Understanding Insurance Policy Terminology

By |2020-04-12T22:54:51+00:00April 13th, 2020|Categories: Blog and News, NHIA Blog|Tags: , |

How well do you know your insurance policy terminology? This month is dedicated to going back to the basics of insurance information. Not everyone is well versed in the terms used in their insurance documents. Ultimately, this makes reading a policy daunting and confusing. Today, we are breaking down the most common insurance policy terms misunderstood by consumers.

When was the last time you read you insurance policy? Did you understand all of it or did you have to give something a Google? Don’t feel bad. Most companies write insurance policies with the expectation that the reader understands insurance policy terminology. It’s the equivalent of reading a contract that explains everything in legal terms you’ve never seen before. Common terminology includes basic principles like a deductible, copayment and more. You can treat this article like a mini-course on your insurance policy.

Each insurance policy is different. This article does not cover all terms, and definitions could change from policy to policy. For a full explanation of a policy, or if you are in need of insurance, please call us at National Health Insurance Agencies. One our policy service members would be happy to assist you.

Common Insurance Policy Terminology

The following terms are fairly standard across the board for coverage of health insurance, life insurance and dental insurance. However, this list is not exhaustive and may not apply to your policy. It is important to understand your policy and its contents. There is no one better to explain it to you than an insurance expert, but we’re defining what we can. Let’s break down the common insurance policy terminology.

  1. Copayment

The copayment, also known as copay, is the set amount that you pay at the desk when you go to the doctor. For instance, if you pay $35 each time you visit the doctor, that is typically your copayment. Copayments can change for different services. However, this is the amount due at the time of service for policy benefits.

  1. Deductible

As far as insurance policy terminology goes, this is probably the most confusing to understand. A deductible is the set amount of money the you must pay each year before your insurance pays for certain services. This amount and how it refers to your plan is specific. As a rule, have your insurance provider detail this information for you.

  1. Premium

Where would insurance policy terminology be without the premium. Your premium is what you pay each month for your insurance. Sometimes companies include other factors in the premium. However, it usually boils down to what insurance customers charge customers each month.

  1. Out Of Pocket

Out-of-pocket anything is what you pay or are expected to pay regardless of what your policy pays.

Out-of-pocket Costs are your regular charges such as your copayments and deductibles. It also includes the parts of your bill that insurance won’t cover. This is the amount you pay your service provider or doctor.

Out-of-pocket Estimates attempt to provide you an estimate of what your out-of-pocket costs will be prior to processing claim information or providing services. Think of this as a quote.

Out-of-pocket Maximum is the highest that you have to come out of pocket for the year. After you pay this amount, insurance should cover everything else.

  1. Plan

Plan information in regards to insurance policy terminology also has specific definitions. A plan is part of employer benefits or offered as a benefit through other sources. This could be a negotiated insurance coverage that only they can offer you. Subsequently, this is why you pay them and they pay the insurance coverage provider.

Plan Type refers to whether you have an HMO, PPO, or something else. This is the category of plan that you have. Insurance companies include this information on your insurance card.

Plan Year details the 12-month stretch of time in which those benefits apply to you.

More information about insurance policy terminology can be found here. At National Health Insurance Agencies, we care about your health and safety. For assistance finding your best coverage, contact us today. Afterhours? Request a free quote!

How To Choose A Health Insurance Policy?

By |2019-03-05T22:25:53+00:00May 5th, 2019|Categories: Blog and News, NHIA Blog|Tags: |

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Choosing a proper health insurance policy can be intimidating and quite tricky, especially if you don’t have professional guidance. However, there are specific terms that you should know, which can ease the process of choosing.

Different types of plans are available in the market to help different kinds of people. While some plans restrict your choices by providing you with a list of medical institutions you can go to, others provide lump sum money whenever you are ill. Here are some pointers to help you choose the correct health insurance policy.

Know The Correct Category

Before you start choosing your health insurance policy, you should know about different marketplace plans. There are four tiers of plans available – namely platinum, gold, silver, and bronze. In each of these tiers, you can get either of the following types of policy

  • Executive provider organization where you are covered only if you use the doctors and medical institutions laid out in the plan
  • Health maintenance organization, which limits doctors, and won’t include anything outside of their network
  • Point of service, where you are paid a portion of the charges for any doctor or institution you choose for treatment
  • Preferred provider organization where a percentage of the fees are paid only if you use the pre-approved system and doctors


Well, just knowing about the types of insurance policies won’t do. You need to pay the premium, and that will depend on your monthly earnings and savings. Before you choose a plan, make sure you research about the monthly premium when you need medical and service and when you don’t. Additionally, there would be other charges, which are not part of the premium. You should also consider the percentage you will be paying out of your pockets if you are ill.

Network Types

Based on your budget and your health condition, you need to choose the correct network and types of policy. For example, if you are suffering from conditions like diabetes, you would need access to medical facilities pretty much everywhere you travel. So, choosing a plan that limits doctors and medical facilities, won’t be a good choice in this case.

Catastrophic Plans

Another type of health insurance plan that you should be aware of is the catastrophic health insurance policy. Only people who are below 30 years of age or affordability or hardship exemption can apply for this. While the premiums are low in this case, you cannot apply for a tax credit with this type of plan. Additionally, the deductibles on this type of plan are higher than normal. On the plus side, they cover a couple of preventive services without additional costs and allow three primary care visits annually.

Final Thoughts

If you are confused about choosing a health insurance policy, you can always consult your agent. Additionally, you can also use National Health Insurance Agencies Inc, who offer you a free consultation. With professional advice available around you, all you need to do is book a call, and clear your doubts!


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This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.
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