Insurance Slang 101
Do you automatically punt to another game when an insurance commercial comes on? Zone out when people start talking about “deductibles” or “premiums”? Is “coverage” something you only associate with defense?
You’re not alone. Insurance can be a lot less thrilling than football, especially if you don’t understand the language. But like anything, once you learn the rules of the game, you can be a player.
Here are 10 insurance terms you need to know to play the game of insurance like a pro:
This is just a fancy name for your insurance company. For example, if you bought cancer insurance from a company called Really Good Insurance, then Really Good Insurance is your carrier. Simple as that.
You know that friend who “owes you one”? A claim is like you cashing in on that promise, only from your insurance company. When you submit a claim, you’re asking your carrier to pay what they owe you.
OK, so this one is kind of like coverage in football—only applied to your well-being. The insurance coverage you choose determines what your insurance company is responsible for paying in the event that you or your beneficiaries (i.e., your spouse and children) are injured or face other health issues in this game we call life.
You know how some parents will help their child pay for their first car, but only if that child spends a certain amount of their own money first? This is somewhat similar. A deductible is the amount you’ll pay out of pocket before your insurance coverage kicks in.
You know how pro teams might not pay a player’s contract if that player gets injured playing paintball? This is kind of like that. Exclusions are things that your insurance plan won’t cover if they happen (like self-inflicted injuries or elective plastic surgery).
Think of this as a salary cap. This is the maximum amount your carrier will pay for a claim under your plan’s coverage.
The person who owns the insurance policy. Easy.
This is like a “subscription cost.” A monthly premium is the insurance version of your monthly streaming bill.
You know those bonuses and incentives that make up any given pro contract? This is the insurance version. A rider can add benefits to or change the terms of a standard insurance policy.
10. Risk assessment
Just like players need physicals before they can get signed, insurance companies require risk assessments before they’ll take you on. With the help of specific analytics—sometimes including a physical—insurance companies determine premiums based on the likelihood that claims will be made against the policy.
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