Group Health Insurance
Coverage underwritten on members of a natural group, such as employees of a particular business, union, association, or employer group. Each employee is entitled to benefits for hospital room and board, surgeon and physician fees, and miscellaneous medical expenses. There is a deductible and a coinsurance requirement each employee must pay. Characteristics of group health insurance include:
- TRUE GROUP PLAN one in which all employees must be accepted for coverage regardless of physical condition. (For example, coverage cannot be denied because of a pre-existing condition such as cancer.) Usually an employee must apply and pay the first premium within the first 30 days of employment or he or she forfeits the right to automatic coverage (a form of GUARANTEED INSURABILITY). Individuals are covered under a MASTER CONTRACT, each receiving a certificate denoting coverage.
- Schedule of Benefits describes what the insured and his or her covered dependent (s) is entitled to in the event of disease, illness,or injury. After the insured or the covered dependent has satisfied the DEDUCTIBLE (defined as the first portion of all of the eligible expenses that occur during a calendar year of coverage), the insurance company pays a given percentage (usually 80%) until a total sum (stop loss), usually $5000, is reached for the calendar year. After the total sum has been reached, the insurance company pays100% of the total eligible expenses until the end of the calendar year subject to a maximum lifetime amount.
- Eligible Expenses include hospital bills, surgery, doctor's services, private nursing, medicines, and X-rays. Payment allowed for these and other expenses are spelled out in the policy. For example, the hospital's daily charge for room and board is subject to a specified maximum.
- Exclusions from Provisions of Medical Benefits many exclusions occur in group health plans, including benefits under Workers Compensation; certain mouth conditions; convalescent or rest cures; expenses incurred by a member of a HEALTH MAINTENANCE ORGANIZATION (HMO) or other prepaid medical plan; expenses associated with intentional self-inflicted injuries or attempt at suicide.
- COORDINATION OF BENEFITS when there are two or more group health insurance plans covering the insured, one plan becomes the Primary Plan and the other plan (s) becomes the Secondary Plan (s).
Popular Insurance Terms
Coverage in which the face amount of a policy remains uniform, neither increasing nor decreasing for as long as the policy is in force. ...
Same as term Limitations: exceptions and limitations of coverage; that is, the maximum amount of insurance coverage available under a policy. ...
Statutory surplus plus the interest maintenance RESERVE plus the ASSET VALUATION RESERVE. ...
Plan that provides a legal resident of the state of Oregon access to basic health care through three major components: Medicaid Reform (rationing) extends Medicaid eligibility to those ...
Amendment to the law that requires companies that manage retirement plans to permit terminating participants to directly transfer any plan distribution to the individual retirement account ...
To accumulate. For example, under one of the dividend options of a participating life insurance policy, dividends can accumulate at interest by leaving them with the insurance company; cash ...
Probability of one's living to a specific age according to a particular mortality table. Life expectancy is the beginning point in calculating the pure cost of life insurance and annuities ...
Net income expressed as a percentage of average total equity. This percentage measures profitability by expressing how efficiently invested capital or equity is being utilized. ...
Type of inland marine insurance used to provide coverage for domesticated animals, including poultry, cattle, horses, sheep, and swine. ...

Have a question or comment?
We're here to help.