The amount an owner may take in cash when surrendering a whole life policy, ending the coverage.

The mortality charge deducted from an unbundled policy's account value, usually monthly, to pay for the pure death-benefit protection; it cannot exceed the contract's guaranteed maximum rate.

Extended term insurance

A nonforfeiture option that uses a policy's cash value to buy term insurance for the original face amount, but only for a limited period.

Guaranteed cash value

The savings element inside a whole life policy that accumulates over time from the excess of early premiums over the current cost of protection.

Guaranteed death benefit

The face amount a whole life policy promises to pay the beneficiary whenever the insured dies while the policy is in force.

Industrial life insurance

Small-face-amount life insurance with premiums collected at the home, usually weekly or monthly, by an agent. Florida insurers may no longer write new industrial policies after a statutory date.

A financial or relational stake in the continued life of an insured, required at the time coverage is written, including when a rider insures a life other than the primary insured.

A whole life premium set at issue that stays the same for the life of the policy, never increasing as the insured ages.

Limited-pay whole life

A whole life policy with premiums compressed into a set number of years or to a stated age, after which the policy is paid up but lifetime coverage continues.

Nonforfeiture provision

The provision guaranteeing that a cash-value policy's built-up value cannot simply be forfeited on lapse, letting the owner choose cash surrender, reduced paid-up insurance, or extended term insurance.

Nonparticipating policy

A whole life policy that pays no dividends and relies solely on its guaranteed values.

A whole life policy on which premiums are paid continuously until the insured's death or the policy's maturity date, producing the lowest annual premium of the whole life variations.

Paid-up nonforfeiture benefit

A benefit, such as reduced paid-up insurance or extended term insurance, that state law requires a lapsed cash-value policy to provide instead of forfeiting the owner's built-up value.

A whole life policy that may pay non-guaranteed policy dividends to the owner.

Non-guaranteed distributions a participating whole life policy may pay, which the owner can take in cash, use to reduce premiums, buy paid-up additions, or leave to accumulate.

Reduced paid-up insurance

A nonforfeiture option that converts a policy's cash value into a smaller permanent face amount with no further premiums due.

Single-premium whole life

A whole life policy fully paid up by one lump-sum premium at issue, with no further premiums due.

Standard Nonforfeiture Law for Life Insurance

The state law, based on a model adopted in every state, requiring a life policy to provide a cash surrender value or a paid-up nonforfeiture benefit once premiums have been paid for the period stated in the policy.

In indexed universal life, the maximum interest rate the insurer will credit in a given crediting period, regardless of how much the referenced index gains.

Current interest rate

The interest rate an insurer actually declares and credits to a policy's account value today; it can change over time and is not contractually guaranteed beyond the policy's guaranteed minimum.

Securities registration through a broker-dealer. A producer needs it, in addition to a life license, to sell variable life, which is both insurance and a security.

A premium structure, used in universal life, that lets the owner pay more or less than a scheduled amount within contract limits, rather than a fixed amount on a fixed schedule.

In indexed universal life, the minimum interest rate the insurer will credit in a crediting period, often zero percent, which protects the account value from losses when the referenced index declines.

The insurer's pool of investments backing its traditional, guaranteed products. Reserves for guaranteed minimum death benefits on variable life policies must be held here.

Guaranteed minimum interest rate

The lowest crediting rate a policy's contract promises regardless of how low the current declared rate falls; only this figure, not projected current rates, is contractually guaranteed.

Increasing death benefit option

A universal life death benefit choice under which the beneficiary receives the face amount plus the policy's accumulated account value, so the total payout rises as the account value grows.

Indexed universal life

A universal life product that credits interest under a formula tied to an external market index, without the owner being directly invested in or receiving dividends from that index.

Interest-sensitive (current assumption) whole life

A whole life product with a scheduled premium and stated face amount, like traditional whole life, but where the insurer credits current interest and applies current mortality and expense assumptions, periodically redetermining values or premiums within guaranteed bounds.

The termination of coverage that occurs when a life policy's premium remains unpaid after the grace period ends and no nonforfeiture option applies.

Level death benefit option

A universal life death benefit choice under which the beneficiary receives the face amount only, with the account value effectively absorbed into that fixed payout rather than added to it.

The difference between the death benefit and the policy's cash value. It is the amount the insurer is actually insuring, and the cost of insurance is charged on it.

In indexed universal life, the percentage of the referenced index's movement that is actually counted toward the interest credited to the policy.

The disclosure document that must be delivered to the buyer of a variable contract no later than the sale, required by federal securities law.

An account, distinct from the insurer's general account, that holds a variable policy's cash value and is invested according to the owner's chosen subaccounts, exposing the owner to investment risk.

The investment divisions within a variable policy's separate account, each investing in a distinct portfolio, among which the owner allocates the policy's cash value.

A permanent life insurance product with flexible premiums and an adjustable death benefit, where premiums fund an account value from which cost of insurance and expenses are deducted and interest is credited.

A life insurance product with a fixed premium and a guaranteed minimum death benefit whose cash value is held in the insurer's separate account and rises or falls with the performance of selected subaccounts.

Variable universal life

A life insurance product combining universal life's flexible premiums with variable life's separate-account investing, generally without a guaranteed cash value tied to subaccount performance.

Annual renewable term

A term policy consisting of successive one-year terms the owner may renew each year without new evidence of insurability, at a rising premium.

The insured's current age at a given point, such as renewal, used as the basis for calculating a new premium rather than the age at original issue.

A term policy provision letting the owner exchange term coverage for a permanent plan without evidence of insurability, within a stated conversion window.

Credit life insurance

Decreasing term insurance sold in connection with a loan, with the face amount tracking the declining loan balance.

A term life policy whose face amount declines on a set schedule while the premium usually stays level, designed to match a shrinking need like a mortgage.

Evidence of insurability

Proof of insurability, such as health history, a medical exam or a questionnaire, that an insurer may require from an applicant for individual coverage or from employees who enroll late in a group plan.

A term life policy whose face amount rises over the term according to a schedule or index, often used as a rider to keep pace with inflation.

Term coverage whose premium is fixed for a multi-year period such as 10, 20 or 30 years; afterward the policy expires or renews at a much higher rate based on the insured's age.

A term life policy whose face amount and, typically, premium stay the same for the entire term.

Original age conversion option

A conversion option that computes the new permanent policy's premium as if it had been issued at the original policy date, typically requiring a lump-sum payment for the difference in past premiums.

Term insurance offering a lower rate to an insured who re-qualifies with fresh evidence of insurability. An insured whose health has declined pays the higher guaranteed rate instead.

A term policy provision letting the owner continue coverage for another term at the end of the current one without evidence of insurability.

Life insurance that pays a death benefit only if the insured dies within a stated period, builds no cash value, and expires if the insured outlives the term.

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Cash surrender value: The amount an owner may take in cash when surrendering a whole life policy, ending the coverage. — Types of life policies and features · Taught in Traditional whole life products, Reinstatement, policy loans, and nonforfeiture options, Life settlements, Individual life nonforfeiture options and policy settlement
Cost of insurance: The mortality charge deducted from an unbundled policy's account value, usually monthly, to pay for the pure death-benefit protection; it cannot exceed the contract's guaranteed maximum rate. — Types of life policies and features · Taught in Traditional whole life products, Interest- and market-sensitive life products
Extended term insurance: A nonforfeiture option that uses a policy's cash value to buy term insurance for the original face amount, but only for a limited period. — Types of life policies and features · Taught in Traditional whole life products, Reinstatement, policy loans, and nonforfeiture options, Individual life nonforfeiture options and policy settlement
Guaranteed cash value: The savings element inside a whole life policy that accumulates over time from the excess of early premiums over the current cost of protection. — Types of life policies and features · Taught in Traditional whole life products
Guaranteed death benefit: The face amount a whole life policy promises to pay the beneficiary whenever the insured dies while the policy is in force. — Types of life policies and features · Taught in Traditional whole life products
Industrial life insurance: Small-face-amount life insurance with premiums collected at the home, usually weekly or monthly, by an agent. Florida insurers may no longer write new industrial policies after a statutory date. — Types of life policies and features · Taught in Traditional whole life products, Premium payment modes and grace period, Reinstatement, policy loans, and nonforfeiture options
Insurable interest: A financial or relational stake in the continued life of an insured, required at the time coverage is written, including when a rider insures a life other than the primary insured. — Types of life policies and features · Taught in Traditional whole life products, Combination and survivorship life plans, Beneficiary designation rules, Application mechanics: signatures, changes, and incomplete applications, Underwriting: insurable interest, medical information, and risk classification, Insurance contract law and its unique characteristics, Third-party ownership of life insurance, Insurance contract law and insurable interest, Individual life contract standard provisions
Level premium: A whole life premium set at issue that stays the same for the life of the policy, never increasing as the insured ages. — Types of life policies and features · Taught in Traditional whole life products
Limited-pay whole life: A whole life policy with premiums compressed into a set number of years or to a stated age, after which the policy is paid up but lifetime coverage continues. — Types of life policies and features · Taught in Traditional whole life products
Nonforfeiture provision: The provision guaranteeing that a cash-value policy's built-up value cannot simply be forfeited on lapse, letting the owner choose cash surrender, reduced paid-up insurance, or extended term insurance. — Types of life policies and features · Taught in Traditional whole life products, Individual life contract standard provisions, Individual life nonforfeiture options and policy settlement
Nonparticipating policy: A whole life policy that pays no dividends and relies solely on its guaranteed values. — Types of life policies and features · Taught in Traditional whole life products
Ordinary whole life: A whole life policy on which premiums are paid continuously until the insured's death or the policy's maturity date, producing the lowest annual premium of the whole life variations. — Types of life policies and features · Taught in Traditional whole life products
Paid-up nonforfeiture benefit: A benefit, such as reduced paid-up insurance or extended term insurance, that state law requires a lapsed cash-value policy to provide instead of forfeiting the owner's built-up value. — Types of life policies and features · Taught in Traditional whole life products, Reinstatement, policy loans, and nonforfeiture options
Participating policy: A whole life policy that may pay non-guaranteed policy dividends to the owner. — Types of life policies and features · Taught in Traditional whole life products, Dividends, incontestability, assignment, suicide, and accelerated death benefits
Policy dividends: Non-guaranteed distributions a participating whole life policy may pay, which the owner can take in cash, use to reduce premiums, buy paid-up additions, or leave to accumulate. — Types of life policies and features · Taught in Traditional whole life products, Dividends, incontestability, assignment, suicide, and accelerated death benefits
Reduced paid-up insurance: A nonforfeiture option that converts a policy's cash value into a smaller permanent face amount with no further premiums due. — Types of life policies and features · Taught in Traditional whole life products, Reinstatement, policy loans, and nonforfeiture options, Individual life nonforfeiture options and policy settlement
Single-premium whole life: A whole life policy fully paid up by one lump-sum premium at issue, with no further premiums due. — Types of life policies and features · Taught in Traditional whole life products
Standard Nonforfeiture Law for Life Insurance: The state law, based on a model adopted in every state, requiring a life policy to provide a cash surrender value or a paid-up nonforfeiture benefit once premiums have been paid for the period stated in the policy. — Types of life policies and features · Taught in Traditional whole life products, Reinstatement, policy loans, and nonforfeiture options, Individual life contract standard provisions, Individual life nonforfeiture options and policy settlement
Cap: In indexed universal life, the maximum interest rate the insurer will credit in a given crediting period, regardless of how much the referenced index gains. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Current interest rate: The interest rate an insurer actually declares and credits to a policy's account value today; it can change over time and is not contractually guaranteed beyond the policy's guaranteed minimum. — Types of life policies and features · Taught in Interest- and market-sensitive life products
FINRA registration: Securities registration through a broker-dealer. A producer needs it, in addition to a life license, to sell variable life, which is both insurance and a security. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Flexible premium: A premium structure, used in universal life, that lets the owner pay more or less than a scheduled amount within contract limits, rather than a fixed amount on a fixed schedule. — Types of life policies and features · Taught in Interest- and market-sensitive life products, Annuity premium and timing structures
Floor: In indexed universal life, the minimum interest rate the insurer will credit in a crediting period, often zero percent, which protects the account value from losses when the referenced index declines. — Types of life policies and features · Taught in Interest- and market-sensitive life products
General account: The insurer's pool of investments backing its traditional, guaranteed products. Reserves for guaranteed minimum death benefits on variable life policies must be held here. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Guaranteed minimum interest rate: The lowest crediting rate a policy's contract promises regardless of how low the current declared rate falls; only this figure, not projected current rates, is contractually guaranteed. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Increasing death benefit option: A universal life death benefit choice under which the beneficiary receives the face amount plus the policy's accumulated account value, so the total payout rises as the account value grows. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Indexed universal life: A universal life product that credits interest under a formula tied to an external market index, without the owner being directly invested in or receiving dividends from that index. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Interest-sensitive (current assumption) whole life: A whole life product with a scheduled premium and stated face amount, like traditional whole life, but where the insurer credits current interest and applies current mortality and expense assumptions, periodically redetermining values or premiums within guaranteed bounds. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Lapse: The termination of coverage that occurs when a life policy's premium remains unpaid after the grace period ends and no nonforfeiture option applies. — Types of life policies and features · Taught in Interest- and market-sensitive life products, Premium payment modes and grace period, Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Modes of premium payment
Level death benefit option: A universal life death benefit choice under which the beneficiary receives the face amount only, with the account value effectively absorbed into that fixed payout rather than added to it. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Net amount at risk: The difference between the death benefit and the policy's cash value. It is the amount the insurer is actually insuring, and the cost of insurance is charged on it. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Participation rate: In indexed universal life, the percentage of the referenced index's movement that is actually counted toward the interest credited to the policy. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Prospectus: The disclosure document that must be delivered to the buyer of a variable contract no later than the sale, required by federal securities law. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Separate account: An account, distinct from the insurer's general account, that holds a variable policy's cash value and is invested according to the owner's chosen subaccounts, exposing the owner to investment risk. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Subaccounts: The investment divisions within a variable policy's separate account, each investing in a distinct portfolio, among which the owner allocates the policy's cash value. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Universal life: A permanent life insurance product with flexible premiums and an adjustable death benefit, where premiums fund an account value from which cost of insurance and expenses are deducted and interest is credited. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Variable life: A life insurance product with a fixed premium and a guaranteed minimum death benefit whose cash value is held in the insurer's separate account and rises or falls with the performance of selected subaccounts. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Variable universal life: A life insurance product combining universal life's flexible premiums with variable life's separate-account investing, generally without a guaranteed cash value tied to subaccount performance. — Types of life policies and features · Taught in Interest- and market-sensitive life products
Annual renewable term: A term policy consisting of successive one-year terms the owner may renew each year without new evidence of insurability, at a rising premium. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features
Attained age: The insured's current age at a given point, such as renewal, used as the basis for calculating a new premium rather than the age at original issue. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features, Group life insurance conversion and contribution, Replacement of health insurance, Group life standard provisions and conversion rights
Convertibility: A term policy provision letting the owner exchange term coverage for a permanent plan without evidence of insurability, within a stated conversion window. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features
Credit life insurance: Decreasing term insurance sold in connection with a loan, with the face amount tracking the declining loan balance. — Types of life policies and features · Taught in Term life insurance types, Third-party ownership of life insurance
Decreasing term: A term life policy whose face amount declines on a set schedule while the premium usually stays level, designed to match a shrinking need like a mortgage. — Types of life policies and features · Taught in Term life insurance types
Evidence of insurability: Proof of insurability, such as health history, a medical exam or a questionnaire, that an insurer may require from an applicant for individual coverage or from employees who enroll late in a group plan. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features, Reinstatement, policy loans, and nonforfeiture options, Group life insurance conversion and contribution, Health policy riders
Increasing term: A term life policy whose face amount rises over the term according to a schedule or index, often used as a rider to keep pace with inflation. — Types of life policies and features · Taught in Term life insurance types
Level premium term: Term coverage whose premium is fixed for a multi-year period such as 10, 20 or 30 years; afterward the policy expires or renews at a much higher rate based on the insured's age. — Types of life policies and features · Taught in Term life insurance types
Level term: A term life policy whose face amount and, typically, premium stay the same for the entire term. — Types of life policies and features · Taught in Term life insurance types
Original age conversion option: A conversion option that computes the new permanent policy's premium as if it had been issued at the original policy date, typically requiring a lump-sum payment for the difference in past premiums. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features
Re-entry term: Term insurance offering a lower rate to an insured who re-qualifies with fresh evidence of insurability. An insured whose health has declined pays the higher guaranteed rate instead. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features
Renewability: A term policy provision letting the owner continue coverage for another term at the end of the current one without evidence of insurability. — Types of life policies and features · Taught in Term life insurance types, Term life renewability and convertibility features, Rights of renewability
Term life insurance: Life insurance that pays a death benefit only if the insured dies within a stated period, builds no cash value, and expires if the insured outlives the term. — Types of life policies and features · Taught in Term life insurance types
Adverse selection: The tendency of healthier insureds to shop for new underwritten policies instead of renewing, leaving a less healthy pool that renews, which is priced into renewal rates. — Types of life policies and features · Taught in Term life renewability and convertibility features, Underwriting: insurable interest, medical information, and risk classification
Attained-age conversion: Converting term to permanent insurance with the premium based on the insured's age at conversion. No back payment is due, but the premium is higher because the insured is older. — Types of life policies and features · Taught in Term life renewability and convertibility features
Conversion privilege: The right to convert coverage to an individual permanent policy without evidence of insurability within a limited window. It is most often used when group life coverage ends, and many term policies offer it too. — Types of life policies and features · Taught in Term life renewability and convertibility features, Group life insurance conversion and contribution, Group health insurance and COBRA, Owner's rights, Group life standard provisions and conversion rights
Convertible term: Term insurance that lets the owner exchange it for permanent insurance (whole life or universal life) from the same insurer without evidence of insurability. The conversion right runs for a limited window, and the new face amount cannot exceed the term face amount. — Types of life policies and features · Taught in Term life renewability and convertibility features
Renewable term: Term coverage the owner may renew at the end of each term without evidence of insurability. The premium rises at each renewal based on attained age, and renewals usually stop at a stated age. — Types of life policies and features · Taught in Term life renewability and convertibility features
Accumulation phase: The period of a deferred annuity before income begins, during which the contract's value grows as interest or earnings are credited. — Types of life policies and features · Taught in Annuity premium and timing structures, Annuity classification and payout options
Annuity intermediary: An entity contracted directly with an insurer, or with another intermediary, to facilitate the sale of the insurer's annuities by producers. — Types of life policies and features · Taught in Annuity premium and timing structures
Annuity starting date: The first day of the first period for which an amount is received as an annuity. It divides the accumulation period from the payout period, and the exclusion ratio is measured as of this date. — Types of life policies and features · Taught in Annuity premium and timing structures, Annuity classification and payout options
Cash compensation: Any discount, concession, fee, commission, sales charge, loan, override, or other cash benefit a producer receives from an insurer, an intermediary, or the consumer for recommending or selling an annuity. — Types of life policies and features · Taught in Annuity premium and timing structures
Consumer profile information: The facts about a consumer that a producer must consider before recommending an annuity, including financial time horizon, liquidity needs, and the financial resources used to fund the annuity (Fla. Stat. 627.4554). — Types of life policies and features · Taught in Annuity premium and timing structures
Deferred annuity: An annuity whose income payments begin on a future annuity date, with the contract growing during an accumulation phase until then. — Types of life policies and features · Taught in Annuity premium and timing structures
Exclusion ratio: A calculation that divides the investment in an annuity contract by the expected return to determine the tax-free portion of each annuitized payment. — Types of life policies and features · Taught in Annuity premium and timing structures, Annuity classification and payout options
FPDA: Flexible premium deferred annuity: deposits are made over time and income begins years later. A flexible premium immediate annuity cannot exist. — Types of life policies and features · Taught in Annuity premium and timing structures
Immediate annuity: An annuity whose income payments begin within about one payment interval after purchase. — Types of life policies and features · Taught in Annuity premium and timing structures
Periodic premium: An annuity funding method in which the owner pays a set amount on a set schedule, such as monthly or annually. — Types of life policies and features · Taught in Annuity premium and timing structures
Single premium: An annuity funding method in which one lump sum funds the contract at issue and no further payments are made. — Types of life policies and features · Taught in Annuity premium and timing structures
SPDA: Single premium deferred annuity: a lump sum is paid in and income begins years later. — Types of life policies and features · Taught in Annuity premium and timing structures
SPIA: Single premium immediate annuity: a lump sum buys income that starts at once. — Types of life policies and features · Taught in Annuity premium and timing structures
Surrender charge: A declining percentage penalty, often starting near 7 percent and falling to zero, deducted when money is taken out early. It lets the insurer recover acquisition costs such as the producer's commission. — Types of life policies and features · Taught in Annuity premium and timing structures, Replacement and point-of-sale disclosures (HIPAA, HIV consent), Policy or contract replacement duties
Annuitant: The measuring life under an annuity contract whose age and sex determine the amount of each payment. — Types of life policies and features · Taught in Annuity classification and payout options
Annuity: A contract that protects against outliving one's money by converting premiums into a stream of income, the mirror image of life insurance. — Types of life policies and features · Taught in Annuity classification and payout options
Beneficiary: The person or entity named in a policy or contract to receive its death benefit or other proceeds when the insured, or the annuitant under an annuity, dies. — Types of life policies and features · Taught in Annuity classification and payout options, Beneficiary designation rules, Third-party ownership of life insurance
Fixed amount: An annuity payout option under which a chosen payment amount continues until the fund and its interest are exhausted. — Types of life policies and features · Taught in Annuity classification and payout options, Individual life nonforfeiture options and policy settlement
Fixed annuity: An annuity that credits interest declared by the insurer, subject to a guaranteed minimum, with the insurer carrying the investment risk. — Types of life policies and features · Taught in Annuity classification and payout options
Indexed annuity: An annuity that credits interest based on the performance of an external index, usually subject to a floor and a cap or participation limit. — Types of life policies and features · Taught in Annuity classification and payout options
Joint and survivor: An annuity settlement option covering two annuitants, under which income continues to the survivor, often at a reduced percentage, after the first annuitant dies. — Types of life policies and features · Taught in Annuity classification and payout options
Life with period certain: An annuity settlement option paying lifetime income, with payments continuing to a beneficiary for the remainder of a stated period if the annuitant dies early. — Types of life policies and features · Taught in Annuity classification and payout options
Life with refund: An annuity settlement option paying lifetime income with a guarantee that at least the amount applied is returned to the beneficiary, as installments or a lump sum. — Types of life policies and features · Taught in Annuity classification and payout options
Owner: The party to an annuity contract who pays premiums and controls the contract. — Types of life policies and features · Taught in Annuity classification and payout options
Payout phase: The stage of an annuity, beginning at annuitization, during which money flows out to the annuitant as income. — Types of life policies and features · Taught in Annuity classification and payout options
Period certain: An annuity payout option paying equal amounts for a set number of years regardless of whether the annuitant is still living. — Types of life policies and features · Taught in Annuity classification and payout options
Settlement option: A way for the policy owner or beneficiary to take policy proceeds other than as one lump sum, such as interest only, a fixed period, a fixed amount, or a life income. In an annuity the same idea sets how accumulated value is turned into income. — Types of life policies and features · Taught in Annuity classification and payout options, Tax treatment of life insurance premiums, proceeds, and MECs, Individual life nonforfeiture options and policy settlement
Straight life (life only): An annuity settlement option paying income for the annuitant's lifetime only, with nothing paid after death, producing the largest periodic payment for a given amount of money. — Types of life policies and features · Taught in Annuity classification and payout options
Variable annuity: An annuity that places value in separate-account subaccounts the owner selects, so values and payments rise and fall with investment results and the owner bears the investment risk. — Types of life policies and features · Taught in Annuity classification and payout options
Buy-sell agreement: An arrangement between business partners, often funded by joint life insurance, giving a surviving partner the cash to buy out a deceased partner's business interest. — Types of life policies and features · Taught in Combination and survivorship life plans, Life insurance needs analysis for individuals and businesses
Combination plan: A life insurance contract that packages permanent insurance with term insurance, such as a family plan. — Types of life policies and features · Taught in Combination and survivorship life plans
Family plan: A combination policy with a permanent base policy on the primary insured plus level term riders covering the spouse and children, often with a conversion right for the children's coverage. — Types of life policies and features · Taught in Combination and survivorship life plans
Irrevocable life insurance trust: A trust that owns a life insurance policy, often survivorship coverage, so the proceeds can fund estate taxes without enlarging the taxable estate. — Types of life policies and features · Taught in Combination and survivorship life plans, Third-party ownership of life insurance
Joint life (first-to-die): A policy covering two insureds that pays the face amount when the first of them dies, after which coverage under that contract ends for the survivor unless the contract grants a purchase or conversion option. — Types of life policies and features · Taught in Combination and survivorship life plans
Marital deduction: A federal estate tax deduction that lets property pass to a surviving spouse without tax at the first death, so any tax is due at the second death. — Types of life policies and features · Taught in Combination and survivorship life plans
Rated policy: A policy issued with an extra premium charged to offset a higher-risk hazard, such as a dangerous occupation or aviation activity, instead of an exclusion rider or decline. — Types of life policies and features · Taught in Combination and survivorship life plans, Health policy riders
Survivorship (second-to-die): A policy covering two insureds that pays nothing at the first death and pays the death benefit only after both insureds have died, with premiums generally continuing after the first death. — Types of life policies and features · Taught in Combination and survivorship life plans
Accidental death and dismemberment: A rider paying a principal sum for accidental death and a capital sum for loss of limbs or sight, usually the full principal sum for two members and half for one. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Disability income and accidental death and dismemberment policies
Accidental death benefit: A rider paying an additional amount on top of the face amount if death results from accidental bodily injury, independent of all other causes, within a stated time limit. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders
Capital sum: A percentage of the principal sum payable under an AD&D rider for a lesser loss, such as one hand or the sight of one eye. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Disability income and accidental death and dismemberment policies
Double indemnity: The nickname for an accidental death benefit equal to the policy's face amount, doubling the total payable if death is accidental. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders
Elimination (waiting) period: The waiting period after an insured becomes disabled, or incurs a covered loss, before benefits begin. It applies to disability income, long-term care and waiver-of-premium provisions. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Individual and group long-term care insurance, Other provisions I: insuring clause, free look, consideration, probationary and elimination periods, Disability classifications: total, partial, recurrent, and residual, Replacement of health insurance
Guaranteed insurability rider: A rider letting the owner buy specified additional coverage on scheduled option dates or qualifying life events with no evidence of insurability, priced at attained age. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Health policy riders
Payor benefit rider: A rider on a juvenile policy that waives premiums until the child reaches a stated age if the adult paying for the policy dies or becomes totally disabled. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders
Principal sum: The full scheduled amount payable under an AD&D rider for accidental death or a major loss. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Disability income and accidental death and dismemberment policies
Rider: An amendment attached to a life policy that adds a benefit, usually for extra premium, and which has no existence independent of the base policy. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders
Total disability: A disability classification, defined by the policy, under which the insured cannot perform the duties of his or her own occupation or of any occupation reasonably suited to education and experience, normally paying the full monthly benefit. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Waiver of monthly deduction / cost of insurance: The universal life equivalent of a waiver of premium rider, waiving the monthly cost-of-insurance deduction while the insured is disabled. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders
Waiver of premium: A rider under which the insurer pays the policy's premiums while the insured remains totally disabled past a waiting period, waiving the premium but not paying cash to the insured. — Life policy riders, provisions, options, and exclusions · Taught in Waiver, guaranteed-insurability, payor, and accidental-death riders, Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles, Health policy riders
Accelerated death benefit: A benefit paying part of the face amount to the owner while the insured is still living, upon a qualifying event such as terminal illness, reducing the death benefit left for the beneficiary. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Dividends, incontestability, assignment, suicide, and accelerated death benefits
Activities of daily living (ADLs): Basic self-care tasks such as bathing, dressing, transferring, toileting, continence, and eating, used to determine long-term care benefit eligibility. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Individual and group long-term care insurance
Children's term rider: A rider added to a parent's life policy that covers all eligible children for one premium at the same level term amount, with newborn or adopted children added at no extra cost. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Chronically ill: A defined health status under which viatical settlement proceeds are excludable from gross income subject to statutory limits. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Individual and group long-term care insurance, Long-term care policy standards and terminology
Decreasing term rider: A term rider whose additional death benefit declines over time, often matched to an amortizing mortgage or shrinking income-replacement need. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Extension of benefits rider: A rider that extends long-term care benefits beyond the base coverage, as on a life and long-term care hybrid that keeps paying care costs after the death benefit has been used up. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Family rider: An other-insured rider that bundles term coverage on both a spouse and children under one policy. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Long-term-care rider: A rider that converts part of a life policy's death benefit into a living benefit paying for qualified long-term-care services, reducing the death benefit by amounts paid out. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Master policy: The single contract issued to a group sponsor such as an employer or association, under which each covered person receives a certificate rather than an individual policy. It is used for group life, group health and other group plans. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Group life insurance conversion and contribution, Group health insurance and COBRA, Owner's rights, Group life standard provisions and conversion rights
Notice to Buyer: A statement Florida requires prominently on the first page of a long-term-care policy, warning that the policy may not cover all the long-term-care costs the buyer incurs and advising periodic review. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Long-term care policy standards and terminology, Long-term care replacement, lapse protection, and partnership programs
Other-insured rider: A rider that extends term coverage under the same policy to a person other than the primary insured, such as a spouse or child. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Outline of coverage: A required disclosure that summarizes a health policy's benefits, limits, exclusions and renewability. It is delivered to applicants for accident and health coverage, along with the Medicare buyer's guide for a Medicare supplement. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Medicare supplement policies, Individual and group long-term care insurance, Health insurance disclosure requirements, Medicare supplement disclosure, replacement, and standardized benefits, Long-term care policy standards and terminology, Long-term care replacement, lapse protection, and partnership programs
Spouse term rider: An other-insured rider providing level term coverage on the primary insured's spouse, typically ending at a stated age or upon termination of the marriage. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Term rider: A rider adding temporary death benefit on the same insured covered by the base permanent policy, expiring at the end of its stated period while the base policy continues. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders
Terminally ill: A defined health status, certified by a physician, that generally makes viatical settlement proceeds fully excludable from the insured's gross income. — Life policy riders, provisions, options, and exclusions · Taught in Term, other-insured, and long-term-care riders, Dividends, incontestability, assignment, suicide, and accelerated death benefits
Any occupation: A stricter disability definition that pays benefits only if the insured cannot work in any gainful occupation for which they are reasonably suited. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Cost-of-living rider: A rider that periodically increases the death benefit to track an inflation index, usually without new evidence of insurability but for added premium at attained age. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Health policy riders
Disability income rider: A rider that pays the insured a monthly income, often a percentage of the face amount, as a living benefit for as long as total disability continues. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders
Own occupation: A disability definition that pays benefits if the insured cannot perform the duties of their own specific job. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Presumptive disability: A provision paying full disability benefits without the usual test, upon severe losses such as sight, hearing, speech, or use of limbs. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders, Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Return-of-premium rider: A rider, usually on term life, that refunds the premiums paid if the insured is still living when the level term period ends; lapsing or surrendering early typically forfeits some or all of the refund. — Life policy riders, provisions, options, and exclusions · Taught in Return-of-premium, disability, and cost-of-living riders, Health policy riders
Consideration: The thing of value each side gives up to form the contract; for the applicant it is the premium and the statements made, and for the insurer it is the promise to pay benefits. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Consideration clause: The provision describing the exchange of value in a life policy: the applicant's completed application and initial premium in return for the insurer's promise to pay benefits. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Other provisions I: insuring clause, free look, consideration, probationary and elimination periods
Entire contract provision: The provision stating that the policy, the attached application, and any attached riders or endorsements make up the whole agreement, so nothing outside those documents binds either party. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Submitting the application for underwriting, Individual life contract standard provisions
Free-look period: A stated period after delivery during which the owner may examine the policy and return it for a full refund of premium. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Replacement and point-of-sale disclosures (HIPAA, HIV consent), Policy delivery and explaining the contract to the client, Medicare supplement policies, Other provisions I: insuring clause, free look, consideration, probationary and elimination periods, Owner's rights, Policy delivery and explaining the contract, Replacement of health insurance, Health insurance disclosure requirements, Medicare supplement required provisions and enrollment periods, Medicare supplement disclosure, replacement, and standardized benefits
Insuring clause: The provision naming the insured and the insurer and stating the insurer's core promise to pay the stated proceeds to the beneficiary upon due proof of the insured's death. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Other provisions I: insuring clause, free look, consideration, probationary and elimination periods
Irrevocable beneficiary: A beneficiary with a vested interest in the policy whom the owner generally cannot change, or take actions reducing that interest, without the beneficiary's written consent. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Beneficiary designation rules, Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes, Owner's rights, Primary and contingent beneficiaries
Owner's rights: The set of contractual rights held by the policyowner while a policy is in force, including naming or changing beneficiaries, assigning the policy, accessing cash value, and exercising policy options. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights
Policyowner: The person who holds all contractual rights and duties under a life policy, including paying premiums, naming beneficiaries, and surrendering or assigning the contract. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Third-party ownership of life insurance, Owner's rights
Unilateral contract: A contract in which only one party makes a legally enforceable promise; in insurance, only the insurer is bound once premium is paid. — Life policy riders, provisions, options, and exclusions · Taught in Core contract provisions: entire contract, insuring clause, free look, consideration, owner's rights, Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Class designation: A beneficiary designation naming a group, such as 'my children,' rather than specific individuals, useful when the group's membership may change. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Contingent (secondary) beneficiary: A beneficiary paid only if no primary beneficiary survives the insured. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Facility-of-payment clause: An optional provision letting the insurer pay up to $1,000 to a relative when benefits are payable to an estate or an incapacitated person. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules
Per capita: A method of splitting proceeds among a class of beneficiaries under which only surviving members share, and a deceased member's portion is redistributed among the survivors. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Per stirpes: A method of splitting proceeds among a class of beneficiaries under which a deceased member's share passes down to that member's own descendants. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Primary beneficiary: The beneficiary first in line to be paid the death benefit if living at the insured's death. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Revocable beneficiary: A beneficiary the owner may change at any time without the beneficiary's permission. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Simultaneous death: A situation where the insured and beneficiary die in the same event with the order of death unclear, in which the insured is presumed to have survived so proceeds pass to the contingent beneficiary. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Specific designation: A beneficiary designation naming an individual by full name and relationship. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules
Spendthrift clause: A policy provision restricting a beneficiary from assigning or pledging installment proceeds and shielding those proceeds from the beneficiary's creditors. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules
Tertiary beneficiary: A third layer of beneficiary designation used as deeper backup if neither the primary nor contingent beneficiary survives. — Life policy riders, provisions, options, and exclusions · Taught in Beneficiary designation rules, Primary and contingent beneficiaries
Grace period: The window after a missed premium or insufficient account value during which a policy stays in force, giving the owner time to pay before coverage lapses. — Life policy riders, provisions, options, and exclusions · Taught in Premium payment modes and grace period, Individual life contract standard provisions
Modal loading: A percentage added to each installment of a more frequent mode to recover the insurer's lost investment income and extra billing and collection costs. — Life policy riders, provisions, options, and exclusions · Taught in Premium payment modes and grace period
Premium due date: The date each premium is due, fixed by the mode chosen, such as the start of each quarter for a quarterly mode. — Life policy riders, provisions, options, and exclusions · Taught in Premium payment modes and grace period
Premium payment mode: How often the policyowner pays premiums, such as annual, semiannual, quarterly, or monthly. — Life policy riders, provisions, options, and exclusions · Taught in Premium payment modes and grace period, Modes of premium payment
Renewal premium: Any premium after the first. The grace period applies only to renewal premiums. — Life policy riders, provisions, options, and exclusions · Taught in Premium payment modes and grace period
Nonforfeiture values: The cash surrender value or other paid-up values that state law requires a life policy to provide, figured with the mortality table and interest rate stated in the contract, so that an owner who stops paying premiums does not forfeit the value built up. — Life policy riders, provisions, options, and exclusions · Taught in Reinstatement, policy loans, and nonforfeiture options
Policy loan: A loan an owner takes against a whole life policy's cash value; any unpaid loan and interest reduce the amount paid to the beneficiary at death. — Life policy riders, provisions, options, and exclusions · Taught in Reinstatement, policy loans, and nonforfeiture options, Tax treatment of life insurance premiums, proceeds, and MECs, Individual life contract standard provisions
Reinstatement: A provision letting the owner restore a lapsed policy's original contract by furnishing evidence of insurability, paying overdue premiums with interest, and settling any outstanding policy loan. — Life policy riders, provisions, options, and exclusions · Taught in Reinstatement, policy loans, and nonforfeiture options
Absolute assignment: A transfer that permanently and completely conveys all of the owner's policy rights to another party. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits, Third-party ownership of life insurance
Assignment: The method by which ownership or rights in a life insurance policy are transferred under the policy's own terms, rather than by simply handing over the document. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits
Collateral assignment: A transfer of only enough policy interest to secure a debt, with any remaining death benefit going to the named beneficiary. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits
Contestable period: The time after a policy is issued during which the insurer may challenge and rescind it for material misrepresentation or concealment in the application. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits, Replacement of health insurance
Divisible surplus: The portion of a participating insurer's surplus apportioned and credited annually to policyowners as dividends, reflecting a return of an overcharge in premium. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits
Incontestability clause: A provision barring the insurer from contesting a policy for misstatements in the application after it has been in force for two years during the insured's lifetime, except for nonpayment of premium. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits, Individual life contract standard provisions
Misstatement of age or sex provision: A policy clause that adjusts the benefit payable, rather than voiding the policy, when the insured's age or sex was stated incorrectly on the application. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits, Individual life contract standard provisions
Paid-up additions: A dividend option that uses the dividend to buy small amounts of additional paid-up permanent insurance, with no new evidence of insurability. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits
Suicide clause: A provision excluding death by suicide during a stated period after the policy date, usually no more than two years, with the usual remedy being a refund of the premiums paid. — Life policy riders, provisions, options, and exclusions · Taught in Dividends, incontestability, assignment, suicide, and accelerated death benefits, Individual life contract standard provisions
Aviation exclusion rider: A rider limiting or excluding coverage for death arising from higher-risk flying, such as acting as pilot or crew, while still generally covering fare-paying commercial passengers. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation
Avocation: A hobby or leisure activity, such as scuba diving or motorcycle racing, that an underwriter may treat as a hazardous risk requiring an exclusion rider or rated premium. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation
Change of Occupation provision: An optional provision that reduces benefits if the insured moves to a more hazardous occupation, or lowers premium if the insured moves to a less hazardous one. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation, Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes, Occupational versus non-occupational classification
Exclusion: A permanent contract provision denying payment for a narrow list of causes of death, enforceable only if written into the policy or an attached rider. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Exclusion rider: A form attached to an issued policy that permanently excludes coverage for a specified condition or risk the underwriter identified. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation, Health policy riders
Flat extra: A temporary additional premium charged per thousand of coverage for a substandard risk expected to improve or end after a stated period. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation, Underwriting: insurable interest, medical information, and risk classification
Results clause: A war exclusion that denies a death claim only if death actually results from an act of war or military conflict. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation
Status clause: A war exclusion that denies a death claim based solely on the insured's status as an active-duty military member during a war or declared conflict, regardless of how death occurred. — Life policy riders, provisions, options, and exclusions · Taught in Policy exclusions: war, aviation, and dangerous occupation
Agent's statement: A section of the application, or a separate report, containing the agent's own observations and disclosures about the applicant, which is not shown to the applicant to complete. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications
Policy amendment: A signed change to the application or policy for terms the insurer changed after underwriting, such as a different rating, lower face amount or exclusion. The applicant signs it, usually at delivery. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications, Policy delivery and explaining the contract to the client
Producer's report: A separate statement the agent sends to the underwriter describing how well the agent knows the applicant and any observations about health, habits, or finances not shown on the application; it is not part of the contract. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications, Completing the health insurance application, Submitting the application for underwriting
Representation: A statement made by an applicant in or with an application that is believed to be true; a material misrepresentation can support rescission during the contestable period. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications, Insurance contract law and its unique characteristics, Completing the health insurance application, Submitting the application for underwriting, Insurance contract law and insurable interest
Waiver: The voluntary, intentional giving up of a known right, such as knowingly accepting a late premium without objection. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications, Insurance contract law and its unique characteristics, Completing the health insurance application
Warranty: A statement in an insurance application guaranteed to be true rather than merely believed true; warranties are rare in modern life and health contracts. — Completing the life application, underwriting, and delivering the policy · Taught in Application mechanics: signatures, changes, and incomplete applications, Insurance contract law and its unique characteristics, Submitting the application for underwriting
Approval-type receipt: A conditional receipt under which no coverage is in force until the insurer approves the application; the receipt only acknowledges the premium and starts underwriting. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Initial premium collection and receipt consequences
Binding receipt (temporary insurance agreement): A premium receipt under which coverage attaches immediately for a stated maximum amount and a limited number of days, regardless of how underwriting later turns out. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Initial premium collection and receipt consequences
Cash on delivery: An application submitted with no premium collected at signing, meaning there is no receipt and no interim coverage until the policy is delivered and the initial premium is paid. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt
Conditional receipt (insurability type): A premium receipt stating that coverage takes effect on a stated trigger date only if underwriting later finds the proposed insured insurable exactly as applied for; if declined or rated, there was never any coverage and the premium is refunded. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Completing the health insurance application, Initial premium collection and receipt consequences
Fiduciary capacity: The trust relationship under which a producer holds premiums, return premiums, and claim money that belong to the insurer or consumer, not to the producer. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Initial premium collection and receipt consequences, Agent responsibilities: fiduciary capacity, compensation, and ethics
Initial premium: The first premium, collected with the application. Collecting it is what makes interim coverage possible and shows the applicant is serious. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt
Insurability (approval-of-insurability) receipt: A conditional receipt under which coverage takes effect retroactive to the receipt date if the applicant proves insurable as of that date, even if approval paperwork finishes later. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Initial premium collection and receipt consequences
Offer and acceptance: The contract element under which the applicant offers to contract by submitting a completed application with premium, and the insurer accepts by issuing the policy as applied for. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Insurance contract law and its unique characteristics, Initial premium collection and receipt consequences, Insurance contract law and insurable interest
Statement of continued good health: A signed statement obtained at delivery confirming there has been no change in the insured's insurability since the application, when the insurer conditions the policy on that fact. — Completing the life application, underwriting, and delivering the policy · Taught in Collecting the initial premium and issuing the receipt, Policy delivery and explaining the contract to the client
Agent disclosure form: A written form a Florida agent must give the consumer before recommending or selling an annuity, describing the agent's role and the products the agent is licensed to sell. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent)
Buyer's Guide: A generic, insurer-neutral disclosure document explaining the basic kinds of life insurance and how to compare costs among similar policies; every applicant receives the same one. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Life and annuity marketing methods and practices
Churning: Repeatedly replacing a client's coverage to generate fresh first-year commissions rather than to serve the client's interest. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Replacement of health insurance, Unfair trade practices III: twisting, churning, rebating, and concealment
Health information authorization: A form permitting release of an applicant's medical, pharmacy, and consumer reporting information for underwriting, stating who may release it, to whom, for what purpose, and for how long. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Underwriting: insurable interest, medical information, and risk classification, Completing the health insurance application, Sources of insurability and HIPAA privacy disclosures, Submitting the application for underwriting
HIPAA: The federal law whose Privacy Rule bars covered entities from releasing protected health information for underwriting without the individual's written authorization. Knowing wrongful disclosure is a federal crime with tiered penalties. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Sources of insurability and HIPAA privacy disclosures
HIV-related test: A test an insurer may require in connection with an accident and health application, permitted only on a uniform, nondiscriminatory basis tied to the coverage applied for. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Florida Healthy Kids Corporation and HIV/AIDS testing requirements
Medical Information Bureau: A member-insurer exchange that files coded impairment information from prior applications and checks it on new ones as a lead for further investigation, not proof of a condition. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Underwriting: insurable interest, medical information, and risk classification, Completing the health insurance application, Sources of insurability and HIPAA privacy disclosures
Policy Summary: A disclosure document specific to the proposed contract, naming the insurer and producer and showing the premiums, death benefits, cash values, and charges for that particular policy. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent)
Privacy notice: A notice describing what nonpublic personal information is collected, what is shared and with whom, and how it is protected. Customers receive it at the start of the relationship and annually. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Replacement: A sale in which new coverage is purchased and existing coverage is lapsed, surrendered, reduced, converted, or borrowed against in connection with the transaction, triggering replacement disclosure duties. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Submitting the application for underwriting, Replacement of health insurance, Policy or contract replacement duties
Replacement notice: A required disclosure form comparing existing and proposed coverage on facts when a sale involves replacing in-force insurance, signed, dated, and copied to the applicant and the replacing insurer. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent), Replacement of health insurance, Medicare supplement disclosure, replacement, and standardized benefits, Long-term care replacement, lapse protection, and partnership programs
Written informed consent: The signed disclosure, obtained before a specimen is collected, explaining that an HIV-related test will be performed, why, and who may receive the result. — Completing the life application, underwriting, and delivering the policy · Taught in Replacement and point-of-sale disclosures (HIPAA, HIV consent)
Anti-money-laundering (AML) program: A written program a covered insurer must maintain, built on a designated compliance officer, ongoing training, internal policies and controls including customer identification, and independent testing. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Covered products: The insurance products that FinCEN's rule subjects to AML program requirements: permanent life insurance, annuities, and other cash-value products, but not term, group life, or property and casualty. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Customer identification: Procedures under the PATRIOT Act to verify the identity of anyone opening an account, keep the records used, and check government lists of known or suspected terrorists. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
FinCEN: The Financial Crimes Enforcement Network, a Treasury bureau that issues the anti-money-laundering rules for insurers and receives suspicious activity reports. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Integration: The final money-laundering stage, in which laundered money re-emerges looking legitimate, such as a policy payout appearing to be clean insurance proceeds. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Layering: The money-laundering stage in which transactions obscure the origin of illicit funds, a stage cash-value life insurance and annuities are attractive for because value can be surrendered, exchanged, or borrowed against. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Money laundering: Disguising the origin of illegally obtained money. It has three stages: placement, layering, and integration. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Nonpublic personal information (NPI): The financial, health, and identifying information an applicant provides that is not publicly available, protected under the Gramm-Leach-Bliley Act's notice, choice, and safeguards duties. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
OFAC: Treasury's Office of Foreign Assets Control, whose sanctions list insurers screen applicants against. A policy may not be sold to someone on it. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Opt-out (GLBA): The consumer's right under the Gramm-Leach-Bliley Act to a reasonable opportunity to decline having nonpublic personal information shared with nonaffiliated third parties, before such sharing occurs. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Placement: The first stage of money laundering, in which illicit funds first enter the financial system. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Pretexting: Obtaining a customer's financial information from an institution under false pretenses, which the Gramm-Leach-Bliley Act prohibits. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Structuring: Breaking cash payments into smaller amounts to avoid reporting. It is a red flag a producer should report. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Suspicious activity reporting: The confidential process of escalating a transaction that shows money-laundering red flags to the carrier, without telling the customer that a report was made or considered. — Completing the life application, underwriting, and delivering the policy · Taught in USA PATRIOT Act, anti-money-laundering, and Gramm-Leach-Bliley privacy
Attending physician's statement: Medical records the insurer requests from an applicant's own physician to clarify health history, obtainable only with a valid signed authorization. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification, Sources of insurability and HIPAA privacy disclosures
Field underwriter: The licensed agent who takes an insurance application and is responsible for gathering complete, accurate information and transmitting it faithfully to the insurer. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification, Completing the health insurance application, Submitting the application for underwriting
Investigative consumer report: A report covering a person's character, general reputation, personal characteristics and mode of living, often gathered through interviews with neighbors, friends or associates. Its disclosure rules are stricter than for an ordinary consumer report. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification, Sources of insurability and HIPAA privacy disclosures
Preferred risk: An applicant better than average, with excellent health and habits, who receives the lowest rates, often split into tobacco and non-tobacco classes. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification
Risk classification: The underwriting process of sorting an applicant into a mortality-based class such as preferred, standard, substandard, or declined and postponed. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification
Standard risk: A life insurance applicant who meets the normal standards and is charged the standard rate. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification
Substandard (rated): A risk classification for higher-than-average expected mortality, priced with a table rating, a temporary flat extra, or an exclusion rider rather than a decline. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification
Table rating: A method of pricing a substandard risk by charging a percentage above the standard premium based on the degree of extra mortality risk. — Completing the life application, underwriting, and delivering the policy · Taught in Underwriting: insurable interest, medical information, and risk classification
Actual delivery: Personal delivery of the issued policy by the producer directly to the owner, allowing the contract to be explained and questions answered. — Completing the life application, underwriting, and delivering the policy · Taught in Policy delivery and explaining the contract to the client, Policy delivery and explaining the contract
Constructive delivery: Delivery of the policy other than in person, such as mailing it to the owner, where the insurer or producer relinquishes control by an approved method. — Completing the life application, underwriting, and delivering the policy · Taught in Policy delivery and explaining the contract to the client, Policy delivery and explaining the contract
Delivery receipt: A document the owner signs at policy delivery establishing the date they took possession of the policy, which can start the free-look period. — Completing the life application, underwriting, and delivering the policy · Taught in Policy delivery and explaining the contract to the client, Policy delivery and explaining the contract
Insurer counteroffer: A policy issued other than as applied for, such as with a rating, a smaller face amount, or an exclusion. The client must accept it, usually by signing an amendment, before it is in force. — Completing the life application, underwriting, and delivering the policy · Taught in Policy delivery and explaining the contract to the client, Insurance contract law and its unique characteristics, Initial premium collection and receipt consequences, Submitting the application for underwriting, Policy delivery and explaining the contract
Aleatory contract: A contract in which the values exchanged by the parties are unequal and depend on an uncertain event such as chance. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Competent parties: One of the four required contract elements, meaning each party to the contract has the legal capacity to enter into it. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Concealment: An applicant's failure to disclose a material fact known to the applicant and that the applicant had a duty to reveal, which can support rescission of the policy. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest, Unfair trade practices III: twisting, churning, rebating, and concealment
Conditional contract: A contract in which the insurer's duty to perform depends on certain conditions being met, such as premiums being current or proof of loss being furnished. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Contract of adhesion: A contract, like an insurance policy, whose wording is written entirely by one party (the insurer) and simply accepted or declined by the other, so genuine ambiguity is read against the insurer. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Estoppel (insurance): A legal bar that stops a party from asserting a right or denying a fact when the other side reasonably relied on that party's words or conduct. It is why an insurer cannot deny an agent's apparent authority or take back a right it appeared to give up. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics
Indemnity: Reimbursement of an actual loss, which is the basis of property and casualty insurance. Life insurance is instead a valued contract paying a stated face amount. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Subrogation
Legal purpose: One of the four required contract elements, meaning the agreement may not be used for an unlawful or wagering objective. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Parol evidence rule: The rule that the written contract controls and prior or outside oral statements cannot change it. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics
Personal contract: A contract between the insurer and a specific person based on that person's individual risk characteristics, so ownership changes hands only by assignment rather than by handing over the document. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics
Utmost good faith: The principle that each party to an insurance contract may rely on the honesty of the other, requiring truthful answers from the applicant and fair dealing from the insurer. — Completing the life application, underwriting, and delivering the policy · Taught in Insurance contract law and its unique characteristics, Insurance contract law and insurable interest
Contingent owner: A named successor owner who takes the policy if a third-party owner dies before the insured. Without one, the policy passes through the owner's estate. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance
Goodman triangle: The situation where the owner, the insured, and the beneficiary are three different people, so the death benefit is treated as a gift from the owner to the beneficiary. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance
Incidents of ownership: Rights an insured holds over a policy, such as the power to change the beneficiary, which cause the death proceeds to be included in the insured's gross estate. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance, Group life insurance conversion and contribution, Owner's rights, Group life standard provisions and conversion rights
Insured: The person whose death triggers payment of the death benefit; the insured must consent to coverage but holds no policy rights unless also the owner. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance
Key person insurance: A policy an employer applies for, owns, pays for, and is beneficiary of, insuring the life of a valuable employee whose death would harm the business. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance, Life insurance needs analysis for individuals and businesses
Third-party ownership: An arrangement in which someone other than the insured owns the life insurance policy on that insured's life. — Retirement and other life insurance concepts · Taught in Third-party ownership of life insurance, Owner's rights
Financing entity: An accredited investor that supplies the money a life settlement provider uses to buy policies. — Retirement and other life insurance concepts · Taught in Life settlements
Fraudulent viatical settlement act: Knowingly presenting false information or engaging in stranger-originated life insurance practices in connection with a settlement. — Retirement and other life insurance concepts · Taught in Life settlements
Life expectancy provider: An independent firm that estimates how long the insured will live for use in pricing. It must register with the Office of Insurance Regulation, and no broker, provider, or agent may own or work for one. — Retirement and other life insurance concepts · Taught in Life settlements
Life settlement: The sale of an existing life insurance policy by its owner to a third party for a cash payment greater than the cash surrender value but less than the death benefit. — Retirement and other life insurance concepts · Taught in Life settlements
Stranger-originated life insurance: A policy bought with the primary purpose of selling it to a third-party investor who has no insurable interest in the insured. States prohibit it, and some treat it as fraud. — Retirement and other life insurance concepts · Taught in Life settlements
Viatical settlement: The sale of a life insurance policy by an owner who is terminally or chronically ill, typically for an offer closer to the face amount because life expectancy is short. — Retirement and other life insurance concepts · Taught in Life settlements, Tax treatment of life insurance premiums, proceeds, and MECs
Viatical settlement broker: A person who represents the owner and shops the policy to buyers. In Florida the person must hold a current life agent license and be appointed by themselves. — Retirement and other life insurance concepts · Taught in Life settlements
Viatical settlement provider: The licensed buyer that enters into the settlement contract with the owner. — Retirement and other life insurance concepts · Taught in Life settlements
Viaticated policy: A policy that has been sold in a settlement transaction. — Retirement and other life insurance concepts · Taught in Life settlements
Viator: The seller in a settlement transaction, who is the policyowner and often but not always the insured. — Retirement and other life insurance concepts · Taught in Life settlements
Certificate of insurance: The document each person covered under a group policy receives as evidence of coverage, because the sponsor, not the individual, holds the master policy. It applies to group life and group health plans. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution, Group health insurance and COBRA, Group life standard provisions and conversion rights
Contributory plan: A group plan, life or health, in which members pay part of the premium, usually by payroll deduction. Insurers typically require a minimum participation percentage to guard against adverse selection. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution, Group health insurance and COBRA, Group life eligible groups, dependent coverage, and assignment of proceeds
Group contract termination: The ending of an HMO group contract, which ends coverage for everyone enrolled under it. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution
Initial enrollment period: The window when someone first eligible may enroll. For Medicare, the 7 months beginning 3 months before the month a person turns 65. For a contributory group plan, the period to join without proof of good health. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution, Medicare Parts A, B, C, and D
Late entrant: An eligible person who declines coverage during the initial enrollment period and asks to join later. The insurer may require evidence of insurability. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution
Noncontributory plan: A group plan paid entirely by the employer or sponsor, life or health. Because no member pays, insurers generally require 100 percent of eligible members to be covered, which removes the adverse-selection risk. — Retirement and other life insurance concepts · Taught in Group life insurance conversion and contribution, Group health insurance and COBRA, Group life eligible groups, dependent coverage, and assignment of proceeds
Cost basis: The after-tax money paid into a policy, annuity or plan. It comes back tax-free on distribution, and only the earnings above it are taxed. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans, Tax treatment of life insurance premiums, proceeds, and MECs
Deferred compensation: A nonqualified arrangement in which an employer promises to pay an employee a benefit in the future, taxed to the employee only when actually or constructively received. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans, Life insurance needs analysis for individuals and businesses
Defined benefit plan: A qualified pension plan that promises a stated benefit at retirement; the employer bears the investment risk. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Defined contribution plan: A qualified plan, such as profit-sharing, money purchase, stock bonus or 401(k), that promises only what the account grows to; the employee bears the investment risk. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Direct rollover: Moving retirement money trustee-to-trustee with no tax and no withholding. Every qualified plan must offer it. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Executive bonus plan: A plan in which the employer pays the life insurance premium as deductible bonus compensation to a select executive, and the bonus is taxable to the employee. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans, Life insurance needs analysis for individuals and businesses
Keogh plan: A qualified plan covering self-employed people and their employees, also called an HR-10 plan. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Nonqualified plan: A retirement arrangement that does not meet Internal Revenue Code qualification requirements, allowing design freedom and discrimination in favor of selected employees but delaying the employer's tax deduction. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Qualified joint and survivor annuity: The form in which a defined benefit plan must pay a vested married participant unless the spouse consents in writing to another form. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Qualified plan: A retirement plan that meets Internal Revenue Code requirements for coverage, participation, vesting, and nondiscrimination, earning favorable tax treatment. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Required minimum distribution: The amount a retirement account owner must withdraw each year once past the required beginning age, currently 73 or 75 depending on birth year. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Rollover: A transfer of a qualified plan distribution to another eligible plan or individual retirement arrangement within a permitted window, avoiding current taxation. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Roth IRA: An individual retirement account taking after-tax contributions, with qualified withdrawals that are tax-free. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Salary continuation plan: A nonqualified employer arrangement that continues paying a selected employee's salary, often into retirement or disability, without IRS approval. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
SEP: Simplified employee pension, a simpler employer plan funded through IRAs. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
SIMPLE plan: A simpler employer retirement plan funded through IRAs for small employers. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Split-dollar arrangement: A nonqualified arrangement in which an employer and employee share the costs and benefits of a life insurance policy. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans, Life insurance needs analysis for individuals and businesses
Vesting: The schedule on which an employee's right to employer contributions becomes nonforfeitable. Qualified plans must meet minimum vesting standards. — Retirement and other life insurance concepts · Taught in Qualified and nonqualified retirement plans
Blackout period: The gap that begins when the youngest child turns 16 and the surviving spouse's parent Social Security benefit ordinarily stops, lasting until survivor benefits can resume as early as age 60. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses, Social Security benefits
Capital liquidation: An assumption in converting an income need to a lump sum that lets survivors spend both interest and principal over a defined period, producing a smaller face amount. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Capital retention: An assumption in converting an income need to a lump sum that funds income entirely from earnings so the principal remains intact, producing a larger face amount. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Cross-purchase plan: A buy-sell funding arrangement in which each business owner personally owns a life insurance policy on each of the other owners. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Dependency period: The years from a death until the youngest child is grown and out of school, during which the family needs income. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Entity plan: A buy-sell funding arrangement in which the business itself owns a life insurance policy on each owner, rather than the owners insuring each other. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Human life value approach: A needs-analysis method that estimates a client's future earnings to retirement, subtracts self-consumption and taxes, and discounts the remainder to a present value. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Insurance gap: The amount of new coverage to recommend: total needs minus existing resources. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Needs approach: A needs-analysis method that totals immediate cash needs and ongoing income needs, then subtracts existing resources to find the coverage gap. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Present value: The value today of a future stream of income, found by discounting it at an assumed interest rate. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Readjustment period: The one or two years after a death when the family continues to receive roughly its full income while adjusting to a new standard of living. — Retirement and other life insurance concepts · Taught in Life insurance needs analysis for individuals and businesses
Currently insured: A Social Security insured status requiring at least six quarters of coverage in the thirteen-quarter period ending with the quarter of death, disability, or entitlement, supporting certain survivor benefits. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Delayed retirement credits: Permanent increases to the Social Security monthly benefit earned by delaying a claim past full retirement age, up to a cutoff age. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Disability insured: A Social Security insured status layered on fully insured status, generally requiring twenty quarters of coverage in the forty quarters ending with the quarter of disability, with relaxed rules for younger workers. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Earnings test: A rule that temporarily withholds part of a Social Security benefit claimed before full retirement age if the beneficiary's work earnings exceed an annual limit. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Family maximum: The cap on the total benefits paid to one family on a single worker's record. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Full retirement age (FRA): The age, set by year of birth, at which a worker receives an unreduced Social Security retirement benefit. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Fully insured: A Social Security insured status generally requiring one quarter of coverage for each year after 1950 or age 21 up to retirement, death, or disability; forty quarters makes the status permanent and it is the gateway to retirement benefits. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
OASDI: Old-Age, Survivors, and Disability Insurance, the cash-benefit side of Social Security funded by FICA and self-employment taxes on covered earnings. — Retirement and other life insurance concepts · Taught in Social Security benefits
Primary insurance amount: The base benefit computed from the worker's average indexed earnings, over the highest 35 years for retirement, from which all benefits are figured. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Quarters of coverage: The units of Social Security credit a worker earns from covered wages, with a maximum of four earned in any calendar year, used to determine insured status. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Spousal benefit: A Social Security benefit paid to a worker's spouse based on the worker's earnings record. — Retirement and other life insurance concepts · Taught in Social Security benefits
Substantial gainful activity: The level of work activity a worker must be unable to perform, due to a medically determinable impairment expected to last at least twelve months or result in death, to meet Social Security's strict definition of disability. — Retirement and other life insurance concepts · Taught in Social Security benefits, Social Security benefits (disability and retirement)
Survivor benefit: A Social Security benefit paid to a deceased worker's eligible survivors based on that worker's earnings record. — Retirement and other life insurance concepts · Taught in Social Security benefits
Imputed income: The taxable value of employer-provided group term life coverage above $50,000, computed from the IRS uniform premium table and included in the employee's income. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Material change: A change to a policy's benefits or terms that makes it a new contract for purposes of the 7-pay test. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Modified endowment contract (MEC): A life insurance contract that fails the 7-pay test by being overfunded, causing living distributions to be taxed income-first with a possible penalty. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Seven-pay test: A statutory test that a life insurance contract fails if cumulative premiums paid in the first seven years exceed what a seven-year paid-up policy would require, creating MEC status. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Tax-deferred: Describes growth, such as cash value in a permanent life policy or earnings in a deferred annuity, that is not taxed while it stays inside the contract. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Transfer-for-value rule: A federal tax rule that limits the income-tax exclusion of death proceeds when a policy is transferred for valuable consideration, unless a statutory exception applies. — Retirement and other life insurance concepts · Taught in Tax treatment of life insurance premiums, proceeds, and MECs
Accidental bodily injury: The broader definition of accident, also called accidental results, requiring only that the result be unintended. Modern policies almost always use it. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Worksite, hospital indemnity, short-term medical, and accident policies
Accidental means: The narrower definition of accident, requiring both the cause and the result to be unintended. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Worksite, hospital indemnity, short-term medical, and accident policies
Benefit period: The length of time disability income benefits can continue, ranging from short-term weeks or months to long-term years or a stated age. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies
Business overhead expense insurance: Disability insurance that pays a disabled business owner's rent, utilities, staff salaries, and other fixed expenses while the owner cannot work. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Tax treatment of premiums and proceeds
Disability buy-sell: Disability insurance that funds a buyout of a partner who becomes disabled. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Tax treatment of premiums and proceeds
Partial disability: A disability classification in which the insured can perform some but not all occupational duties or cannot work full time, typically paying a flat reduced benefit for a short stated period. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Recurrent disability: A provision treating a relapse within a stated period as a continuation of a prior claim, so no new elimination period applies. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Residual (partial) disability: A provision paying a reduced benefit when an insured returns to work at lower earnings than before the disability. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Disability classifications: total, partial, recurrent, and residual
Social insurance supplement rider: A rider paying a benefit until, or unless, social insurance disability benefits begin. — Types of health policies · Taught in Disability income and accidental death and dismemberment policies, Health policy riders
Basic medical expense insurance: First-dollar medical coverage with no deductible but low, stated benefit maximums for hospital, surgical, and physicians' expenses. — Types of health policies · Taught in Basic and major medical expense insurance
Coinsurance: The percentage split, such as 80/20, by which the insurer and insured share covered charges above the deductible. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Comprehensive major medical: A single policy combining basic and catastrophic protection under one deductible and one coinsurance percentage. — Types of health policies · Taught in Basic and major medical expense insurance
Coordination of benefits: A policy provision that decides which of two or more health plans covering the same person pays first and how much each contributes, so combined payments do not exceed the allowable expense. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums, Dependent children benefits, Nonduplication and coordination of benefits, Medicare supplement required provisions and enrollment periods, Medicare supplement disclosure, replacement, and standardized benefits
Corridor deductible: An amount the insured must satisfy that bridges the gap between exhausted basic plan benefits and the start of supplemental major medical benefits. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Deductible: A flat dollar amount of covered expense the insured must pay before the plan begins paying benefits. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Essential health benefits: Ten required coverage categories, such as hospitalization and maternity care, that Marketplace plans must include without annual or lifetime dollar caps. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums, Health insurance disclosure requirements
First-dollar coverage: Coverage with little or no deductible and no coinsurance, characteristic of basic plans, which however have low ceilings. — Types of health policies · Taught in Basic and major medical expense insurance
Major medical expense insurance: Broad medical coverage with a high overall maximum, a deductible, coinsurance, and a stop-loss, designed for catastrophic claims. — Types of health policies · Taught in Basic and major medical expense insurance
Relative value scale: A method that assigns each procedure a number of points that is multiplied by a conversion factor to set the surgeon's payment. — Types of health policies · Taught in Basic and major medical expense insurance
Stop-loss (out-of-pocket maximum): The point at which the insured's coinsurance payments reach a set amount, after which the plan pays remaining covered charges in full. — Types of health policies · Taught in Basic and major medical expense insurance
Supplemental (superimposed) major medical: A major medical policy layered on top of an existing basic medical plan, paying after the basic benefits are exhausted. — Types of health policies · Taught in Basic and major medical expense insurance
Surgical schedule: A list of the dollar amount the plan pays for each surgical procedure. — Types of health policies · Taught in Basic and major medical expense insurance
Usual, customary, and reasonable charge: A surgeon's payment limit based on the amount typically charged for the same service in the area. — Types of health policies · Taught in Basic and major medical expense insurance, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Balance billing: A provider charging a patient the difference between the billed amount and the plan's negotiated payment, generally avoided when using in-network preferred providers. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Capitation: A payment method in which a managed care organization pays a provider a fixed amount per enrolled member per month regardless of services used. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Concurrent review: Utilization review during care, such as monitoring the length of a hospital stay. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums, Managed care concepts
Gatekeeper: The role of a primary care physician in controlling a managed care member's access to specialist care through required referrals. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Group model: An HMO model in which the HMO contracts with one multispecialty medical group to serve its members. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Health maintenance organization (HMO): A tightly managed care structure requiring a gatekeeper primary care physician, network-only coverage, and flat copayments. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts, Health plan types and dread disease policies
Individual practice association: An HMO model in which the HMO contracts with an association of independent physicians who keep their own offices and also see non-HMO patients, an open panel. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Network model: An HMO model in which the HMO contracts with several medical groups. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Point-of-service (POS) plan: A hybrid managed care plan giving HMO-level benefits when care is coordinated through a primary care physician in-network, and reduced indemnity-style benefits for self-referral out-of-network. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts, Health plan types and dread disease policies
Preauthorization: Required insurer approval before certain non-emergency services, such as inpatient admission or surgery, that confirms medical necessity but does not guarantee payment. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Preferred provider organization (PPO): A managed care structure with no gatekeeper, allowing any provider but paying higher benefits for using preferred, discounted network providers. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts, Health plan types and dread disease policies
Primary care physician (PCP): The physician a managed care member selects who coordinates care and, in an HMO, must authorize referrals to specialists. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans
Second surgical opinion: A cost-containment tool requiring a second physician's opinion before elective surgery. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Service area: The geographic area in which an HMO's health care services are available and accessible to enrollees. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans
Staff model: An HMO model in which the HMO employs salaried physicians who work in HMO-owned facilities, a closed panel. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Utilization review: The managed care process of testing whether services are medically necessary and delivered in the right setting, through tools such as preauthorization, concurrent review, and retrospective review. — Types of health policies · Taught in Managed care structures: HMO, PPO, and POS plans, Managed care concepts
Catch-up contribution: An extra $1,000 that a person age 55 or older may add to an HSA each year. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Eligible individual: A person who may contribute to an HSA: covered by an HDHP on the first day of the month and not covered by another non-HDHP plan for the same benefits. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Flexible Spending Account (FSA): An employer-sponsored account funded mainly by employee pre-tax salary reduction for qualified medical expenses, subject to a use-or-lose rule and not portable. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Health Reimbursement Arrangement (HRA): A notional account funded solely by the employer that reimburses substantiated medical expenses tax-free, with terms set by the employer's plan. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Health Savings Account (HSA): An individually owned, portable trust or custodial account that only a qualifying HDHP enrollee may fund, with balances that roll over indefinitely. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA, Tax treatment of premiums and proceeds
High-deductible health plan (HDHP): A medical plan with a deductible and out-of-pocket maximum within federally prescribed ranges, required for HSA eligibility. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Individual coverage HRA: An HRA that reimburses an employee's premiums for individual health insurance. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Limited-purpose FSA: A flexible spending account covering only dental and vision care, so it can be used alongside an HSA. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Qualified medical expense: A medical, dental, or vision expense eligible for tax-free reimbursement from a consumer-directed health account. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Qualified small employer HRA: An HRA available to small employers that do not offer a group health plan. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Triple tax advantage: The HSA's combination of deductible or excludable contributions, tax-free growth and tax-free withdrawals for qualified medical expenses. Other withdrawals are taxed plus a 20 percent penalty, waived after death, disability or age 65. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Use-or-lose rule: The FSA feature under which amounts not spent by the end of the plan year are generally forfeited, absent a permitted grace period or carryover. — Types of health policies · Taught in Consumer-directed health accounts: FSA, HDHP/HSA, and HRA
Attained-age rating: A pricing method where the premium rises as the insured ages. — Types of health policies · Taught in Medicare supplement policies
Community rating: Pricing in which everyone covered under the same policy form pays the same premium regardless of personal characteristics such as age. States differ on whether they require it and which characteristics it reaches. — Types of health policies · Taught in Medicare supplement policies, Group health insurance and COBRA
Guaranteed renewable: A renewability feature under which the insurer must keep renewing the policy while premiums are paid and may not cancel it because of claims or worsened health, though it can raise premiums for a whole class of insureds. Medicare supplement policies must be guaranteed renewable. — Types of health policies · Taught in Medicare supplement policies, Individual and group long-term care insurance, Rights of renewability
Issue-age rating: A pricing method where the premium is set by the age at purchase and does not rise because of age. — Types of health policies · Taught in Medicare supplement policies
Medicare Advantage plan: A private plan that replaces the way Original Medicare delivers benefits, unlike a supplement, which sits alongside and pays after Original Medicare. — Types of health policies · Taught in Medicare supplement policies, Medicare Parts A, B, C, and D
Medicare Select: A Medigap policy requiring the insured to use network hospitals and sometimes network doctors, except in an emergency, to receive full benefits, in exchange for a lower premium. — Types of health policies · Taught in Medicare supplement policies
Medicare supplement (Medigap): Private insurance sold to a person already enrolled in Original Medicare that pays some or all of the deductibles, coinsurance, and copayments Medicare leaves behind. — Types of health policies · Taught in Medicare supplement policies, Medicare supplement required provisions and enrollment periods
Open enrollment: The protected window tied to Medicare eligibility during which a Medicare supplement applicant cannot be turned down or surcharged for health history. — Types of health policies · Taught in Medicare supplement policies, Medicare supplement required provisions and enrollment periods
Original Medicare: Medicare Parts A and B together, under which the government pays providers directly on a fee-for-service basis. — Types of health policies · Taught in Medicare supplement policies, Medicare Parts A, B, C, and D
Part B excess charges: What a doctor who does not accept assignment may bill above the Medicare-approved amount, which some Medigap plans pay. — Types of health policies · Taught in Medicare supplement policies
Preexisting condition: A condition for which the insured received diagnosis, care, or treatment, or that manifested itself, before the coverage's effective date. — Types of health policies · Taught in Medicare supplement policies, Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles, Replacement of health insurance, Health insurance disclosure requirements, Medicare supplement required provisions and enrollment periods
Standardized plans: Medicare supplement coverage sold under lettered plans, where every insurer offering a given letter must provide the same core benefit package. — Types of health policies · Taught in Medicare supplement policies, Medicare supplement disclosure, replacement, and standardized benefits
COBRA: The federal law generally applying to employers with 20 or more employees that lets qualified beneficiaries continue the same group health coverage temporarily at their own expense. — Types of health policies · Taught in Group health insurance and COBRA
Election period: The 60-day window a qualified beneficiary has to elect COBRA continuation coverage after being notified of a qualifying event. — Types of health policies · Taught in Group health insurance and COBRA
Experience rating: Readjusting group premiums at the end of a policy year based on the group's claims, retroactive only for that year. — Types of health policies · Taught in Group health insurance and COBRA
Health Insurance Coverage Continuation Act: Florida's mini-COBRA law, which gives employees of small employers not covered by COBRA, and their dependents, the right to continue group coverage. An employee terminated for gross misconduct is not a qualified beneficiary. — Types of health policies · Taught in Group health insurance and COBRA, Standard health policy provisions and group health eligibility
Qualified beneficiary: The covered employee, spouse, or dependent child entitled to elect COBRA continuation coverage after a qualifying event. — Types of health policies · Taught in Group health insurance and COBRA
Qualifying event: An event, such as termination of employment, divorce, or death, that triggers a qualified beneficiary's right to elect COBRA continuation coverage. — Types of health policies · Taught in Group health insurance and COBRA
Self-insured plan: A funding arrangement in which the employer pays claims from its own assets or a trust and bears the risk. It gains cash flow and freedom from state mandates through ERISA preemption but risks a large claim year. — Types of health policies · Taught in Group health insurance and COBRA
Small employer: An employer whose number of eligible employees falls within the size range state law sets for the small group health market (commonly up to 50 employees, and up to 100 in some states). An employer with fewer than 20 employees is also outside federal COBRA, so state continuation law covers its employees instead. — Types of health policies · Taught in Group health insurance and COBRA
Benefit trigger: The documented condition, such as inability to perform activities of daily living or severe cognitive impairment, that must be met before long-term care benefits begin. — Types of health policies · Taught in Individual and group long-term care insurance
Contingent nonforfeiture benefit: A benefit that applies even when a nonforfeiture benefit was declined, if the insurer later raises premiums substantially, letting the insured keep some paid-up coverage. — Types of health policies · Taught in Individual and group long-term care insurance
Custodial care: Help with activities of daily living such as bathing and dressing, which can be given by people without medical training. It is the care most long-term care claimants need, and ordinary health insurance and Medicare do not pay for it long term. — Types of health policies · Taught in Individual and group long-term care insurance
Expense-incurred benefit: A specified-disease benefit design that pays scheduled amounts for specific treatment items such as hospital days, radiation, or chemotherapy. — Types of health policies · Taught in Individual and group long-term care insurance
Inflation protection: A long-term care policy option that increases the benefit amount over time so coverage keeps pace with rising care costs. — Types of health policies · Taught in Individual and group long-term care insurance, Long-term care replacement, lapse protection, and partnership programs
Intermediate care: Occasional nursing and rehabilitative care, less than daily. — Types of health policies · Taught in Individual and group long-term care insurance
Licensed health care practitioner: A physician, licensed nurse, or other licensed professional who certifies that an insured is chronically ill. — Types of health policies · Taught in Individual and group long-term care insurance, Long-term care policy standards and terminology
Limited benefit policy: A long-term care policy that covers only nursing home care, home health care, or community-based care, not all settings. — Types of health policies · Taught in Individual and group long-term care insurance, Long-term care policy standards and terminology
Long-term care insurance: Coverage for the help people need with everyday activities when they cannot care for themselves, delivered in a nursing facility, assisted living, adult day care, or the insured's home. — Types of health policies · Taught in Individual and group long-term care insurance, Long-term care policy standards and terminology
Noncancellable: A renewability category in which the insurer must renew coverage to a stated age and the premium is fixed in the contract, so long as premiums are paid on time; the strongest position for the insured. — Types of health policies · Taught in Individual and group long-term care insurance, Rights of renewability
Partnership policy: A long-term care policy that gives dollar-for-dollar Medicaid asset protection: each dollar the policy pays lets the insured keep a dollar of assets otherwise spent down. — Types of health policies · Taught in Individual and group long-term care insurance
Severe cognitive impairment: A deficiency in short- or long-term memory, orientation, or reasoning that requires substantial supervision to protect health and safety. — Types of health policies · Taught in Individual and group long-term care insurance
Shopper's guide: A consumer guide to long-term care insurance that an insurer must deliver to the applicant. — Types of health policies · Taught in Individual and group long-term care insurance
Skilled care: Daily nursing or rehabilitation ordered by a physician and performed by or under the supervision of skilled professionals. — Types of health policies · Taught in Individual and group long-term care insurance
Tax-qualified policy: A long-term care policy meeting federal HIPAA standards, whose benefits are generally income-tax-free and whose premiums count as medical expenses up to limits. — Types of health policies · Taught in Individual and group long-term care insurance, Long-term care replacement, lapse protection, and partnership programs
Alternative benefit provision: A provision paying for the least costly professionally acceptable treatment when more than one option exists. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Annual maximum: The most a dental plan pays per person per year. It caps what the plan pays, the reverse of major medical's out-of-pocket cap on what the insured pays. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Dental HMO: A prepaid dental plan that pays its dentists a set fee per member, called capitation, and requires the member to use the assigned dentist. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Frequency limitation: A cap on how often a service is paid, such as two cleanings a year. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Health benefit plan: Florida's definition of the main medical plans subject to small-employer rules, which expressly excludes limited-benefit coverage such as dental, vision, specified-disease, accident-only, and individual hospital indemnity policies. — Types of health policies · Taught in Dental, vision, and specified-disease policies, Health plan types and dread disease policies
Missing tooth clause: A dental plan clause that may exclude replacing a tooth lost before coverage began. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Predetermination of benefits: The practice of submitting a proposed dental treatment plan to the insurer for an estimate of covered benefits before work begins. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Specified-disease (dread disease) policy: A policy that pays benefits only when the insured is diagnosed with a disease named in the contract, such as cancer. — Types of health policies · Taught in Dental, vision, and specified-disease policies, Health plan types and dread disease policies
Waiting period: A delay after enrollment before certain benefits are payable, such as dental basic or major services, to stop people buying coverage only when they already need the work. — Types of health policies · Taught in Dental, vision, and specified-disease policies
Accident-only policy: A policy that pays only for loss resulting from accidental bodily injury, excluding sickness entirely. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies
Blanket insurance: Coverage of a group whose membership keeps changing, such as students, passengers of a common carrier, sports teams or volunteer firefighters. The insured people are not named and are covered by belonging to the described class when a loss occurs. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies
Franchise insurance: An older form of worksite coverage, also called wholesale insurance, sold to individual members of a group under separate individual policies. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies
Hospital indemnity policy: A policy paying a fixed dollar amount per day or admission of hospital confinement, regardless of actual charges incurred, paid directly to the insured. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies
Short-term (limited-duration) medical policy: Individually underwritten, expense-incurred coverage for a short defined term, meant to bridge a coverage gap, and generally nonrenewable. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies, Health insurance disclosure requirements
Worksite marketing: A distribution method, not a product type, in which an insurer offers coverage to employees at the workplace, typically employee-paid through payroll deduction. — Types of health policies · Taught in Worksite, hospital indemnity, short-term medical, and accident policies
Health grace period: The window after a renewal premium due date when the premium can still be paid and the policy stays in force: 7 days for weekly, 10 days for monthly, and 31 days for all other premium modes in Florida. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Modes of premium payment, Standard health policy provisions and group health eligibility
Mandatory uniform provisions: The set of provisions every individual health policy must contain, so a buyer gets the same basic protections whatever the insurer. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Standard health policy provisions and group health eligibility
Reinstatement provision: The mandatory provision describing how a lapsed policy may be restored to force, by accepting late premium or approving a reinstatement application. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions I: entire contract, incontestability, grace period, reinstatement, Individual life contract standard provisions, Standard health policy provisions and group health eligibility
Assignment of benefits: An arrangement, usually through an optional provision, that lets the insurer pay a hospital, doctor, or other provider directly instead of the insured. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims, Owner's rights
Claim forms: The forms an insurer normally uses for proof of loss, which it must furnish within 15 days of notice; otherwise the claimant may submit written proof of the occurrence, character and extent of the loss. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims, Standard health policy provisions and group health eligibility
Facility-of-payment provision: A provision letting the insurer pay a relative or a person who advanced funeral costs when no valid beneficiary claim exists. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims
Notice of claim: The mandatory provision requiring the insured to give the insurer written notice of a covered loss within 20 days of its occurrence. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims, Standard health policy provisions and group health eligibility
Proof of loss: The substantive documentation of a claim, generally due within 90 days after the date of loss or the end of each period for periodic benefits. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims, Standard health policy provisions and group health eligibility
Time of payment of claims: The mandatory provision requiring benefits to be paid immediately upon receipt of written proof of loss, with periodic benefits paid at least monthly. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions II: claim notice, forms, proof of loss, and payment of claims, Standard health policy provisions and group health eligibility
Change of beneficiary: A provision giving the insured the right to change the beneficiary without the beneficiary's consent, unless the designation is irrevocable. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes
Illegal occupation provision: An optional provision letting the insurer deny a loss caused by the insured's commission of a felony or illegal act. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes
Intoxicants and narcotics provision: An optional provision letting the insurer deny a loss sustained while the insured was under the influence of intoxicants or narcotics not administered on a physician's advice. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes
Legal Actions provision: The mandatory provision setting the window for suing the insurer, barring suit until 60 days after proof of loss and after an outer limit commonly three years from when proof was due. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes, Standard health policy provisions and group health eligibility
Misstatement of age: A standard policy provision requiring the death benefit to be adjusted to what the premiums paid would have purchased at the insured's correct age, if the age was stated incorrectly on the application. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes
Physical Examination and Autopsy provision: The mandatory provision allowing the insurer, at its own expense, to examine the insured as often as reasonably required while a claim is pending, and to order an autopsy where not forbidden by law. — Health policy provisions, clauses, and riders · Taught in Mandatory provisions III: physical exam, legal actions, and beneficiary/occupation changes
Probationary period: A period after a specified-disease policy is issued during which a diagnosis is generally not covered, to prevent buying coverage for a condition already present. — Health policy provisions, clauses, and riders · Taught in Other provisions I: insuring clause, free look, consideration, probationary and elimination periods, Replacement of health insurance
Calendar-year deductible: A deductible met once per year. A carryover provision lets expenses in the last three months of a year count toward the next year's deductible. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Carryover provision: A provision that counts expenses in the last three months of the year toward the next year's deductible. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Copayment: A flat dollar charge the insured pays per office visit or prescription, as distinct from a percentage-based coinsurance split. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles, Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Family deductible: A deductible treated as met for the whole family once a set number of members, often two or three, have met theirs. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Out-of-pocket maximum (stop-loss): The point at which the insured's payments reach a set amount, after which the plan pays 100 percent of remaining covered expenses. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Per-cause deductible: A deductible applying separately to each illness or accident rather than once per year. — Health policy provisions, clauses, and riders · Taught in Other provisions II: waiver of premium, exclusions, preexisting conditions, coinsurance, deductibles
Allowed amount: The amount the insurer negotiated with a network provider for a service, which the provider accepts as full payment. — Health policy provisions, clauses, and riders · Taught in Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Benefit maximum: A ceiling on what a plan will pay, expressed as a scheduled amount, a per-period or per-condition limit, a visit cap, or an aggregate contract maximum. — Health policy provisions, clauses, and riders · Taught in Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Eligible expense: A charge the policy actually promises to pay toward, meaning it is a listed benefit, incurred while coverage is in force, medically necessary, and within the allowable amount. — Health policy provisions, clauses, and riders · Taught in Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Lifetime maximum: The most a policy will ever pay for one insured. Under the Affordable Care Act, major medical plans may not impose lifetime or annual dollar limits on essential health benefits. — Health policy provisions, clauses, and riders · Taught in Other provisions III: eligible expenses, copayments, preauthorization, and benefit maximums
Guaranteed issue: Coverage offered to all applicants without health questions. Worksite enrollment often uses simplified or guaranteed issue. — Health policy provisions, clauses, and riders · Taught in Health policy riders, Small employer group health requirements
Hospital confinement rider: A rider that pays a stated daily amount while the insured is a hospital inpatient. — Health policy provisions, clauses, and riders · Taught in Health policy riders
Impairment (exclusion) rider: A rider permanently excluding loss arising from a named condition or body part, letting the insurer accept an applicant it would otherwise decline. — Health policy provisions, clauses, and riders · Taught in Health policy riders
Cancellable: A renewability category in which the insurer may terminate coverage during the policy term on the notice and terms stated in the policy, and may change the premium; the weakest renewability position for the insured. — Health policy provisions, clauses, and riders · Taught in Rights of renewability
Conditionally renewable: A renewability category in which the insurer may decline renewal only for reasons stated in the policy that are unrelated to the insured's health, such as reaching a stated age; premiums may still change. — Health policy provisions, clauses, and riders · Taught in Rights of renewability
Nonrenewal: An HMO's class-level, end-of-term decision not to continue a plan or contract, distinct from cancelling an individual enrollee. — Health policy provisions, clauses, and riders · Taught in Rights of renewability
Optionally renewable: A renewability category in which the insurer must let the current term run out but may decline to renew at the renewal date for any reason, and may raise the premium. — Health policy provisions, clauses, and riders · Taught in Rights of renewability
Annual election period: October 15 through December 7, when beneficiaries can switch between Original Medicare and Medicare Advantage or change plans. — Social insurance · Taught in Medicare Parts A, B, C, and D
End-stage renal disease: A kidney condition requiring dialysis or a kidney transplant that extends Medicare entitlement to a person regardless of age. — Social insurance · Taught in Medicare Parts A, B, C, and D
General enrollment period: January 1 through March 31 each year, for those who missed their initial enrollment period. — Social insurance · Taught in Medicare Parts A, B, C, and D
Late-enrollment penalty: A statutory increase applied to a beneficiary's Part B or Part D premium for enrolling after the eligible enrollment period without other qualifying coverage. — Social insurance · Taught in Medicare Parts A, B, C, and D
MA-PD plan: A Medicare Advantage plan that bundles in Part D prescription drug coverage along with the Part A and B benefits it delivers. — Social insurance · Taught in Medicare Parts A, B, C, and D
Medicare Part A: The hospital insurance benefit of Medicare, covering inpatient hospital stays, post-hospital skilled nursing facility care, home health services, and hospice care, usually without a monthly premium for those who qualify through Medicare-taxed work. — Social insurance · Taught in Medicare Parts A, B, C, and D
Medicare Part B: The voluntary supplementary medical insurance benefit of Medicare, covering physician services, outpatient care, diagnostic tests, durable medical equipment, and preventive services, paid for with a monthly premium and subject to a deductible and coinsurance. — Social insurance · Taught in Medicare Parts A, B, C, and D
Medicare Part C (Medicare Advantage): A Medicare delivery route, not a separate set of benefits, in which private organizations contract with Medicare to furnish at least Part A and Part B benefits, often with extra benefits, through a managed-care or other approved plan. — Social insurance · Taught in Medicare Parts A, B, C, and D
Medicare Part D: The voluntary outpatient prescription drug benefit of Medicare, delivered only through private plans, either a standalone drug plan added to Original Medicare or the drug portion of a Medicare Advantage plan. — Social insurance · Taught in Medicare Parts A, B, C, and D
Prescription drug plan: A stand-alone Part D plan added to Original Medicare. — Social insurance · Taught in Medicare Parts A, B, C, and D
Children's Health Insurance Program: A companion program for uninsured children in families that earn too much for Medicaid. — Social insurance · Taught in Medicaid
Dual eligible: A person enrolled in both Medicare and Medicaid; Medicaid may pay that person's Medicare premiums, deductibles, and coinsurance and cover services Medicare excludes. — Social insurance · Taught in Medicaid
EPSDT: Early and Periodic Screening, Diagnostic and Treatment, a mandatory Medicaid benefit for screening and treating children. — Social insurance · Taught in Medicaid
Estate recovery: The requirement that states seek repayment from a deceased Medicaid recipient's estate for certain amounts the program paid on the recipient's behalf. — Social insurance · Taught in Medicaid
Express Lane eligibility: A state option to rely on eligibility findings from another public program to enroll children in Medicaid or CHIP, with the family's consent. — Social insurance · Taught in Medicaid
Look-back period: The statutory window before a Medicaid application during which asset transfers made for less than fair market value are reviewed and can trigger a penalty period of ineligibility. — Social insurance · Taught in Medicaid
Mandatory eligibility groups: The categories of low-income applicants, such as children, pregnant women, and the aged, blind, and disabled, that federal law requires every state Medicaid program to cover. — Social insurance · Taught in Medicaid
Medicaid: The jointly funded federal-state medical assistance program under Title XIX of the Social Security Act that pays for medical care for people with limited income and resources, based on financial need rather than earned coverage. — Social insurance · Taught in Medicaid
Medically needy: An optional Medicaid category allowing an applicant whose income is too high to qualify to become eligible by incurring medical expenses that reduce countable income to the state's eligibility level, a process called spend-down. — Social insurance · Taught in Medicaid
Payer of last resort: Medicaid pays after every other legally responsible source: private insurers pay first, and for a dual eligible Medicare pays first. — Social insurance · Taught in Medicaid
Spend down: Using income or savings to pay for medical or long-term care until they fall to Medicaid's limit, after which Medicaid can cover the remainder. — Social insurance · Taught in Medicaid
Spousal impoverishment protection: Federal rules that shield a portion of a couple's income and resources for the spouse who remains at home when the other spouse enters a nursing facility and applies for Medicaid. — Social insurance · Taught in Medicaid
State plan: A state's federally approved plan for administering its Medicaid program, under which the state receives a matching share of its expenditures from the federal government. — Social insurance · Taught in Medicaid
Continuing disability review: A periodic review judging whether a beneficiary's disability continues, on a neutral basis. — Social insurance · Taught in Social Security benefits (disability and retirement)
Social Security disability insurance: The Social Security program paying the worker's full unreduced PIA after a five full month waiting period, ending at death, recovery or full retirement age, with Medicare beginning after 24 months of benefits. — Social insurance · Taught in Social Security benefits (disability and retirement)
Supplemental Security Income: A federal needs-based program for the aged, blind and disabled; most recipients qualify for Medicaid. — Social insurance · Taught in Social Security benefits (disability and retirement)
Trial work period: A period that lets a disability beneficiary test a return to work without losing benefits, with reinstatement if work later ends. — Social insurance · Taught in Social Security benefits (disability and retirement)
Split definition: A total disability definition, also called modified own-occupation, that uses own occupation for an initial period and then any occupation afterward. — Other health insurance concepts · Taught in Disability classifications: total, partial, recurrent, and residual
Birthday rule: A common order-of-benefit rule for a dependent child of married or cohabiting parents under which the plan of the parent whose birthday falls earlier in the calendar year pays first. — Other health insurance concepts · Taught in Dependent children benefits, Nonduplication and coordination of benefits
Creditable coverage: Prior health coverage that counts for a legal purpose, such as reducing a preexisting condition exclusion under HIPAA's original rules or showing no long gap in coverage. — Other health insurance concepts · Taught in Dependent children benefits, Medicare supplement required provisions and enrollment periods
Dependent child: A natural, step or adopted child covered under a family health plan. The law and the plan set when coverage ends at a limiting age, commonly 26 for medical coverage, and what happens to a child who cannot support themselves. — Other health insurance concepts · Taught in Dependent children benefits
Disabled dependent child: An unmarried child of any age who stays covered as a dependent if incapable of self-sustaining employment because of mental illness, developmental disability or physical handicap that began before the limiting age. — Other health insurance concepts · Taught in Dependent children benefits
Limiting age: The age at which a dependent child's coverage under a plan normally ends, subject to extensions for full-time students or children incapable of self-support. — Other health insurance concepts · Taught in Dependent children benefits
Newborn coverage: A required provision under which a policy covering the insured's family covers a newborn child from the moment of birth, including congenital defects, birth abnormalities, and prematurity, without a waiting period. Keeping the child covered beyond the first weeks may require notice to the insurer and any added premium. — Other health insurance concepts · Taught in Dependent children benefits
Primary plan: Under coordination of benefits, the health plan that pays first and in full as if no other coverage existed, applying its own deductible, coinsurance, and limits. — Other health insurance concepts · Taught in Dependent children benefits, Nonduplication and coordination of benefits
Direct billing: A payment method where the insurer sends a premium notice and the owner pays it. — Other health insurance concepts · Taught in Modes of premium payment
Modal factor: A small percentage loading the insurer applies to each installment of a more frequent mode to cover added billing expense, lost investment earnings, and higher lapse risk. — Other health insurance concepts · Taught in Modes of premium payment
Payroll deduction: A payment method where the employer withholds the premium from the employee's pay, common in group and worksite coverage. — Other health insurance concepts · Taught in Modes of premium payment
Pre-authorized check: A payment method where the premium is taken automatically from the owner's bank account, commonly used for monthly mode to reduce missed payments. Also called an automatic bank draft. — Other health insurance concepts · Taught in Modes of premium payment
Nonduplication of benefits: A provision stating that a secondary plan will not pay a benefit already paid by another plan; it pays only what it would have paid on its own minus what the primary plan already paid, sometimes nothing. — Other health insurance concepts · Taught in Nonduplication and coordination of benefits
Order of benefit determination: The sequence of rules that decides which plan is primary: employee before dependent, the birthday rule, custodial parent rules for divorced parents, active before laid-off or retired, COBRA secondary, and longer coverage. — Other health insurance concepts · Taught in Nonduplication and coordination of benefits
Overinsurance: Coverage that could pay an insured more than the actual loss or earnings, which weakens the incentive to avoid a claim. Overlapping policies can cause it, and disability insurers cap the monthly benefit at about 60 to 70 percent of earned income to prevent it. — Other health insurance concepts · Taught in Nonduplication and coordination of benefits
Secondary plan: The plan that pays second, covering some or all of what remains but never more than it would have paid as primary. — Other health insurance concepts · Taught in Nonduplication and coordination of benefits
Non-occupational coverage: Accident and health coverage that pays only for injury or sickness unrelated to employment, excluding on-the-job losses that are expected to be covered by a work-injury system such as workers' compensation. — Other health insurance concepts · Taught in Occupational versus non-occupational classification
Occupational coverage: Accident and health coverage, also called 24-hour coverage, that pays for a covered injury or sickness whether it happens on or off the job. — Other health insurance concepts · Taught in Occupational versus non-occupational classification
Workers' compensation: A statutory, no-fault insurance system that pays medical, income, death and burial, and rehabilitation benefits to employees injured, disabled, or killed arising out of and in the course of employment, including occupational disease. — Other health insurance concepts · Taught in Occupational versus non-occupational classification, Workers' compensation
Dismemberment benefit: A benefit for the permanent loss or loss of use of a body part or permanent disfigurement, with the amount set by the nature of the injury rather than time off work. It is tax-free even when the employer paid. — Other health insurance concepts · Taught in Tax treatment of premiums and proceeds
Itemized medical expense deduction: The way an individual may deduct medical premiums and expenses, limited to the part of qualifying medical expenses above 7.5 percent of adjusted gross income. — Other health insurance concepts · Taught in Tax treatment of premiums and proceeds
Key person disability insurance: Coverage owned, paid for and collected by the business on an employee whose skills drive profits. Benefits offset lost profits and pay to recruit and train a replacement; premiums are not deductible and benefits are tax-free. — Other health insurance concepts · Taught in Tax treatment of premiums and proceeds
Self-employed health insurance deduction: An adjustment to income that lets self-employed people generally deduct health insurance premiums for themselves, a spouse, and dependents. Disability income premiums remain nondeductible. — Other health insurance concepts · Taught in Tax treatment of premiums and proceeds
Case management: Coordinating care for expensive, long-term conditions to control cost and quality. — Other health insurance concepts · Taught in Managed care concepts
Exclusive provider organization: A PPO-like plan with no gatekeeper but no out-of-network benefit, covering only network care except emergencies. — Other health insurance concepts · Taught in Managed care concepts, Health plan types and dread disease policies
Managed care: An arrangement that combines paying for health care with controlling how it is delivered, through provider networks, primary care gatekeepers, referrals, utilization review, case management and preventive care. — Other health insurance concepts · Taught in Managed care concepts
Nonparticipating provider: A provider with no contract with the plan, whose care is covered less or not at all. — Other health insurance concepts · Taught in Managed care concepts
Participating provider: A physician or other provider under contract with an HMO or other network plan to treat its enrollees at agreed rates. The contract limits what the provider may bill the enrollee, and state law sets deadlines for paying the provider's claims. — Other health insurance concepts · Taught in Managed care concepts
Prospective review: Utilization review before care, such as preauthorization or precertification of a hospital stay or surgery. — Other health insurance concepts · Taught in Managed care concepts
Retrospective review: Utilization review after care is given, by examining claims and records to decide whether the care was medically necessary. — Other health insurance concepts · Taught in Managed care concepts
Employers liability (Part Two): The second part of a workers' compensation policy, written with dollar limits, that pays damages when an employee's work-related injury falls outside the compensation statute and the employer is sued directly. — Other health insurance concepts · Taught in Workers' compensation
Exclusive remedy: The workers' compensation principle that, in exchange for prompt statutory benefits, an employee generally gives up the right to sue the employer for damages over a covered injury. — Other health insurance concepts · Taught in Workers' compensation
Extraterritorial coverage: Coverage for an employee temporarily working outside the home state who is injured there. — Other health insurance concepts · Taught in Workers' compensation
Judge of compensation claims: The Florida official before whom contested workers' compensation claims are heard. — Other health insurance concepts · Taught in Workers' compensation
Monopolistic state fund: A state fund that is the only permitted source of workers' compensation coverage, as in North Dakota, Ohio, Washington and Wyoming. — Other health insurance concepts · Taught in Workers' compensation
No-fault: A workers' compensation principle under which an injured worker need only show the injury is work-related, without proving the employer was negligent. — Other health insurance concepts · Taught in Workers' compensation
Double recovery: Being paid twice for the same loss, once by one's own insurer and again by the party at fault; subrogation exists to prevent this. — Other health insurance concepts · Taught in Subrogation
Made-whole doctrine: A rule in some states that the insured must be fully compensated for the loss before the insurer recovers through subrogation. The exact rules vary by state and plan type. — Other health insurance concepts · Taught in Subrogation
Subrogation: The right of an insurer that has paid a covered loss to step into the insured's place and pursue recovery from the party responsible for the loss, up to the amount it paid. — Other health insurance concepts · Taught in Subrogation
Subrogation lien: A claim an insurer asserts against the insured's recovery from an at-fault party for the benefits it already paid. — Other health insurance concepts · Taught in Subrogation
Fair Credit Reporting Act: The federal law requiring consumer reporting agencies to handle credit, personnel and insurance information with confidentiality, accuracy, relevancy and proper use, and fairly to the consumer. — Field underwriting procedures · Taught in Completing the health insurance application, Sources of insurability and HIPAA privacy disclosures
Misrepresentation: An unfair trade practice under state insurance law: an untrue statement of material fact, a misleading half-truth, a misstatement of law, or a failure to disclose a legally required fact about a policy. — Field underwriting procedures · Taught in Completing the health insurance application, Insurance contract law and insurable interest, Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
Covered entity: A term whose meaning depends on the law. Under the federal HIPAA Privacy Rule, a health plan, health care clearinghouse or health care provider. Under New York's Part 500 cybersecurity rule, any person licensed under its Insurance, Banking or Financial Services Law, who must keep a risk-based cybersecurity program. — Field underwriting procedures · Taught in Sources of insurability and HIPAA privacy disclosures
Notice of Privacy Practices: The notice health plans and providers must generally give individuals, describing how their information is used and their rights to see records and request corrections. — Field underwriting procedures · Taught in Sources of insurability and HIPAA privacy disclosures
Protected health information: Individually identifiable health information held by a HIPAA covered entity. It may not be released for life insurance underwriting without the individual's written authorization. — Field underwriting procedures · Taught in Sources of insurability and HIPAA privacy disclosures
Commingling: Mixing premiums or claim money, which a producer holds in a fiduciary capacity for the insurer or consumer, with personal or general operating funds. — Field underwriting procedures · Taught in Initial premium collection and receipt consequences
Statement of good health: A declaration obtained at policy delivery confirming the applicant's health is unchanged from what the application described, required when no premium was collected with the application. — Field underwriting procedures · Taught in Initial premium collection and receipt consequences, Policy delivery and explaining the contract
Twisting: Making false or misleading statements or comparisons to induce a person to lapse, surrender, or convert existing insurance; an unfair trade practice under state insurance law. — Field underwriting procedures · Taught in Replacement of health insurance, Unfair trade practices III: twisting, churning, rebating, and concealment
Chief Financial Officer: The elected Florida Cabinet officer who heads the Department of Financial Services. — Florida statutes, rules, and regulations common to all lines · Taught in Florida insurance regulators: CFO, Financial Services Commission, OIR, and OFR
Department of Financial Services: The name some states give the agency that oversees insurance, and its duties vary. New York's, headed by the Superintendent, regulates insurance and banking. Florida's, headed by the elected Chief Financial Officer, houses agent licensing and discipline. — Florida statutes, rules, and regulations common to all lines · Taught in Florida insurance regulators: CFO, Financial Services Commission, OIR, and OFR
Financial Services Commission: The Governor and Cabinet acting collegially as agency head. It adopts insurance rules and appoints the directors of its two offices, OIR and OFR. — Florida statutes, rules, and regulations common to all lines · Taught in Florida insurance regulators: CFO, Financial Services Commission, OIR, and OFR
Office of Financial Regulation: The Financial Services Commission's other office, which regulates state-chartered banks, credit unions, finance companies, and securities, not insurers. — Florida statutes, rules, and regulations common to all lines · Taught in Florida insurance regulators: CFO, Financial Services Commission, OIR, and OFR
Office of Insurance Regulation: The office under the Financial Services Commission that reviews and approves policy forms and rates, and licenses, examines, and monitors insurers, but does not license individual agents. — Florida statutes, rules, and regulations common to all lines · Taught in Florida insurance regulators: CFO, Financial Services Commission, OIR, and OFR
Alien insurer: An insurer organized under the laws of another country, such as a Swiss or Japanese insurer, which is alien in every state. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Attorney-in-fact: The person or firm that manages a reciprocal insurer on behalf of its subscribers. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Authorized insurer: An insurer holding a certificate of authority or license from a state's insurance regulator to transact insurance in that state, also called admitted. An insurer without one is unauthorized. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Certificate of authority: The authorization an insurance company must hold from a state's insurance regulator to do the business of insurance in that state; a company holding one is described as authorized or admitted. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Domestic insurer: An insurer organized under the laws of the state in question. Domicile is judged from the viewpoint of the state you are standing in. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Foreign insurer: An insurer organized under the laws of another U.S. state. An Ohio insurer is domestic in Ohio and foreign in every other state. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Fraternal benefit society: A lodge-system membership organization that writes life and health benefits for its members. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Lines of insurance: The groupings of kinds of insurance that the Financial Services Commission adopts by rule, consistent with NAIC reporting requirements. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Lloyd's association: Individual underwriters or syndicates who join under a common name, each accepting a share of a risk through an attorney-in-fact and liable only for the share agreed. The members, not Lloyd's itself, insure the risk. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Mutual company: An insurer owned by its policyholders rather than by outside shareholders. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Reciprocal (interinsurance) exchange: An organization in which subscribers insure one another through an attorney-in-fact rather than through a traditional insurance company. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Risk retention group: A liability insurer owned by members in the same industry or profession, who pool their own liability risk. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Self-insurer: An employer or group that retains its own risk instead of buying a policy. Florida lets employer groups self-insure workers' compensation collectively, with members staying liable for premiums and assessments. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Stock company: An insurer organized as a corporation owned by its shareholders. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Surplus lines agent: A licensed agent who places coverage with a nonadmitted insurer when the admitted market will not write it. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions, Licensing: purpose, license types, appointments, and requirements
Unauthorized insurer: An insurer with no certificate of authority or license to do business in the state, also called nonadmitted. It generally may not deal with the public there except through a licensed surplus lines agent or broker, and helping it otherwise is generally prohibited. — Florida statutes, rules, and regulations common to all lines · Taught in Insurance entity definitions
Appointment: An insurer's own authorization, filed with the state insurance department, letting a licensed producer act as its agent; it is separate from and in addition to the producer's license. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Customer representative: A licensee whose license covers the same classes the appointing general lines agent or agency is currently authorized to transact. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
General lines agent: A licensee for all property, marine, casualty, and surety lines, which also covers health insurance. Bail bonds need a separate license under chapter 648. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Health agent: A licensee for all kinds of health insurance, which may not be limited to one class except a limited travel insurance license. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
License: A grant of authority from a state insurance department letting a person transact the lines of insurance business it names. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Life agent: A licensee for all classes of life insurance, except a limited credit insurance license. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Limited or specialty license: A producer license authorizing only a narrow, defined class of insurance business, such as small-face-amount funeral life insurance or credit-related coverage, rather than a full line of authority. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Nonresident agent: A person licensed in a home state who is also licensed in Florida. On moving to Florida the agent has up to 90 days to become a resident licensee. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Personal lines agent: A licensee limited to property and casualty insurance sold to individuals and families for noncommercial purposes. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Temporary license: A limited, short-term license some states issue. Each state sets who qualifies and how long it lasts, and one use is keeping a book of business alive after a licensee's death, disability or military service. — Florida statutes, rules, and regulations common to all lines · Taught in Licensing: purpose, license types, appointments, and requirements
Continuing education: Coursework a licensed producer must complete each renewal period, usually including an ethics component, as a condition of keeping the license in force. Each state sets the hours and topics. — Florida statutes, rules, and regulations common to all lines · Taught in Maintaining a license: continuing education, recordkeeping, and disciplinary actions
Disciplinary action: The Department's ability to deny an application, or to suspend, revoke, or refuse to renew a license or appointment, under sections 626.611 and 626.621. Discipline of a surplus lines agent affects all other licenses the person holds. — Florida statutes, rules, and regulations common to all lines · Taught in Maintaining a license: continuing education, recordkeeping, and disciplinary actions
Update course: The 4-hour license-specific course required each cycle, covering insurance law updates, ethics, disciplinary trends, industry trends, premium discounts, and suitability. Title insurance agents are exempt. — Florida statutes, rules, and regulations common to all lines · Taught in Maintaining a license: continuing education, recordkeeping, and disciplinary actions
Insurance agent: A licensed producer who represents one or more insurers and acts on their behalf. In most states an agent must also be appointed by each insurer it represents. — Florida statutes, rules, and regulations common to all lines · Taught in Agent responsibilities: fiduciary capacity, compensation, and ethics
Surplus lines service fee: A fee of up to 0.3 percent of gross premium collected by the Florida Surplus Lines Service Office and paid by the insured, which the surplus lines agent holds in a fiduciary capacity. — Florida statutes, rules, and regulations common to all lines · Taught in Agent responsibilities: fiduciary capacity, compensation, and ethics
Assessment: A charge a state guaranty association levies on member insurers, usually after an insolvency, to pay covered claims. Some states let insurers recover it through policyholder surcharges. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Florida Insurance Guaranty Association: The nonprofit association that pays covered property and casualty claims of an insolvent member insurer, up to statutory limits. It is funded by assessments on member insurers and may never be used as a sales tool. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Life and Health Insurance Guaranty Association: The Florida association protecting policyholders of insolvent life and health insurers and annuity providers, administered through three accounts. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Member insurer: An insurer that, as a condition of being licensed in a state to write life, health, accident, or annuity business there, must belong to that state's guaranty association. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Plan of operation: The plan the association submits to the Department, which sets out how claims are filed and proved and how the board operates. It takes effect only with the Department's written approval. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Reconciliation report: A report an insurer files showing what it paid the association and what it actually collected from policyholders. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Workers' Compensation Insurance Guaranty Association: The Florida association that pays workers' compensation claims of insolvent insurers, created from FIGA's former workers' compensation account and the self-insurance fund guaranty association. — Florida statutes, rules, and regulations common to all lines · Taught in Florida Insurance Guaranty Association
Boycott, coercion, or intimidation: Agreeing, or acting in concert, to boycott, coerce, or intimidate in a way that unreasonably restrains or monopolizes the business of insurance. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
Defamation: An unfair trade practice under state insurance law: making or circulating false or maliciously critical statements about an insurer or anyone in the business of insurance, intended to injure its reputation or business. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
False advertising: An unfair trade practice under state insurance law: untrue, deceptive, or misleading statements about insurance made to the public in print, mail, broadcast, online, or any other medium. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
Sliding: Adding coverage the customer did not knowingly agree to, such as claiming it is required by law or included in the coverage requested when it is not. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
Unfair or deceptive act: Conduct prohibited by a state's unfair trade practices law that misleads, misrepresents, or otherwise treats a consumer unfairly in the business of insurance. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices I: sliding, coercion, misrepresentation, defamation, false advertising
Anti-fraud unit: A designated unit, or a contractor, that every Florida admitted insurer must have to investigate and report possible fraud by insureds or claimants. It requires a plan and a designated responsible employee. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Controlled business: Insurance a licensee writes on their own life, property or interests, or those of relatives, an employer or a business they control. Some is lawful, but a license may not be obtained or used principally to write it. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Controlled insurer: A property and casualty insurer subject to a controlling producer's placements, which must keep an audit committee of independent directors to review its loss reserves. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Controlling producer: A producer whose gross written premiums with a controlled property and casualty insurer reach 5 percent of the insurer's admitted assets, triggering rules such as a board-approved written contract and fiduciary handling of funds. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Unfair claim settlement practice: A violation of state claims-handling law, such as failing to settle a claim promptly and fairly once liability is reasonably clear, or refusing to pay without a reasonable investigation. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Unfair discrimination: Charging different rates or offering different terms to individuals of the same class and essentially the same expectation of life or hazard; prohibited under state insurance law. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Unfair Insurance Trade Practices Act: Florida's law defining and prohibiting unfair methods of competition and unfair or deceptive acts in the business of insurance. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices II: unfair discrimination, claims practices, fraud, and controlled business
Rebating: Giving, offering, or promising anything of value not stated in the policy as an inducement to buy, keep, or renew insurance; prohibited whether offered or knowingly accepted. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices III: twisting, churning, rebating, and concealment
Rebating schedule: A schedule filed with the insurer under section 626.572 that lets an agent rebate part of a commission, applied uniformly to every insured in the same actuarial class. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices III: twisting, churning, rebating, and concealment
Surplus lines premium tax: A 4.94 percent tax a surplus lines agent must collect from the insured. The agent may not absorb it or rebate it. — Florida statutes, rules, and regulations common to all lines · Taught in Unfair trade practices III: twisting, churning, rebating, and concealment
Best interest standard: The duty of a producer recommending an annuity, and in some states life insurance, to act in the consumer's best interest, based on the consumer's profile information. It is a standard of conduct, not a guarantee of outcome. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Career agency system: A distribution system in which agents represent primarily one insurer, recruited, trained, and supported through that insurer's offices. Also called captive or exclusive agency. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Direct response marketing: Selling by mail, print, broadcast, telephone, or internet, often to a group or association's members, with no agent meeting the buyer face to face. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Independent agency system: Agents represent several insurers, and the agent, not the insurer, owns the expirations: the renewal records and client list. Also called the American agency system. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Inducement: Anything of value not specified in the contract offered to persuade someone to buy, which is an unlawful rebate, subject to exceptions such as fair surplus bonuses and payroll-deduction rate savings. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Personal-producing general agent: An experienced independent producer who contracts directly with an insurer and is paid mainly on their own sales. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Value-added product or service: A benefit, such as financial wellness education, post-loss services, or healthy-behavior incentives, that Florida lets life insurers and agents offer if the cost is reasonable relative to the premium. — Florida statutes pertinent to life and annuity insurance · Taught in Life and annuity marketing methods and practices
Annuity suitability: Florida's requirement in section 627.4554 that a recommended annuity have a reasonable basis grounded in the consumer's actual profile information. For a replacement, the agent must weigh surrender charges, lost benefits, higher fees, net benefit, and any replacement in the prior 60 months. — Florida statutes pertinent to life and annuity insurance · Taught in Policy or contract replacement duties
Standard policy provisions: The contract terms state law requires in life insurance policies, including the grace period, incontestability, reinstatement, and misstatement of age, which apply regardless of how the policy credits interest. — Florida statutes pertinent to life and annuity insurance · Taught in Individual life contract standard provisions
Fixed-period option: A settlement option paying principal plus interest in equal installments over a chosen number of years. — Florida statutes pertinent to life and annuity insurance · Taught in Individual life nonforfeiture options and policy settlement
Interest-only option: A settlement option where the insurer keeps the principal and pays interest, with the principal paid out later. — Florida statutes pertinent to life and annuity insurance · Taught in Individual life nonforfeiture options and policy settlement
Life income option: A settlement option paying for the payee's lifetime, including straight life, life with period certain, life with refund, and joint and survivor. — Florida statutes pertinent to life and annuity insurance · Taught in Individual life nonforfeiture options and policy settlement
Net single premium: The one-time premium, based on the insured's age, that the cash value is used to buy reduced paid-up insurance. — Florida statutes pertinent to life and annuity insurance · Taught in Individual life nonforfeiture options and policy settlement
Conversion on termination of eligibility: A conversion right when a person's coverage ends because they leave the job or eligible class. — Florida statutes pertinent to life and annuity insurance · Taught in Group life standard provisions and conversion rights
Conversion on termination of the policy: A usually more limited conversion right when the whole group policy ends, often for people insured several years and for a smaller maximum amount. — Florida statutes pertinent to life and annuity insurance · Taught in Group life standard provisions and conversion rights
Debtor group: A group where a creditor insures its debtors, usually for the amount owed. Florida's payment-of-benefits, certificate, and conversion provisions do not apply to it. — Florida statutes pertinent to life and annuity insurance · Taught in Group life standard provisions and conversion rights
Standard group life provisions: The provisions Florida requires in substance in a group life policy under sections 627.559 to 627.568, including grace period, incontestability, statements as representations, insurability, misstatement of age, payment of benefits, and certificate. — Florida statutes pertinent to life and annuity insurance · Taught in Group life standard provisions and conversion rights
Association group: A group made up of the members of a qualifying association. State law sets what qualifies, and the association must generally exist for a purpose other than buying insurance. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Credit union group: A group of the members of a credit union. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Dependent coverage: Coverage of a spouse and dependent children, usually smaller and fixed in amount and payable to the insured member, ending when dependency ends. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Employee group: A group of the employees of one employer, the most common group life group. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Group policyholder: The employer, union, association, or trustee to which a group master policy is issued. The policyholder does not name the beneficiary of members' coverage. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Labor union group: A group of the members of a labor union. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Trustee group: A group formed through a trust fund set up by employers or unions to insure their employees or members. — Florida statutes pertinent to life and annuity insurance · Taught in Group life eligible groups, dependent coverage, and assignment of proceeds
Group health insurance: Coverage of many people under one master contract issued to the policyholder, usually an employer, with each employee receiving a certificate. The group, not the individual, is underwritten, and timely enrollees usually need no evidence of insurability. — Florida statutes pertinent to health insurance · Taught in Standard health policy provisions and group health eligibility
Small employer health alliance: A group type listed in Florida's group health part, addressed together with labor union and association groups. — Florida statutes pertinent to health insurance · Taught in Standard health policy provisions and group health eligibility
Special enrollment period: A window outside annual open enrollment during which a person may enroll in a Marketplace plan after a qualifying life event such as marriage or loss of coverage. — Florida statutes pertinent to health insurance · Taught in Standard health policy provisions and group health eligibility
Division of Consumer Services: The part of the Department of Financial Services where consumers can send inquiries and complaints. Insurers offering behavioral health coverage must publish its contact information and send an annual notice. — Florida statutes pertinent to health insurance · Taught in Health insurance disclosure requirements
Guaranteed enrollment after group coverage: A second guaranteed window of 2 months after termination of coverage under a group health policy, with the same treatment as open enrollment. — Florida statutes pertinent to health insurance · Taught in Medicare supplement required provisions and enrollment periods
Medicare eligible expense: An expense covered by Medicare, which a Medigap policy may not define more restrictively than Medicare does. — Florida statutes pertinent to health insurance · Taught in Medicare supplement required provisions and enrollment periods
Medicare Supplement Buyer's Guide: The guide that must accompany a Medigap policy, developed jointly by the NAIC and the federal Health Care Financing Administration, now CMS. — Florida statutes pertinent to health insurance · Taught in Medicare supplement required provisions and enrollment periods, Medicare supplement disclosure, replacement, and standardized benefits
Cognitive impairment: A deficiency in short- or long-term memory, orientation as to person, place and time, deductive or abstract reasoning, or judgment as it relates to safety awareness. — Florida statutes pertinent to health insurance · Taught in Long-term care policy standards and terminology, Long-term care replacement, lapse protection, and partnership programs
Home health care benefits: Long-term care benefits that Florida bars from requiring skilled nursing need, nurse-only care, an acute condition first, or Medicare-certified providers, and may not exclude personal care by a home health aide or adult day care. — Florida statutes pertinent to health insurance · Taught in Long-term care policy standards and terminology
Lapse protection: Protections against unintended lapse: a third-party designee to receive notice, advance written notice and time to pay, and reinstatement after a lapse caused by cognitive impairment or loss of functional capacity. — Florida statutes pertinent to health insurance · Taught in Long-term care replacement, lapse protection, and partnership programs
Long-term care partnership: A program joining a state Medicaid program and private insurers, expanded nationally by the Deficit Reduction Act of 2005, in which a qualified policy gives dollar-for-dollar asset protection. — Florida statutes pertinent to health insurance · Taught in Long-term care replacement, lapse protection, and partnership programs
Qualified partnership policy: A tax-qualified long-term care policy with age-based inflation protection that disregards a dollar of the insured's assets for each dollar of benefits paid when the insured applies for Medicaid. — Florida statutes pertinent to health insurance · Taught in Long-term care replacement, lapse protection, and partnership programs
Third-party designee: A person, such as an adult child, whom the applicant may name to receive notice before the long-term care policy lapses for nonpayment. — Florida statutes pertinent to health insurance · Taught in Long-term care replacement, lapse protection, and partnership programs
Composite rating: A rating method that sets one blended rate for the group, which Florida bars for employers with fewer than 10 employees. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Employee Health Care Access Act: Florida's small employer health law, section 627.6699, which lets small employers buy group health coverage without being turned away or priced out because of employee health. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Late enrollee: A person who enrolls in a group plan after first becoming eligible; under HIPAA's original rules their exclusion could last up to 18 months. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Minimum employer contribution: A rule a carrier may set requiring the employer to pay a minimum share of the premium, applied uniformly and varied only by group size. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Modified community rating: A premium method using only the age, gender, family composition, tobacco use, and geographic area of employees and dependents. Rates are locked for 12 months, experience adjustments are capped, and area boundaries follow county lines. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Small employer carrier: An insurer that writes health benefit plans for small employers and is subject to the state's small employer market rules while it participates in that market. — Florida statutes pertinent to health insurance · Taught in Small employer group health requirements
Florida Healthy Kids Corporation: A private not-for-profit corporation, chaired by the Chief Financial Officer or designee, created to provide comprehensive health coverage to children, mainly school-age children at or below 300 percent of the federal poverty level who do not qualify for Medicaid. It is not an insurer. — Florida statutes pertinent to health insurance · Taught in Florida Healthy Kids Corporation and HIV/AIDS testing requirements
Medical loss ratio: The share of premium an insurer spends on medical care and quality improvement. The ACA minimums are 80 percent for individual and small group and 85 percent for large group, measured over three years, with a rebate to policyholders if missed. — Florida statutes pertinent to health insurance · Taught in Florida Healthy Kids Corporation and HIV/AIDS testing requirements
Payor of last resort: The position of a Healthy Kids contracted insurer: its coverage is secondary to any other available private coverage. — Florida statutes pertinent to health insurance · Taught in Florida Healthy Kids Corporation and HIV/AIDS testing requirements
Continuity of care: A provision allowing an enrollee to keep receiving ongoing treatment from a provider for a limited period after that provider leaves the HMO's or other plan's network, typically during a pregnancy or a serious ongoing illness. — Florida statutes pertinent to health insurance · Taught in Health plan types and dread disease policies
Fee-for-service plan: A traditional indemnity plan where the insured may see any licensed provider and the insurer reimburses covered expenses after a deductible, then shares costs through coinsurance up to an out-of-pocket limit. — Florida statutes pertinent to health insurance · Taught in Health plan types and dread disease policies
Health Maintenance Organization Consumer Assistance Plan: The Florida plan to which a new HMO must pay a special assessment before the Office of Insurance Regulation issues its certificate. The assessment is not an HMO asset. — Florida statutes pertinent to health insurance · Taught in Health plan types and dread disease policies
Step therapy: A protocol requiring a cheaper drug first. A Florida HMO may not require it for a covered drug the subscriber was already approved for through another plan's step therapy and paid for. — Florida statutes pertinent to health insurance · Taught in Health plan types and dread disease policies

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