Understanding the terms and conditions of a health insurance policy seems like rocket science to many out there. However, it is always wise to have a knowledge of all the jargons your agent uses at the time of discussing health insurance plans. Here is our list of commonly used health insurance terminology:

Certificate of Insurance

This is the description of all important factors of the health insurance plans like coverage, cash limit and including benefits.

Co-payment

It is the number of hospital expenses that the policyholders agree to pay above the reimbursement cost that an insurer pays. The option of co-payment comes an advantage of a lesser premium.

Cumulative Bonus

The increase in the amount of Capital Sum by a certain percentage for each claimless year is a cumulative bonus. It never exceeds more than 50% of the Capital Sum. They increase the coverage amount and offer better protection to the health insurance holder.

Deductible

It is the amount of money that the insured must pay every year before consuming the benefits of their respective health insurance policies.

Grace Period

It is the time policyholder get for premium payment to the insurance company even after the due date.

Free Look Period

It is like a window given to the policyholder to review the benefits of the policy. In case of dissatisfaction, the insured can cancel the policy to get money back. It generally lasts for 15 days from the purchase of the policy.

Long-Term Care Policies

They differ from traditional health insurance plans as they are designed to provide a long term cover for services and support to individuals above age 65 for activities like custody care, nursing care or home health care services. They reimburse the holders a daily amount for such services. They are more flexible with more options than other policy programs.

Long Term Disability Insurance

They are designed to protect the future of the holder in case he/she loses his ability to work due to physical disability. They replace the portion of the individual's income.

Maternity expenses

With a certain waiting period, some health insurance plans provide coverage for maternity expenses. One can reduce the waiting period by paying more premium.

Portability

If the policyholders discontinue paying a premium when they switch to another insurer or a fresh plan with the same insurer after encountering an issue with the current policy, they may lose certain benefits of the policy. The portability protects the policyholders from this loss. This is the right rendered to the policyholder (including family cover) to transfer credit acquired from pre-existing terms and time-bound exclusions. It works only when the previous policy is preserved without break in the premium.

Reasonable Charges

These are the charges mentioned on the hospital bills. Generally, insurers prefer paying reasonable charges and not the additional expensive services the insured get from the hospital.  

Sum Insured

It is an annual maximum amount that the insurance company pay in case of hospitalisation.