Benefits Terminology
ACTIVELY AT WORK OR ACTIVE AT WORK
The employee is performing the normal duties of their occupation and working the number of hours set forth in the policy for plan participation eligibility.
BENEFICIARY
The person who is to receive the insurance proceeds at death of the insured.
BEST DOCTORS
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CO-INSURANCE
A provision in a health insurance contract by which the insurer and the insured share, in a specific ratio, the covered expenses under a policy.
COORDINATION OF BENEFITS
Families with two working adults may be covered by more than one health or dental plan. If your primary plan does not pay the full amount of an expense, you can submit a claim to the other plan for the balance.
CREDIBILTY
The degree to which a group's own claims experience is used to set the premium rates.
CRITICAL ILLNESS INSURANCE
A type of insurance that pays you a lump sum if you are diagnosed with a life-altering illness such as cancer, heart attack, stroke, etc.
DEDUCTIBLE
The amount of covered expenses that must be incurred and paid by the insured, before benefits become payable by the insurer.
DENTAL INSURANCE
A type of insurance that provides coverages for dental expense.
DEPENDENT LIFE INSURANCE
Life insurance for an employee's spouse and/or children.
DISPENSING FEE
The dispensing fee represents the charge for the professional services provided by a pharmacist when dispensing a prescription.
ELIGIBILITY PERIOD
The length of time you must be an employee of an insured company in order to qualify for coverage under the group plan.
ELIMINATION PERIOD
The waiting period an employee must be disabled before disability benefits become payable.
EMPLOYER ALLOCATION
Amount the employer contributes to the benefit plan. Most often considered in a per employee amount. Term relates mostly to the employer contribution in a Flex Plan model.
EXPERIENCE-RATED BENEFITS
Benefits for health, dental and vision expenses - where claims are frequent enough to provide statistical predictability - and insurers can set renewal rates directly related to the claims experience.
EXTENDED HEALTH INSURANCE (EHC)
Part of a Group Plan that offers coverage for health expenses beyond the provincially delivered government benefits. Includes things like, Drugs, Practitioners, Supplies, Out-of-Country Medical Emergency
FLEX PLAN or FLEX BENEFITS
Group Benefits plan that provides employees with choice in the plan options they want to enrol in and/or control over the way they "spend" Employer Allocation.
HEALTH SPENDING ACCOUNT
Covers medical expenses allowed by CRA for medical Tax purposes. Provides employees with control of how they spend. Employers set the budget rather than insurers calculating rates.
INCURRED BUT NOT REPORTED RESERVE (IBNR)
Reserves established to cover the insurer's liability for claims incurred by plan members during the experience period, but due to lag in claim submission, will be reported to and paid by the insurer during the following period.
INFLATION
Due to rising health care costs it is necessary to adjust past experience for the inevitable rise in future claim costs. An inflation adjustment is therefore included when evaluating the claims experience.
LONG TERM DISABILITY
A benefit plan that provides income replacement to an employee who has become totally disabled due to illness or injury
LOSS RATIO
The ratio of the claims paid by the insurer to the premium earned within the experience period.
MANUAL RATES
Book insurance rates in the insures rate tables
PAID CLAIMS
The actual amount of claims submitted and paid by the insurer within a period.
PARTIAL DISABILITY BENEFIT
A disability benefit that pays a monthly amount that's less than a total disability benefit works in conjunction with an employee's return to work.
PLAN ADMINISTRATION
The daily management and implementation of a benefit plan. (Includes handling of claims, adjusting coverage, adding and removing employees, etc.
PLAN SPONSOR
The employer, association or entity which holds the group contract.
POOLED CLAIMS
Claims that are too large to be included in an experience rated model as the impact to the employer could be financially prohibitive. Life Insurance Claims, Disability claims and Health claims in excess of the large amount pooling level that are removed from the paid claims in each period so that they will not impact the experience rating
PREDETERMINATION OF BENEFITS
A claim procedure required by many group plans before you incur large expenses.
PRE-EXISITING CONDITIONS
A medical condition for which you have had symptoms, consulted a medical professional or received treatment before you apply for insurance or before your coverage takes effect.
PREMIUM-BILLED
The actual amount of premium billed to the client by the insurer during each period.
PREMIUM-POOLED
A percentage of billed premiums are charged to the client to cover the cost of pooled claims to the insurer.
RESIDUAL DISABILITY
Encourages return to work by enabling employees to satisfy the elimination period while working at a reduced capacity.
SHORT TERM DISABILITY
A benefit plan that pays an employee an income while unable to work due to non-work related illness or injury.
SURVIVOR BENEFITS
Pays an additional 2 years of Health and Dental benefits in the event of an employees death.
TARGET LOSS RATIO - BREAKEVEN POINT
The insurer's objective in maintaining claims costs equal to a fixed percentage of premium. The remaining percentage is reserved for expenses, or the insurer's cost of doing business and insurer profit.
TAXABLE BENEFIT
Employer-provided non-cash compensation that is subject to income tax.
TREND
Factors that contribute to increasing the frequency of claims or utilization, including, aging workforce, cost shifting of provincial plans technological advances, public awareness, and health issues.
WAIVER OF PREMIUM
A feature of some insurance policies that allows you to stop paying the premium if you become disabled.