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GLOSSARY
Cancellation - the termination of an in-force insurance contract by either the insured or insurer. Termination may be voluntary, involuntary, or mutual in accordance with the provisions in the contract.
Cash value - the amount of money to which a policy owner is entitled if the policy is surrendered before maturity.
Certificate - a statement (or booklet) evidencing that a policy has been written and stating the coverage in general.
Co-insurance - a portion of the medical expense that the individual must pay, with the insurance policy paying the rest; the co-insurance may be either in a dollar amount or as a percentage of the expense, such as 80 percent paid by the insurer and 20 percent (the co-insurance) paid by the insured.
Co-payment - the percentage of the allowable amount, or low, fixed fee that members pay for covered services when receiving benefits. Co-payments are the member's share of the cost of covered services. With PPO plans, most percentage co-payments only apply after you satisfy a plan deductible. Most HMO co-payments apply right away, without any deductible.
Co-payment Maximum or Out-of-Pocket maximum - a limit on the amount a member might have to pay for many covered services during a calendar year. An Out-of-Pocket Maximum includes the plan deductible, while a Co-payment Maximum does not. Once either type of maximum is reached, for the rest of the calendar year, insurers will pay 100% of the allowable amount for all applicable covered services, up to specified maximums. Certain covered services, such as office visits co-payments, generally do not count toward these maximums, and continue to be a member responsibility.
COBRA - Consolidated Omnibus Budget Reconciliation Act, passed in 1986, which allows specific employees and their dependents to continue coverage after termination from the employer's group health plan.
Commission - the payment made by insurers to agents or brokers for the sale and service of policies.
Commissioner of Insurance (Superintenden, Director) - the title of the head of a state insurance department.
Comprehensive Major Medical Insurance - a policy designed to combine the protection offered by a basic plan and a major medical health insurance policy in a single plan; it is characterized by a low deductible amount, a co-insurance feature, and high maximum benefits.
Contributory - a group insurance plan issued to an employer under which both the employer and the employee contribute to the cost of the plan.
Convertible - a policy that may be exchanged for another type of policy, by contractual provision, at the option of the policy owner, and without evidence of insurability.
Coordination of Benefits (COB) - a procedure used by insurance companies to keep individuals from collecting more in benefits that was actually charged for services covered under more than one health insurance policy; no matter how many policies a person has, this provision limits the benefits that can be paid on each claim to 100 percent of the expenses covered; COB provisions also designate the order in which the multiple carriers are to pay benefits.
Countersignature - the act of signing an insurance policy by a licensed resident agent.
Coverage - the perils (or causes of loss) which are covered in a policy.
Covered Expenses - hospital, medical, and miscellaneous health-care expenses incurred by the insured that entitle him or her to a payment of benefits under a health insurance policy; the term defines the amount of expense that will be considered in the calculation of benefits.
CSO table - the Commissioner's Standard Ordinary table. A mortality table used in Life insurance that mathematically predicts the likelihood of death.
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