Health Insurance is a type of an insurance coverage that covers the cost of an insured individual’s surgical and medical expenses. In health insurance terminology a clinic, hospital, doctor, laboratory, healthcare practitioner that treats an individual is known as the “provider”. The insured is the owner of the health insurance policy or the person with health insurance coverage. Health insurers today provide coverage for daycare hospitalization, pre-hospitalization, and post-hospitalization. Depending on the type of health insurance coverage, either the insured pay the cost out of pocket and is then reimbursed or the insurer makes payment directly to the provider.
Getting to know the insurance terms can go a long way in understanding the plan and choosing the best one. Below is the list of few common terms used in Health Insurance:
Agent: Person appointed by the insurer to work on behalf of the insurer.
Assignee: Person who gets the benefit of the policy
Claim: request filed by an insured to the insurance company to pay for services obtained from the healthcare provider
Certificate of insurance: The description of the benefit and the coverage provisions forming the contract between the carrier and the customer.
Co-payment: when the insured files a claim there is a certain out of a pocket fraction of the claim amount he has to borne himself before the insurer steps in.
Deductible: the amount of loss borne by the insured.
Exclusions: those conditions for which the insured will not be given any benefit
Premium: the monthly amount an insured pays in exchange for insurance coverage
Pre-existing condition: a medical condition of an individual is excluded from coverage if it is believed to have existed prior of obtaining the policy
Provider Network: a group of medical providers that have contracted with the insurance company to provide healthcare services.
Waiting period: when an individual signs up for a new policy there is a certain period after which few benefits come into effect
There are plenty of reasons why buying a health insurance plan has become necessary. The benefits of health insurance outweigh the cost of the premium. Currently, life expectancy has increased due to medical advancements but people find it difficult to fund their treatment and medical expenses. This may be due to lack of finances at the old age resulting in the sale of assets or opting for the mortgage. This is where health insurance could be a savior. Anything can happen to anyone at any time, it is best to be prepaid.