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Frequently Ask Questions pertaining to life and health insurance:here we will give you the terms you need to know and can understand in plain English,not legal jargon, so you can comprehend what each term means.
What is a Deductible?
Answer: A deductible is the amount of money you would have to pay before any insurer pays your claims. Ex: you go to a medical provider and say your deductible is $2,000 dollars; before the insurance company pays any of your claims/bills you would have to meet the deductible first not unless your plan has co-payments.
What is Co-Insurance?
Answer: Co-Insurance- Is the amount of money you would pay after you have met your deductible. Ex: after you meet your $2,000 dollar deductible, then the insurance company will split the difference depending on which percentage of a co-insurance you have. 100/0%; 90/10% ; 85/15%; 80/20%; 70/30%; 60/40%.
What is a Co-Payment?
Answer: Is a flat payment you make to a particular provider according to your insurance agreement. Your co-payment to your primary care provider could be a $30.00 with unlimited visits; or to certain specialist the co-payment could be $65.00-either way it's a flat amount of money.
What does Premium mean?
Answer: Premium is the amount of money you pay every month to maintain your insurance coverage.
What is a Qualifying Event?
Answer: A qualifying event is an event that occurs in your life anytime throughout the year. There are guidelines and most qe's have to be done within a certain time period. Each state has their own policy and procedures and so does each insurance carrier; though in most instances the time period are between a 30-60 day window to notify carriers of such an event. Here is a brief list of qualifying events: birth of child, adoption, loss of credible coverage from another carrier, relocation, loss of income, death, divorce, marriage, or a substantial change of income.
What is Accident Insurance?
Answer: Is the kind of coverage that will pay you a certain amount of money when you have an accident. There are too variations to pinpoint to the amount of money you would receive for each accident that may occur. Just know this type of insurance only pays out when accidents occur.
What is Accidental Death and Dismemberment Insurance?
Answer: This type of insurance will pay out only if you were in an accident and died or lost a limb of your body parts. If you died, then your beneficiaries would receive payment from the insurer. If you lost a limb; ex: say you lost your arm in an accident; then you would receive a certain amount of money for the lost of your arm or any other body part if you have this type of coverage; a certain dollar amounts for each limb.
What is Critical Illness Insurance?
Answer: This type of insurance is coverage if and when you may have an heart attack, stroke, or some other major life threatening occurrence. You need to be healthy in order to qualify for this type of protection not unless you purchased through some type of group coverage. Coverage amount ranges from $2,500 and higher. Ex: if you purchased a critical illness policy and had a $25,000 dollar plan-if you had a heart attack-then you would receive that amount in a payout depending on your contract with the carrier.
What is Disability Income Insurance?
Answer: This type of coverage is income replacement- in most instances 2/3 or a certain percentage of your income can be replaced after a elimination period. The elimination period varies depending on which choice of time you choose. Either 30, 60, 90, days or even 6 months. The longer you wait, the lower the premium.
What is Health Insurance?
Answer: health insurance is coverage that will pay for all of your medical services rendered by medical providers and is another avenue of protecting yourself from financial losses. Including but not limited to: health, dental, vision, and other type of supplemental plans.
What is Life Insurance?
Answer: Life insurance is income replacement when the breadwinner of the family dies. However, depending which type of life insurance you purchase; you could receive payments while still living.
Listed below is a brief explanation of some common type of life insurances.
Answer: A fixed annuity is an investment contract sold by an insurance carrier for either life or for a certain period of time.
Guaranteed Issue is the kind of coverage that will protect your income regardless of your health- there are no underwriting questions involved and is one of the most expensive coverage's to buy since there is no underwriting involved. Guaranteed issue vary in time when a policy will pay out. In most instances a person would have to live two to three years (also known as Graded Death Benefit) before beneficiaries would receive life insurance proceeds. If you passed away before six months premiums in most cases would be returned to your beneficiary.
Simplified Issue is insurance with minimum health questions and minimum underwriting guidelines. Premiums vary depending on which level of coverage you purchase.
Term insurance is the most affordable and cheapest insurance money can buy with a limited time period. The time period vary from annual renewable term (ART)- either 1 or 5 year renewals or level term policies with 5;10;15;20;25; or 30 year terms, either way the term will expire eventually.
Whole Life is insurance that will outlive you and is guaranteed for your entire life as long as premiums are paid. This is just a small portion and explanation of life insurance; every carrier is different and every plan policy varies with limitations, exclusions, and benefits.
What is Long Term Care Insurance?
Answer: You need to be healthy in order to qualify for this type of protection not unless you purchased through some type of group coverage. Coverage amount varies depending on the choice of time you choose with the elimination period. Either 30, 60, 90, days or even 6 months. The longer you wait, the lower the premium. Long term care insurance helps protects your assets and are for individuals who has a certain amount of wealth. However, this type of insurance is expensive as you get older. The best time to purchase long term care insurance is when you are young and financially able to have discretionary income available to protect your assets.
What is Short-Term Health Insurance?
Answer: Is health insurance covering a short period of time; as short as 30 days to up to maybe two years depending on the carrier. The purpose of this coverage is to bridge a gap in coverage when income is not consistent due to job changes.
What is Supplement Health Insurance?
Answer: This type of insurance helps pay certain providers and claims over and beyond your regular health insurance. Supplemental coverage can also pay you if you are hospitalized for a certain period of time-called Indemnity insurance coverage; the amounts vary depending on which type plan you choose.
What is Travelers' Insurance?
Answer: Is insurance that goes with you as you travel throughout the continental USA and abroad- coverage varies from carrier to carrier.
The information on this website is for information and educational purposes only. The information contained throughout this site is not legal advice of any kind. If legal advice is needed; then we highly recommend you consult an attorney who specializes in the particular areas of law you need legal guidance.