Basic Insurance Terms
Written Contract of Insurance
What is a Policy?
A formal device for reducing the chance of loss by transferring the risks of several individual entities to insurance companies
What is Insurance?
A "package" policy providing coverage against property and liability perils facing homeowners.
What is Homeowner's Insurance?
A fixed amount you pay for certain healthcare services, such as doctor's visits or prescriptions.
What is a co-pay?
This is the type of life insurance that provides coverage for a specified period, such as 10 or 20 years.
What is a Term Life Policy?
The regular monthly or annual payment you make to your insurance company in exchange for coverage
What is a Premium?
Required by law in most states, this type of car insurance helps pay for injuries, damage, and legal fees you cause to others in an accident.
What is Liability Coverage?
Provides Personal Property and Liability coverage to individuals who do not own their home.
What is Renter's Insurance
The percentage of costs that an individual pays for health services after the insurance company pays their percentage
What is Coinsurance?
This type of life insurance provides coverage regardless of when you die.
What is a Whole Life Policy?
An agreed upon amount, between you and your insurer, that you will pay before the insurance company pays anything.
What is a Deductible?
Subject to a deductible, this coverage pays to repair damage to your car that’s caused by something other than a collision.
What is Comprehensive?
If you have a loss, this part of your policy would cover costs to repair or rebuild the structures.
What is the Property Section?
The highest amount of money you will have to pay for covered medical services within a plan year before your health insurance company starts covering 100% of the cost
What is Maximum Out Of Pocket?
The person or entity designated to receive the death benefit from a life insurance policy is called this.
What is a Beneficiary?
Type of loss or a cause of loss that is specifically not covered by your insurance policy.
What is an Exclusion?
Subject to a deductible, this coverage pays to repair damage to your car when you hit, or are hit, by another vehicle or object, regardless of who’s fault it is.
What is Collision?
This section on your policy helps protect you and your family from claims and lawsuits filed by other people, both on and off your property.
What is the Liability Section?
Often Less expensive, this coverage generally requires a referral from your primary Dr for specialist care and does not cover medical care out of network.
What is HMO (Health Maintenance Organization)?
This term refers to the process of determining eligibility and premium rates for a life insurance policy.
What is Underwriting?
When you make a request to your insurance company to pay you after a loss.
What is a Claim?
Coverage on your policy for medical expenses, lost wages and other damage caused by a driver who has insufficient or no insurance
What is Uninsured/ Underinsured Motorist Coverage?
The cause of a loss. Examples of covered perils include fire, hail and wind.
What is a Peril?
A health insurance plan that allows you to use providers both within and outside of the network, but you may pay lower out-of-pocket costs for in-network care
What is PPO (Preferred Provider Organization)?
This term describes the amount of money paid out to beneficiaries when the insured person passes away.
What is a Death Benefit?