Insurance & Risk Terms

A 1035 exchange moves the value of one insurance or annuity contract into another without triggering tax on the gain. It only runs in certain directions, the old contract's cost basis carries over rather than resetting, and cash or a discharged loan taken out along the way is taxable.

ACA metal tiers are the four coverage levels (Bronze, Silver, Gold, and Platinum) that sort Marketplace health plans by how much of the average person's costs the plan pays, from about 60% for Bronze to about 90% for Platinum.

The ACA subsidy cliff is the point where household income crosses 400% of the federal poverty line and the premium tax credit for Marketplace health coverage drops from a partial subsidy to zero, all at once.

An accelerated death benefit lets a seriously ill insured collect part of their own life insurance death benefit before dying, with the amount paid subtracted from what the beneficiary later receives. Federal tax law sets the two conditions under which it arrives tax-free.

Accident insurance pays stated amounts when the insured is injured in an accident, according to a schedule of covered injuries and treatments rather than the cost of the care. Federal law treats it as an excepted benefit in all circumstances, without the conditions attached to the other supplemental health products.

Accidental death and dismemberment coverage pays a lump sum if the insured dies in an accident, and a stated fraction of that sum for the loss of a hand, a foot, sight, hearing or speech. It pays nothing when the cause is illness, which is why it is not a substitute for life insurance.

Activities of daily living are the six basic self-care tasks that federal tax law names as the measure of whether someone is chronically ill: eating, toileting, transferring, bathing, dressing and continence. They are the legal trigger a long-term care policy pays on, and the list is fixed rather than descriptive.

Actual cash value is a property-insurance settlement basis equal to what it would cost to replace the damaged item, reduced by its physical depreciation. It is a common basis for contents claims and the usual one on a totaled vehicle, and how the depreciation is measured is a question of state law rather than a single national formula.

An actuary is a professional who measures financial risk with mathematics and statistics, most often by estimating how much a set of future claims or benefits will cost and what should be set aside today to pay them. Several actuarial roles are creatures of federal or state law rather than job titles.

An additional insured is a person or entity added by endorsement to somebody else's liability policy, so that the policy covers them too. A client, landlord or venue asking to be "added" is asking for real coverage under your policy, not for a document proving your policy exists.

Adult day care costs are what a daytime program for an adult who cannot safely be left alone charges, usually by the day. It is the least expensive supervised setting, it is the one whose financial logic is that it lets a family caregiver keep working, and Medicare does not pay for it as a benefit of its own.

An advance directive is a written instruction about your medical care, recognized under state law, that takes effect if you become unable to make decisions yourself. It is a category rather than a single document, and its two main members do different jobs: one records what you want, the other names who decides.

Adverse selection is what happens when the people most likely to need coverage are the most likely to buy it, and the seller cannot tell who is who. Left unaddressed it pushes the low-risk buyers out of a pool and drives the price up for whoever is left.

The Affordable Care Act is the 2010 federal law that reshaped individual health coverage in the United States: insurers must sell to anyone regardless of health history, plans must cover a defined set of benefits, and income-based subsidies make coverage cheaper for people buying it themselves.

Annuitization is the act of turning an annuity contract into a stream of payments. The moment it happens sets the contract's annuity starting date, which permanently changes how every payment is taxed and fixes the numbers used to calculate it.

An annuity is a contract with an insurance company: you pay a premium, and the insurer promises a stream of payments, often for life. It is the only private product that insures against outliving your money, but costs, surrender charges, and commission-driven sales make careful evaluation essential.

An annuity rider is an optional benefit added to an annuity contract for an extra fee, most commonly a guarantee of lifetime withdrawals or a minimum death benefit, on top of the base contract.

Any-occupation disability describes a disability policy that pays only when the insured cannot work in some other suitable occupation, not merely the one they held. Like its opposite it is market vocabulary rather than a regulated category, so how far "any occupation" actually reaches is set by the contract's own words inside a regulatory floor.

Assisted living costs are the price of a residential setting that bundles housing with help for daily activities but not skilled nursing. National medians run around $6,000 to $6,500 a month. Because it is not medical care, Medicare does not cover it, and Medicaid rarely pays the room and board.

Auto insurance is not one product but a bundle of legally distinct coverages sold under a single policy, each protecting a different person against a different event. Understanding which of them you have, and at what limits, matters far more than the premium.

Balance billing is a provider charging you the difference between what it billed and what your plan recognized as the price. It is not cost sharing, it is not capped by your out-of-pocket maximum, and it exists only where no contract forbids it.

A beneficiary is a person or organization entitled to receive something under an instrument: a will, a trust, an insurance policy, a retirement account, or a payable-on-death registration. The word carries materially different meanings in different bodies of law, and in several of them the beneficiary is a living person receiving benefits now rather than an heir waiting for someone to die.

A benefit period is the maximum length of time a disability or long-term care policy will keep paying on a single claim. It is the ceiling on duration, the way a policy limit is the ceiling on dollars, and it is one of the two or three choices that set the premium.

Bodily injury liability is the part of an auto policy that pays other people for injuries the insured driver is legally responsible for causing. It is written with two separate limits, one per injured person and one per accident, and the per-person limit is usually the one that binds.

Business interruption insurance replaces the income a business loses and pays its continuing expenses while it is shut down by a covered property loss. In standard policies it pays only when the shutdown follows direct physical damage to property, which is why it usually did not cover pandemic closures.

Business liability insurance, written formally as commercial general liability, covers claims that your operations caused bodily injury or property damage to somebody else, plus a closed list of personal and advertising injury offenses. It does not cover claims that your professional work was wrong, and the reason is the coverage grant rather than an exclusion.

Business overhead expense insurance reimburses a business for its continuing operating costs while the owner is disabled and cannot work. It pays rent, utilities and staff wages so the doors stay open, and it deliberately does not pay the owner's own salary.

A businessowners policy (BOP) is a packaged insurance policy for small and mid-sized businesses that bundles commercial property coverage and general liability, and often business income coverage, into a single contract at a lower cost than buying each separately.

A captive insurance agent is a licensed insurance producer who sells the products of a single insurance company. The label is a description of the agent's contracts and appointments rather than a license category, because the producer license itself does not distinguish how many insurers an agent represents.

Car insurance shopping is the process of comparing auto insurance quotes and choosing coverage, which means setting the limits and deductibles you want, requesting the same coverage from several insurers, and understanding the factors that drive the price.

Cash surrender value is what a permanent life insurance policy is worth to its owner on the way out, rather than to a beneficiary on the way in. State nonforfeiture law, not the insurer's product design, is what requires the value to exist at all.

Cash value life insurance is life insurance whose contract accumulates a value the policyholder can borrow against, withdraw from, or take by surrendering the coverage. The account is funded by premium left over after the cost of insurance and expenses, and it grows without current income tax while it stays inside the contract.

A catastrophic health plan is a Marketplace plan that sits outside the metal tiers, sold only to people under 30 or holding a hardship or affordability exemption. It covers the essential health benefits but pays nothing until the enrollee has spent an amount equal to the year's cap on cost sharing, apart from preventive care and three primary care visits.

The Children's Health Insurance Program is a federal-state program that funds health coverage for children in families earning too much for Medicaid and too little to buy private coverage. It has its own title of the Social Security Act and its own appropriation, and each state designs its own program within federal rules.

A claims adjuster is the person who investigates an insurance claim, works out what the damage is worth, and recommends what the insurer should pay. Most adjusters work for the insurer, either as employees or as contractors, and the estimate they write is the insurer's valuation rather than an agreed number.

Claims history is the record of insurance claims associated with a person, a vehicle or a property, which insurers pull when they price a policy or decide whether to write one. It follows the property as well as the owner, and what gets reported into it is not the same as what a state lets an insurer charge for.

A CLUE report is the consumer report showing insurance claims filed on a person, a vehicle or a property over the previous seven years. It is produced by LexisNexis from the Comprehensive Loss Underwriting Exchange, insurers pull it when they quote, and a consumer is entitled to a free copy every twelve months.

COBRA continuation coverage is the federal right to keep the employer group health plan you were already on, at your own expense, after an event that would otherwise end it. The coverage is identical to what you had; what changes is that you now pay the whole cost, including the share your employer used to pay, plus an administrative charge.

Coinsurance is the percentage of a covered health care service you pay after meeting your deductible, with the plan paying the rest. The percentage applies to the plan's allowed amount rather than to the provider's billed charge, which is where most of the confusion about medical bills starts. Confusingly, property insurance uses the same word for something else entirely.

Collision coverage is the part of an auto policy that pays to repair or replace your own vehicle after it strikes another vehicle or an object, or after it overturns. It pays without regard to who caused the crash, and the deductible is subtracted from every payment.

Commercial auto insurance covers liability and physical damage for vehicles a business uses. Its most under-appreciated feature is that it can reach vehicles the business does not own, including an employee's own car driven on company business, which a personal policy may not cover.

Commercial property insurance pays to repair or replace a business's building and its contents after a covered event. How much it covers depends on which of three causes-of-loss forms the policy uses, and how much it pays depends on whether the property is insured at replacement cost or actual cash value.

Comprehensive coverage is the auto-insurance part that pays for damage to your own vehicle from causes other than a collision, such as theft, fire, weather or an animal strike. It is defined by what it excludes rather than by a list of what it includes, which is why many policy forms title it "Other Than Collision".

A contingent beneficiary is the backup named on a policy, account or plan: the person or entity that takes if the primary beneficiary cannot or will not. Four separate events promote a contingent, and one of them, a disclaimer, only works at all if a contingent has been named.

A continuing care retirement community is a campus that contracts to house a resident for life and to move them through independent living, assisted living and nursing care as their health requires. Residents typically pay a large entrance fee plus a monthly fee, and the promise is only as good as the operator's finances.

Convertible term life insurance carries a contractual right to exchange the term policy for permanent coverage without new evidence of insurability, inside a stated window. It is optionality against becoming uninsurable, and it is a different right from the right to renew.

A copayment is a fixed dollar amount you pay for a covered health care service, set by the plan in advance and charged per visit, per prescription or per service rather than as a share of the bill. Because the amount does not move with the cost of the care, it is the one form of cost sharing you can know the price of before you go.

A cost-of-living rider is an optional addition to an insurance policy, bought for extra premium, that increases a benefit over time so inflation does not erode it. On disability income coverage, which is where regulators describe it, it raises the monthly benefit while a claim is being paid. The label is not standardized and is used for other mechanics elsewhere.

Cost-sharing reductions are the second Affordable Care Act subsidy: they lower the deductibles, copayments, coinsurance and out-of-pocket maximum inside a Marketplace plan for lower-income enrollees. They attach only to silver plans, and they are applied automatically at the point of care.

Credit life insurance pays off a specific debt if the borrower dies, with the lender as the beneficiary rather than the family. It is sold at the point of borrowing, priced against the opening balance, and covers a debt that shrinks while the price generally does not.

A credit-based insurance score is a number built partly or entirely from a consumer's credit history that insurers use to estimate how likely that person is to file a claim. It is not a credit score, it predicts a different thing, and what an insurer may do with it is limited by state law.

Critical illness insurance pays a lump sum on the diagnosis of a condition named in the policy, such as a heart attack, a stroke or a covered cancer. The money goes to the insured to spend on anything, and federal law files the product under the broader heading of coverage for a specified disease or illness.

Cyber insurance covers a business's losses from a cyber attack or data breach. Roughly half of what it pays for is the business's own response cost, which is why "cyber liability insurance" describes only part of the product, and the policies are deliberately not standardized.

A death benefit is the amount a contract pays because the insured or the contract holder died. On a life insurance policy it is generally received free of income tax; on an annuity or a pension it is generally taxable, and income tax and estate tax are separate questions with separate answers.

Decreasing term life insurance holds the premium level while the death benefit falls on a schedule set in the contract. It is sold against a shrinking debt, and its central weakness is that the benefit falls on the insurer's schedule rather than on the loan's.

A deferred annuity accumulates value first and pays income later, if at all. Unlike an immediate annuity, it does not have to become a stream of payments; you can withdraw or surrender instead, which is where surrender charges and most of the annuity market's complexity live.

Dental insurance is coverage for dental care, usually sold separately from medical coverage. Federal law treats limited-scope dental as an excepted benefit, which puts it outside the rules that govern major medical plans and is why a dental plan can cap what it pays in a year.

Dependent coverage to age 26 is the federal rule requiring a health plan that covers children at all to keep covering an adult child until they turn 26. The plan may not condition it on the child's income, address, marital status, student status, job, or access to other coverage.

Direct primary care is an arrangement in which a patient pays a primary care practice a flat periodic fee for primary care services, and the practice does not bill insurance for them. It is not health coverage, and federal tax law defines it at IRC 223(c)(1)(E) for health savings account purposes.

Disability determination is the process the Social Security Administration uses to decide whether a person meets its definition of disability, run through a five-step sequential evaluation set out in 20 C.F.R. 404.1520 and 416.920.

Disability insurance replaces part of your income if illness or injury keeps you from working. It protects the asset most working people never think to insure: their ability to earn a paycheck for the next few decades.

Dwelling coverage is the part of a home insurance policy that pays for damage to the house itself and the structures attached to it. It is also the anchor number on the policy, because most of the other coverage limits are set as percentages of it.

Earthquake insurance covers shake damage to a home, which every standard homeowners policy excludes. It is bought as a separate policy or endorsement, its deductible is a percentage of the dwelling amount rather than a flat sum, and in California insurers are required by statute to offer it.

Elder care costs are the price of the care an aging adult needs across settings, from an in-home aide to assisted living to a nursing home. The costs run high, into six figures a year for full-time skilled care, and Medicare pays for very little of it, which makes how you will pay the central planning question.

Elder care planning is the financial and legal work of helping an aging parent through the years when they can no longer manage their affairs or their care independently — arranging legal authority to help before a crisis, deciding how to pay for care, and understanding what Medicare, Medicaid and private insurance actually cover for long-term care.

An elimination period is the stretch of time that must pass after a covered disability or care need begins before the policy starts earning benefits for the insured. It is a deductible measured in time rather than dollars, and because benefits are paid on amounts that have already accrued, the first money usually arrives later than the period alone suggests.

Employment practices liability insurance covers claims by employees and applicants that the employer treated them unlawfully: wrongful termination, discrimination, harassment, failure to hire or promote. A general liability policy cannot reach these claims, and the reason is the coverage grant rather than an exclusion.

Estate liquidity is the cash an estate can raise, on time, to pay what it owes after a death: the federal estate tax, any state death tax, debts and administration expenses. It becomes a problem when the estate is mostly a farm, a business or a house, because the bill arrives nine months after the death and those assets do not.

An exclusive provider organization is a health plan that pays for covered care only inside its own network, with an exception for emergencies. On the question that actually separates plan types, whether anything is paid out of network, it behaves like an HMO rather than sitting halfway to a PPO.

An explanation of benefits is the statement a health plan sends after processing a claim, showing what was billed, what the plan allowed, what it paid and what it says you owe. Where it denies or reduces anything, it is also a legal notice with mandatory content and a deadline attached.

An extended warranty is an agreement, bought separately from the product, that pays to repair or replace it for a stated period. Under federal law it is not a warranty at all: because you paid extra for it, or bought it after the sale, it is a service contract.

Extra Help, formally the Part D Low-Income Subsidy, is a federal program that pays much of the premium, deductible, and copays for Medicare prescription drug coverage for people with limited income and resources.

Federal Employees' Group Life Insurance (FEGLI) is the group term life insurance program for U.S. federal employees and retirees, established under 5 U.S.C. chapter 87 and administered by the Office of Personnel Management.

The federal poverty level is the annual income figure the federal government uses to decide who qualifies for a long list of benefits. Three different documents are commonly called by that name, and which one a given rule uses changes the answer.

FEMA Individual Assistance is the set of federal programs that help individuals and households after the President declares a major disaster. Its main money program pays for disaster-caused housing needs and other necessary expenses that insurance and other sources do not cover, subject to two separate annually adjusted maximums, and federal law expressly forbids paying for any part of a loss another source has already paid.

Final expense insurance is a small permanent life insurance policy, usually whole life with a face amount in the low five figures, bought so that a beneficiary has cash soon after a death. Three quite different underwriting grades are sold under the one name.

A fixed annuity is an annuity contract in which the insurer credits interest at a rate it declares in advance, rather than tying growth to markets. The best-known version is a multi-year guaranteed annuity (MYGA), which locks a single rate for a set term much like a bank CD — except that it is not FDIC-insured.

A fixed indexed annuity is an insurance contract that credits interest based on the movement of a market index, subject to caps and other limits, and credits zero rather than a loss when the index falls. It is generally not an SEC-registered security; it is regulated as insurance under state law.

A flexible spending account is an employer-sponsored arrangement under section 125 of the Internal Revenue Code that lets an employee set aside part of their salary before tax to reimburse medical expenses. The election is made before the year starts, is generally locked for the whole year, and money left unspent at the end is forfeited unless the employer offers one of two limited relief options.

Flood insurance is a separate policy covering damage from rising surface water, which standard homeowners and renters policies exclude. Most United States coverage is written through the federal National Flood Insurance Program, whose authority to enter new contracts is set by statute and has been extended repeatedly, with a private market alongside it.

A flood zone designation is the classification FEMA assigns to a piece of land on a published flood map. It decides whether a lender must require flood insurance, and it is not what sets the premium.

A formulary is the list of prescription drugs a health plan or drug plan covers, usually sorted into tiers that carry different cost sharing. It is the plan's own list rather than a medical standard, it can change during the year, and a drug that is not on it is generally not covered.

A free look period is a window after a new policy arrives during which the buyer may return it and undo the purchase. On the two lines where model regulation prescribes it the window is 30 days, but one measures it from delivery and the other from receipt, and what comes back is not always every dollar paid.

A future increase option is a contract provision that lets the policyholder buy additional coverage at set times later on without proving their health again. Regulators generally call it guaranteed insurability, and what it insures is not the risk itself but the continued ability to buy insurance against it.

GAP covers the difference between what an insurer pays for a vehicle that is totaled or stolen and what the borrower still owes on it. The name covers two legally different products, an insurance policy and a waiver written into the finance agreement, and which one you bought decides who regulates it and how a refund works.

A generic drug is a medicine approved by the FDA on an abbreviated application showing it is the same as an already-approved brand-name drug in active ingredient, strength, dosage form and route, and bioequivalent to it. It costs less because its maker did not repeat the original trials and because competition follows the loss of exclusivity.

Group disability insurance is income-replacement coverage an employer buys for its workforce under a single master policy, with each covered employee holding a certificate rather than a policy. The contract structure is not a technicality: it decides who the insurer answers to, what document governs, and which body of law reviews a denied claim.

Group life insurance is life insurance an employer buys for its workforce under a single policy, usually term coverage set as a multiple of salary. The first $50,000 of employer-provided group-term coverage is excluded from your income; anything above it produces taxable imputed income calculated from an IRS table rather than from what your employer paid.

Guaranteed income is retirement income you can count on receiving for as long as you live, regardless of markets: Social Security, a pension, and a portion of savings converted into an annuity are the ways to create it.

Guaranteed issue life insurance is a small permanent policy an insurer must accept without asking about the applicant's health. The price of not being asked is a graded death benefit, which returns premiums rather than the face amount if death comes in the first years.

A guaranteed renewable policy is one the insurer must keep in force as long as the premiums are paid, and whose provisions the insurer cannot change on its own. The one thing it does not guarantee is the price: rates can still be raised for a whole class of policyholders.

A health care sharing ministry is a nonprofit whose members share one another's medical expenses according to shared religious or ethical beliefs. Federal tax law defines the term, state insurance regulators do not supervise these organizations, and they are not insurance and are not legally required to pay anything.

Health insurance for early retirees is the coverage that bridges the gap between leaving work before 65 and becoming eligible for Medicare, usually assembled from a spouse's plan, COBRA, a Marketplace plan, or retiree coverage.

The Health Insurance Marketplace is the government-run service where individuals and families shop for and enroll in private health plans that meet Affordable Care Act standards. Its statutory name is an Exchange, it is run by the state in some states and by the federal government in the rest, and it is the only place a premium tax credit can be obtained.

A health insurance premium is the recurring amount you pay to keep a health plan in force. For ACA-compliant individual and small-group plans, the law limits the factors an insurer may use to set it to just four.

A health maintenance organization is a health plan built around a closed set of providers, paid a fixed periodic amount per member rather than a fee per service. Outside that set, and outside an emergency, the plan generally pays nothing.

A health reimbursement arrangement is an employer-funded account that reimburses employees for medical expenses tax-free. The employer alone puts money in, the employee never gets it as cash, and unused amounts can carry forward rather than being forfeited at year end.

A health savings account (HSA) is a tax-advantaged account for people with high-deductible health plans that offers a triple tax break: deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses.

A healthcare power of attorney is a document naming someone to make medical decisions for you when you cannot make them yourself. It appoints a person rather than recording instructions, which is what makes it broader than a living will and useful in situations no document could have anticipated.

A high deductible health plan is a health plan that meets the deductible and out-of-pocket tests in section 223 of the Internal Revenue Code, which is what makes its holder eligible to contribute to a health savings account. A large deductible alone does not qualify a plan: the statute also caps total out-of-pocket exposure and limits what the plan may pay for before the deductible is met.

A HIPAA authorization is a signed form telling a doctor, hospital or health plan that it may share your health information with people you name. It is one of three routes federal privacy rules provide, and the other two need no signature, which is why the rule is narrower than the reputation around it.

Home health care costs are what it costs to have care delivered in someone's home. The planning problem is that Medicare pays in full for a narrow, skilled, physician-ordered service and pays nothing for the ongoing help with daily living that most families mean by the phrase.

A home warranty is an annual service contract that pays to repair or replace covered home systems and appliances when they fail, in exchange for a fee per visit. It is not a warranty in the sense federal law uses the word, and in many states it is not regulated as insurance either.

Home-based business insurance is the coverage that fills the gap between a homeowners or renters policy and what a business run from home actually needs. NAIC's assessment is that personal policies are "rarely adequate" for it, and the two routes to closing the gap are an endorsement or a separate business policy.

Homeowners insurance bundles four separate coverages into one policy: the dwelling, your belongings, your personal liability, and the extra costs of living elsewhere while the home is unlivable. Two choices made at purchase, rather than the premium, decide what you actually collect after a loss.

Hospice costs are what a family actually pays once someone elects hospice. Under Medicare the answer is unusually small, two coinsurance items and nothing else, but the benefit pays for care rather than for housing, so a resident of a nursing facility or assisted living keeps paying the room and board.

Hospital financial assistance is help a nonprofit hospital must offer eligible patients with the cost of medically necessary care, delivered through a written financial assistance policy that federal tax law requires of charitable hospitals.

Hospital indemnity insurance pays a fixed dollar amount for each day of a hospital stay or each covered service, regardless of what the care actually cost. Paying that way is a legal condition of its status as an excepted benefit, which is also why the protections that govern health plans do not apply to it.

Household income is the income figure the Affordable Care Act uses to decide who gets a premium tax credit or a cost-sharing reduction. It is the taxpayer's modified adjusted gross income plus the modified adjusted gross income of every other person in their family size who was required to file a tax return.

Human life value is the present value of the earnings a household would lose if an income earner died, after subtracting what that earner would have spent on themselves. It is one of the two established ways to think about how much life insurance a life is worth insuring for, and it answers a different question from adding up specific obligations.

A hybrid long-term care policy is a life insurance contract or an annuity that also provides long-term care coverage, so that money not spent on care is paid out some other way. For tax purposes the care portion is treated as a separate contract inside the wrapper, which is what produces the design's distinctive tax results.

Identity theft insurance reimburses the cost of cleaning up after your identity is stolen, such as legal fees, lost wages and administrative expenses, rather than the money the thief took. It is often an endorsement on a homeowners or renters policy rather than a separate contract.

An immediate annuity converts a lump sum into a stream of payments that begins right away, usually within a year of purchase. It is the simplest annuity to compare because the entire quote is dollars per month, and the simplest to regret because the lump sum is generally gone for good.

An in-network provider is one that has a contract with your health plan. That one contract does two separate things for you: it fixes the price, and it stops the provider billing you the difference. Outside it, you get neither.

IRMAA is the income-related monthly adjustment amount, a surcharge added to Medicare Part B and Part D premiums for beneficiaries whose income was above a threshold two years earlier. It is a cliff rather than a slope, and Social Security rather than Medicare decides it.

An independent insurance agent is a licensed insurance producer who holds appointments with several insurance companies and can therefore quote each of them. The license is the same one a single-company agent holds, so what makes an agent independent is the set of contracts they have rather than anything the state issued.

Indexed universal life is a universal life policy whose interest credits are tied to the movement of a market index, subject to a cap or participation rate on the upside and a floor, usually zero, on the downside. The floor applies to the interest credited, not to the account, so policy charges still come out.

An individual coverage HRA is an employer arrangement that reimburses employees for individual health insurance premiums and other medical expenses instead of offering a group health plan. The employee has to be enrolled in individual coverage or Medicare every month the arrangement covers them.

An insurable interest is a genuine stake in a person or a thing such that its loss would cost you something. Without one, an insurance contract is not insurance at all but a wager on someone else's misfortune, and it is void.

An insurance broker is a person who arranges insurance on behalf of the buyer rather than on behalf of an insurer. Whether "broker" is a license category or just a description depends on the state, and the compensation almost always comes from the insurer either way.

Insurance bundling is buying two or more policies, most often home and auto, from the same insurer in exchange for a multi-policy discount. The discount is real, and it is applied to a price the insurer set, so the comparison that decides whether bundling saves money is the bundled total against the best separate quotes rather than the discount against nothing.

An insurance claim is a request for payment under a policy after a covered event. How it is handled is regulated rather than purely commercial: states set claim-practice standards, and federal law puts employer health and disability plans on a fixed decision clock.

An insurance company financial strength rating is a rating firm's published opinion of an insurer's ability to meet its obligations to policyholders. It is an opinion rather than a guarantee, the firms that issue them do not use the same scales or the same processes, and it answers a different question from a credit rating on the insurer's debt.

An insurance deductible is the amount you pay out of your own pocket for a covered loss or covered service before the insurer pays anything. It resets annually on a health plan and separately for each occurrence on most property policies, and the premium you pay to hold the policy is never credited toward it.

An insurance exclusion is a policy provision that removes something from coverage the policy would otherwise have provided. Exclusions are how a policy's real boundary gets drawn, and many of them carry their own exceptions putting part of the coverage back.

Insurance fraud is deception used to obtain a benefit from an insurance transaction that the deceiver would not otherwise be entitled to. It runs in three directions, and the consequence people underestimate is the civil one: a policy can be voided from the date of the act, taking the legitimate part of a claim with it.

An insurance grace period is the window after a premium's due date in which a late payment still keeps the policy in force. It is a mandated policy provision on the lines where it applies, with statutory minimum lengths that depend on how often the premium is billed, and it is what stands between a missed payment and a lapse.

An insurance lapse is the termination of a policy because a required renewal premium was not paid. It is not a pause: coverage ends, and getting it back depends on a reinstatement provision whose terms differ by line of insurance and can leave a gap even after the policy is restored.

An insurance needs analysis is the process of calculating how much life or disability coverage a person actually needs, by working through specific debts, income, and future costs, rather than applying a flat rule of thumb like a fixed multiple of salary.

An insurance premium is the amount you pay to keep an insurance policy in force, usually monthly or annually. It is the price of holding the coverage, owed whether or not you ever file a claim, and it is separate from what you pay when you do claim.

Insurance underwriting is the process an insurer uses to decide whether to issue a policy to a particular applicant and at what price. It classifies risk rather than measuring ability to repay, which is what separates it from the underwriting a mortgage lender does.

International health insurance is coverage designed for people living, working, or traveling outside their home country, because most domestic US plans, and Medicare in particular, do not cover care received abroad.

An irrevocable life insurance trust owns a life insurance policy so that the death benefit is not part of the insured's taxable estate. Whether that works turns on the powers the insured gave up, not on who paid the premiums, and moving an existing policy in starts a three-year clock.

An itemized hospital bill is the line-by-line list of every item and service a hospital charged for, with a quantity and a price on each line. It is not the summary statement most patients receive first, and for care Medicare paid for there is a statute that makes producing one mandatory.

A joint and survivor annuity pays income over two lifetimes, continuing at a reduced percentage to a named survivor, usually a spouse, after the first person named dies.

Juvenile life insurance is life insurance on the life of a child. State law regulates it more tightly than coverage on an adult, capping the amount and requiring consent, because the historical worry is that someone will insure a child they have no honest reason to insure.

Key person insurance is a policy a business buys on the life or health of someone whose loss would damage it, with the business as owner, premium payer and beneficiary. Its purpose is to give the company cash to survive the gap, not to provide for the insured's family.

Landlord insurance is the market name for the property coverage an owner buys on a dwelling that someone else lives in. No insurer files a form by that name: the coverage is usually written as a dwelling policy, and the most important thing to know about it is that liability is often not included unless it is added.

Level term life insurance is term coverage on which both the premium and the death benefit stay the same for a stated number of years. It is the ordinary shape of term insurance in the United States, and the years it names are the guaranteed premium period rather than necessarily the life of the contract.

Liability coverage pays what you become legally responsible for when you injure someone else or damage their property. It is third-party coverage: it protects other people's claims against you, never your own losses, and it usually comes with the insurer's obligation to defend you as well as to pay.

Using life insurance as an investment means buying a permanent policy with a cash value component partly for its tax-advantaged savings rather than only for the death benefit. Whether it makes sense turns on cost, and for most people the comparison is against buying term insurance and investing the difference.

A life insurance beneficiary is the person, trust or organization a policy names to receive the death benefit. The naming is a contract term rather than a bequest, so it operates outside the will, and the law governing it differs depending on whether the policy is individually owned or an employer group plan.

Life insurance laddering means buying several term policies of different lengths instead of one long policy, so that coverage steps down as the obligations behind it end. It matches the shape of the need instead of paying long-term rates on coverage that stops being needed early.

A life insurance rider is an optional amendment attached to a life insurance policy that adds, limits or changes a benefit, priced and disclosed separately from the base contract. Riders are where most of the difference between two otherwise similar policies actually sits.

A life settlement is the sale of a life insurance policy by its owner to a third-party buyer for more than the insurer would pay to surrender it. Where the insured is not terminally or chronically ill, the sale falls outside the tax exclusion for death benefits and is taxed as a disposition of property.

A limited-purpose health FSA is a flexible spending account restricted to categories of care that do not disqualify the holder from contributing to a health savings account. In practice that usually means dental and vision, but the legal envelope is wider than that.

A living will is a written instruction about the medical treatment you would and would not want if you become unable to say so yourself. Despite the name it has nothing to do with a will: it disposes of no property, operates only while you are alive, and stops mattering at death.

Long-term care insurance pays for extended help with daily living (home aides, assisted living, nursing care) that health insurance and Medicare largely do not cover. Policies pay out when you can no longer perform basic activities of daily living or suffer cognitive impairment.

A Long-Term Care Partnership Program is a state Medicaid arrangement under which buying a qualifying long-term care insurance policy lets the buyer keep an extra amount of assets, equal to the benefits the policy actually pays, if they later need Medicaid. The same amount is also shielded from Medicaid estate recovery.

Long-term disability is insurance that replaces part of your income for years, or through to retirement age, if illness or injury stops you working. It is the disability coverage that decides a household's financial outcome, and the single most consequential term in the contract is how it defines disability.

Longevity risk is the risk of living longer than your money lasts. It is not a risk of markets but of arithmetic (the longer a retirement runs, the less any given portfolio can safely pay each year), and it is the one retirement risk that gets worse the better things go.

Medicaid is the joint federal and state health coverage program for people with limited income and, in some categories, limited assets. Because each state runs its own program within federal rules, what Medicaid covers, who qualifies, and even what it is called differ by state, and it is the country's largest payer for long-term care, which Medicare does not cover at all.

The Medicaid look-back period is the window before a long-term care application during which the state examines transfers of assets for less than fair market value. A transfer inside the window produces a period of ineligibility calculated by dividing the amount given away by the state's average monthly cost of nursing facility care.

A Medicaid spend-down is the lawful reduction of income or countable assets to reach a state's Medicaid eligibility limit. One name covers two different mechanisms: deducting incurred medical expenses from income under a medically needy program, and reducing countable resources before qualifying for long-term care coverage.

A medical billing advocate is someone paid to review, dispute and negotiate medical bills on a patient's behalf. The title is a job description rather than a credential issued by any body, so the buyer's real question is what the fee is measured against and what the advocate is doing that free routes would not have done.

Medical debt is money owed to a healthcare provider, or to whoever has bought or been assigned that obligation, for care already delivered. It behaves unlike every other consumer debt because in most cases it was never an extension of credit in the first place.

The medical expense deduction lets a taxpayer who itemizes deduct unreimbursed medical and dental costs, but only the part that exceeds 7.5% of adjusted gross income. Everything below that line produces nothing at all.

Medical tourism is traveling to another country to obtain medical care. The Centers for Disease Control and Prevention names the practice and catalogs its risks; U.S. tax law treats the resulting costs unevenly, and the rules for a drug bought and taken abroad differ from the rules for the same drug shipped home.

Medicare is the federal health insurance program for people aged 65 and over, for people under 65 who have received Social Security disability benefits for two years, and for people with end-stage renal disease. It is not one plan but a set of separate coverages, called parts, that a beneficiary assembles or replaces with a private plan.

Medicare Advantage is Part C of Medicare: a private plan that delivers your Part A and Part B benefits in place of the government, usually bundling drug coverage and adding extras, in exchange for a provider network and prior authorization. It replaces Original Medicare rather than supplementing it, and unlike Original Medicare it must cap what you can be asked to pay in a year.

A Medicare Advantage trial right is a federal guarantee that someone who tries a Medicare Advantage plan and leaves it within twelve months may buy a Medigap policy without medical underwriting. There are two versions, and which one applies decides which policies are open to the buyer.

The interaction between Medicare and a health savings account is that enrolling in any part of Medicare ends your ability to contribute to an HSA, though you can still spend the balance you already have, including on most Medicare premiums.

Medicare enrollment periods are the fixed windows in which you can first sign up for Medicare: the seven-month Initial Enrollment Period around your 65th birthday and, if you miss it, the January 1 to March 31 General Enrollment Period.

A Medicare late enrollment penalty is a permanent surcharge added to your premium for signing up for Part A, Part B, or Part D later than you were supposed to. Each part has its own formula, and two of the three last for life.

Medicare Open Enrollment refers to the annual windows for changing coverage you already have: the fall window (October 15 to December 7) when anyone can switch drug or Advantage plans, and the January to March window that only current Medicare Advantage members can use.

Medicare Part A is the hospital half of Medicare, formally named Hospital Insurance. It pays for inpatient hospital stays, skilled nursing facility care after a qualifying hospital stay, home health services and hospice, and its cost-sharing resets with each new benefit period rather than each calendar year.

Medicare Part B is the outpatient half of Medicare, formally named Medical Insurance. It pays for physician services, outpatient care, durable medical equipment and most preventive services, charges an annual deductible and then usually 20% of the approved amount, and has no ceiling on what an enrollee can end up paying.

The Medicare Part B premium is the monthly amount you pay to keep Part B, the outpatient half of Medicare. Most people pay a standard premium set each year by the government, and it is usually deducted from your Social Security check.

Medicare Part D is outpatient prescription drug coverage, delivered by private plans under federal rules rather than by the government directly. Since 2025 the standard benefit has had a hard annual ceiling on what an enrollee pays out of pocket, and the old coverage gap is gone, but the ceiling counts only drugs on the plan's own formulary.

The Medicare Part D coverage gap, universally called the donut hole, was a stretch of the prescription drug benefit in which an enrollee paid a far larger share of their drug costs than in the phases on either side of it. It no longer exists: the Inflation Reduction Act removed it from 2025.

Medicare Savings Programs are four state-run programs that use Medicaid funds to help people with limited income and resources pay Medicare Part A and Part B premiums and, in some cases, deductibles, coinsurance, and copayments.

Medicare Supplement Insurance, also commonly referred to as Medigap, is private insurance sold alongside Original Medicare that pays some of the deductibles, coinsurance, and copayments Medicare leaves to the beneficiary. Policies come in standardized lettered packages, so two companies selling the same letter are selling identical benefits at different prices.

The Medigap open enrollment period is a one-time six-month window, beginning in the first month a person is both 65 or older and enrolled in Medicare Part B, during which an insurer must sell them any Medigap policy it offers at the same price it charges a healthy applicant. It does not repeat.

A mini-med plan is health coverage that looks comprehensive but caps in dollars what it will pay, often at a few thousand dollars a year. The Affordable Care Act prohibits annual and lifetime dollar limits on essential health benefits, which is why a plan that still carries such caps has to sit outside the rules governing health insurance rather than inside them.

A modified endowment contract is a life insurance policy that was funded faster than the tax code's seven-pay test allows. It stays life insurance, and the death benefit stays tax-free, but money the owner takes out while alive is taxed on a less favorable basis.

Moral hazard is the change in behavior that follows from being protected against a cost. It is used in two related but different senses: insurance regulators use it for traits in an insured that raise the chance of a loss, while economists use it for the incentive effect of the coverage itself.

The mortality and expense (M&E) fee is an annual percentage-of-assets charge on a variable annuity that compensates the insurer for its mortality and expense risk, on top of the underlying investment fund fees.

Mortgage protection insurance is life insurance sized to a home loan. The name covers two different arrangements, and the question that separates them is who receives the money when the borrower dies: the lender, or the family.

The named insured is the person or entity written on a policy's declarations page as the party the insurer contracted with. It is a narrower category than "insured", which on most policies also reaches people the named insured never listed, and where more than one name appears the first one carries rights the others do not.

The No Surprises Act is the 2020 federal law that bars out-of-network providers from billing patients beyond in-network cost sharing in three defined situations. It is an eighteen-section statute of which only three sections concern balance billing, and it left ground ambulance out.

No-exam life insurance is coverage issued without a paramedical exam or lab work, usually because an algorithm has evaluated the applicant from third-party data instead. It is faster, it is not the same as no underwriting, and the applicant can still be routed back into the full process.

A noncancelable policy is one the insurer can neither cancel nor change while the premiums are paid, including the premium rate itself. It is the stricter of the two renewal grades, and the frozen price is what separates it from a guaranteed renewable policy.

Nursing home costs are the price of care in a skilled nursing facility, the highest and most expensive level of long-term care. National medians run well over $100,000 a year, Medicare covers only limited short-term skilled stays, and Medicaid is the primary payer for long-stay custodial care after a person spends down their assets.

Open enrollment is a defined period in which you can sign up for or change coverage without needing a qualifying reason. At least five legally distinct windows go by the name, in the individual market, in employer benefits and in three separate places inside Medicare, and they run at different times with different consequences for missing them.

An out-of-pocket maximum is the most an enrollee has to pay toward covered care in a plan year, after which the plan pays the whole of the covered in-network bill. Premiums do not count toward it, and at least three different federal ceilings go by the name, set by different law at different amounts.

Own-occupation disability describes a disability policy that measures whether you can perform the duties of your own occupation rather than any occupation at all. The label is market vocabulary rather than a regulated term, and contracts sold under it differ on one clause that decides whether you can work elsewhere and still be paid.

A period certain annuity pays income for a fixed, predetermined number of years, regardless of whether the annuitant lives the whole time or dies early, in which case a named beneficiary receives the remaining payments.

Permanent life insurance is life insurance with no scheduled end date: it stays in force for as long as the contract's requirements are met, rather than expiring at the end of a term. It is a category rather than a product, and it covers several structures that behave quite differently.

Personal injury protection is the part of an auto policy that pays your own and your passengers' medical bills, lost income and related costs after a crash, without regard to who caused it. What it covers, how much, and whether you can decline it are all set by state law.

Pet insurance is a property insurance policy that covers accidents and illnesses of pets. It reimburses veterinary costs rather than paying providers directly, and where a state has enacted the NAIC model act, the meaning of the words insurers may use in the contract is fixed.

A point of service plan is a health plan that pays more for care inside its network and something toward care outside it, while requiring a referral from a primary care doctor before a specialist visit is covered. It is the design that genuinely combines an HMO's gatekeeping with a PPO's out-of-network benefit.

A policy limit is the most an insurer will pay under a coverage, no matter how large the loss. It is the ceiling on the insurer's obligation, which makes it the opposite bookend to a deductible, and a single policy usually contains several limits rather than one.

A policy loan is an advance an insurer makes to the owner of a cash-value life insurance policy, secured by the policy alone. There is no application, no credit check and no repayment schedule, because the insurer is lending against money it already owes.

A preferred provider organization is a health plan that contracts a network of providers but still pays something toward covered care delivered outside it. That single feature is the whole difference from an HMO, and it is what the higher premium buys.

The premium tax credit is a refundable federal credit that pays part of the premium for health coverage bought through the Affordable Care Act Marketplace. It is computed month by month as the amount by which a benchmark silver plan's premium exceeds a set percentage of household income, and most people take it in advance as a monthly payment to the insurer.

A prescription discount card is a free card or app that gives you a pre-negotiated cash price at a participating pharmacy. It is not insurance: the fill is processed as a cash purchase outside any drug plan, which is both why the price can beat a copay and why it does not count toward a plan's annual out-of-pocket limit.

Prior authorization is a health plan's requirement that it approve a service before you receive it, or it will not pay. The requirement is what converts the request into a formal claim, which puts the plan on a legal decision clock and makes a refusal an appealable denial rather than an administrative answer.

Private mortgage insurance is a policy a conventional mortgage lender requires when the borrower puts down less than 20 percent. The borrower pays the premium, the lender is the party insured, and federal law sets out when the requirement has to end.

Professional liability insurance covers claims that a business's professional work was wrong: bad advice, a missed deadline, a flawed design. It exists because a general liability policy insures bodily injury and property damage, and a client's purely financial loss is neither.

Property damage liability is the part of an auto policy that pays for what an at-fault driver damages that belongs to someone else. Unlike the injury half of the same coverage it carries a single per-accident limit shared by every claimant, and "property" reaches well beyond the other car.

A public adjuster is a licensed claims adjuster hired and paid by the policyholder rather than by the insurer, to prepare, document and negotiate a property claim. The fee comes out of the claim proceeds, so the adjuster has to improve the settlement by more than their own percentage before the policyholder is ahead.

Qualified medical expenses are the costs that a health savings account, flexible spending account, or similar arrangement can reimburse tax-free. They start from the definition of medical care in section 213(d) of the tax code, which is also the basis for the medical expense deduction, but the two rules diverge in ways that surprise people.

A qualified small employer health reimbursement arrangement, or QSEHRA, lets a business that is not an applicable large employer and offers no group health plan reimburse employees tax-free for individual health insurance and other medical expenses, up to a dollar limit set by statute and indexed each year.

A qualifying life event is a change in your circumstances that lets you enroll in or change health coverage outside the normal annual window. It is the trigger, not the window: the event opens a special enrollment period, and the two are governed by different rules depending on whether the coverage is bought on the Marketplace or offered by an employer.

A qualifying longevity annuity contract, or QLAC, is a deferred income annuity bought inside a traditional IRA or an employer retirement plan that meets specific IRS requirements. Its distinguishing feature is that the premium comes out of the balance used to compute required minimum distributions until the annuity's own payments begin, which must be no later than age 85.

Recoverable depreciation is the part of a property claim an insurer withholds from the first payment and pays later, once conditions are met. It is the difference between what the repair costs today and the depreciated value of what was damaged, and on a replacement cost policy it is the policyholder's money waiting on paperwork rather than the insurer's to keep.

Reference-based pricing is a health plan design under which the plan pays a fixed amount for a particular procedure and treats only the providers who accept that amount as in-network. It exists under a federal enforcement posture rather than a settled rule, and the posture is conditional on the plan meeting a list of reasonableness factors.

A registered index-linked annuity (RILA) is an insurance contract registered with the Securities and Exchange Commission whose return is tied to a market index over a set term, with a buffer or a floor that absorbs only part of a decline. Because the protection is partial, a RILA can lose principal.

Reinsurance is insurance bought by an insurance company from another insurance company. The policyholder is not a party to it and keeps dealing with the insurer that issued the policy; what reinsurance changes is the issuing insurer's balance sheet.

Renters insurance covers a tenant's own belongings, their personal liability, and the cost of living elsewhere if the unit becomes uninhabitable. It exists because the landlord's policy covers the building and nothing of the tenant's, and the liability half is the part that matters most.

Replacement cost coverage is a property-insurance settlement basis that pays what it costs to repair or replace damaged property with new property of like kind and quality, with no deduction for depreciation. It is bought as a level of coverage rather than being automatic, it comes in three tiers, and on most policies it does not pay in full until the work is actually done.

A residual disability benefit pays a disability policy's monthly benefit in proportion to the income the insured has lost, for someone working but earning less because of illness or injury. Insurance regulation defines it by reference to the reduction in earnings, which is what separates it from a partial disability benefit.

Respite care is short-term care arranged so that an unpaid family caregiver can stop for a while. The care recipient is the person served, but the caregiver is the person the service exists for, and three federal programs pay for it under three sets of rules that share almost nothing.

Retiree health benefits are medical coverage an employer continues to provide to former employees after they stop working. Federal law treats the promise very differently from a pension: unless the employer has clearly agreed otherwise, it can generally be changed or ended at any time.

Retirement healthcare costs are the total medical spending a household should plan for after leaving work, including Medicare premiums, supplemental coverage, out-of-pocket costs, and dental and vision care that Medicare does not cover.

Return of premium life insurance is term coverage that refunds the premiums paid if the insured survives the term. The refund is generally not taxable income, and the extra premium it costs is what turns the policy into a savings decision as well as an insurance one.

Risk pooling is combining many independent exposures so that the group's total loss becomes predictable even though no individual loss is. It is what lets an insurer promise more than it could ever pay all at once, and it stops working when the exposures are not independent.

Self-insurance is the deliberate decision to bear a risk yourself rather than pay an insurer to take it. In household planning it means choosing a higher deductible, declining a coverage, or funding a foreseeable loss out of savings because the premium is not worth what it buys.

Short-term disability is income replacement for an illness or injury that keeps you off work for weeks to a few months. It is a market category rather than a legal one, it pays money rather than protecting your job, and it is not the disability coverage that decides a household's financial outcome.

Short-term health insurance is medically underwritten coverage sold for a limited period, which federal law calls short-term, limited-duration insurance and deliberately places outside the definition of individual health insurance coverage. That exclusion is why the Affordable Care Act's protections do not apply to it.

A single life annuity pays a fixed amount for as long as one named person, the annuitant, lives, and stops entirely at that person's death, with nothing paid to anyone afterward.

Social Security Disability Insurance pays a monthly benefit to workers who have paid enough into Social Security and who can no longer do substantial work because of a medical condition expected to last at least a year or to end in death. It is insurance you already paid for, not a means-tested benefit.

A special enrollment period is a limited window in which you may enroll in or change coverage outside the normal annual opportunity. At least three different bodies of law use the phrase for windows of different lengths, and each of them sets the date coverage actually starts by a separate rule.

A state guaranty association is a body created by state law that pays covered claims when a licensed insurer fails. States run two separate systems, one for life, health and annuity products and one for property and casualty insurance, and each has its own limits.

A state insurance commissioner is the official who heads a state's insurance regulator, licenses the companies and agents that sell insurance there, and takes consumer complaints. Insurance is regulated jurisdiction by jurisdiction, and these officials do not all carry the same title.

State minimum auto insurance is the least liability coverage a driver may carry and still be legal. What the law actually requires is proof of financial responsibility, and buying a policy is only the most common of several ways to provide it.

Stay-at-home parent finances are the planning steps that protect a non-earning caregiver and the family that depends on them: a spousal IRA so the caregiver keeps saving for retirement, life and disability insurance on the caregiver's unpaid work, Social Security spousal and survivor rights, and safeguards against divorce or death.

Stranger-originated life insurance is an arrangement in which a policy is taken out on someone's life at the outset for the benefit of an investor who has no stake in that person's survival. Where states define it, they define it as a fraudulent act rather than merely as a contract that fails.

Subrogation is the principle that a party who pays somebody else's loss steps into that person's claim against whoever caused it, to the extent of the payment. It is why an insurer that has already paid you can sue the person at fault in your name, and why settling with that person yourself can cost you your coverage.

Supplemental life insurance is the extra coverage an employee buys and pays for through a workplace group plan, on top of whatever the employer provides. It is employee-paid, but that alone does not keep it out of the tax rule that applies to employer-provided coverage.

A surrender charge is a fee an insurer deducts when a contract holder takes money out of an annuity or a cash-value life policy early. It is a sales charge collected on the way out rather than on the way in, and it falls to zero once the contract's schedule expires.

The Survivor Benefit Plan is the federal annuity that lets a military retiree continue part of their retired pay to a surviving spouse or child after their death, paid for by a reduction in the retiree's own monthly pay. Retired pay itself stops at death, so this is the mechanism that keeps any of it flowing.

Survivor benefits are payments that continue to a spouse, child, or other dependent after someone dies. They are not one program but a category — Social Security, employer pensions, the military, annuities, and life insurance each pay them under their own rules, and most of the decisions that determine what a survivor receives are made years before the death.

Survivorship life insurance covers two people under one permanent policy and pays a single death benefit when the second of them dies, not the first. It is usually bought because the money is needed at the second death rather than the first.

Telehealth is medical care delivered by a provider who is somewhere else, using audio and video technology or, in some cases, audio alone. Medicare covers a defined set of telehealth services under Part B, and through the end of 2027 covers them wherever in the United States the patient is.

Term life insurance is pure death-benefit coverage: you pay a level premium for a set period (commonly 10, 20, or 30 years), and if you die during that term, the insurer pays your beneficiaries a tax-free lump sum. Outlive the term and the coverage simply ends.

Title insurance is a policy that pays if someone turns up with a claim against a property arising from before you bought it. A purchase almost always involves two separate policies, and the one your lender requires protects the lender's loan rather than your equity.

Travel insurance is insurance coverage for personal risks incident to planned travel, such as trip cancellation, lost baggage, illness or injury while traveling, emergency evacuation and repatriation of remains. What is sold at checkout is often a "travel protection plan", which can bundle travel insurance with two other things that are not insurance at all.

TRICARE is the Department of Defense health care program for active-duty and retired members of the uniformed services and their families. It is not one plan but an umbrella over several plan options, chiefly TRICARE Prime, TRICARE Select, and TRICARE For Life for those with Medicare.

Tuition insurance is a policy bought from an insurer that reimburses tuition and fees a college does not refund when a student withdraws mid-term for a covered reason. It is a named line of insurance in state insurance codes, and it pays only the part of the bill the school's own refund schedule leaves behind.

Twisting is inducing someone to drop, surrender or borrow against an existing life insurance policy and buy from a different insurer, by misrepresenting the facts or comparing the two incompletely. In the states that define it, it is a named unfair method of competition in the business of insurance.

Umbrella insurance is a liability-only policy that sits on top of the liability limits already carried on a home, auto, or renters policy and pays above them, usually in increments of a million dollars. It covers claims made against you by other people, and never your own property, your own vehicle, or your own injuries.

Uninsured motorist coverage pays you for injuries caused by a driver who has no liability insurance, and its companion, underinsured motorist coverage, pays when the at-fault driver has some but not enough. Whether either is required, what triggers it, and how the payment is calculated are all set by state law and differ materially between states.

Universal life insurance is permanent coverage built as a running account: interest is credited to a policy value and the cost of insurance and expenses are deducted from it as separately identified charges. That structure is what lets the premium and the death benefit be adjusted after issue.

Usage-based insurance prices an auto policy on how the vehicle is actually driven rather than on the characteristics of drivers who resemble the policyholder. The measurement can be as simple as an odometer reading or as detailed as a device recording braking, cornering and time of day.

The use-it-or-lose-it rule is the requirement that money left in a flexible spending account at the end of the plan year is forfeited. It is not an employer policy: it follows from a statutory ban on using a cafeteria plan to defer compensation from one year into the next.

A variable annuity is an annuity contract whose value rides on investment subaccounts you choose, so it can rise and fall. It is the one annuity that is a security under federal law: registered with the SEC, sold by prospectus, and regulated by the SEC and FINRA in addition to state insurance departments.

Variable universal life is a universal life policy whose cash value is invested in subaccounts the owner selects, so the value rises and falls with the markets. It is a registered security sold by prospectus, and unlike an indexed policy it carries no floor under a losing year.

A viatical settlement is the sale of a life insurance policy by its owner to a licensed buyer, where the insured is terminally or chronically ill. Meeting that federal tax description is what makes the proceeds arrive free of income tax.

Vision insurance is a limited benefit plan that pays a set amount toward eye exams, glasses and contact lenses rather than a share of a medical bill. Pediatric vision is an essential health benefit that every Marketplace plan carries; adult vision is optional and bought separately.

A waiver of premium is a benefit under which the insurer stops charging for a policy while the insured meets the contract's definition of disability, keeping the coverage fully in force without payment. It is bought and priced separately, and four terms inside it decide what it is actually worth.

Wedding insurance is special-event coverage bought for a wedding, and it comes in two separable halves: cancellation coverage, which reimburses the money already committed if the event cannot go ahead, and event liability coverage, which responds if someone is injured or property is damaged. Venues commonly require the second and not the first.

Whole life insurance is permanent life insurance whose premium is fixed for life and whose contract carries a guaranteed schedule of cash values. It does not expire while the premium is paid, and what is guaranteed is that schedule of dollar amounts rather than a rate of return.

Workers' compensation is state-mandated insurance that pays an employee's medical bills and part of their lost wages for a job-related injury or illness, regardless of fault, in exchange for the employee giving up the right to sue the employer.

A workplace wellness program is an employer program of health promotion or disease prevention, usually attached to the group health plan and usually paying a reward for participation or for hitting a health target. What the employer may lawfully condition that reward on depends on which of two regulatory categories the program falls into.