre-Insurance Lic

C - Vocabulary Words

Cafeteria Plan Employee Benefit Plan. Employees select among various group programs & insurance plans that best meet their needs.
Cancellable A renewability provision with a health insurance contract that allows the insurance company, at its option, to terminate or renew the policy.
Capital Sum The benefit provided for accidental dismemberment or accidental blindness.
Capitation A method of payment for health services, the medical provider is paid a fixed amount for each patient without regard to the actual number or nature of services provided. Common payment method for HMO primary care physicians.
Carrier Another term for insurer or insurance company.
Cash Refund Annuity A settlement option that offers an additional guarantee to pay a beneficiary if not all premiums were returned to the annuitant as income payments.
Cash Surrender option A nonforfeiture option that allows the policyowner to receive the cash value when surrendering or giving up their permanent life insurance.
Cash Surrender Value The amount of equity (cash value) available if the policyowner surrenders their permanent life insurance.
Cash Value The amount of equity (ownership) or cash accumulation in a permanent life insurance policy.
Catastrophe (Catastrophic) Insurance A health policy that provides substantial benefits if the insured has a prolonged, serious and expensive diseability or illness
Certificate of Creditable Coverage Documentation issued by a group health care plan to an employee for presentation to a new group plan to verify previous coverage especially for a preexisting condition.
Certificate of Insurance Issued by group contracts (typically employer groups) that summarizes coverage to insured employees. AKA Group Certificate
Chronic Condition A treatable but incurable illness such as arthritis or high blood pressure.
Claim A request for payment of a loss which may be covered by the insurance contract.
Class Designation A beneficiary designation that does not specify beneficiaries by name, but rather by a group or class. e.i. "all my children" named as beneficiaries
Class Rate A premium calculation for a group or class of persons with similar risks. AKA - rating
Coinsurance The insurance company pays a percentage and the insured pays a percentage. i.e. 80/20
Collateral Assignment A type of policy assignment in which the assignee receives partial control over the policy and also partial rights to its benefits. Used to secure a loan. AKA temporary assignments
Commercial Health Insurers Private health insurance companies offering traditional reimbursement policies such as major medical expense insurance.
Commission A percentage of premium paid by the insurance company to the agent as compensation for selling an insurance policy.
Common Disaster Provision A policy condition designed to protect the contingent beneficiary or provide an alternative beneficiary in the event that both the insured and primary beneficiary die as a result of a common accident.
Competent Party Requires both parties understand the contract and agree to it for the contract to be enforceable. A policyowner must be of legal age
Major Medical Expense A traditional medical expense insurance designed to reimburse the policy owner for out-of-pocket expenses. Typically has low deductibles, coinsurance & Stop loss limits.
Concealment The deliberate withholding of information in order to financially gain, such as obtaining an insurance policy or receiving payment on a claim under false pretense.
Conditional Contract A contract that is inforce only if certain obligations are met or events have occurred.
Conditional Receipt Given to potential policyowners at time of application & initial premium payment. It allows for the earliest possible coverage if the policy is approved subject to underwriting and any other stated conditions on the receipt.
Conditionally Renewable A health insurance provision that allows renewability if certain stated conditions are met by the insured, such as full-time employment to age 65.
Conditions Another term for policy provisions or terms
Consent Written approval or permission to be insured by another party.
Consideration Exchange of values between parties to complete a contract. With an insurance contract, premium is paid by the policyowner, and the insurer promises to pay according to the policy.
Consideration Clause The part of the insurance contract that sets forth the amount, renewal and frequency of premium payments by the policyowner.
Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) A law that extends group health insurance coverage for terminated employees and assume more control in protecting their health.
Consumer-Driven Health Plan A type of health benefit plan in which the insureds select their health care providers, manage their health expenses and assume more control in protecting their health.
Contestable Period A period of time, usually the first two years the policy is in force, in which the insurance company can contest a claim based on misstatements or omissions on the application.
Contingent Beneficiary Recipient of life or accident policy payable upon death of the insured & no primary beneficiary is named or alive. AKA - secondary or tertiary bene's
Contract An agreement (offer & acceptance) between two parties that have the legal capacity to do so and have exchanged valuable consideration.
Contributory Plan A group insurance policy were the policyowner (an employer) and insureds (employees) share the cost of the plan. Generally, insurance companies will require 75% or more of all eligible employees to participate.
Convertible Term A term life policy that may be exchanged to a permanent life policy without evidence of insurability.
Coordination of Benefits Provision It prevents duplication of benefits with multiple group health insurance coverage. It limits coverage to 100% of thee expenses covered and designates the order of benefits payable by the group carriers.
Co-payment A set amount of money that a managed care plan member must pay at the time of medical services.
Corridor Deductible With supplemental major medical expense, it is an amount that is paid by the policyowner after the insurer first pays the basic plan portion when covered expenses are submitted.
Cost of Living Rider (COLA - cost of living adjustment) A rider that automatically increases the benefit of a policy (typically linked to the CPI - consumer Price Index) to offset the effects of inflation.
Counteroffer An initial offer that is not accepted, but negotiated by the second party. With insurance, the alternate offer usually involves additional premium to be paid for the coverage requested.
Credit Accident & Health Insurance A policy that will pay an outstanding debt if the insured becomes totally disabled.
Credit Life Insurance A policy that will pay the outstanding loan balance of a debt if the insured dies.
Critical Illness Insurance A supplemental health policy - pays a lump sum in the event the insured is diagnosed with a critical illness. Can be used to pay for medical care, daily living expenses, etc.
Currently Insured A status of limited eligibility under Social Security that provides only death benefits.
Custodial Care A level of care assisting someone with the activities of daily living. The caregiver does not need medical training, but a doctor orders the care. AKA - Personal or residential care.
Customary & Reasonable Expense Medical expenses paid by the insurance company, no specific dollar amount, payment based on similar charges for like service in same geographic area. Charges in excess can be denied. AKA - usual, customary & reasonable expenses.
Created by: Rosemj42
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