Insurance Glossary

AJAX progress indicator
Search: (clear)
  • a

  • Absence Management
    Absence management is an employer effort to reduce unscheduled employee absenteeism and, in turn, lower the associated costs such as health care expenses and lost productivity. Among the approaches used to reduce absenteeism are paid-time-off ("PTO") programs, case management, integrated(...)
  • Absenteeism
    An employee's frequent failure to physically appear for work.
  • Accessibility
    One of five governing principles under the Canada Health Act that provides for access to services regardless of income, age, health status, or gender.
  • Accident Insurance
    Accident Insurance is a form of health insurance that protects against loss by accidental bodily injury.
  • Accident Only Coverage
    A disability policy covering disabilities due to injury only.
  • Accidental Death and Dismemberment
    Accidental death and dismemberment provides a lump-sum payment if death occurs as a result of an accident. It also provides payments for injuries as sustained or loss of use of specified body parts as a result of an accident.
  • Accidental Death Benefit
    A provision added to an insurance policy that pays an additional benefit in case of death by accidental means. 
  • Accidental Dental Benefits
    A type of insurance coverage found in group and individual extended health insurance plans that typically covers the cost of dental treatment due to an accident that causes injury to the natural teeth. Payment is made in accordance with the limits set out in the policy.
  • Accidental Fracture Benefit
    An optional benefit that pays a lump sum in the case of fracture of a bone with the amount dependent on the particular bone fractured.
  • Accidental Medical Reimbursement Benefit
    A benefit included in some injury policies at no extra cost that reimburses medical expenses related to injury such as hospital costs, ambulance, and other practitioners' fees not covered by provincial hospital insurance plans; sometimes offered as optional benefit at an additional cost.
  • Accommodation
    The type of room accommodation offered by a hospital; standard ward, semi-private or private hospital room.
  • Accountability
    Obligation to periodically disclose appropriate information in adequate detail and consistent form to all involved parties in a benefit plan.
  • Accreditation
    Formal recognition by an agency or organization that evaluates and recognizes a program of study or an institution as meeting predetermined standards. Accreditation may be for a specified period of time or permanent.
  • Accreditation Canada
    A nonprofit, independent organization that provides national and international health care organizations with an external peer review process to assess and improve the services they provide to patients based on standards of excellence.
  • Accrue
    A dollar amount that is accumulating periodically over time. Interest accrues on savings accounts. A pension plan sponsor accrues liability for future payments due to plan participants.
  • Accumulation
    With respect to saving and investing, the act of purchasing or otherwise amassing assets. Accumulation is essentially the opposite of decumulation.
  • Active Life Reserves
    A reserve set up on in-force policyholders to cover expected benefit and expense payouts on disabilities that have not yet been incurred.
  • Actively at Work Provision
    A group insurance plan policy provision that requires an employee to be at work (versus sick or on leave) on the day the employee's coverage takes effect. If the employee is not actively at work on the specified day, coverage does not become effective until the next day that the employee is(...)
  • Activities of Daily Living
    Activities such as bathing, dressing and toileting that are needed for self-care. Activities of daily living are used to evaluate the continued feasibility of self-care and to determine eligibility for long-term care benefits.
  • Activities of Daily Living (ADLs)
    A measurement of one's ability to perform five or six specific activities such as bathing, dressing, hygiene associated with toileting, transferring, and feeding ones self. The inability to perform two or more of these activities or a diagnosis of a cognitive impairment may entitle an insured(...)
  • Actuarial Assumptions
    Factors used to forecast uncertain future benefits and costs associated with a fund. Among these factors may be investment return, salary increases, employee turnover, retirement ages and mortality.
  • Actuarial Cost
    The present value of future benefits payable to plan participants and fund administration expenses.
  • Actuarial Gain/Loss
    The difference between what was predicted and what occurs. A gain results when the actuarial experience is more favourable than the estimate, while a loss reflects an adverse deviation. 
  • Actuarial Present Value
    The current value of an amount or series of amounts receivable over a set period of time that is determined using a set of actuarial assumptions.
  • Actuarial Risk
    The loss an insurance company is willing to cover in exchange for premiums.
  • Actuary
    An actuary is a person whom is professionally trained in the technical and mathematical aspects of insurance, pensions an related fields. An actuary is used by a pension fund to estimate how much money must be contributed to the fund each year to provide the promised benefits. Insurance(...)
  • Acupuncture
    Acupuncture is a form of complimentary and alternative medicine of Asian origin used to treat pain or disease. Fine needles are inserted into specific points on the body, manipulated and removed.
  • Acute
    A medical condition that requires sudden and immediate treatment.
  • Acute Care
    Short-term medical treatment for a person who has a severe illness or injury. Acute care may include surgery, a hospital stay and/or visits with skilled professionals (e.g., doctors).
  • Add-Back
    The increase in an employee's taxable annual earnings that corresponds to the insurance premium paid on that employee's behalf.
  • Adjudication Process
    The various stages throughout the claims processing period from the time of notification by the client that a disability has occurred through to ultimate payment; includes ongoing reviews until the client has returned to work or the file is otherwise closed.
  • Adjusted Cost Base
    The sum of the initial investment in a business plus any additional contributions or reinvested.distributions less any amount of previous redemptions. It represents the tax cost used to determine the capital gain or Loss realized on the disposition of a capital property.
  • Administration
    Process of running a business, organization, etc.
  • Administrative Cost
    Expense incurred for management of a benefit plan such as maintenance of eligibility records, claims review, claims adjudication and benefit payments. Administrative costs do not include the actual cost of benefits.
  • Administrative Manager
    Individual or firm providing professional services to an employee benefit plan such as maintenance or eligibility records, claims review, claims adjudication and benefit payments. Compensation for services may be made through salary or contract management.
  • Administrative Practice
    An insurer's current method of handling, processing or interpreting a particular term in a provision or situation not specifically defined in the policy contract. Administrative practices often change over time for reasons such as a change in the economy (which can cause an increase in(...)
  • Administrative Services Only (ASO)
    Arrangement in which a benefit plan hires a third party, often an insurance company, to provide services such as account management, claims processing, customer service and fee negotiations. The plan bears the risk for the claims. Such an arrangement is common in self-funded health care plans.
  • Administrator
    Person or entity managing a benefit plan. A plan administrator is usually an employer sponsoring the plan, a board of trustees for a multi-employer plan or a plan committee.
  • Adult Day Care
    Provision of a range of services to a disabled or elderly person in the home or at a center that may include medical, psychological, social, nutritional and educational services. Such care is often used when a primary caregiver is at work or otherwise unavailable. 
  • Adverse Drug Reaction (ADR)
    Undesirable patient response to a medication that compromises therapeutic efficacy, enhances toxicity or both. ADR's range from mild to severe.
  • Adverse Event
    Undesirable consequence associated with the medical treatment of a patient.
  • Adverse Selection
    Tendency of individuals to consider their health status when selecting an insurance plan and making choices most favourable to them but costlier to the plan. For example, a person with poor health is more likely to purchase health insurance and select a plan with higher levels of coverage to(...)
  • After-Tax Contribution
    Contribution to a benefits plan that is subject to income tax. After-tax contributions are not as financially advantageous to a plan participant as pre-tax contributions.
  • Aftercare
    Continued contact to support and increase gains made as the result of health treatment and to prevent relapse.
  • Age of Entitlement
    The belief that one has a right to certain social benefits.
  • Agent
    A person or firm authorized to act on behalf of or represent another. Insurance agents sell insurance policies and recommend which policies should be purchased. Some agents are only allowed to sell products from specific companies or have quotas with specific companies. Agents typically(...)
  • Aggregate Benefit Amount
    The overall maximum amount covered by the policy in total during the full period of coverage.
  • Aggregation
    The treatment of a group of individuals or other entities as one.
  • Algorithm
    A process or set of rules designed to direct decision making.
  • All Source Maximum
    The maximum percentage of earnings an employee can receive from all sources during  a disability, such as 85%. There are two categories of sources, direct offsets and indirect offsets. The plan's all-source maximum may provide for offsetting of direct sources only, or of both direct and(...)
  • All-Payers System
    A health insurance term that indicates both public and private third-party payers are subject to the same rules and rates when paying for health care services.
  • All-Salaried Workforce
    A pay policy that makes exempt/non-exempt status (with respect to overtime) invisible to workers. All employees are paid on a salaried basis and all pay is defined in the same terms, such as monthly or annual salary.
  • Allied Health Professional
    A health care practitioner with formal education and clinical training but no medical degree.
  • Allowable Amount
    The maximum dollar amount paid by a health plan, insurance company or third-party payer to a health care provider. If a provider charges in excess of the allowable amount, the patient may have to pay the difference. The allowable amount may be subject to deductibles or coinsurance. Other terms(...)
  • Allowance for the Survivor
    A federal benefit available to persons age 60 to 64, who are a Canadian citizen or a legal resident; who reside in Canada and have resided in Canada for at least 10 years since the age of 18; have had their spouse or common-law partner die; have not remarried or entered into a common-law(...)
  • Alternate Benefit Provision (ABP)
    An element of a contract that states the benefit payable will be based on the least expensive professionally acceptable procedure necessary to treat a given problem. ABP is common in dental plans due to the many procedural and material options available for care. When applied, the beneficiary(...)
  • Alternate Payee
    A spouse, former spouse, child or other dependent who is recognized by a domestic relations order as having a right to receive all, or a portion of a participant's plan benefits.
  • Alternative Dispute Resolution
    A variety of methods used to resolve disagreements out of court. These methods include, negotiation; conciliation; mediation; and arbitration. Alternative dispute resolution tends to be faster, less formal and less expensive than litigation. The process may be voluntary or involuntary and(...)
  • Amalgamation
    An amalgamation in Canada is a merger or combining of two or more companies or corporations.
  • Ambulance Services
    A benefit contained in the extended health-care line of coverage that covers charges incurred for transportation by ambulance up to the difference  between the provincial health insurance plan and the customary charges in the province of residence. Payment is covered up to the limits set out(...)
  • Ambulatory Care Facility
    A freestanding or hospital-based center that provides medical services that do not require overnight admission.
  • Ambulatory Care Quality Alliance ("AQA")
    A broad based coalition of organizations that includes physicians, health insurance plans, consumers and other seeking to improve health care quality and patient safety through a collaborative process. Key stakeholders agree on and promote strategies to measure performance at the physician,(...)
  • Ambulatory Care-Sensitive Conditions
    Medical issues that do not require hospitalization if patient care is provided to prevent complications or the onset of more severe forms of an illness. Asthma, diabetes and hypertension are examples of such conditions.
  • Ambulatory Surgery Center ("ASC")
    An ambulatory surgery center is also called a same-day surgery center, a freestanding or hospital based establishment that performs surgery of an uncomplicated nature that has traditionally been done in an inpatient setting but now can be done with equal efficiency without hospital admission.
  • Amendment
    An addition, deletion or change in a legal document. A change in terms of an insurance policy or group benefits plan is often called an amendment. Usually, a document is prepared stating the changes that must be signed by the parties or representatives of those affected by the change.
  • Amortized Value
    The financial worth of an item at a given point in time.
  • Ancillary Benefit
    A secondary or supplementary benefit that accompanies a major benefit.
  • Ancillary Services
    Ancillary services are supplemental services that go beyond the hospital room, medical procedures and nursing provided to a patient in the course of care. Such services include lab work, radiology, pharmacy and physical therapy.
  • Anniversary Date
    The month and day when an individual began their employment or when an insurance policy was issued.
  • Anniversary Year Maximum
    The maximum a plan will reimburse an insured during the stated period of time based on the consecutive 12-month period following the effective date that coverage commences and annually thereafter.
  • Annual Addition
    A yearly contribution made to a participant's defined contribution account. The annual addition includes employer and employee contributions.
  • Annual Bonus
    Additional pay in cash or stock, beyond an employee's normal pay for a fiscal or calendar year, based on individual, business unit and.or company performance. Usually in the form of a lump-sum payment.
  • Annual Deductible Combined
    Typically used in health savings account (HSA) eligible plans, the total amount family members on a plan must pay out-of-pocket for health care or prescription drugs before the health plan begins to pay.
  • Annual Information Return (AIR)
    Pursuant to Canada's Pension Benefits Standards Act, pension plans must file financial and other information each year with the Canada Revenue Agency and the appropriate provincial government.
  • Annual Limit
    The maximum benefits a person may receive from a health benefit plan in a play year. After the limit is reached, the plan no longer pay for covered services.
  • Annual Statement
    A yearly report providing financial data such as assets, liabilities, receipts and disbursements.
  • Annualize
    To annualize, is to express a rate of return for a period greater than one year or less than one year, in terms of 12 months.
  • Annuitant
    A person, on whose life an annuity contract is based. The annuitant receives the payments due on the contract.
  • Annuitization
    The conversion of a lump sum of money to a stream of periodic income payments. Annuitization for a plan participant's life or the lifetimes of the participant and participant's spouse is an option offered by many retirement plans.
  • Annuity Certain
    An insurance contract in which an insurance company agrees to make payments to a person for a specified number of years, regardless of whether the person is living or deceased. If the person dies, his or her designated beneficiary will receive payments for the years remaining in the contract.(...)
  • Annuity Consideration
    A lump-sum payment or series of payments made to purchase an annuity.
  • Annuity Rate
    A price charged by an insurance company to provide one dollar of annuity payments (usually per month) to an individual, based on the person's age, interest rates and other specified conditions.
  • Annuity Starting Date
    The first day of the period for which an annuity payment is paid to an annuitant.
  • Any Occupation
    An occupational definition defining what the insurer considers to be a state of total disability. This definition eliminates the over-insurance aspect associated with a pure own occupation definition.
  • Appeal
    A request for an insurer or benefit plan to review a benefit decision.
  • Appraisal
    An estimate of quantity, quality or market value of property by an expert.
  • Appreciation
    An increase in asset value. A stock advancing from $70 to $80 is said to have appreciated ten points.
  • Approved Plan
    A pension, deferred profit-sharing or stock bonus plan that meets the requirements of the applicable Revenue Canada regulations. Such approval qualifies the plan for favourable tax treatment. Approval of a pension plan, however, does not indicate any judgement regarding the plan's actuarial(...)
  • Arbitrary and Capricious Standard
    A guide employed by courts to determine whether a plan's decision to deny benefits should be upheld or overruled. A benefits decision is considered arbitrary and capricious if no rational connection can be found between the facts and the choice made.
  • Arbitration
    A process of resolving a dispute using an impartial individual (or group of people) appointed by mutual consent or statutory provision. The arbitrator listens to the facts of a dispute, then provides a judgement. Arbitration is often used to settle disputes between labour and management. It is(...)
  • Arm's Length Transaction
    An agreement made by two or more parties freely and independently of each other, with no special relationship. Certain individuals connected by blood relationship, marriage, common-law partnership or adoption are examples of related persons that may be deemed under the law as to not be dealing(...)
  • Asking Price
    The lowest price that any potential seller declares acceptable for a given security. For mutual funds, the asking price is the net asset value plus any sales charges. Asking price is also referred to as ask price, asked price and offering price.
  • Assessed Value
    Worth of real estate or other property assigned by a public tax assessor for tax purposes.
  • Asset
    A resource, property right or property owned by an individual or organization. Assets may include cash, securities, materials and inventory.
  • Asset Allocation Fund
    A mutual fund that invests mainly in a mix of stocks, bonds and cash equivalents. Some asset allocation funds maintain a fixed proportion of these asset classes over time, while others adjust the proportion of each as economic and investment circumstances change. The objective of an asset(...)
  • Asset Class
    A category of investment securities that share common financial traits. Stocks, bonds and cash (including cash equivalents) are major asset classes. Other classes include real estate, derivatives, futures contracts and precious metals.
  • Asset Reversion
    The termination of a pension plan by a plan sponsor in order to reclaim assets in excess of the amounts needed to pay accrued fund benefits.
  • Asset Smoothing
    A method by which the actuarial value of assets is determined. Fluctuations in market values are "smoothed" by gradual recognition of investment return.
  • Asset-Backed Security
    A pool of consumer debt such as auto loans, revolving credit accounts, home-equity loans and home-equity lines of credit. Loan payments are passed through to ABS investors.
  • Assignment
    The transfer of rights from one party (the assigner) to another (the assignee).
  • Assignment of Benefits
    An arrangement by which benefit payments are transferred (assigned) by a beneficiary to a third  party. For example, a patient may request that dental benefit payments be made directly to a dental provider.
  • Assisted Living Facility
    A shared and supervised housing facility persons who cannot function independently.
  • Association Group Insurance Plan
    Individual insurance policies offered to a group of persons who share a common interest (an association). For example, trade professions. Self-employed, small businesses and religious organizations can also have associations. Individuals or businesses within the association have the option of(...)
  • Assurance
    Assurance is synonymous with insurance in Canada and Great Britain.
  • At The Money
    A condition in which the strike price (the amount per share paid) of an option is equal to the price of the underlying stock.
  • Attachment Point
    In self-funded plans, the attachment point is the dollar amount at which stop-loss coverage is triggered. Similar to a deductible, once the attachment point is reached, the stop-loss insurance carrier is responsible for additional claims.
  • Attained Age
    An individual's age at his or her last birthday.
  • Attest
    The act of agreeing that information provided is correct, true or genuine. Foe example, when an individual applies for insurance coverage, the applicant is required to attest to the truth of the information being provided in their application.
  • Attestation
    An affirmation that something is correct, true or genuine.
  • Attitude Survey
    Questions designed to elicit feelings, concerns, expectations and/or preferences on issues.
  • Attorney-Client Privilege
    A legal right that keeps communication between a lawyer and his/her client confidential.
  • Attribution
    Assigning of pension benefits or costs to periods of employee services.
  • Audit
    A systematic investigation of procedures, operations, records or financial accounts.
  • Audit Finding
    A conclusion about a monetary or non monetary matter resulting from an investigation of procedures, financial records, etc. A finding typically identifies a problem and provides recommendations for corrective action.
  • Audit of Provider Treatment/Charges
    A review of services and/or fees rendered or proposed by a health care provider.
  • Audit Trail
    The availability of records containing evidence of activities such as transactions or communications by individual people, systems, accounts, etc.
  • Authentication
    A process by which a person's identity or fact is confirmed. Authentication can be as simple as looking at a person's driver's license or using a password.
  • Authorizations
    Statements signed by the claimant that authorize other institutions or organizations to release information about the claimant for the purpose of adjudicating the claim.
  • Automatic Premium Loan
    An agreement between an insurer and the insured that the payment for a life insurance policy will be lent to the insured from the cash value of the policy if the insured (or other policy holder) does not pay on time.
  • Average Annual Compensation
    An employee's yearly pay averaged over a specified number of years.
  • Average Daily Census
    The average number of inpatients (other than newborns) in a hospital or other health facility each day throughout a given period. The census is calculated by dividing the number of patient days during a period by the number of calendar days in the period.
  • Average Length of Stay
    A measure of the use of a health care facility, often used for health planning services.
  • Average Life
    The length of time that will pass before half of the principal on a debt obligation has been paid.
  • Average Price
    Also referred to as the mean price. Average price is the sum of the dollar amounts paid for an item, divided by the number of prices.
  • Average Wholesale Price
    A term used by the prescription drug industry that refers to the average price at which wholesalers sell a drug to physicians, pharmacies and other customers.
  • Avocation Exclusions
    Certain hazardous hobbies that may be excluded from coverage under a disability income policy such as flying as a private pilot, mountain climbing, heliskiing, or similar activities. Special risk insurance can be purchased to cover this risk exposure not covered by the disability policy.
  • b

  • Baby Bonus
    A financial payment used by some nations to encourage the decision to have more children and to help lighten the financial costs of raising children.
  • Baby Boomer
    An individual born between 1946 and 1964.
  • Back End Load
    A fee charged to an investor upon the sale of mutual fund shares. The fee is a percentage of the value of the shares being sold.
  • Backpay
    Salary and wages from a prior pay period to which an employee is entitled. A retroactive pay increase is provided in the form of backpay. Backpay may also be ordered by a court as the result of an employment practice that is deemed illegal.
  • Balance Sheet
    A condensed financial statement showing the nature and amount of an organization's assets and liabilities on a given date.
  • Balance Sheet Approach
    A technique used by companies to ensure that expatriates operating in other nations are not at a financial disadvantage when compared with home country peers with respect to the purchase of good and services, and payment of taxes.
  • Balanced Billing
    The act of charging patients for health care fees that exceed the amount approved by a plan or third-party insurer.
  • Balanced Fund
    A mutual fund that combines stocks, bonds and sometimes a money market component into one investment portfolio to provide current income and long-term growth.
  • Bank Draft
    A cheque drawn by one bank that authorizes a second bank to make payment to the person named on the draft.
  • Bank of Canada
    The central bank of Canada, similar to the federal reserve system in the United States. Founded in 1934, the Bank of Canada is responsible for managing the nation's banking system, including issuing currency and administering monetary policy.
  • Bankruptcy
    Bankruptcy is the inability to repay debts in full because liability exceeds assets.
  • Bare-Bones Health Plan
    A no-frills health plan or insurance policy that typically offers a reduced set of benefits for a lower premium.
  • Bargaining Unit
    A group of employees authorized to negotiate working terms and conditions on behalf of all the employees of an employer or an industry.
  • Barriers to Care
    Obstacles that prevent persons from getting quality health care and/or complying with recommended treatment guidelines.
  • Bed Days
    The number of inpatient hospital days per 1,000 persons covered by a plan for a year or other period.
  • Behavioral Health
    The emotions, behaviors and biology relating to people's mental well-being, their ability to cope with the everyday challenges of life and their concept of self. Behavioral health is sometimes used interchangeably with mental health. Others differentiate mental health as only the biological(...)
  • Behavioral Intervention
    A treatment to modify what a person does or how he or she reacts using strategies such as positive and negative reinforcement, behavior modifications and behavior therapy.
  • Beneficiary
    A person or group that receives benefits, profits or advantages. A beneficiary may be a plan participant or a person eligible for benefits through the plan participant.
  • Benefit
    The right of a participant or beneficiary to cash, goods or services after meeting the eligibility requirements of a benefit plan.
  • Benefit Booklet
    A publication for employees that contains a general explanation of benefits.
  • Benefit Design
    A process used to determine which benefits and the level of benefits that will be offered to plan participants, the extent to which participants are expected to share the cost of the benefits and how the participant can access these benefits.
  • Benefit Package
    Specific goods, services and/or payments provided by a benefit plan or insurance contract.
  • Benefit Period
    The maximum duration for which benefits can be collected under a disability policy or a group LTD plan, usually measured in years or to a specified age.
  • Benefit Specialist
    An individual or organization who is responsible for administering an employee benefits program.
  • Benefit Year Maximum
    The maximum a plan will reimburse an insured during the stated period of time based on the 12 consecutive-month period following the date that a claim for a specific benefit is first incurred. Under this method, the maximum acts as a rolling 12 measured from the date a particular category of(...)
  • Benefits Adjudicator
    A person responsible for authorizing payment of valid claims or notifying the claimant of a denied claim. The benefits adjudicator manages the claim through the process of evaluation to ultimate payment and close.
  • Bereavement Leave
    Paid time off for employees, usually following the death of a relative. Bereavement policies typically specify the relatives whose death qualifies an employee for leave.
  • Bioavailability
    The rate and extent of a medication's absorption in the human body.
  • Bioequivalent
    A medication that has the same active ingredients, strength, dosage and delivery form as an existing drug. Also referred to as biological equivalent drugs.
  • Biologic
    A biology-based drug that structurally mimics compounds found in the body. Biologics include a wide range of products such as vaccines, blood and blood components, allergenics, gene therapy, tissues and therapeutic proteins created by biological process in contrast to traditional medications(...)
  • Biometric Screening
    An examination of a person's physical characteristics to determine his or her risk level to certain diseases and medical conditions.
  • Biosimilar
    A biology based drug (biologic) similar to a brand name biologic that is available once the patent on the brand name product has expired.
  • Biotech Drug
    A medication that is produced using living organisms such as yeast, bacteria or human cells.
  • Birth Rate
    The number of births per 1,000 people in a specific geographic locale. The birth rate is calculated by dividing the total population into the number of live births and multiplying by 1,000.
  • Birthday Rule
    A method used to determine primary and secondary insurance coverage for a child covered by both parents' health and/or dental insurance plans. Primary coverage falls to the parent who has the earlier birthday (month and day).
  • Biweekly Pay Systems
    A schedule by which employees receive salary or wages every two weeks.
  • Board Certified
    A physician or other health professional who has passed an examination given by a medical board and has been certified by that board as a specialist in a specific type of care.
  • Board Eligible
    A physician or other health professional who has completed the requirements to practice a specialty but has not taken and passed the required examination.
  • Body Mass Index (BMI)
    A measure of body fat that equals the weight of an individual in kilograms divided by the square of the person's height in meters. 
  • Bonus
    A payment in addition to normal salary and wages typically given at a manger's discretion to recognize work performance.
  • Boomerang Employee
    An employee who leaves an employer, for whatever reason, then returns to work for the same employer at a later point.
  • Brand Name Drug
    A medication marketed under a specific trade name. A brand name is a proprietary or patent protected pharmaceutical available from only one manufacturer. Production of the drug by other companies is prohibited as long as the patent remains in effect.
  • Brand Name Interchange
    The substitution of a brand name drug that is the chemical or therapeutic equivalent or another brand name drug.
  • Breach of Fiduciary Duty
    Conduct that falls short of the standard expected.
  • Breach of Trust
    An act that violates the duties of a trustee or breaks a promise or confidence. A breach of trust does not need to be intentional or done without malice. It can result in negligence.
  • Broker
    A person or business that buys or sells for another in exchange for a commission.
  • Brokerage
    A company's use of independent advisors (i.e. advisors it does not control) to distribute its products.
  • Business Continuation Insurance
    An insurance contract issued by an insurance company that promises protection to business partners if a partner dies or is disabled. The remaining partners are provided with the funds to purchase that partner's interest in the firm.
  • Buy-Sell Agreement
    An agreement between business partners or shareholders documenting the terms of their business relationship, including how the interests of each partner or shareholder are to be purchased on retirement, death, or disability.
  • c

  • Calendar Year Deductible
    A portion of expenses that an insured must pay before an insurer will begin benefit payments.
  • Calendar Year Maximum
    The maximum a plan will reimburse an insured during the stated period of time based on the 12 consecutive-month period beginning January 1 of each year.
  • Canada Health Act
    Federal Legislation that requires each Canadian Province to provide legal residents with health care coverage for hospital and medical services.
  • Canada Labour Code
    Federal legislation that mandates minimum wage and overtime standards in Canada similar to the standards established by the Fair Labor Standards Act in the United States.
  • Canada Pension Plan
    The Canada Pension Plan is a social insurance program that ensures a measure of protection to contributors and their families against the loss of income due to retirement, disability or death.
  • Canada Revenue Agency
    Canada Revenue Agency (CRA) is the administrator of tax laws for the Government of Canada as well as most provinces and territories.
  • Canadian Human Rights Act
    Federal legislation that prohibits decisions and actions that treat a person or a group negatively for reasons on the grounds of race, national or ethnic origin, colour, religion, age, sex, sexual orientation, marital status, family status, disability and a conviction for which a pardon has(...)
  • Cancelable
    A term used for an insurance policy that indicates the policy can be terminated at any time by the insurer.
  • Carryover Deductible
    A deductible amount satisfied within a specified time period (typically the last three months of the year), which can also be applied to the deductible of the following year.
  • Carryover Provision
    An employer policy that allows employees to take unused vacation or other leave in a subsequent calendar year or fiscal year. Some health insurance plans also permit expenses arising from claims during the last three months of the year to be carried forward to the next year.
  • Case Management
    A patient care model that focuses on coordinating the health care and disability services needed by individual patients.
  • Case Manager
    A doctor, nurse or social worker who works with patients, care providers and third-party payers to coordinate the services considered necessary and appropriate for a patient.
  • Case Mix
    Classifications or categories of patients treated by a hospital.
  • Case Rate
    A method of paying for health care services in which a benefit plan negotiates with a hospital a flat amount the plan will pay for a specific type of service. The hospital absorbs any cost in excess of the fixed amount.
  • Cash Flow
    The net income of a business or specific project during a defined period of time.
  • Cash Value Life Insurance
    A life insurance policy that combines insurance with a savings or investment plan.
  • Catastrophic Coverage
    A Line of coverage occasionally found in a personal health insurance plan that protects against catastrophic loss for those who want protection in case of a serious accident or major illness; normally requires satisfying a Large deductible, such as $2,500, $4,500 or a higher amount. Payment is(...)
  • Catastrophic Drug Program
    A provincial drug program for individuals who may need access to higher-cost drugs than they would not otherwise be able to afford, such as treatment for cancer and palliative care. A deductible is usually required, based on household income.
  • Catchment Area
    An area served by an organization; for example, the geographic area defined by a local EMS agency in its trauma care system plan as the area served by a designated trauma center.
  • Certificate Holder
    A certificate holder is typically, the primary individual covered by a benefit plan. Plan member is a term frequently used in Canada.
  • Certificate of Insurance
    A document issued by an insurance company that is used to verify the existence of insurance coverage. The certificate typically lists the effective date, type and dollar amount of coverage.
  • Certified Employee Benefit Specialist (CEBS)
    A designation granted jointly by the International Foundation of Employee Benefit Plans and the Wharton School of the University of Pennsylvania to individuals who complete eight college-level courses and examinations in the areas of compensation and employee benefit plans. Persons who receive(...)
  • Certified Financial Planner (CFP)
    An individual who has met the education, examination and experience requirements set by the Certified Financial Planner Board of Standards that show a person is able to manage a client's banking, estate, insurance investment and tax affairs. CFP's must agree to ethical standards of conduct and(...)
  • Certified Public Accountant (CPA)
    A professional license granted to persons meeting certain educational, experience and examination requirements.
  • Change in Status
    A life-changing event that may permit a participant to make mid-year changes in an employee benefits plan. These events may include a change in marital status, number of dependents, dependent eligibility for a benefit, employment, residence or the beginning or termination of adoption(...)
  • Channeling
    A practice in which a plan or medical provider directs patients or workload away from one source to another, such as to a different plan, physician or hospital.
  • Charge Back
    Money returned to a wholesaler by a manufacturer to compensate the wholesaler for the difference between a drug's acquisition cost and the contracted price agreed upon in advance by the wholesaler and wholesaler's retail customers.
  • Chartered Financial Analyst (CFA)
    A designation held by financial analysts, money managers, investment advisors and other financial professionals who have completed a graduate level, self-study curriculum and examination program covering a broad range of investment topics.
  • Chartered Financial Consultant (ChFC)
    A title used by accountants, attorneys, bankers, insurance agents, brokers and securities representatives who have completed The American College's eight course education program, met experience requirements and agreed to uphold a code of ethics.
  • Chartered Life Underwriter (CLU)
    A designation conferred on individuals by The American College recognizing the attainment of certain standards of education pertaining to personal risk management. life insurance and estate planning issues.
  • Chemical Equivalent
    A medication that contains the same active ingredient as another.
  • Chemotherapy
    The use of drugs to treat or control disease; typical uses are the treatment of cancer and select mental illnesses.
  • Child Care
    A provision of a range of services that may include health, medical, psychological, social, nutritional and educational services for a child by someone other than the child's parents or legal guardian. Such care may be provided at home or in a center.
  • Children's Benefit
    Dependent children of disabled or deceased contributors to either the Canada Pension Plan (CPP) or Quebec Pension Plan (QPP) are eligible to receive a fixed monthly payment. Conditions apply.
  • Chiropractic Care
    Medical treatment based on the theory that illness is caused by a malfunction of the nervous system and that normal function can be achieved by manipulation of the body structure, primary the spinal column. A practitioner is a doctor or chiropractic, a form of alternative complementary and(...)
  • Chronic Care Management
    A coordination of health care and other services to improve the health status of patients with chronic conditions such as diabetes and asthma. In addition to providing care specific to the problem, chronic care management may also include efforts to promote health, encourage self-care, reduce(...)
  • Chronic Condition
    A health state that tends to develop slowly and is long-lasting or recurrent. Chronic illnesses are not generally life threatening nor do they require hospitalization, but they do require managed care on a long-term basis. 
  • Chronic Obstructive Pulmonary Disease (COPD)
    An Illness that makes it increasingly difficult to breathe. Causes of COPD include cigarette smoking and long-term exposure to other lung irritants such as air pollution, chemical fumes and dust.
  • Churning
    An unethical and frequently illegal practice that involves the excessive provision of services. In health care, churning occurs when a service provider bills for the same medical procedure more than once or sees a patient more than is medically necessary.
  • Claim
    A request for the return of property, payment or reimbursement. Benefit claims are typically submitted to a plan administrator or insurer. Health service claims include an itemized statement of health services rendered by a provider for a given patient.
  • Claim Adjudication
    The processing of a request for payment submitted to a benefit plan or insurance company.
  • Claim Administrator
    An individual or organization that determines whether to make a payment on behalf of a benefit plan or insurance company. The administrator may be an employee of the plan, a third-party administrator or another private contractor.
  • Claim Form
    A document used to request payment from a benefit plan or insurance company.
  • Claim Review
    An examination of a request for payment by a professional to determine the amount of payment due from a benefit plan or insurance company for goods and services rendered. A claim review may also involve determining the eligibility of the claimant, whether a service is covered and is necessary,(...)
  • Claimant
    An individual or organization that files a claim, generally a service provider, plan participant or plan beneficiary.
  • Claimant's Statement
    A form completed by the insured at the time of a claim providing details of the disability.
  • Claims Audit
    The examination of a health provider's records to assess whether services provided were necessary, properly administered and correctly billed.
  • Claims Charged
    The payment requests submitted and paid by an insurance policy. If pooling or claim averaging is used to stabilize a group's experience during a contract period, the claim expense "charged" to the group's premium in that period may be more or less than the group's actual incurred claims.
  • Claims Cost Control
    Efforts both inside and outside an organization to restrain and direct claim payments so benefit dollars are used as efficiently as possible.
  • Claims Expenses
    Expenses incurred in adjudicating and paying claims.
  • Claims Experience
    The frequency, cost and type of claims that are being filed by a group over time. Insurance companies use this information when calculating insurance premiums for individual and group insurance plans.
  • Claims Fluctuation Reserve
    Also known as the premium stabilization fund, a surplus held by an insurer of a group benefit plan when the premium paid exceeds the claims incurred. This money is used to offset deficits the group plan experiences in the future. Upon termination of a contract, any funds remaining are usually(...)
  • Claims Reserve
    Money set aside by an insurance company or benefit plan to meet claims incurred but not yet settled.
  • Class
    Refers to the grouping of employees with commonality for the purpose of offering a different plan of coverage to each grouping (e.g., all managers and executive officers, all salaried staff, all hourly workers). The group cannot be based on discriminatory characteristics  such as gender or(...)
  • Class Rating
    An approach to determining insurance premiums (rates). Similar insureds are placed in the same group (class) and charged the same rate.
  • Closed Formulary
    Also called a restrictive or proprietary formulary, a closed formulary is a list of the medications reimbursed by a patient's benefit plan.
  • Closed Network
    A select group of health or health-related service providers that contract to provide good or services to plan participants at a discounted rate. Providers within the group are referred to as preferred providers.
  • Coinsurance
    Coinsurance is a form of cost sharing between an insurance company and the insured. In major medical insurance, the cost of coverage is shared as specified ratio. A common example is payment of 80% by the insurer and 20% by the insured after the deductible is met.
  • Collective Bargaining Agreement
    A legal contract that results from negotiations between one or more employers and one or more unions on behalf of employee. Elements of the written agreement typically include wages, benefits, work hours and other conditions of employment.
  • Combination Drug
    A combination drug has two or more medications combined in a single dose.
  • Commission
    A form of payment to a salesperson or agent for services rendered, often a percentage of the money in the transaction.
  • Common-Law Marriage
    The treatment of two persons as legally married without the couple having formally registered their relationship through a marriage ceremony or the acquisition of a marriage license. In regards to Canadian employee benefits, once a couple have lived together (cohabitation) for twelve months(...)
  • Comp Time
    Overtime hours that are worked and then taken later as paid time off. Comp time is short for compensatory time and is also known as time off in lieu.
  • Compensation
    Money or something given as payment for the provision of a good or service. Employees are given compensation in exchange for their work. Cash compensation may include wages, salary, base pay, overtime pay, profit sharing and other monetary payments. Total compensation is a broader term that(...)
  • Competence
    The ability to do something successfully or efficiently.
  • Competency Based Pay
    Monetary compensation given on the basis of an employee acquiring the knowledge, skills and abilities needed to perform a job.
  • Compliance
    The extent to which an entity follows guidelines or rules. For example, the extent to which a benefit plan follow laws and regulations concerning reporting and disclosure, privacy protection, etc. Also the extent to which a patient takes prescribed medication or follows other medical advice.(...)
  • Compound Interest
    Interest calculated on both the principal and the accrued interest in a savings account. Interest may be compounded daily, monthly, quarterly, semiannually or annually. For example, a $100 savings account earning 5% interest compounded annually would earn $5 and be worth $105 ($100 + $5) at(...)
  • Compressed Work Week
    An employee work schedule that involves fewer than the traditional five days in one week or ten days in two weeks. This arrangement usually involves working more hours per day.
  • Comptroller
    The chief accountant of a company or government entity. A comptroller, also referred to as a controller or financial controller, oversees the accounts, supervises financial reporting and has responsibility over implementing and monitoring internal financial records.
  • Concurrent Disability Provision
    A standard provision in all disability policies that provides that if a disability is caused by more than one injury or sickness or a combination thereof the insurer will pay benefits as though they were one based on the greater of the periods of disability. It clarifies that an insured cannot(...)
  • Conditionally Renewable
    A feature in an insurance policy that grants an insurer the right to refuse to renew the policy for reasons specified in the policy at the end of a premium payment period.
  • Consultant
    A person or firm offering expert business, professional or technical advice. Compensation is provided through commission, on a fee-for-service basis or a combination thereof.
  • Contestability
    The ability to dispute the validity of a contract. An insurer has the right during the first two years of the policy to cancel or rescind it if the application contains a material misrepresentation. Thereafter, the insurer must prove fraud.
  • Contingent Beneficiary
    A person or entity identified to receive insurance, retirement or other benefits if the first person named to receive the benefits is deceased.
  • Continuity of Care
    Coordination of the care received by a patient over time and across multiple health care providers.
  • Contract
    An oral or written agreement between two or more parties to do, or refrain from doing, an act, which is enforceable in a court of law.
  • Contract Freelancer
    A person who is self-employed and works under contract for an organization or company. The contracted period of time is usually limited and specifically defined, such as six months. At the end of the period, the contract may be renewed or the freelancer may move on to another organization or(...)
  • Contract Language
    Provisions in a policy contract that govern a claimant's entitlement to benefits.
  • Contributory Plan
    A retirement benefit program that requires employees to make contributions to qualify for plan benefits.
  • Conversion
    Persons who are insured through a group policy may be given the option to convert to an individual policy without evidence of insurability.
  • Conversion Privilege
    A provision that enables an insured to continue some coverage in force as personal disability income insurance when there is no longer a need for special business coverage. The amount is subject to the normal issue and participation limits and thus takes into account any existing personal(...)
  • Conversion Provision
    An optional provision in a group contract whereby a departing employee can maintain some (or all) of his specific coverage(s) in the form of a personal-owned plan. It must be applied for within a stipulated period following  departure from the group, and the employee must assume the premium(...)
  • Convertible Term Insurance
    A term insurance policy that give the policyholder the right to switch to another form of insurance without penalties and regardless of physical condition. This option, sometimes referred to as a conversion privilege, usually allows conversion of the term policy to a cash value policy that(...)
  • Coordination of Benefits Provision
    A provision in a health or dental benefit plan or individual health or dental insurance policy designed to eliminate duplicate payments. A sequence is established as to which coverage will apply (primary and secondary) when a person is insured under two contracts.
  • Copayment/Copay
    A flat fee paid by an insured beneficiary each time a medical service or prescription drug is provided.
  • Core Benefit
    An employee benefit received by all employees regardless of position.
  • Core Plus Options Plan
    A flexible benefit plan that groups benefits providing a minimal level of economic security with a wide array of other benefit options that employees can add to the core. Under these plans, employee receive benefit credits that entitle them to purchase additional benefits.
  • Corporate Owned Life Insurance
    A contract with an insurance company that provides financial protection if a key employee dies. The insurance is purchased by the employer. If the covered employee dies, the employer receives the cash stated in the insurance policy.
  • Cost Containment
    Methods of minimizing future rates increases through selection of various plan options or plan design.
  • Cost of Living Adjustment (COLA)
    An across the board increase (or decrease) in payments according to the rise (or fall) in the cost of living as measured by some index.
  • Cost of Living Rider
    A provision added to a life or disability insurance policy that increases the benefit when inflation occurs. Benefits are usually tied to changes in the Consumer Price Index (CPI).
  • Cost Sharing
    An arrangement in which some benefit costs are paid by benefit plan participants. In addition to paying a portion of an insurance plan premium, cost-sharing techniques include coinsurance, copayments, deductibles and exclusions.
  • Coverage
    The extent to which someone or something is included or protected. For example, coverage is used to describe the number or percentage of employees eligible for participation under an employee benefit plan. Coverage is also used to describe the scope of protection provided by an insurance policy.
  • Covered Charge
    A fee for services or supplies that qualify for payment under a benefit plan. Actual payment may be in whole, in part or none depending on plan design provisions such as deductibles, coinsurance, annual and lifetime maximums, and limitations.
  • Covered Expense
    A cost incurred by an insured that will be paid or reimbursed through an insurance policy. The precise expenses covered by insurance can vary greatly from one policy to another.
  • Covered Person
    An individual in whose name a health plan or policy is issued. In the case of family coverage, covered persons also include the enrollee's dependents.
  • Covered Service
    A service to which an insurance policyholder is entitled under the terms of an insurance contract or benefit plan.
  • Credibility Weighting
    Credibility is a posterior probability measure, i.e. it is based on actual past results. The greater the number of actual claims studies, the more reliable it is as a predictor of future experience. If the base is small, less reliance is placed on it. Weighting refers to the degree to which(...)
  • Critical Illness Benefit
    A line of coverage that pays a Lump sum benefit in the event the insured is diagnosed with a covered condition and in accordance with the Limits set out in the policy.
  • Critical Illness Coverage
    A limited form of health insurance in which an insurer agrees to pay if the policyholder is diagnosed with a specific condition such as cancer, heart attack, stroke, Alzheimer's disease, kidney failure, organ transplant, etc. Some policies require that the policyholder survive a specified(...)
  • Cross-Purchase Agreement
    A buy-sell agreement wherein each shareholder or partner  purchases a policy insuring  the other in an amount equal to her value of the business.
  • Crown Corporation
    A government controlled company or enterprise in Canada.
  • Customary Charge
    A fee most commonly charged for a service by health care providers within a defined geographic region. The customary charge is sometimes the maximum amount a health insurance plan will allow for covered expenses.
  • d

  • Daily Benefit
    A flat dollar amount an insurance company pays under specific circumstances stated in an insurance policy. A daily benefit is frequently a feature of long-term care insurance policies. The benefit is the amount the insurer will pay for each day of care the insured receives in a care facility(...)
  • Death Benefit
    A payment to a beneficiary upon the death of a plan participant.
  • Decreasing Term Life Insurance
    An life insurance plan that provides a death benefit that declines at a predetermined rate over the life of the policy. Premiums throughout the contract are usually level, but the benefit is reduced annually. 
  • Deductible
    An amount of expenses that an insured must pay before an insurer begins payment. The deductible is usually a flat amount and is common to health and dental insurance contracts.
  • Defined Benefit Health Plan
    An employer determined package of health benefits provided through a group benefit plan.
  • Defined Contribution Health Plan
    An arrangement in which a predetermined dollar amount is provided annually by an employer to employees to fund an employee benefits plan. A defined contribution plan makes it possible for an employer to cap its exposure but the employee may have insufficient coverage.
  • Demographics
    Basic statistical data on the characteristics of a population or group such as age, gender, marital status, employment, income and geographical location.
  • Dental Care Benefits
    Care and treatment of teeth, gums and the mouth. Dental care benefits are sometimes considered part of health care benefit, for example, accidental dental.
  • Dependent
    A person who relies on, or obtains benefit coverage through a covered individual. Dependents are most commonly a spouse, domestic partner and/or children.
  • Dependent Life Insurance
    A group life insurance policy that covers dependents of the person who is the primary insured.
  • Differential Copayment
    The application of a higher copayment for some drugs than others; for example, plan participants might pay a higher copayment for brand name versus generic drugs.
  • Direct Billing
    When a health care provider directly bills a patient for services rendered. The patient must pay the bill then submit a claim form to the plan administrator for reimbursement of covered expenses.
  • Direct Offsets
    Also known as primary offsets. It is one of two categories of sources that must be considered in the all-source maximum (the other is indirect offsets). Direct offsets include deduction of amounts from sources directly paid to and for the employee, such as the primary benefit  paid under CPP(...)
  • Disability Benefit
    Periodic payments (typically monthly) when a person is unable to perform the duties of his or her occupation. 
  • Disability Buy-Sell Insurance
    Special insurance designed for partnerships and shareholders of private companies to provide funds that facilitate a transfer of ownership in the event of a partner's or shareholder's disability.
  • Disability Income Rider
    A provision added to a life insurance policy that pays income replacement benefits in the case of disability.
  • Disability Insurance
    A contract in which an insurance company agrees to provide a person with periodic payments to replace a certain percentage of income lost when the insured is unable to work as a result of illness, injury or disease. In exchange, the insured pays the insurer a premium for the transfer of risk.
  • Disability Management
    Steps taken to reduce the likelihood of work-related injury and disease, and if a worker is unable to work, the efforts to help the employee return to work. The process often requires a partnership among labour, management, insurance carriers, health care providers and vocational(...)
  • Disability Mindset
    The tendency for a claimant to identify with  disability the longer she is absent from work, resulting in a continually diminishing Likelihood of a successful return to work.
  • Disease Management
    Disease management is a coordinated health care approach focused on reducing costs and/or improving the quality of life for individuals who have (or are at risk of having) a chronic condition. Disease management integrates preventative, diagnostic and therapeutic measures.
  • Dismemberment
    The loss of an appendage, limb, sight, hearing or speech.
  • Dispensing Fee
    A flat dollar amount paid to a pharmacy for distributing a prescription in addition to the cost of the drug. The dispensing fee covers administrative and labour costs incurred by the pharmacy.
  • Disposable Income
    Income an individual has available for saving and spending after taxes are paid.
  • Dividend
    A share of profits paid to corporate shareholders or participating insurance policyholders.
  • Drug Card
    A card that may be provided in connection with the prescription drug benefits  line of coverage. The card is presented when purchasing a prescription and scanned to enable immediate determination of the amount covered by the drug plan and the out-of-pocket cost to the insured. This method(...)
  • Drug Formulary
    A list of prescription medications that will be covered by a health insurance plan. Criteria for placing a drug on a formulary are often based on what is deemed to be the most effective and economical. Drugs not on the formulary may not be available, may carry a higher cost-share amount or may(...)
  • Drug Identification Number (DIN)
    A number by which eligible drugs are listed on the provincial formulary and which is assigned by the Health Protection Branch of Health Canada after it has been assessed by the common drug review process (CDR), which all provinces except Quebec use to provide impartial advice and(...)
  • Duplication of Benefits Provision
    Provides for a reduction in benefits when the insured is also entitled to disability benefits from another source; the purpose is to prevent over-insurance. While the sources that are offset vary by policy, they may include government benefits,employer-paid benefits, and other individual(...)
  • Durable Medical Equipment
    An apparatus used to provide health care that is not disposable. Examples include, hospital beds, wheelchairs, oxygen tanks and glucose monitors.
  • e

  • Effective Date
    The date on which a change in benefit status occurs; for example, the day when insurance coverage begins, a retirement plan officially starts or a pay increase goes into effect.
  • Electronic Claims Submission
    A method of submitting health and dental claims electronically from the practitioner or dental office direct to the insurer thereby eliminating the need for paper submission. A reimbursement cheque is mailed from the insurer to the insured or directly deposited into their chequing account,(...)
  • Eligibility Audit
    Verification that a plan participant and their dependents meet the criteria for receiving benefits.
  • Eligibility Date
    The day an individual is entitled to participate in a benefit plan or receive benefits from the plan.
  • Eligibility Period
    The frame of time, usually 31 days, when potential members of a group life or health insurance plan can enroll without evidence of insurability.
  • Eligibility Requirements
    Conditions that an employee must satisfy to participate in a benefits plan or obtain a benefit.
  • Eligible Employee
    A member of a group who has met the requirements for participation in a benefit plan.
  • Eligible Expense
    A charge for which an insurance policy will provide coverage.
  • Elimination Period
    The number of days that must pass after a disabling event has occurred to the date when the insured's policy covers disability. The actual payment, however, does not occur until the end of the first full covered month has passed. Thus, under a policy with a 30-day elimination period the(...)
  • Emergency
    To be considered an emergency a situation must generally meet the following criteria:the treatment is medically necessary, performed at a Licensed facility, is in relation to an illness, disease, or condition that is acute and unexpected, requires immediate  treatment and first arose during(...)
  • Emergency Travel Medical Benefits
    A line of coverage that may be found in an individual or group health insurance plan that covers the insured for expenses related to the cost of emergency hospital and medical care when travelling outside the province of residence and out of the country. Expenses are covered in accordance with(...)
  • Employee
    An individual who is compensated for services performed and whose duties are under the control of an employer.
  • Employee Assistance Program (EAP)
    An employment based program designed to assist in the identification and resolution of a broad range of employee personal concerns that may affect job performance. These programs typically deal with situations such as substance abuse, marital problems, stress, domestic violence, financial(...)
  • Employee Benefit
    Non-wage compensation provided to workers by an employer in addition to normal wages and salaries. Benefits may include, retirement income, group insurance (e.g., health, dental, disability, life, critical illness, vision care), housing, child care, cafeteria meals, education assistance,(...)
  • Employee Contribution
    Money that a worker contributes (voluntarily or involuntarily) to participate in an employer sponsored benefit plan.
  • Employee Health Benefit Plan
    An employer sponsored program for providing medical and health care benefits to workers.
  • Employee Pay-All Plan
    A plan fully funded by the covered employees; the employer makes no contribution whatsoever.
  • Employer
    A person or organization that contracts with workers (employees) providing compensation in exchange for the workers' services.
  • Employer-Paid Benefits
    Benefits for which the insured's employer pays the premiums.
  • Employment Insurance (EI)
    A Canadian program that provides temporary income support to those who are between jobs; cannot work for reasons of sickness, childbirth or parenting; or who are providing care or support to a family member who is gravely ill with significant risk of death.
  • Endodontics
    A term associated with dental benefits and that refers to root canal treatment.
  • Endorsement
    With respect to insurance, a written agreement added to the end of an insurance policy that modifies coverage. Endorsements (aka riders) supersede the original terms of the policy.
  • Enrollee
    A person who has applied to be or has become a member/participant of an organization or plan.
  • Enrollment
    A process by which an individual becomes a member/participant of an organization or plan. Enrollment in a benefit plan may be done through the actual signing up of the individual, by virtue of a collective bargaining agreement or by conditions of employment.
  • Equipment Purchase/Rental and Medical Supplies
    A benefit  in the extended health-care benefit line of coverage that provides for payment of charges related to the purchase or lease of devices such as wheelchairs, crutches, walkers, and other equipment and medical supplies as listed in the policy. Payment is made in accordance with the(...)
  • Equivalent
    That which is equal or essentially equal. Many brand-name drugs have generic equivalents.
  • Evidence of Insurability
    Proof of a person's physical condition, occupation or other factor that affects enrollment in an insurance or benefit plan. For example, enrollment may require applicants to respond to a medical history questionnaire or provide a doctor's report after a medical examination.
  • Exceptional Access Program
    The program under which drugs not Listed in the provincial formulary may be considered on a case-by-case basis.
  • Exclusion
    A contractual provision in an insurance policy that denies coverage for certain peril, person, treatment etc.
  • Exclusions
    A standard group of provisions in an disability policy that preclude payment when an insured's disability is caused by one of the listed conditions. In a non-cancellable policy, the standard exclusions are minimal and include act of war, participation in the military,and normal pregnancy. In(...)
  • Expected Claims
    The forecasted payout an insurance company will make for an insured person or group of insured persons. Expected claims are one of the factors considered when an insurance company establishes the premium for insurance coverage.
  • Experience
    A loss record of an insured or a class of coverage over a specified period of time used to calculate insurance renewal rates.
  • Experience Rated Premium
    The amount of money an insurer charges to provide coverage based on anticipated claims that takes into consideration age, gender and any other attributes of the group that may affect the number and size of claims. Such a premium is subject to periodic adjustments in line with actual claims or(...)
  • Experience Rating
    A process of determining the insurance premium for a group, wholly or partially on the basis of the group's actual claims. The insurer compares the actual claims with the claims experience that is normally expected in the insured's rating class. The premium is modified to reflect this(...)
  • Explanation of Benefits
    A statement from an insurance company that reports the services and amounts paid on behalf of the insured. The EOB summarizes the charges submitted, the dollar amount allowed by the insurer for each service, the amount paid and the balance owed by the insured, if any. If any services were not(...)
  • Extended Health Care Plan
    An extended health care plan offers coverage beyond provincial medical coverage, sometimes referred to as a major medical plan. One can purchase this type of plan as an individual or group.
  • Extended Health-Care (EHC) Benefits
    A line of coverage found in an individual or group health plan that covers the insured for medical expenses not covered by the provincial health plan incurred due to illness, injury, or pregnancy in the province of residence in accordance with the limits set out in the policy.
  • f

  • Face Amount
    The amount indicated on the face of a life insurance policy that will be paid in the event of death or when the contract matures. Excluded are dividend additions and amounts payable under accidental death or other special provisions.
  • Fact Finding
    The process of gathering pertinent data about a client for the purpose of identifying insurance needs such as birth date, gender, health status, spousal and dependent information, details of assets and liabilities, income and expenses, existing coverage,and goals.
  • Family Deductible
    A deductible that is satisfied by the combined expenses of all covered family members. For example, a program with a $100 deductible per covered individual may limit its application to a maximum of $300 for the family. More typical, a $100 family deductible would be applied for the family unit(...)
  • First Dollar Coverage
    A health benefit plan that provides reimbursement for incurred health care costs starting with the first dollar of expenses; there is no deductible.
  • Flexible Benefit Plan
    A benefit program that allows employees to choose benefits they want or need from a package of benefits offered by an employer. The choices offered may be taxable, non-taxable or a combination of both.
  • Formulary
    A list of eligible drugs covered by the prescription drug benefit.
  • Full Disability
    Disability that is both permanent and total. Sometimes used interchangeably with total disability.
  • Fully Insured Plan
    A group insurance plan in which an employer contracts with the insurer to assume financial responsibility for all of the enrollees' claims and administrative costs in exchange for payment of a premium by the employer.
  • g

  • Gainful Occupation
    Applies after the own occupation period has expired and is defined as an occupation that an employee is reasonably qualified to perform and that can be expected to generate income within a specified earnings range, such as 60% or more of prior earnings.
  • Generic Drug
    Also called a generic derivative, a chemically equivalent drug approved as a substitute for a brand-name drug whose patent protection has expired. Generic drugs have the same active ingredient(s) and are administered in the same form and dosage as brand-name drugs.
  • Generic Drug Plan
    A prescription drug benefit that covers only generic prescription drugs. A generic drug is a Lower-cost drug similar  but not identical to a brand name drug, manufactured after the patent protection has ceased on the original brand name version. While the active ingredients are the same and(...)
  • Generic Substitution
    When a generic version of a brand-name drug is given to a patient instead of the brand name drug. In some cases, a health care plan will only pay for the generic version; the insured must pay for the brand name.
  • Government Health Insurance Plan (GHIP)
    An acronym used to refer generically to the various provincial health insurance plans whose names vary by province.
  • Grace Period
    A period of time after a payment is due before there is a penalty or loss of insurance protection. Insurance policies often have a grace period in which an overdue premium may be paid without penalty and the insurance policy remains in force.
  • Grandfathered Plan
    A benefit plan that is exempted from provisions of a new rule. Typically, a grandfathered plan must still comply with the rules that existed prior to creation of the new rule.
  • Gross Income
    Total money received before taxes and expenses are deducted.
  • Gross Revenue
    Income that a company receives from the sale of goods and services to customers with no deductions for expenses. A company's gross revenue may also include income from interest, dividends or royalties.
  • Group Benefits Associate (GBA)
    A specialty designation focusing on health care and other group benefits.
  • Group Health Plan
    An employee benefit plan providing medical care to participants and beneficiaries, directly or indirectly.
  • Group Insurance
    An insurance policy that provides coverage for many people under one contract.The group is typically made up of employees from the same company or members of the same organization who have a relationship beyond the desire for insurance. The policyholder is the organization, and the covered(...)
  • Group Registered Retirement Savings Plan (Group RRSP)
    A collection of individual Registered Retirement Savings Plan (RRSP) contracts in a single trust. Employee contributions to Group RRSPs are deducted directly from an employee's paycheck.
  • Guaranteed Conversion Plan
    A type of guaranteed-issue individual health and dental insurance plan available to a person previously covered by a group insurance plan and that requires application within the 60-day period following termination of group benefits. It does not require submission of a health questionnaire and(...)
  • Guaranteed Insurability Option (GIO)
    An optional benefit that provides a client with the right to increase monthly benefits  at specified times without evidence of medical insurability but that still requires evidence of financial insurability.
  • Guaranteed Issue
    Insurance coverage that must be granted regardless of health status. Group health insurance and basic personal health insurance plans are often described as guaranteed issue plans because the policy is issued regardless of the individual's health status. As long as the individual meets certain(...)
  • Guaranteed Issue Plan
    An individual or small group health and dental insurance plan that does not require submission of a health questionnaire and that covers existing medication/conditions up to the plan's maximums.
  • Guaranteed Renewable
    A provision in an insurance policy that requires the insurance company to renew the policy on the policy anniversary until the insured reaches a specified age and as long as the premiums are paid. There may be other requirements to maintain coverage and the insurer can change the premium(...)
  • h

  • Harmonized Sales Tax
    Consumption tax used in Canadian provinces that combines the federal good and services tax (GST) with the regional provincial sales tax (PST).
  • Health Care Fraud
    An intentional deception or misrepresentation for the purposes of gaining an unauthorized medical benefit or benefit payment. Examples of health care fraud include billing for goods or services never provided, misrepresenting what and when treatment was provided, and preforming medically(...)
  • Health Care Provider
    An individual or organization (e.g., physician, nurse, massage therapist, laboratory) that provides medical services.
  • Health Care Spending Account (HCSA)
    An individual employee account that reimburses the eligible medical and dental expenses of Canadian employees, their spouses and dependents. The sponsor (employer) of a HCSA program contributes a defined amount of funds into an account for each eligible plan member (employee). These funds may(...)
  • Health Consumerism
    A movement advocating that patients be partners with their physicians versus simply accepting whatever a doctor recommends. Such involvement requires patients to be more informed and actively participate in the health care decision process. Patients may also be encouraged to have a better(...)
  • Health Insurance
    Protection against financial loss due to sickness or injury.
  • Health Literacy
    The degree to which individuals are able to obtain, process and understand basic health information in order to make appropriate health decisions.
  • Health Promotion
    The education, marketing and other endeavors that help people gain greater control over their health and the factors that impact it.
  • Health Spending Account (HSA)
    A self-insured private health services plan (PHSP) benefit that permits an employer to allocate funds exclusively for the purpose of health and/or dental care payments by employees residing in Canada. In some cases the employer makes advance payments including the cost of administration and(...)
  • Hearing Aid Coverage
    A benefit plan or insurance that reimburses the insured for the purchase of a hearing aid and/or offers a discount on the amount paid by the insured for a hearing aid.
  • High Deductible Health Plan
    Sometimes referred to as a catastrophic health insurance plan, a HDHP is a lower cost insurance policy that features a higher annual deductible than that of a traditional health insurance policy. This type of plan offers affordable coverage for health events that might wreak financial havoc on(...)
  • HIV and Hepatitis B, C Rider
    A rider offered to health-care professionals whereby monthly benefits become payable if the insured has tested positive for either HIV or hepatitis B or C. The rider addresses the insured's loss of income due to the illness (not the illness itself) resulting from. for example, the(...)
  • Home Health Care
    Health and social services that are provided in the homes of individuals who are disabled or ill. The services range from skilled nursing care and physical therapy to personal assistance and help with household chores.
  • Homeopathy
    The treatment of disease using minute doses of natural substances that in a healthy person would produce symptoms of disease. This approach is thought to stimulate the body's natural defenses against the symptoms of the disease.
  • Hospice
    A health care program providing medical care, support services and comfort to terminally ill patients and their families. The support services may include emotional, spiritual, social and financial assistance. Hospice care is available in diverse settings including an independent hospice(...)
  • Hospital Audit
    An examination of records to determine whether a patient received billed goods and services, and that the dollar amounts billed are consistent with contract agreements. A hospital audit is generally used when there is a large claim to ensure there are no billing errors.
  • Hospitalization
    The period of time when a person is confined to a hospital, which typically includes an overnight stay.
  • Hospitalization Benefit
    A benefit that may be found as part of the extended health-care line of coverage and that covers the additional cost between standard (also known as basic) and preferred accommodation up to a stated maximum charge per day and number of days per year. Standard or basic is sometimes referred to(...)
  • Hour Bank
    A method used to establish or maintain a worker's eligibility for health insurance benefits. The hours worked by an employee are credited to an individual account. At each determination date for benefits, the required hours for eligibility are drawn out. A variation of this approach is putting(...)
  • Human Resources Information System
    A computer based system for collecting and managing information regarding employees, volunteers and other personnel within an organization. An HRIS can be used to support a broad range of HR management activities.
  • i

  • In Force
    When an insurance policy is active; in other words, the policy will pay if there is a claim.
  • Incentive Formulary
    A list of medications covered by a benefit plan that is a compromise between an open and closed formulary. Used in combination with three tier copays, the number of medications on the list is limited, and the process for adding new drugs is very selective like a closed formulary. Generic drugs(...)
  • Incurred but Not Reported (IBNR)
    Claims that an insurance company anticipates will be made by policyholders as the result of events that already have occurred but have not yet been filed for an accounting period.
  • Incurred Claims
    An estimate of the outstanding liabilities for an insurance policy in a given period. This estimate includes claims paid during the period plus a reasonable estimate of unpaid liabilities. It is calculated by adding paid claims and unpaid claims, then subtracting the estimate of unpaid claims(...)
  • Incurred Losses
    The total amount of paid claims and loss reserves associated with a particular period of time, usually a policy year. Customarily, incurred losses are calculated by adding the losses incurred during the period and the outstanding losses at the end of the period, then subtracting outstanding(...)
  • Indemnify
    To protect against a loss or injury. For example, a health insurance policy indemnifies a person against the medical costs associated with illness and injury. Disability insurance indemnifies workers and their families against the wages lost as a result of these same circumstances.
  • Indemnity
    A payment made by an insurer to compensate for a loss covered by an insurance policy.
  • Independent Brokers
    Intermediaries who operate independent of a single insurer and are free to sell any company's products.
  • Independent Contractor
    A person who works for another, but the means and methods of work are not controlled by the employer. Only the result of the work is controlled. In contrast to employees, independent contractors pay their own taxes.
  • Indirect Offsets
    Also known as secondary offsets. It is one of two categories of sources that must be considered in the all-source maximum (the other is direct offsets). Indirect offsets include a much broader range of deductions such as amounts paid (or entitled to be paid) under CPP to the disabled(...)
  • Individual Health Insurance Plan
    Medical coverage for an individual with no covered dependents. Commonly known as individual coverage.
  • Individual Insurance
    A contract with an insurance company that is purchased on an individual or family basis, as opposed to being offered to a group via an employer or member association.
  • Individual Life Policy
    In contrast to a group policy, a life insurance policy purchased through an insurance agent or directly from the insurance company.
  • Infertility Benefits
    Insurance coverage related to the biological inability to conceive and carry a pregnancy to full term. Infertility benefits range from diagnostic tests and treatment or the underlying causes of infertility to in vitro procedures.
  • Ingredient Cost
    The dollar value of a drug as stated on a drug claim or as calculated by multiplying the quantity of a drug dispensed by its unit cost.
  • Inpatient
    A person whose treatment requires at least one night's residence in a hospital.
  • Insurability
    Whether a loss (risk) can be granted insurance coverage. For example, to obtain life insurance, an individual may be required to have a physical examination to show that he or she is insurable.
  • Insurable Earnings
    The portion of earnings that can be insured for disability. In group LTD it is defined in the policy and may include  salary, salary and bonus, or salary,bonus,and  commissions. In Dl, the amount  of insurable  earnings is established at the time of application according to financial(...)
  • Insurance
    A means by which one party (the insurer) agrees to compensate another party (the insured) for any losses or damages caused by risks identified in the contract. The insured pays the insurer a lump sum or periodic amounts of money called premium in exchange for transferring the risk.
  • Insurance Annuity
    An insurance contract purchased with a lump sum of money or a series of premium payments in which an insurance company agrees to provide a series of payments at regular intervals over a period of more than one full year to an individual (the annuitant).
  • Insurance Broker
    A person or business that brings together clients seeking insurance coverage with insurance companies. The broker represents the buyer rather than the insurance company but receives a commission from the company.
  • Insurance Policy
    A legal agreement between an insurance buyer and an insurance company that establishes the rights and duties of each party.
  • Insured Event
    An occurrence that triggers coverage by an insurance plan. For example, the death of an insured triggers payment of life insurance benefits. Hospitalization is an event that could trigger payment of health insurance benefits, and so on.
  • Insurer
    A company that issues a contract (insurance policy) and assumes the risk for covering a potential loss. Also referred to as an insurance carrier.
  • Integration
    Programming of Disability insurance benefits with benefits payable from another source such as short-term disability benefits (STD), Long-term disability benefits  (LTD), or employment insurance (EI) so as to avoid overlap in coverage. This is accomplished through the selection of an(...)
  • Intermittent Leave
    Separate periods of time taken off from work due to illness or injury, rather than one continuous period of time.
  • Intoxication Exclusion
    A provision in an accidental death and dismemberment insurance policy that denies benefits if the accidental death or dismemberment is the result of drugs or alcohol inebriation.
  • Irrevocable Beneficiary
    A person or organization named in an insurance policy or pension plan to receive benefits if the insured person or plan participant dies while the policy or plan is in effect. Once irrevocable beneficiaries have been named, they cannot be removed as beneficiaries.
  • Issue and Participation Limits
    The maximum Disability insurance available based on an applicant's age and occupation class. The issue Limit refers to the maximum the insurer will issue and the participation limit refers to the maximum an insured can have in combination with other insurers. For example, Insurer A might(...)
  • j

  • Joint Beneficiary
    A person legally entitled to share in the proceeds of an insurance policy or a retirement plan.
  • Joint Employer
    A company that shares control with another company over the working conditions of an employee. Joint employers commonly include temporary staffing or leasing agencies.
  • Jointly Trusteed Single Employer Plan
    An employee benefit plan of one employer that is administered by a board of trustees consisting of an equal number of employee and employer representatives.
  • Juvenile Insurance
    A cash value life insurance policy written on the life of a child.
  • k

  • Key Employee Insurance
    A life or disability insurance policy purchased by a business on the life of an employee whose continued participation in the business is necessary to the firm's success and whose death or disability would cause an adverse impact on the company. The insurance company agrees to reimburse the(...)
  • Key Person Insurance
    A special disability policy that pays a benefit to the business on the permanent and total disability of a covered key person.
  • Knowledge-Based Pay
    A compensation system based upon an employee's attainment of skills and education. Knowledge-based pay can be an incentive for employees to acquire additional training and education, thus upgrading overall workforce skills.
  • l

  • Labour Law
    Also known as employment law; the rules, regulations and court precedents that govern the relationship between workers and management. Labour law defines the rights, privileges, duties and responsibilities of each.
  • Lactation Program
    In the workplace, the provision of a private space, access to a refrigerator and sufficient break time for a nursing mother to breast-feed a child or express milk.
  • Lag
    A period of time that occurs between one event and another. For example, the period of time between when a claim is made and the payment of the claim.
  • Lapsed Policy
    An insurance contract that has been terminated due to nonpayment of the premium.
  • Large Amount Pooling
    The placement of a plan's insurance claims over a specified limit into a pool made up of similar claims for other plans to curb fluctuations in insurance premium amounts. Providers of group life and health insurance may purchase this extra protection for a fee from an insurer, with the amount(...)
  • Late Entrant
    For the purposes of group insurance, an individual who enrolls in a group plan at a time other than during the first period in which he or she is eligible to enroll or during a special enrollment period.
  • Layoff
    Temporary suspension or permanent termination of an employee(s) for business reasons such as reduced sales or budgetary constraints. Suspension or termination due to poor performance or misconduct is not typically considered a layoff.
  • Leave of Absence
    A period of time during which an employee is not working when he or she typically would be while maintaining the status of employee. This period may be with or without pay.
  • Legal Reserve
    A minimum amount of funds a company must keep to meet future claims and obligations. Typically, insurance companies are obligated by government to maintain a legal reserve to ensure their solvency. In Canada, minimum levels of capital and liquidity are determined by the Office of the(...)
  • Length of Stay
    The number of days that elapse between admission and discharge from a hospital or health care facility.
  • Level Premium
    Payment for a life insurance policy that remains unchanged for the life of the policy.
  • Level Term Life Insurance
    A death benefit policy with a premium that remains unchanged versus a policy with a premium that increases with the increased risk as a person ages.
  • Life Annuity
    A promise under an insurance contract or defined benefit pension plan to make periodic payments (usually monthly) for the lifetime of an individual (the annuitant). Payments stop upon the death of the annuitant. 
  • Life Insurance
    An insurance contract that provides a sum of money if the person who is insured dies while the policy is in effect.
  • Lifestyle Drugs
    Prescription drugs, such as those used to treat obesity, erectile dysfunction, male pattern baldness, infertility, smoking cessation or cosmetic problems, which are not considered medically necessary. Lifestyle drugs are frequently excluded form the list of drugs covered by a drug formulary.
  • Lifetime Annuity
    An insurance contract that provides income for the remaining life of a person (the annuitant).
  • Lifetime Maximum
    A limit stipulated in some individual health and dental insurance plans limiting the overall lifetime maximum that can be claimed through the plan. The lifetime maximum can range from $100,000 to $350,000, although some plans are unlimited.
  • Light Duty
    Work that is less demanding (physically, mentally or because it requires fewer hours of work) than an employee's usual position.
  • Limited Formulary
    A preferred drug list with a restricted number of medications permitted in each therapeutic class covered by a benefit plan. The addition of a new drug requires the deletion of a medication already on the list.
  • Limited Payment Life Insurance
    A variation of whole life insurance with premium payments for a shorter, predetermined number of year (e.g. 10, 15 or 20 years). The death benefit remains available for the lifetime of the insured or until the insured reaches a specific age (e.g., 100 or 200 years). Premiums may be paid(...)
  • Living Benefits
    Living benefits is a term used to describe a portfolio of health-related insurance products. These benefits are paid to an insured during his Lifetime, not after death. The range of products usually includes disability insurance, critical illness insurance, long-term care insurance, health and(...)
  • Living Wage
    An hourly rate of pay that is high enough for an employee and his or her family to maintain a given level of living. Generally, this level is described as meeting basic needs and maintaining health.
  • Living Will
    A legal document that conveys a person's desires concerning health care if the person is unable to communicate his or her wishes at some future date. A person can accept or refuse medical care and address specific issues such as the use of dialysis, breathing machines, feeding tubes,(...)
  • Long-Term Care
    A variety of medical and non-medical services needed by the elderly, disabled, and persons with chronic health issues who need assistance with the activities of daily living (e.g., feeding themselves, dressing and bathing). Long-term care can be provided at home, in the community, in an(...)
  • Long-Term Care Insurance
    Insurance that covers costs associated with the long-term care provided at home or in a residential facility (e.g., nursing home) for persons who are unable to care for themselves as the result of a chronic illness, disability or mental impairment ( e.g., dementia, Alzheimer's disease).(...)
  • Long-Term Disability
    An injury or illness that prevents a person from continuing in the occupation for which he or she was trained. For most purposes, an LTD is defined as lasting more than three to six months.
  • Long-Term Disability Benefits
    Also referred to as group LTD, it is a monthly disability income benefit payable under a group insurance policy. Note that LTD is always associated with group insurance, whereas Dl is always associated with  an individual-owned policy that provides a monthly disability income benefit. Benefits(...)
  • Long-Term Disability Insurance
    Insurance that offers income payments for long-term injuries, illnesses and disabilities. Generally, monthly payments commence after a specified waiting period and continue while the employee remains disabled or up to 2 years, 5 years or age 65. Payments are percentage of the earned income(...)
  • Loss Ratio
    The ratio of incurred claims to premiums received by an insurance company.
  • Loss Reserve
    An estimate of the value of a claim or group of claims not yet paid by an insurance company.
  • m

  • Mail Order Drug Program
    A method of dispensing medication directly to a patient through the mail or other shipping service.
  • Maintenance Drug
    Prescription medication taken for the treatment of a chronic condition such as high blood pressure or high cholesterol for an extended period of time.
  • Maintenance Drug List
    Also referred to as an additional drug benefit list, medications approved for dispensing in larger quantities for long-term use and chronic conditions.
  • Major Medical Insurance
    A form of health care coverage that pays for many of the medical expenses not covered by basic medical coverage.
  • Major Restorative Services
    Services covered under a dental benefit plan that encompass more extensive work than routine services such as restorative procedures,crowns, inlays,and  bridges. These services are covered at a lower coinsurance rate, often requiring the insured to pay 50% of the cost and up to a lower annual(...)
  • Managed Therapeutic Formulary
    A two-tiered formulary that encourages the use of cost-effective drugs whereby the preferred drugs are reimbursed at a higher Level(i.e.,the insured pays a lower copayment). It targets medications that are not interchangeable and that therefore cannot be substituted by pharmacists.
  • Mandatory Employee Contribution
    An amount that must be paid by a worker in order to participate in a benefit plan or to in some way receive more favourable treatment than those not contributing.
  • Master Contract
    The legal agreement between an insurance company and an employer sponsoring a group plan; the agreement contains the terms and conditions under which benefits are paid. The employee is not a party to the agreement but instead receives a certificate as evidence of coverage and/or a booklet as a(...)
  • Material Misrepresentation
    A misstatement, hiding of a fact or falsification that, if known to another party, would significantly change a contract, transaction, etc. For example, a plan participant might have made a different decision regarding receipt of benefits or an insurance company might have chosen to not issue(...)
  • Maternity Benefit
    An employer-provided benefit for a new mother that may include pair or unpaid leave, flexible work opportunities, health insurance provisions, and information resources.
  • Maternity Leave
    Paid or unpaid time off work provided to a mother with the arrival of a new child.
  • Maximum Monthly Benefit
    The stated maximum monthly amount payable under the group LTD benefit as per the master contract, for example, 67% of earnings up to $2,500 ($2,500 is the maximum monthly benefit as stated in the contract). The actual benefit amount payable is the least of the following three amounts:(...)
  • Medical Care
    The prevention, treatment and management of illness, and the preservation of mental health, through services offered by health professionals.
  • Medical Insurance
    A term often used interchangeably with health insurance, an insurance plan that pays for medical, surgical and hospital related expenses.
  • Medical Marijuana
    The use of cannabis (marijuana) and its cannabinoids to treat disease or improve symptoms.
  • Medical Reimbursement Plan
    An employer benefit program that directly reimburses employees for health care expenses from employer funds versus an insurance policy.
  • Medical Underwriting
    The process of evaluating an insurance applicant's medical history to determine if her pre-existing conditions can be covered by the plan and if so, at what premium rate or with what potential exclusions, if any.
  • Medically Necessary
    Health care services and supplies that are deemed appropriate and essential for the diagnosis or treatment of a medical condition. Such treatment is to be in accordance with generally accepted standards of medical practice.
  • Medically Underwritten Plan
    An individual or small group health and dental insurance plan that requires submission of a completed health questionnaire as part of the application process. An underwriter reviews the documents and determines  what basic coverage is available. Depending on the insurer, a plan can be(...)
  • Mental Health
    A person's emotional, psychological and social well-being, which affects how the individual thinks, feels and acts. Mental health also helps determine how a person handles stress, relates to others and makes choices.
  • Multi-Employer Plan
    A benefit plan in Canada that covers employees of two or more financially unrelated employers.
  • n

  • Naturopathy
    Also know as naturopathic medicine or natural medicine, a complementary and alternative method of treatment that emphasizes the body's intrinsic ability to maintain and heal itself. Naturopaths prefer to use natural remedies such as manual manipulation, light, heat, sunshine, herbs and foods(...)
  • Non-Evidence Maximum
    The amount of coverage an insurer will provide regardless of an employee's current state of health; varies based on the group's demographics, the nature of the industry, and the insurer's underwriting guidelines. Employees whose coverage entitlement falls below this level are not required to(...)
  • Non-Medical Expenses
    Expenses of a non-medical nature arising from an illness, disease, or condition that required medical treatment. Some examples include: return of the insured's vehicle, flying family to the affected traveler, returning children home, or repatriation of a deceased traveler to his residence.(...)
  • Non-Occupational Benefits
    A method of dealing with workers' compensation benefits so as to avoid duplication of coverage under a personal disability policy. A Dl policy that provides non-occupational coverage does not cover work-related injuries.
  • Non-Occupational Coverage
    An LTD plan that does not cover work-related injuries. This definition is used when the employees insured are also covered by workers' compensation. Also, an injury income policy that does not cover work-related injuries (usually coverage is provided at a discounted rate). This definition(...)
  • Noncancelable and Guaranteed Renewable
    Sometimes referred to as noncancelable, a feature in an individual insurance policy that states the insurance company cannot terminate the policy once it is in force as long as the premiums are paid. In addition, the company cannot change the premium amount or monthly benefit.
  • Noncontributory
    When an employer bears the full cost of a benefit for employees; employees are not required to share the cost of the benefit.
  • Noncore Coverage
    Dental, vision and other types of benefits, as opposed to what are considered essential benefits (e.g., health care).
  • Nonformulary Drug
    A medication not on a benefit plan list of preferred drugs. Health and drug benefit plans often require higher copays for nonformulary medications to encourage patients to use medications that are on the formulary list.
  • Normal Pregnancy Exclusion
    A standard exclusion found in almost all disability policies indicating that benefits are not payable for normal pregnancy. Most policies will confirm that a complication of pregnancy is covered.
  • Nurse Practitioner
    A registered nurse who has completed advanced education and training in the diagnosis and management of common as well as complex medical conditions. Nurse practitioners provide a broad range or health care services, including many of the duties of a physician.
  • Nursing and Home Care
    A benefit in the extended health-care benefit line of coverage that covers the cost of a registered nurse, registered practical nurse, or certified home support  worker in the insured's home as may be required during recovery from an injury or illness. Payment is made in accordance with  the(...)
  • o

  • Occupational Disability Benefit
    Periodic payments (typically through an insurance company) hen a worker is unable to perform the duties of his or her regular job due to an injury or illness associated with work activities.
  • Occupational Health Services
    Activities performed to protect the physical health and safety of employees at work.
  • Occupational Therapy (OT)
    Treatment by means of productive and creative activities that helps a disabled person perform the tasks of daily living (e.g., bathing, dressing, eating, working). OT often involves helping a patient develop skills and find new ways of accomplishing tasks that allow the person to have an(...)
  • Offsets
    A method of protecting the insurer from over-insurance by reducing an insured's benefits if he receives income from other sources such as government benefits or other personal disability insurance plans. The method of adjustment varies and may be a dollar-for-dollar reduction or only the(...)
  • Online Pharmacy
    An organization providing pharmacy services via a networked computer. Mail or another shipping service delivers medication to consumers.
  • Optional Benefits
    A feature or benefit that can be added to an insurance policy at the insured's option (usually at an additional cost).
  • Oral Health
    As defined by the World Health Organization (WHO), freedom from chronic mouth and facial pain, oral and throat cancer, oral sores, birth defects such as cleft lip and palate, periodontal (gum) disease, tooth decay and tooth loss, and other diseases and disorders that affect the oral cavity.
  • Orthodontic Benefits
    Insurance coverage for the repositioning of teeth and jaws. Orthodontic benefits are not included in all dental plans. When provided, the coverage may be restricted to persons under a certain age and to yearly or lifetime dollar limits.
  • Orthodontics
    A branch of dentistry dealing with the proper positioning of teeth and jaws, usually through the use of braces.
  • Orthotics
    Brace, splint or other devices used to support, align, prevent or correct the function of a body when moving. For example, show inserts are orthotics intended to correct an abnormal or irregular walking pattern; the devices alter the angle at which the foot strikes a walking or running surface.
  • Osteopathic Medicine
    A form of conventional medicine that give particular attention to the muscles, joints, bones and nerves of the body. There is an underlying belief that all of the body's systems work together and disturbances in one system may affect function elsewhere in the body.
  • Out of Pocket Expense
    The cost incurred and paid for by the individual. From an insurance perspective, out-of-pocket expenses are the deductibles, copay's and coinsurance not covered by the insurance policy.
  • Out of Pocket Maximum
    The highest amount a health plan specifies a plan participant must pay for deductible, co payments, coinsurance payments and similar charges.
  • Over-Insurance
    Over-insurance refers to a higher-than-appropriate replacement ratio. If a person has coverage that is close to or exceeds 100% of their pre-disability income,there is a disincentive to return to work, which results in prolonged benefit payments and higher claims costs to the insurer.
  • Overbilling
    Charging a plan or insurer more than what has been agreed upon; for example, a health care provider might not disclose a waiver of a patient copayment.
  • Overhead Expense Insurance
    Reimbursement insurance for owners of small businesses to help offset certain ongoing  business expenses if the owner becomes disabled.
  • Overinsurance
    When the amount of insurance payments to an insured on a loss is greater than the actual loss incurred.
  • Own Occupation
    Also known as pure own occupation definition. An occupational definition defining what the insurer considers a state of total disability, normally available only to the lowest-risk occupations. This definition offers protection to an insured against his inability to perform the primary duties(...)
  • Own Occupation Period
    Part of the definition of disability in the LTD benefit that describes the period of time during  which an employee is considered disabled if unable to perform  the main duties of his regular occupation at the time of claim. A standard duration is 24 months. During this time, an  employee is(...)
  • p

  • Paid Claims
    In the financial reporting by benefit plans and insurers, the dollar value of all claims paid during a specific time period with no adjustment for anticipated or known liabilities that have not yet been paid.
  • Paramedical Exams
    A medical assessment conducted by a medical professional (usually a non-M.D.) for the purposes of evaluating an individual's health risk. Paramedical exams are typically paid for by the insurer and can be conducted at a an applicant's home or place of work. The exam is specific to each(...)
  • Paramedical Services
    In Canada, services provided by professionals who aren't covered by the public health care system (e.g., chiropractic care, massage therapy, physiotherapy, acupuncture and osteopathy).
  • Partial Disability
    A state of disability where the insured is unable to do one or more of her significant duties, or can perform all significant duties but for only half the normal time. Some policies  provide for a continued benefit so long as the insured remains under the care of a physician. The amount(...)
  • Partial Disability Rider
    A rider that can be added to a total disability policy so half the benefits will be paid for a period of time when the insured is only able to perform her duties for less than half the time, or is unable to perform one or more of the primary daily duties; partial disability riders can be(...)
  • Participating Employer
    An employer that is making contributions to a benefit plan.
  • Percentage of Earnings
    A calculation of the amount of benefit paid to a disabled employee based on her earnings (one of several factors the actual amount payable is based on). The actual benefit amount payable is the least of the stipulated percentage of earnings, the stated maximum benefit, and the plan's(...)
  • Periodontics
    A term associated with dental benefits and that refers to the treatment of gum disease.
  • Perks
    Non-wage compensation provided  most often to shareholder-employees or executives in a corporation. Examples include a company car, pension contribution, parking, tuition reimbursement, and other forms of non-wage  remuneration. Insurers recognize that this form of compensation has income(...)
  • Permanent Disability
    An illness or injury that renders a person incapable of performing one or more duties of his or her occupation, typically for a lifetime. Substantial variations exist in definitions for this term. Some consider a disability permanent only if the person is incapable of doing any job.
  • Pharmacare Program
    A provincial insurance program that assists low-income and elderly residents to pay for eligible prescription drugs and certain medical supplies. A small deductible is normally required. Only drugs that are Listed on the provincial formulary are covered.
  • Pharmacy Card Program
    The use of a drug benefit identification card that, when presented to a participating pharmacy, entitles the recipient to receive the medication at a discount or for a minimal copay.
  • Plan Document
    A written description of an employee benefit plan maintained by a plan sponsor that sets forth the benefits available and eligibility requirements. The plan document is often separate from the trust agreement in order to allow plan modifications without frequent trust agreement amendments.
  • Plan Member
    A plan member is any person who is or may become eligible to receive a benefit from an employee benefit plan or whose beneficiaries may be eligible to receive a benefit.
  • Plan Member or Participant
    Any person who is or may become eligible to receive a benefit from an employee benefit plan or whose beneficiaries may be eligible to receive a benefit.
  • Plan Sponsor
    An entity that establishes an maintains a benefit plan. The sponsor may be a single employer, an employee organization or an association, committee, joint board of trustees or other similar group of representatives or the entities involved.
  • Plan Year
    Calendar, policy or fiscal year on which records of a benefit plan are kept.
  • Policyholder
    The owner of an insurance policy. With a group insurance plan, the policyholder is the employer, labour union or other entity to which the group contract is issued. Individual insurance policies are contracted directly with the individual or family to whom the contract is issued.
  • Pooling of Risk
    The spreading of health-care costs across a large number of people so that each person can pay a rate that represents the average cost of medical care for the group as a whole, thereby making the cost affordable.
  • Pre-determination of Benefits
    The process of submitting an estimate to the insurer in advance of dental work being performed for the purpose of determining the costs that will be covered by the insurer.
  • Pre-Existing Condition
    A provision often found in an injury or injury and illness policy that protects the insurer from anti-selection. It provides that a disability is not covered if it begins within the first 12 months of the effective date of coverage if it is related to a condition that existed prior to the(...)
  • Pre-Existing Condition Limitation
    A provision in an insurance plan that limits or excludes payment for a pre-existing condition. A pre-existing condition is one for which the insured had symptoms, visited a doctor or was advised to do so, sought medical treatment, or took medication, whether the condition is diagnosed or not.(...)
  • Preexisting Condition
    A medical condition that exists prior to a person's admission to a hospital, issuance of a health insurance policy or enrollment in a health care plan.
  • Premium Waiver
    A provision that can be added to a life insurance policy that allows a policyholder to stop making payments in the event of a disability that leads to loss of income.
  • Prescription Drug
    A medication that may be obtained only with an order from an individual legally permitted to order its dispensing and use.
  • Prescription Drug Benefits
    A line of coverage that may be found in an individual or group insurance plan that provides for reimbursement of prescription medication listed in the plan's formulary  (List of eligible drugs) in accordance with  the limits set out in the policy.
  • Prescription Drug Card Program
    The use of a benefit identification "card" that entitles a patient to receive medications as a covered benefit through a participating pharmacy.
  • Prescription Drug Plan
    An insurance or benefit program that helps pay for the costs of medications prescribed by a health professional. Most, but not all, prescription drug plans are a component of health care coverage.
  • Prescription Medication
    One of two categories of pharmaceuticals, the other being non-prescription medication, also known as over the counter (OTC) medication. Prescription medication is available only if prescribed by a physician or other authorized licensed specialist such as a dentist and is dispensed by a(...)
  • Primary Beneficiary
    A person or entity designated as the first in line to benefit from a will, trust or insurance policy.
  • Primary Payer
    An insurance carrier that has first responsibility for payment of benefits when the insured has duplicate coverage.
  • Private Health Services Plan
    A vehicle providing coverage for any combination of hospital, medical and dental expenses. An arrangement where an employer reimburses its employees for the cost of such care may also come within the definition of a private health services plan. Such plans in Canada are more specifically(...)
  • Proof of Insurability
    Evidence that an insured is in good health when applying for insurance. Typically, an individual must submit to a physical examination or some type of medical screening to show evidence of good health. Group insurance plans generally do not require individuals to show proof of insurability(...)
  • Prostheses and Accessories
    A benefit in the extended health-care benefit line of coverage that provides for payment of initial costs related to the purchase of various prostheses, artificial eyes, or limbs, a wig if required as a result of chemotherapy, and other items such as custom-made orthotic shoes and surgical(...)
  • Prosthetic
    A device, either external or implanted, that substitutes for or supplements a missing or defective part of the body.
  • Provincial Dental Association Fee Schedule
    A term associated with dental benefits. It is the recommended fee schedule for dentists broken down by type of service and is set annually by the provincial dental association.
  • Provincial Formulary
    A list of eligible drugs covered under a province's pharmacare program.
  • Provincial Health Insurance Plan
    The government-sponsored medicare plan for the insured's province of residence.
  • q

  • Qualification Period
    The time before a person has the right to receive or do something. For example, the time between the onset of a disability and the start of disability benefits.
  • Qualifying Event
    An occurrence that entitles a person to a benefit.
  • r

  • Rating
    For insurance, a rating is an assessment of risk and the process used to assess the risk.
  • Recalls
    A term associated with dental benefits that refers to the number of check-ups covered in a year. The normal variations are 6, 9, and 12-month intervals.
  • Regular Occupation
    Refers to the occupation the insured was performing at the time of a claim (not the occupation at the time of applying for coverage).
  • Reimbursement Plan
    A plan that pays benefits for eligible expenses incurred on submission of receipts as evidence of the amount incurred and its eligibility for payment.
  • Reinsurance
    Insurance for insurance companies; a contract that an insurance company makes with another insurer to protect against a major payout of claims in excess of a designated limit. Essentially, the insurance protects the insurance company when there are catastrophic losses.
  • Relocation Services
    Benefits offered by an employer to a current employee accepting an assignment in a new location. Examples include reimbursement for house-hunting expenses, household moving costs or interim travel expense or help in orienting to a new culture or learning a new language.
  • Remediation
    The process of correcting a situation.
  • Renewal
    Continuance of coverage under an insurance policy beyond its original term by the insurer's acceptance of a premium for a new policy term.
  • Renewal Privilege
    A provision defining the insured's rights to continue the policy every year to a specified age.
  • Reserves
    Funds put aside by an insurer to pay for future benefits and expenses; includes active life reserves and disabled life reserves. To ensure that reserves are adequate to pay for benefits and expenses in the future, insurers must include a margin for adverse deviations in their pricing assumptions.
  • Residual Disability Benefit
    A provision in an insurance policy that pays a partial benefit for a partial disability. Persons are considered residually disabled if they are not totally disabled and are able to work but, as a result of the injury or illness, they suffer a loss of income.
  • Respite Care
    Services provided to a sick or elderly person in order to allow the person's primary caregiver a temporary period of relief or rest.
  • Restorative Care
    In dentistry, the repair of teeth.
  • Retirement Savings Rider
    A rider that can be added to a disability policy to assist a client with maintaining regular contributions towards retirement savings during periods of total disability; contributions are made on the insured's behalf to a locked-in account for payment at age 65.
  • Retroactive
    Effective on a date earlier than the date enacted. For example, when an employer applies a percentage increase in compensation to pay periods prior to the date when the increase was announced, the pay raise is said to be retroactive to an earlier date.
  • Retrospective Experience Rating
    An insurance arrangement that adjusts the premium for an insured group at the end of the coverage period based on the group's actual claims (experience) for the period. The amount ultimately charged is subject to a minimum and maximum and also must be sufficient to cover the insurer's(...)
  • Retrospective Payment
    The most common method of payment to health facilities. Payment is made after the services are rendered on the basis of costs incurred by the facility; also known as retrospective reimbursement.
  • Retrospective Premium
    An additional payment that must be made by an insured benefit plan at the end of the contract year if the claims submitted to and expenses incurred by the insurer exceed the amount initially paid for protection at the beginning of the coverage period.
  • Return of Premium Rider
    A rider that returns a portion or all of the premiums paid for the base policy plus its riders after a period of time if certain conditions are satisfied related to claims history and persistency.
  • Return to Work Program
    An employer-sponsored program of rehabilitation, job modification and monitoring to get disabled employees back to work as soon as possible.
  • Reverse Discrimination
    A situation where employees receive higher Levels of income replacement than the company's executives do during a disability. It occurs because the group LTD formula contains a maximum, which results in the percentage of earnings replaced being higher for Lower-paid employees and Lower for(...)
  • Risk Avoidance
    Choosing not to become involved in a hazardous situation such as skydiving, speeding or smoking cigarettes.
  • Risk Charge
    A payment to an insurer as compensation for the potential loss assumed. Also referred to as profit and expense charge, risk and profit charge, or risk and expense charge.
  • Risk Classification
    A process by which a company decides how its premium rates for insurance should differ according to the risk characteristics of individuals ( e.g., age, occupation, sex, state of health), and then applies the resulting rules to individual applications.
  • Risk Control
    A stage in risk management where options for minimizing the probability, severity, frequency and/or unpredictability of a loss are examined. A balance is chosen between affordability and effectiveness to support management objectives. It is in this step that a risk management plan is developed.
  • Risk Factor
    A characteristic that is capable of provoking ill health, injury or loss. For example, smoking is considered a risk factor for poor health.
  • Risk Management
    A process seeking cost-effective ways to prevent or reduce uncertainty and loss among other techniques for minimizing exposure to loss or injury.
  • Risk Pool
    A population of insured persons or entities across which claims, administrative expenses and other costs are spread via a premium or other mechanism.
  • Risk Prevention
    Implementation of initiative(s) to reduce the frequency of losses from activities that cannot be avoided. For example, a benefit plan sponsor might introduce education programs and promote practices to improve participant health and reduce the chance participants will have to file a claim for care.
  • Risk Retention
    A risk management option where an individual or organization decides to accept the consequences of a particular risk.
  • Risk Transfer
    Shifting the responsibility for a potential loss to another party. Purchasing insurance is a very common means to transfer risk.
  • Routine Services
    Services covered under a dental benefit plan, which include  preventative  care (examinations, diagnostic  services, and tests) and basic maintenance care (fillings, cleanings, and simple extractions). Endodontics and periodontics are usually, but not always, covered as part of routine(...)
  • s

  • Salary Continuation Plan
    A benefit option designed to provide some form of protection during a disability.
  • Scaling Units
    A term associated with dental benefits and dental hygiene. A unit is equal to 15 minutes of dental hygiene services, with most dental plans covering up to 10 units per year.
  • Schedule of Benefits
    A list of amounts that an insurance company will pay for specific goods and services claimed under an insurance policy.
  • Secondary Beneficiary
    The next person or entity in line to receive benefits from a will, trust or insurance policy if the first person named to receive benefits (the primary beneficiary) is deceased. The secondary beneficiary may also be referred to as a contingent beneficiary.
  • Self Funding
    With a self-insured benefit plan, the plan sponsor essentially acts as its own insurer, determining what will be covered by the plan and paying claims directly. The plan may contract with an insurance company or third party to administer the plan. The sponsor of a fully self-funded plan(...)
  • Self-Administered Plan
    A benefit plan administered by an employer of fund trustee(s) rather than through an insurance carrier or third-party administrator.
  • Series
    Dl policies  can be grouped into four categories, or series, based on promises contained in the contract regarding renewability and rate guarantees. These series include  non-cancellable, guaranteed renewable, conditionally renewable, and cancellable.
  • Severance Package
    Pay and benefits an employee receives when he or she leaves an employer.
  • Severance Pay
    Money paid as compensation to someone whose employment has ended.
  • Shared Dispensing Fee
    A plan that limits the amount covered for the pharmacist's dispensing fee and thereby encourages the insured to shop wisely when selecting a pharmacy for purchasing prescription medication to be covered under the plan.
  • Short-Term Disability Benefits
    Also known as group STD, weekly income benefits, and WI. It is a disability income benefit payable under a group insurance policy. Benefits are payable after fulfillment of an initial elimination period such as seven days and usually pay for a limited number of days or weeks such as 120 days(...)
  • Short-Term Disability Insurance
    Insurance that provides a percentage of a person's salary if he or she is unable to work for a short period of time dues to sickness and/or injury. Short-term disability policies typically have a limit on the amount that will be paid per month, and another limit on the amount of time benefits(...)
  • Single Employer Plan
    A pension or employee benefits plan maintained by one employer. Single employer plan is also used to describe a plan maintained by related parties such as a parent company and its subsidiaries.
  • Specialty Drug
    A high-cost medication used to treat certain complex and rare medical conditions. Specialty drugs are often self-injected or, otherwise self administered. Many grow out of biotech research and may require refrigeration or special handling. As a result, they may not be available at the typical(...)
  • Specialty Pharmacy
    A facility that dispenses specialty drugs.
  • Standard Risk Class
    A group of insurance applicants who represent average risk within the context of an insurer's underwriting practices.
  • Stop-Loss Insurance
    Also referred to as excess-loss insurance, an insurance contract or provision in a contract between a self-funded benefits plan and an insurance carrier that provides financial protection if claims to the plan exceed a specified dollar amount over a set period of time. There are two types of(...)
  • Student Professionals Discount
    A rate reduction offered by some insurers to attract graduating professionals, and bundled with other special incentives.
  • Subrogation
    A legal process by which an insurance company (or benefit plan), after paying a loss, has the right to recover that loss from another legally liable party. For example, an insurance company might attempt to recoup benefit paid to an insured through a lawsuit against a third party that caused(...)
  • Subscriber
    A person who contracts for a good or service. Persons who elect coverage under a benefit plan are sometimes referred to as subscribers.
  • Substandard Risk Class
    Also known as a special risk class, a group of insurance applicants who have the potential for claims greater in number and size than what is considered typical (standard). Such persons may be able to purchase a substandard insurance policy with a higher premium and/or special contract provisions.
  • Suicide Provision
    An element of a life insurance policy that states the insurer will not pay a death benefit if the insured commits suicide within a specific period of time after opening the policy.
  • Supplemental DI Plan
    A method of increasing a person's disability benefits by purchasing individual disability insurance as a top-up (addition) to their group LTD.
  • Supplemental Life Insurance
    Coverage over and above the basic coverage available via an employee benefit package. Each employee has the option to purchase a rider providing the additional coverage in an amount chosen by the individual employee. Depending on the age of the employee and amount of coverage purchased, the(...)
  • Supplementary Health Plan
    Private health insurance plans are sometimes referred to as supplementary health plans because they focus on services that are not fully covered by government plans.
  • Supplementary Private Health Insurance
    Medical insurance through a non-government source that covers medical expenses not covered by medicare, the most prevalent source being group insurance through the individual's place of employment.
  • Surplus
    More than what is needed; for example, when plan assets exceed liabilities.
  • Surrender Value
    Money a policyholder receives if an annuity or specific types of life insurance policies are cashed in or cancelled before maturity.
  • Survivor Benefit
    A payment or other benefit provided to a family member (or other named beneficiary) upon the death of an individual.
  • t

  • Taxable Benefit Plan
    A plan whose benefits paid during a claim are considered taxable earned income by Canada Revenue Agency (CRA). Insurers offer higher coverage amounts under the Income Ratio Guide for Dl policies whose benefits are taxable. This can arise when the employer  has paid some or all of the premiums.
  • Telemedicine
    The use of video links, e-mail, telephone or another interactive telecommunications system to deliver medical services over a geographical distance.
  • Term Life Insurance
    Financial protection if an insured dies within a specified period. The person or persons named by the insured as beneficiaries are provided the amount (face value) specified when the policy was written. Term Life insurance provides coverage for a specified period referred to as the term (i.e.,(...)
  • Terminal Illness
    A medical condition that, in the opinion of medical experts, cannot be cured and will lead to death.
  • Termination
    The end of an employee's duration with an employer or benefit plan.
  • The Canadian Institute of Actuaries
    A professional body that regulates the actuarial profession in Canada.
  • Therapeutic Class
    A group of drugs that are similar in the disease they are used to treat or the effect they can produce in the human body. Therapeutic classes are often used to categorize drugs on a formulary list.
  • Therapeutic Drug Class Review
    The evaluation of clinical evidence to identify preferred drugs within a therapeutic class.
  • Therapeutic Equivalent
    A medication that contains an active ingredient that is different from that used in another drug but that provides similar treatment outcomes. Therapeutic equivalents, also referred to as therapeutic alternatives, are usually within the same pharmacological class.
  • Therapeutic Index
    Used in assessing the safety of a drug, the ratio of the median lethal dose to the median effective dose.
  • Therapeutic Interchange
    Dispensing a medication different from the one prescribed that is thought to produce the same patient outcome. The alternative drug is clinically similar to, but chemically different from, the medication initially prescribed. The terms therapeutic interchange and therapeutic substitution are(...)
  • Third Party Administrator (TPA)
    An organization external to a benefit plan that provides the plan with administration services such as collecting premiums, handling claims and negotiating for stop-loss protection. A TPA may also be referred to as an administrative agent or contract administrator.
  • Third Party Payer
    An entity that pays for health care services provided to a patient. The payer may be an insurance company, government, self-insured employer or managed care organization.
  • Three Tier Copayment
    A system where a beneficiary typically pays one price for generic drugs, a higher price for preferred brand-name drugs and an even higher price for non-preferred brand-name drugs.
  • Tiered Benefit Plan
    A health plan with two or more levels (tiers) of benefits that allows subscribers to choose their level of coverage. Higher levels of benefits generally have higher premiums.
  • Total Disability
    Sometimes referred to as full disability, an illness or injury that renders a person incapable of performing most duties of a job. Substantial variations exist in definitions for this term. Some definitions specify a person is unable to perform his or her current occupation, while others state(...)
  • Total Rewards System
    All of the tools used by an employer to attract, motivate and retain employees. These rewards include everything an employee may perceive to be of value as a result of the employment relationship, such as financial compensation, benefits, opportunities for social interaction, security,(...)
  • Traditional Disability Insurance
    Individual accident and sickness insurance purchased from traditional life insurers.
  • Two Tier Copayment
    A system where a beneficiary pays one price for generic drugs and a higher price for brand-name drugs.
  • u

  • Unbundled Injury and Illness Plan
    A policy that offers injury as a standalone contract and to which optional illness coverage can be added. While injury can be purchased independent of illness, insurers do not allow illness to be purchased independent of injury coverage. The two benefits can have different elimination periods(...)
  • Underfunded Benefit Plan
    An employee benefit plan in which the sponsor's past contributions are insufficient to cover current and future liabilities.
  • Underwriter
    An individual who has the responsibility for making decisions regarding the acceptability of a particular insurance contract and in determining the amount, price and conditions under which the contract is acceptable.
  • Underwriting
    A process used by an insurance company to assess the risk associated with providing a product. If the risk is acceptable, the underwriting process includes determining what level of risk will be acceptable and the cost of the risk.
  • Unilateral Plan
    A benefit plan that does not result from collective bargaining.
  • Union Sponsored Plan
    A benefit program developed by a union. The union may contract for the benefits or operate the program directly. Benefits are usually paid out of a fund, which receives its income from employer contributions, union member contributions or a combination of both.
  • Upcoding
    Also referred to as overcoding, a deceptive practice of health care providers in which service codes reported are for a higher cost or more complex service than what was actually performed.
  • v

  • Vision Care Benefits
    A Line of coverage that may be found in an individual health insurance plan or added to a group insurance plan that provides for reimbursement of eligible expenses related to the cost of prescription lenses and frames or contact lenses in accordance with the limits set out in the policy; often(...)
  • Vision Coverage
    A benefit program providing treatment relating to the eye. Coverage typically includes eyeglasses, contact lenses, preventative screening and other care provided by optometrists, opticians and ophthalmologists. Coverage may be subject to deductibles, coinsurance, per visit copayments, maximum(...)
  • Voluntary Benefits
    Ancillary benefits made available by an employer often at a group rate or discount to employees. The voluntary benefit is administered by the employer but can be paid by the employees. Traditional group benefits require high levels of participation, typically 75%-100%, but voluntary programs(...)
  • Voluntary Contribution
    Salary, wages or other monetary compensation that an employee elects to pay into an employer sponsored benefit plan. Participation by the employee in such a plan is not required, and the voluntary contributions do not affect the level of employer contributions.
  • Voluntary Life Insurance
    Death benefit coverage that can be purchased above and beyond any basic coverage provided in an employee benefits package. The employee selects the coverage amount and typically pays the entire cost. Unlike supplemental life insurance, voluntary life insurance typically uses a separate policy(...)
  • w

  • Waiting Period
    The time frame before a person is eligible for participation in a benefits plan. Many employee benefit plans require new employees to wait a specified length of time before they are eligible for participation. Additionally, disability plans generally have a waiting period between the onset of(...)
  • Waiver of Premium
    A provision in some insurance policies that allows a policyholder to stop making premium payments under specific circumstances (e.g., the insured suffers a permanent disability or dies).
  • Wellness Program
    A broad range of employer sponsored facilities and activities designed to promote safety and good health among employees. Other goals include increasing worker morale and reducing the costs associated with accidents and ill health leading to absenteeism, lower productivity and health care(...)

Bonner, P. A., Ph.D., CEBS (Ed.). (2016). Employee Benefits Glossary (13th ed.). Brookfield, WI: International Foundation of Employee Benefit Plans.