Life & Health Insurance Agent Glossary

Health Insurance Terms

Premium – The amount paid by the policyholder to the insurance company to keep the policy active.
Deductible – The amount of money the policyholder must pay out of pocket before the insurance company begins to pay for covered expenses.
Copayment – A fixed amount of money that the policyholder must pay for a covered service or medication.
Coinsurance – A percentage of the cost of a covered service or medication that the policyholder must pay.
Out-of-pocket maximum – The maximum amount of money the policyholder will have to pay for covered expenses in a given year.
Network – A group of healthcare providers and facilities that have contracted with an insurance company to provide services at a discounted rate.
Pre-existing condition – A health condition that existed before the policy went into effect.
Open enrollment – The period of time during which policyholders can enroll in or make changes to their health insurance coverage.
Special Enrollment Period (SEP) – A period of time when individuals can make changes to their health coverage outside of the regular enrollment periods due to certain life events, such as moving or losing other health insurance coverage.
Health savings account (HSA) – A tax-advantaged savings account that can be used to pay for healthcare expenses.

Life Insurance Terms

Premium – The amount paid by the policyholder to the insurance company to keep the policy active.
Death benefit – The amount of money paid to the beneficiary upon the death of the policyholder.
Beneficiary – The person or entity designated by the policyholder to receive the death benefit.
Policyholder – The person who owns the life insurance policy.
Insured – The person whose life is being insured.
Term life insurance – A policy that provides coverage for a specified period of time.
Whole life insurance – A policy that provides coverage for the life of the insured.
Cash value – The savings portion of a permanent life insurance policy.
Surrender value – The amount of money that can be obtained by surrendering a permanent life insurance policy.
Underwriting – The process of evaluating a person’s risk of death to determine the premium rate.
Annuity – An annuity is an insurance contract you purchase that guarantees you’ll receive a specified amount of money every month for the rest of your life. Annuities were created to help protect people as they age by generating a consistent income stream they can rely on throughout their lifetime.

Medicare Terms

Medicare – A federal health insurance program for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS).
Original Medicare – The traditional fee-for-service Medicare program that is offered directly by the federal government and consists of Part A (hospital insurance) and Part B (medical insurance).
Medicare Advantage – A type of Medicare plan offered by private insurance companies that provides Medicare Part A and Part B coverage, and often includes additional benefits such as prescription drug coverage, dental, vision, and hearing.
Medicare Part A – Hospital insurance that covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care.
Medicare Part B – Medical insurance that covers doctor visits, outpatient care, preventive services, and medical equipment.
Medicare Part C – Also known as Medicare Advantage, it is a type of Medicare plan offered by private insurance companies that provides Medicare Part A and Part B coverage, and often includes additional benefits such as prescription drug coverage, dental, vision, and hearing.
Medicare Part D – Prescription drug coverage that can be added to Original Medicare or a Medicare Advantage plan.
Medigap – Also known as Medicare Supplement Insurance, it is a private insurance policy that can be purchased to cover some of the costs not covered by Original Medicare, such as deductibles, coinsurance, and copayments.
Annual Enrollment Period (AEP) – The period of time each year when Medicare beneficiaries can make changes to their Medicare Advantage and Part D coverage.
Initial Enrollment Period (IEP) – The period of time when individuals first become eligible for Medicare and can enroll in Medicare Parts A and/or B.
Special Enrollment Period (SEP) – A period of time when individuals can make changes to their Medicare coverage outside of the regular enrollment periods due to certain life events, such as moving or losing other health insurance coverage.
Low-Income Subsidy (LIS) – Also known as Extra Help, it is a program that helps people with limited income and resources pay for their Medicare prescription drug costs.
Medicare Summary Notice (MSN) – A statement that shows all the services and supplies that Medicare has paid for on behalf of the beneficiary, and any amounts owed by the beneficiary.

Agent & Broker Terms

· Agent – A licensed individual or entity who is authorized to sell health insurance policies on behalf of one or more insurance companies.

· Broker – A licensed individual or entity who is authorized to sell health insurance policies on behalf of the consumer and represents the consumer’s interests in finding the best insurance coverage.

· Carrier – An insurance company that provides health insurance coverage.

· Deductible – The amount of money that an insured person must pay out-of-pocket before the insurance company will begin to pay for covered medical expenses.

· Copayment – A fixed amount of money that an insured person must pay for a covered service or medication.

· Coinsurance – A percentage of the cost of a covered service or medication that an insured person must pay.

· Network – A group of healthcare providers and facilities that have contracted with an insurance company to provide services at a discounted rate.

· Open Enrollment Period – The period of time during which individuals can enroll in or make changes to their health insurance coverage.

· Premium – The amount paid by the policyholder to the insurance company to keep the policy active.

· Pre-existing condition – A health condition that existed before the policy went into effect.

· Underwriting – The process of evaluating a person’s risk of needing medical care to determine the premium rate.

· Short-term health insurance – A temporary health insurance policy that provides coverage for a limited period of time, typically up to 364 days, and may be renewable for up to 36 months in some states.

· Guaranteed issue – A provision that requires insurance companies to issue policies to all applicants regardless of their health status.

· Health Savings Account (HSA) – A tax-advantaged savings account that can be used to pay for healthcare expenses and is available to individuals who have a high deductible health plan.

· High deductible health plan (HDHP) – A health insurance plan that has a higher deductible than traditional health insurance plans and is typically paired with a Health Savings Account (HSA).