Insurance terms & definitions
Understanding insurance terms can be complicated — we’re here to help. Check out our glossary of insurance terms and definitions to start building your knowledge.
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Means an unintentional, sudden and unforeseeable event due exclusively to an external cause of a violent nature and inflicting, directly and independently of all other causes, bodily injuries.
Accidental death and dismemberment insurance
A type of insurance that makes a payment if you die from an accident or lose full or partial use of a limb, hearing or eyesight. You can buy this type of insurance on its own or add it to a life insurance policy.
A person professionally trained in calculating the risks and costs of insurance.
Administrative services only (ASO) plan
A type of group plan where the benefits are not insured. The plan sponsor (usually an employer) hires an outside firm (often a life and health insurance company) to administer their plan. The plan sponsor is responsible for providing the funds to pay claims.
A person who is licensed by a provincial or territorial regulator to sell life insurance, accident and sickness insurance, group insurance and annuities, including segregated funds. Also called an agent or a broker.
Application for Insurance
An application is a formal request for insurance coverage. It provides information about you and the type and amount of insurance you want. The information you give the insurance company helps them decide if you meet their requirements and qualify for the insurance. In some cases, you have to answer a series of health questions. You may also have to undergo basic medical tests as part of your application.
The payment an insurance company makes when they approve an insurance claim.
Means the Policyholder if living, otherwise the Spouse if living, otherwise the Estate.
Benefit Survival Period
Means that continuous period of time which must elapse between the date the definition of critical condition is met and the date the benefit is payable, as long as the Insured is still living.
Blue Cross Life
blue cross life Insurance Company of Canada (an independent licensee of the Canadian Association of Blue Cross Plans) and the underwriter for all Life Insurance, Accidental Death and Dismemberment, Disability and Critical Illness benefits offered by Saskatchewan Blue Cross.
Blue Cross Travel Assistance
CanAssistance, the company appointed by Saskatchewan Blue Cross to offer assistance services to insured persons while they are covered by a travel insurance contract.
See Advisor: A person who is licensed by a provincial or territorial regulator to sell life insurance, accident and sickness insurance, group insurance and annuities, including segregated funds. Also called an agent or a broker.
Certificate of insurance
A document that sets out the key features of the insurance under a group insurance plan. It lists things like the type and amount of coverage, categories of dependents, deductibles and coinsurance, limits and exclusions, and instructions for making a claim.
A formal request to an insurance company for payment of a benefit.
The person who makes a claim.
An arrangement in a health or dental insurance plan where you and the insurance company share the cost of the items covered. You usually pay a set percentage (e.g., 20% paid by you and 80% paid by the plan).
Contestability is the legal right of the insurance company to question (or ‘contest’) your insurance coverage. If the company finds that you gave incomplete or incorrect information when applying for the insurance, they will look at what impact the missing information would have had on their decision to insure you. If their decision would have been different, they may cancel your coverage and deny any claims.
Most policies have a two-year contestability period. After that, the company cannot contest your coverage except in the case of fraud (a deliberate misstatement of fact). An example of fraud is a smoker who states in their application that they’re a non-smoker, to get a reduced premium.
An insurance contract is the legal agreement with your insurance company that sets out the terms of your coverage. The contract usually includes your application, the policy, and any changes made later to the policy.
Contract Expiry Date
The date the coverage ends. This date is indicated on your certificate of insurance.
See Policyholder: The person who owns an insurance policy. Also called the policyowner.
Coordination of Benefits
Families with two working adults may be covered by more than one health or dental plan. If your primary plan doesn’t pay the full amount of an expense, you can submit a claim to the other plan for the balance. In this way, you can receive up to 100% of your expense.
See Eligible expenses: Reasonable and Customary Charges that are covered under a health or dental plan as outlined in the Policy document. Depending on the coverage provided, you may have to pay a share of the expenses. Expenses are usual, customary and reasonable as determined by Saskatchewan Blue Cross.
The period between the effective date of the insurance contract and the contract expiry date indicated on your certificate of insurance.
Critical illness insurance
A type of insurance that pays you a lump sum if you are diagnosed with a life altering illness such as cancer, heart attack, stroke, Multiple Sclerosis or Parkinson’s Disease. The exact illnesses covered are listed in your policy. You can buy this type of insurance on its own or may be able to add it to a life insurance policy or group plan.
Deductibles are common in health insurance plans. The deductible is the amount of a covered expense that you pay before your insurance company makes any payments. The deductibles apply to you and to any dependents covered under the plan. Examples might be $50 per person per year or $5 for each drug prescription.
A type of insurance that provides coverage for dental expenses.
A person qualified and licensed as a doctor of dentistry entitled to practice dentistry under the laws of the place where the services are provided.
- Unmarried child up to eighteen (18) years of age
- Unmarried child under twenty-five (25) years of age undergoing full time student education
- Child who due to physical or mental infirmity cannot leave the care of the Policyholder
Dependent(s) must be listed in the Policyholder’s Blue Choice® Application for Insurance or in a supplemental notice received and accepted by Saskatchewan Blue Cross. Any person who ceases to meet any of the above requirements shall thereupon cease to be included under the Policy.
Disability income insurance
A type of insurance that makes regular payments (usually monthly) to replace income if you become disabled and unable to work. It’s usually provided as part of a group plan, but you can also buy it on its own.
- Have been approved by Health Canada for specific indications and assigned a drug identification number (DIN)
- Are dispensed by a licensed Pharmacist, Physician, or Dentist (or other qualified health professionals authorized by law)
- Legally require a prescription from a Physician or Dentist, (or other qualified health professionals authorized by law)
- Are marketed and available for purchase in Canada
The date the coverage begins as indicated on the certificate of insurance.
Reasonable and Customary Charges that are covered under a health or dental plan as outlined in the Policy document. Depending on the coverage provided, you may have to pay a share of the expenses. Expenses are usual, customary and reasonable as determined by Saskatchewan Blue Cross.
The length of time you must be a member of a group before qualifying for coverage under the group plan. For example, an organization whose health and dental plan has a 90-day eligibility period would require 90 days of qualified employment before coverage could begin.
In disability insurance, you have to be continuously disabled for a certain amount of time before making a claim. This amount of time is the elimination period (sometimes referred to as a “waiting period”). You won’t receive benefits for the elimination period.
Means a sudden and unforeseen Medical Condition that requires immediate Treatment. An Emergency no longer exists when the evidence indicates that no further Treatment is required at destination or you are able to return to your province/territory of residence for further Treatment.
Evidence of insurability
The information an insurance company uses to decide whether or not to insure you. It’s often called “proof of good health”. The information may include medical, lifestyle, smoking and other personal information.
Things that are not covered by an insurance policy. They can include:
- certain medical conditions you had before you applied for the insurance
- high-risk activities such as sky-diving
You can sometimes buy extra insurance to pay for risks that wouldn’t otherwise be covered.
Extended health care insurance
A type of insurance that pays for hospital and medical expenses not covered by your provincial health plan. It can be part of a group plan or you can buy it on its own.
Financial needs analysis
When you buy insurance, an advisor may help you decide how much insurance you need by completing a financial needs analysis. This looks at your current financial and personal situation and goals to help decide how much insurance you need. It can include things like taking care of dependents and paying off loans.
A period in which an insurance policy is effective even though the premium is past due.
A type of insurance that provides coverage for a group of people (for example employees or members of an association) under one contract called a group plan or group policy.
An organization (for example an employer or association) that enters into a group insurance contract with an insurance company.
Guaranteed death benefit
The minimum amount an insurance company pays to the beneficiary when the insured person dies.
Healthcare Spending Account
An arrangement in a group plan where the plan member gets a number of credits in an account. The member can use the credits to pay for health and dental expenses not covered elsewhere in their plan.
A type of insurance that covers medical expenses (such as drugs, dental expenses, vision expenses, and paramedical expenses) or loss of income if you’re sick or injured.
Types of health insurance include:
- accident and sickness insurance;
- accidental death and dismemberment insurance;
- critical illness insurance;
- disability income insurance;
- extended health care insurance;
Means an institution that is licensed as an accredited Hospital that is staffed and operated for the care and Treatment of In-patients and out-patients. Treatment must be supervised by Physicians and there must be registered nurses on duty 24 hours a day. Diagnostic and surgical capabilities must also exist on the premises or in facilities controlled by the establishment.
A Hospital is not an establishment used mainly as a clinic, extended or palliative care facility, rehabilitation facility, addiction treatment centre, convalescent, rest or nursing home, home for the aged or health spa.
Means the Policyholder’s legal or common-law Spouse, parent, step-parent, grandparent, grandchild, in-law, natural or adopted child, legal guardian, step-child, brother, sister, step-sister, step-brother, aunt, uncle, niece, or nephew.
In life and health insurance, a person who has physical or health problems, or who has a risky occupation or hobby, is known as an impaired risk. A person who presents an impaired risk may not qualify for coverage. If they do qualify, they may pay higher premiums for their coverage. For example, someone with a history of strokes would be an impaired risk.
Insurance you buy as an individual from an advisor or insurance company. This differs from group insurance, which you may have through your employer.
Means bodily harm sustained directly as a result of an Accident.
Means a patient confined to a Hospital for more than twenty-four (24) hours on the recommendation of the attending Physician.
See Policyholder: The person who owns an insurance policy. Also called the policyowner.
An insurance company that issues policies and promises to pay benefits.
An insurance policy that has ended because you stopped paying premiums and there was not enough money in the policy (cash value) to keep the payments up to date.
The official certification a provincial or territorial regulator gives an individual to show the individual is authorized to sell insurance.
A type of insurance that pays out when the insured person dies.
The person whose life is insured.
Means the maximum amount payable for Eligible Expenses during the entire time you are insured.
Long-term disability insurance
A type of group insurance that replaces part of your income if you become disabled and are unable to work. Long-term disability often starts after short-term disability ends and usually provides coverage for two or more years.
Information or a fact you’re aware of that could affect an insurance company’s decision about whether to insure you and at what cost. For example, if you’re being checked for a medical condition when you’re applying for insurance, you must tell the insurance company. If you don’t, the company could cancel your policy and refuse to pay any claims.
Means any disease, illness or Injury (including symptoms of undiagnosed conditions).
See Plan member: The person insured under a group insurance, group benefit, group pension, or group savings plan (for example, an employee, union member or association member).
A false or misleading statement an applicant makes when applying for insurance. An insurance company can cancel the policy if they find you gave them false or misleading information in your application.
Misstatement of age
This happens when an insurance company is given the wrong age for the person insured. In some situations the insurance company can cancel the coverage when the wrong age is given. However, in many cases they adjust the coverage or premiums to take the correct age into account.
Means a person qualified and licensed to dispense Drugs and medicine on a Physician’s prescription under the laws of the place where the services are provided.
Means a person who is not you or a member of your Immediate Family or your traveling companion licensed in the jurisdiction where the services are provided, to prescribe and administer medical Treatment.
Plan member or participant
The person insured under a group insurance, group benefit, group pension, or group savings plan (for example, an employee, union member or association member).
The holder of a group insurance, group benefit, group pension, or group savings plan. It can be any organization that provides group benefits to its members, for example an employer, union or association.
The legal agreement between you and your insurance company that sets out the terms of your insurance coverage.
The person who owns an insurance policy. Also called the policyowner.
Pre-determination of benefits
A claim procedure required by many group plans before you incur large expenses. For example, if you need major dental work, your plan may require you to obtain and submit an estimate of the costs so your insurer can determine what portion of the costs your plan will cover (called a pre-determination of benefits) before you receive treatment. You can then budget for the expense knowing how much your plan will pay and how much you’ll have to pay. You may be able to cover some of your costs under your spouse’s or partner’s plan.
Pre-existing Medical Condition
A medical condition for which you’ve had symptoms, consulted a medical professional or received treatment before you apply for insurance or before your coverage takes effect.
Preferred Hospital Accommodation
Means a semi-private or private room in a Hospital where an Insured is accommodated as an In-patient, but does not include long-term care which might otherwise be provided in a nursing home, or private rooms where an Insured In-patient’s family is accommodated.
Private Duty Nurse
Means a registered nurse or a licensed practical nurse, registered with the appropriate provincial, state or national association. A relative of the Insured, or a person who normally resides with the Insured, shall not be eligible for any remuneration as a Provider of private duty nursing services to an Insured.
Means one who provides services and/or treatment to an Insured.
Reinstating a policy
You may apply to restart your insurance coverage if it ended because you did not pay your premiums. This process is called reinstating your policy. To do so you must apply within two years of the date the required premiums were not paid. You must also provide evidence of insurability and pay any outstanding costs, plus interest.
Reasonable and Customary Charges
Means charges incurred for goods and services that are comparable to what other providers charge for similar goods and services in the same geographical area.
Short-term disability insurance
A type of insurance that replaces income for a short period of time when a person becomes disabled and is unable to work. If the disability continues, the person may be eligible for long-term disability benefits, if they have that coverage.
Supplementary health insurance
See Extended health care insurance: A type of insurance that pays for hospital and medical expenses not covered by your provincial health plan. It can be part of a group plan or you can buy it on its own.
Means a person who is legally married to the Policyholder or who has continuously resided with the Policyholder in a common-law relationship for at least twelve (12) months and is publicly represented as such.
The Policyholder requesting coverage for a common-law spouse must give written notice to Saskatchewan Blue
Cross. Unless such written request is made, a person legally married to the Policyholder shall be considered to be the spouse of the Insured. Discontinuance of cohabitation with the Policyholder shall terminate coverage for a common-law spouse.
A Medical Condition is considered Stable when all of the following statements are true:
- There has not been any new Treatment prescribed or recommended, or change(s) to existing Treatment (including a stoppage in Treatment), and
- There has not been any change to any existing prescribed drug (including an increase, decrease, or stoppage to prescribed dosage), or any recommendation or starting of a new prescription drug, and
- There has not been any new, more frequent or more severe symptoms, and
- There has been no hospitalization or referral to a specialist, and
- There have not been any tests, investigation or Treatment recommended, but not yet complete, nor any outstanding test results, and there is no planned or pending Treatment
All of the above conditions must be met for a Medical Condition to be considered Stable.
Term life insurance
A type of life insurance that provides coverage for a set period of time. The period (or term) of the coverage can be either a fixed number of years (e.g., 10 years) or to a set age (e.g., age 65). The policy has no cash value.
Insurance designed to pay for certain unexpected costs that may arise when you are travelling outside your home province or Canada. These costs may include emergency hospital and medical costs, trip cancellation and lost baggage. Some travel insurance coverage includes an accidental death benefit.
Means a procedure prescribed, performed or recommended by a Physician for a Medical Condition. This includes but is not limited to prescribed medication, investigative testing and surgery.
The process an insurance company goes through to decide whether or not to insure someone.