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Glossary of Insurance Terms

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Saving Age: A procedure used to make the effective date of a policy earlier than the application date. Saving age is commonly used to make the insurance age of the insured at policy issue lower than it actually is in an effort to receive a lower premium. Most policies can be backdated up to six months. Saving age is commonly referred to as backdating.

Secondary Beneficiary: A person(s) designated by the policy owner to receive policy proceeds if the Primarily beneficiary is deceased at the time benefits become payable. This is often referred to as a contingent beneficiary.

Second-to-die Life Insurance: A type of life insurance policy that insures the lives of two people, typically a husband and wife. The death benefit proceeds are payable upon the second death.

Settlement: The process of receiving the proceeds from a life insurance policy. Settlement choices usually include lump sum payments or annuitization.

Service Area: The geographical area covered by a health plan within which it provides direct service benefits.

Simplified Underwriting: An underwriting process that applies a less strict analysis of risk factors.

Single Premium Life Insurance: A life Insurance policy that requires only one premium and is guaranteed to remain paid up throughout the insured's lifetime.

Skilled Nursing Facility (SNF) : A facility, either free standing or part of a hospital, with a professionally trained staff that provides medical treatment, continuous nursing, rehabilitation, and various other health and social services to patients who are not in an acute phase of illness, but who requires skilled care on an inpatient basis in lieu of hospital inpatients services.

Specialist : A physician trained and/ or certified to treat a specific body system, such as cardiologist (heart) gynecologist (woman's reproductive system), or dermatologist (skin).

Speech Therapy: The study, examination, and treatment of defects and diseases of the voice, speech, and spoken and written language, and the use of appropriate devices and treatment.

Split Dollar Plan: An arrangement in which two parties, usually an employer and employee, jointly purchase the policy, pay premiums and share in the policy's benefits.

Spousal Discount: A discount for purchasing life insurance coverage together with a spouse from the same insurance company. Typically, the second policy fee is waived. Spousal discounts are more often seen on permanent life insurance policies.

Standard Rating Class: The premium rate class available on life insurance policies for applicants that are determined by underwriting to be of average health.

Standard Plus Rating Class: The premium rate class available on life insurance policies for applicants that are determined by underwriting to be of slightly better than average health.

Standard Risk: An average risk as determined by underwriting.

Stock Insurance Company: An insurance company formed and capitalized through the sale of shares of stock. Those purchasing the stock are owners and share in the company's earnings through stock dividends declared by the company.

Stop Loss: The total dollar amount up to which you share medical costs with the insurance company. For example, if the stop loss is US$ 5,000 and your share is 20 percent, you pay US$ 1,000 and the company pays 100 percent thereafter up to the lifetime benefit.

Sub-Standard Risk: A below average risk as determined by underwriting. Insurance policies can be issued to individuals with sub-standard risk and are referred to as table rated or modified.

Suicide Clause: A life insurance policy provision that states if the insured dies by suicide within a certain period of time from the date of issue (usually two years) the amount payable would be limited to the total premiums paid minus any policy loans or outstanding premiums.

Subscriber: The individual who is responsible for payment of premiums or whose employment is the basis for eligibility for membership in a group health plan. This is also referred to as a member or emolee.

Substance Abuse/Chemical Dependency: The consumption of alcohol or other chemical agents at dosages that place a person's social, economic, psychological and physical welfare in potential hazard, or endangers public health, morals, safety or welfare, or a combination of these.

Supplemental Accident: Provides first-dollar coverage for accidental injuries. This benefit is usually not subject to copayments, deductibles, or coinsurance.

Surrender: The cancellation of a life insurance policy.

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