Insurance Vocabulary
I have created some simple insurance vocabulary worksheets for my students based on the following master vocabulary list : DOC (Word97)
The Insurance Vocabulary List
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
The worksheets:
Worksheets 1-3 (Covers key vocabulary from A-F)
Worksheets 4-6 (Covers key vocabulary from F-M)
I have omitted some of the less essential words from the worksheets as to not overwhelm my intermediate-level students. The worksheets do not have the answers. Answers can be obtained from the master vocabulary list.
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We are training local omanis and therefore we need this please.
very fantastic
THANKS VERY MUCH
It was helpful thank you
Marine insurance and life insurance
Wonderful – thank you!
thanks so much for compiling this, really needed it
best regards
This is really nice! Thanks for taking the time to make these worksheets.
Thank you very much! How helpful!
lOVE IT
Awsome, Sir !
Thank you for this list
I will create a lesson out of it :-)
I ‘d like the Keys on this exercites , please
Great resource. You saved me so much time. thanks
Thanks a lot!