Health & Life Insurance Glossary: 126 Terms in Plain English

What Do Common Insurance Terms Mean?

Most insurance terms describe one of three things: what you pay, which providers you can use, and when you can buy or change coverage. This insurance glossary defines 126 of them in a few short sentences each, with the 2026 and 2027 numbers that apply as of fall 2026.

Terms run A to Z across health insurance (ACA, Marketplace and employer plans), Medicare, life insurance, disability coverage and small-business benefits. Every term has its own link, so you can jump to the A–Z list or share a single definition. Each one ends with a link to our full guide on that topic.

FreedInsure LLC (NPN: 20230457) is an independent brokerage licensed in 42 states. We compare 14+ carriers, and if a term on your quote or bill doesn't make sense, call (844) 788-3733. Our help is free to you. This page is general information, not tax or legal advice.

Last updated: October 5, 2026

By Constantino Lardi, independent broker • FreedInsure LLC • NPN 20230457 • Licensed in 42 states • (844) 788-3733

Insurance Glossary: Terms A to Z

Here are all 126 terms in alphabetical order. Acronyms are filed under their full names, with the short form in parentheses, so APTC appears under "Advance premium tax credit." Pick a letter to jump ahead.

A

Accelerated death benefit

A life insurance rider that lets you collect part of the death benefit early if you're diagnosed with a terminal illness. Whatever you take is subtracted from what your beneficiaries later receive, and many modern term policies include it. Learn more: term life riders →

Accelerated underwriting

A faster way to qualify for life insurance in which the insurer checks your health through data, such as prescription, medical-information and driving records, instead of a medical exam. Healthy applicants can be approved in minutes to days, often at prices comparable to exam-based policies. Learn more: life insurance with no medical exam →

Accident insurance

A supplemental policy that pays you set cash benefits after a covered injury, such as a fracture, ER visit or ambulance ride, typically $100–$5,000 per covered event. The money goes to you, not the doctor, and it doesn't replace health insurance. Learn more: accident and critical illness insurance →

Advance premium tax credit (APTC)

Your premium tax credit paid in advance, straight to your insurer each month, to lower your Marketplace premium. You reconcile it on your tax return using Form 8962, and starting with tax year 2026 there's no cap on paying back excess credit if your income ends up higher than you estimated. Learn more: estimate your 2027 tax credit →

Affordable Care Act (ACA)

The 2010 federal health law, often called Obamacare, that created the Health Insurance Marketplace, premium tax credits and Medicaid expansion. ACA-compliant plans must accept you regardless of health, cover pre-existing conditions and the 10 essential health benefits, and cap your yearly in-network out-of-pocket costs. Learn more: what the ACA is and how it works →

Allowed amount

The most a health plan will pay for a covered service, sometimes called the eligible expense or negotiated rate. Your coinsurance is figured on the allowed amount, not the provider's full charge, and an out-of-network provider may bill you for the difference. Learn more: how out-of-network claims are paid →

Annual Enrollment Period (Medicare AEP)

Medicare's yearly window, October 15–December 7, when people already on Medicare can switch Medicare Advantage plans, move between Original Medicare and Medicare Advantage, or join, switch or drop a Part D drug plan, with changes starting January 1. It's separate from ACA Open Enrollment. Learn more: ACA Open Enrollment vs Medicare Annual Enrollment →

Applicable large employer (ALE)

An employer with 50 or more full-time employees, counting full-time equivalents. Under the ACA's employer mandate, an ALE must offer affordable, minimum-value coverage to full-time employees or risk a penalty; smaller employers aren't required to offer coverage. Learn more: small business health insurance requirements →

Association health plan (AHP)

A group health plan sponsored by an association of employers. As of fall 2026, AHPs follow the Labor Department's pre-2018 guidance; a new proposed rule was sent to the White House for review in August 2026 but hasn't been published. An AHP covering two or more employers is a MEWA, so state rules apply. Learn more: association health plan rules →

Auto re-enrollment

If you take no action during Open Enrollment, most Marketplace enrollees are renewed into the same or a similar plan for the next year. It keeps you covered, but your premium and tax credit can change, so it's worth re-shopping before December 15. Learn more: should you let your plan auto-renew? →

Back to A–Z ↑

B

Balance billing

When an out-of-network provider bills you for the difference between its charge and your plan's allowed amount. The No Surprises Act bans it for emergencies and for certain out-of-network providers at in-network facilities, but care you choose to get out of network can still be balance billed. Learn more: out-of-network costs and balance bills →

Benchmark plan (SLCSP)

The second-lowest-cost silver plan available to you on the Marketplace. Your premium tax credit is sized so the benchmark plan costs no more than a set share of your income, 2.15%–10.22% for 2027 coverage, and you can apply the credit to any Marketplace plan except a catastrophic plan. Learn more: the 2027 ACA subsidy calculator →

Beneficiary

The person, people, trust or organization you name to receive a life insurance death benefit. Update it after a marriage, divorce or new child, because the insurer generally pays whoever is named on the policy, not whoever is named in your will. Learn more: how life insurance works →

Benefit period (disability)

How long a disability policy keeps paying once benefits start. Short-term disability commonly pays for 3–12 months; long-term disability pays for a set number of years or up to age 65 or 67. Learn more: short-term vs long-term disability →

Buy-sell agreement

A contract among business owners that spells out what happens to an owner's share if they die, become disabled or leave. It's often funded with life insurance on each owner, so the remaining owners have cash to buy the share from the family at an agreed price. Learn more: life insurance on a business partner →

Back to A–Z ↑

C

Cap rate (IUL)

The most interest an indexed universal life policy will credit for a period, however much the index rises. For example, with a 10% cap and a 100% participation rate, a 15% index gain is credited as 10%. Caps work alongside a participation rate and a floor, usually 0%; they vary by carrier and contract, aren't a promise of any return, and insurers can change them within the contract's limits. Learn more: how IUL caps and floors work →

Cash value

The savings component inside a permanent life insurance policy, funded by part of each premium. Any growth is tax-deferred, and you can reach it through policy loans, withdrawals or a surrender; on whole life, it often takes 10–15 years to catch up to the premiums you've paid. Learn more: whole life cash value →

Catastrophic plan

A high-deductible ACA plan for people under 30, or 30 and older with a hardship or affordability exemption. It covers the 10 essential health benefits, free preventive care and at least 3 primary care visits a year before the deductible, but premium tax credits can't be used on it. Learn more: catastrophic health insurance →

CHIP (Children's Health Insurance Program)

State-run, federally funded coverage for children in families that earn too much for Medicaid but can't afford private insurance. Income limits vary by state, premiums are low or zero, and you can enroll any time of year. Learn more: CHIP health insurance →

COBRA

A federal law that lets you and your family keep your employer's group health plan after a job loss, cut in hours or other qualifying event, generally for 18 months and up to 29 or 36 months in some cases. It applies to most private employers with 20 or more employees, and you can be charged up to 102% of the plan's full cost. Learn more: how COBRA insurance works →

Coinsurance

Your percentage share of a covered bill after you meet the deductible. With 20% coinsurance on a $1,000 allowed amount, you pay $200 and the plan pays $800, until you reach your out-of-pocket maximum. Learn more: deductible vs copay vs coinsurance →

Contestability period

The window, typically the first 2 years a life insurance policy is in force, when the insurer can review your application and deny or adjust a claim over a material misstatement. After it ends, the policy generally can't be contested except for nonpayment of premiums. Learn more: the 2-year contestability window →

Contingent beneficiary

The backup person or entity who receives a life insurance death benefit if your primary beneficiary has died or can't be paid. Naming one can keep the payout from defaulting to your estate. Learn more: how beneficiaries and payouts work →

Conversion rider

The right to convert some or all of a term life policy into permanent coverage without a new medical exam, usually before a stated age or policy year. It protects you if your health changes before the term ends. Learn more: term life conversion →

Copay (copayment)

A flat dollar amount you pay for a covered service, such as $25 for a primary care visit or $10 for a generic drug. Depending on the plan, copays can apply before or after the deductible, and they count toward your out-of-pocket maximum. Learn more: how copays and coinsurance work for families →

Cost-sharing reduction (CSR)

Extra savings that lower your deductible, copays and out-of-pocket maximum, available only on silver Marketplace plans for household incomes from 100% to 250% of the federal poverty level. For 2027, the strongest CSR silver plans cap out-of-pocket costs at $4,000 for one person, versus $12,000 on a standard plan. Learn more: 2027 ACA income limits →

Critical illness insurance

A supplemental policy that pays you a lump sum, typically $5,000–$50,000, if you're diagnosed with a covered condition such as cancer, a heart attack or a stroke. You can use the cash for anything, but it doesn't replace health insurance. Learn more: what critical illness insurance covers →

Back to A–Z ↑

D

Death benefit (face amount)

The amount a life insurance policy pays your beneficiaries when the insured person dies while the policy is in force. It's generally income-tax-free to beneficiaries, and any unpaid policy loans or withdrawals reduce it. Learn more: is life insurance taxable? →

Deductible

The amount you pay for covered care each year before your health plan starts sharing the cost. ACA plans cover preventive care before the deductible, and many plans cover some visits or generic drugs with a copay before you meet it. Learn more: deductible vs copay vs coinsurance vs out-of-pocket max →

Dividend (life insurance)

A share of the insurer's surplus that a participating whole life policy may pay each year. Dividends are never guaranteed; you can typically take them as cash, use them to lower your premium, or buy paid-up additions that add to the cash value and death benefit. Learn more: whole life insurance →

Back to A–Z ↑

E

Elimination period

The waiting time between the start of a disability and the first benefit payment, like a deductible measured in days. Short-term disability typically uses 0–14 days; long-term disability commonly uses 90–180 days. Learn more: short-term vs long-term disability →

Employer contribution

The share of the premium an employer pays for a group health plan. Carriers commonly require a minimum, often around 50% of the employee-only premium, and employer contributions are generally a deductible business expense (confirm with your CPA). Learn more: small-group contribution and participation rules →

EPO (exclusive provider organization)

A health plan that covers care only from providers in its network, except emergencies. EPOs often don't require referrals, and they're often, though not always, priced below a comparable PPO. Learn more: EPO vs PPO →

Essential health benefits (EHB)

The 10 categories of care every ACA individual and small-group plan must cover: outpatient care, emergency services, hospitalization, maternity and newborn care, mental health and substance use services, prescription drugs, rehabilitative services, lab tests, preventive care, and pediatric services including children's dental and vision. Adult dental and vision aren't on the list. Learn more: ACA health insurance plans →

Excepted benefits

Coverage that federal law carves out of most ACA rules, such as fixed indemnity, hospital indemnity, accident, critical illness and stand-alone dental or vision policies. On their own, excepted benefits don't count as minimum essential coverage. Learn more: supplemental insurance →

Explanation of benefits (EOB)

A statement your insurer sends after processing a claim, showing what the provider charged, the allowed amount, what the plan paid and what you may owe. It isn't a bill; compare it with the provider's bill before you pay. Learn more: claims and EOB help →

Back to A–Z ↑

F

Federal poverty level (FPL)

The HHS income guideline used to decide eligibility for Medicaid, CHIP, premium tax credits and cost-sharing reductions. For 2027 Marketplace coverage, the 2026 guidelines apply: 100% FPL is $15,960 for one person and $33,000 for a family of four in the 48 contiguous states and DC. Learn more: ACA income limits by household size →

Final expense insurance

A small whole life policy, commonly $5,000–$25,000, meant to cover a funeral, burial and final bills. Many final expense policies are simplified issue, with health questions but no exam; others are guaranteed issue with a graded death benefit. Learn more: life insurance for seniors →

Fixed indemnity insurance

THIS IS A SUPPLEMENT TO HEALTH INSURANCE AND IS NOT A SUBSTITUTE FOR MAJOR MEDICAL COVERAGE. LACK OF MAJOR MEDICAL COVERAGE (OR OTHER MINIMUM ESSENTIAL COVERAGE) MAY RESULT IN AN ADDITIONAL PAYMENT WITH YOUR TAXES.

A plan that pays a set dollar amount per day in the hospital or per service, such as $100 a day or $50 a visit, regardless of the actual bill. It's an excepted benefit, not major medical coverage or minimum essential coverage. There's no out-of-pocket maximum, and you pay any charges above the scheduled amount. Learn more: major medical vs minimum coverage →

Flexible spending account (FSA)

An employer-sponsored account that lets you set aside pre-tax pay for medical costs, up to $3,400 for 2026. Unlike an HSA, an FSA generally stays with the employer, and money you don't use is forfeited unless the plan offers a carryover (up to $680 for 2026) or a grace period. Learn more: employee fringe benefits, including FSAs →

Form 1095-A

The tax form the Marketplace sends if anyone in your household had a Marketplace plan, showing your premiums and any advance tax credit paid. You need it to complete Form 8962 and reconcile your premium tax credit when you file. Learn more: how to get your 1095-A →

Formulary

A health plan's list of covered prescription drugs, usually grouped into tiers that set your copay or coinsurance. Check each prescription against the formulary before you pick a plan, because drug lists can change every year. Learn more: how to choose a health insurance plan →

Free look period

A window after you receive a new life insurance policy, set by state law and often at least 10 days, when you can cancel and get a refund of the premium you paid. Use it to read the policy and confirm it matches what you were quoted. Learn more: how a life insurance policy works, step by step →

Back to A–Z ↑

G

Gap insurance

A broad label for coverage that fills holes in your main plan or the time between plans. It can mean supplemental policies that pay set cash benefits you can put toward your deductible or other costs, subject to the policy's limits, or temporary coverage between jobs. Neither is ACA-compliant coverage, and supplemental policies aren't a substitute for major medical coverage. Learn more: gap health insurance →

Grace period

Extra time to pay a late premium before coverage ends. Life insurance policies typically allow about 30 days; Marketplace enrollees who get advance tax credits have a 3-month grace period, and COBRA allows at least 30 days for each payment after the first. If the grace period runs out, the policy lapses. Learn more: how life insurance works →

Graded death benefit

A limit, common on guaranteed issue life insurance, that pays back premiums (often with interest) instead of the full benefit if the insured dies of natural causes in the first 2 years. Accidental deaths are usually covered in full from the start. Learn more: guaranteed issue life insurance →

Group health insurance

Health coverage an employer or other sponsor provides to a group, usually employees and their dependents, with the employer paying part of the premium. Federal rules bar group health plans from imposing pre-existing condition exclusions. Learn more: group health insurance for employers →

Group term life insurance

Term life coverage an employer provides to employees, often a flat amount or a multiple of salary. Under IRC Section 79, the cost of the first $50,000 of employer-paid coverage is tax-free to the employee; coverage above that creates taxable imputed income. Learn more: group term life insurance taxes →

Guaranteed issue

Coverage the insurer must offer without screening your health. Guaranteed issue life insurance accepts everyone in its age range, usually 50–85, but caps coverage around $5,000–$25,000 and uses a graded death benefit; ACA health plans are also guaranteed issue during Open Enrollment or a Special Enrollment Period. Learn more: guaranteed issue life insurance →

Back to A–Z ↑

H

Health care sharing ministry

A membership group whose members voluntarily share one another's medical bills, usually based on shared religious beliefs. It isn't insurance: the ministry has no legal obligation to pay your bills, and it doesn't have to cover pre-existing conditions or cap your costs. Learn more: health sharing vs ACA plans →

Health Insurance Marketplace (exchange)

The government-run service where you compare and buy individual ACA plans: HealthCare.gov in most states, or a state-run exchange such as DC Health Link in Washington, DC. Premium tax credits and cost-sharing reductions are available only through the Marketplace. Learn more: the health insurance Marketplace →

High-deductible health plan (HDHP)

A health plan that qualifies you to contribute to a health savings account. For 2027, it needs a deductible of at least $1,750 self-only or $3,500 family and out-of-pocket costs capped at $8,700 or $17,400; starting in 2026, Marketplace bronze and catastrophic plans also count as HDHPs. Learn more: high-deductible health plans →

HMO (health maintenance organization)

A health plan that covers care only from its network, except emergencies, and usually requires you to choose a primary care physician and get referrals for specialists. In exchange for those rules, HMO premiums typically run below comparable PPO plans. Learn more: what HMO insurance is →

Hospital indemnity insurance

THIS IS A SUPPLEMENT TO HEALTH INSURANCE AND IS NOT A SUBSTITUTE FOR MAJOR MEDICAL COVERAGE. LACK OF MAJOR MEDICAL COVERAGE (OR OTHER MINIMUM ESSENTIAL COVERAGE) MAY RESULT IN AN ADDITIONAL PAYMENT WITH YOUR TAXES.

A supplemental policy that pays you a fixed cash amount when you're hospitalized, typically $100–$500 per day plus an admission benefit, no matter what the hospital bills. It isn't major medical or minimum essential coverage, there's no out-of-pocket maximum, and you pay any charges above the benefit. Learn more: hospital indemnity insurance →

HRA (health reimbursement arrangement)

An employer-funded account that reimburses employees, tax-free, for qualified medical expenses and, with some HRA types, insurance premiums. Only the employer contributes; common types include the ICHRA, the QSEHRA and the excepted-benefit HRA, which can provide up to $2,250 for 2027 plan years. Learn more: ICHRAs and other HRAs →

HSA (health savings account)

A tax-advantaged account you can fund only while enrolled in an HSA-eligible HDHP. For 2027 the contribution limits are $4,500 self-only and $9,000 family, plus $1,000 if you're 55 or older, and the money stays yours if you change jobs or plans. Learn more: 2027 HSA contribution limits →

Back to A–Z ↑

I

ICHRA (individual coverage HRA)

An HRA that lets employers of any size reimburse employees, tax-free, for individual health insurance premiums, with amounts that can vary by employee class. In September 2026 federal officials began calling it a CHOICE Arrangement; the rules didn't change. For 2027, it's affordable when the monthly self-only lowest-cost silver premium, minus the monthly ICHRA amount, is no more than 10.22% of monthly household income. Learn more: what an ICHRA is →

In-network

Doctors, hospitals, labs and pharmacies that have a contract with your health plan to accept negotiated rates. Staying in network keeps your costs lowest, and it's the only way most HMO and EPO plans cover non-emergency care. Learn more: PPO vs HMO networks →

Indexed universal life (IUL)

Permanent life insurance whose cash value earns interest tied to a market index such as the S&P 500, subject to a cap, a participation rate and usually a 0% floor. You aren't invested in the market directly, policy fees still apply, and illustrated returns aren't guaranteed. Learn more: indexed universal life insurance →

Infinite banking

A strategy, usually built on a high-cash-value participating whole life policy, in which you borrow against your own cash value instead of from a bank. In plain terms it's a policy loan: interest still accrues, unpaid loans shrink the death benefit, and a loan that outgrows the cash value can lapse the policy, which can create taxable income. Learn more: whole life cash value and policy loans →

Initial Enrollment Period (Medicare IEP)

Your first chance to sign up for Medicare: 7 months that include the 3 months before the month you turn 65, your birthday month and the 3 months after. If you miss it, the General Enrollment Period runs January 1–March 31, and a late penalty can apply. Learn more: Medicare enrollment periods →

Insurable interest

A real financial or family stake in someone's life, as a spouse, parent, child or business partner typically has, which you need before you can buy life insurance on another person. The insured person generally must also consent, usually by signing the application. Learn more: buying life insurance on someone else →

Back to A–Z ↑

K

Key person insurance

Life insurance a business buys on an owner or employee it depends on, with the business as owner, payer and beneficiary. Premiums aren't tax-deductible, and the death benefit is generally income-tax-free only if IRC 101(j) notice-and-consent rules were met before the policy was issued. Learn more: key man life insurance →

Back to A–Z ↑

L

Level term life insurance

Term life insurance whose death benefit and premium stay the same for the whole term, commonly 10, 20 or 30 years. When the term ends, coverage stops or renews at much higher rates. Learn more: level term life insurance →

Level-funded plan

A group health plan, sold mainly to small and mid-size employers, that is technically self-funded but billed like insured coverage: a fixed monthly payment, stop-loss insurance against big claims, and a possible surplus refund in a good year. Groups are medically underwritten; KFF found 37% of covered workers at firms with 10–199 workers were in one in 2025. Learn more: how level-funded health plans work →

Long-term disability insurance (LTD)

Insurance that replaces part of your income, often 50%–70%, if a serious illness or injury keeps you from working for an extended time. Benefits usually start after an elimination period, commonly 90–180 days, and last a set number of years or up to age 65 or 67. Learn more: long term disability insurance →

Back to A–Z ↑

M

MAGI (modified adjusted gross income)

The income figure the Marketplace uses to set premium tax credits: your adjusted gross income plus any untaxed foreign income, non-taxable Social Security benefits and tax-exempt interest. Use your best estimate of the coming year's household MAGI when you apply. Learn more: what counts as income for the ACA →

MEC (two meanings)

MEC means two different things. In health insurance it's minimum essential coverage, the kind of coverage that counts under the ACA (and "MEC plan" is also industry shorthand for a skinny, preventive-focused employer plan). In life insurance it's a modified endowment contract, a policy funded too fast to pass the IRS 7-pay test. Learn more: minimum essential coverage → · Learn more: modified endowment contracts and max-funded IUL →

Medicaid

Free or low-cost health coverage run by each state with federal funding for people with limited income, including many children, pregnant people, adults, older adults and people with disabilities. Eligibility and covered services vary by state, and you can apply any time of year. Learn more: how to qualify for Medicaid →

Medicaid expansion

The ACA option for states to cover nearly all adults with income up to about 138% of the federal poverty level, about $22,025 for one person under the 2026 guidelines. As of August 2026, 41 states including DC have expanded, according to KFF. Learn more: Medicaid income limits by state →

Medical underwriting

The process an insurer uses to review your health, through questions, records or an exam, to decide whether to cover you and at what price. ACA plans can't medically underwrite you, but short-term plans, life insurance, some supplemental policies and, in many cases, Medigap outside its open enrollment window can. Learn more: how non-ACA plans screen for health →

Medicare

Federal health insurance for people 65 and older and for some younger people with disabilities or end-stage renal disease. It has four parts: A (hospital), B (medical), C (Medicare Advantage) and D (prescription drugs); medicare.gov and 1-800-MEDICARE are the official resources. Learn more: Medicare enrollment dates →

Medicare Advantage (Part C)

Private plans approved by Medicare that provide your Part A and Part B benefits in place of Original Medicare and usually include Part D drug coverage, often through HMO or PPO networks. If you're already enrolled, you can make one switch during the January 1–March 31 Medicare Advantage Open Enrollment Period. Learn more: Medicare Advantage PPO plans →

Medicare Part A

Hospital insurance covering inpatient hospital stays, skilled nursing facility care, hospice and some home health care. Most people get it without a monthly premium; the 2026 inpatient deductible is $1,736 per benefit period. Learn more: when to enroll in Medicare →

Medicare Part B

Medical insurance covering doctor visits, outpatient care, preventive services and medical equipment. For 2026 the standard premium is $202.90 a month and the annual deductible is $283. Learn more: Medicare Part B enrollment and special enrollment →

Medicare Part D

Prescription drug coverage sold by private plans approved by Medicare, either as a stand-alone plan alongside Original Medicare or built into a Medicare Advantage plan. Going without Part D or other creditable drug coverage after you're first eligible can mean a lasting late penalty. Learn more: Medicare Annual Enrollment and Part D →

Medigap (Medicare Supplement)

Private insurance that helps pay Original Medicare's deductibles, copays and coinsurance; it doesn't work with Medicare Advantage plans. Your guaranteed-issue window is generally the 6 months after Part B starts, and outside it insurers can generally use medical underwriting unless you have another guaranteed-issue right or your state requires otherwise. Learn more: Medicare enrollment and Medigap timing →

Metal tiers

The ACA's four plan levels, based on the average share of costs each plan pays: bronze 60%, silver 70%, gold 80% and platinum 90%. Bronze has the lowest premiums and highest costs when you get care; platinum is the reverse, and only silver plans carry cost-sharing reductions. Learn more: bronze vs silver vs gold →

MEWA (multiple employer welfare arrangement)

A plan that provides health benefits to employees of two or more unrelated employers, such as many association health plans and PEO master health plans. States can regulate MEWAs, and MEWAs must file Form M-1 with the Labor Department. Learn more: association health plans and MEWAs →

Minimum essential coverage (MEC)

Coverage that counts as qualifying health insurance under the ACA, such as Marketplace and other individual plans, most job-based plans, Medicare Part A, most Medicaid and CHIP coverage, and COBRA. Losing it can open a Special Enrollment Period; short-term plans and excepted benefits such as fixed indemnity don't count. Learn more: minimum essential coverage →

Modified endowment contract (MEC)

A life insurance policy funded faster than the IRS 7-pay test allows, typically through large deposits in the first seven years; the status is permanent once triggered. Loans and withdrawals from a MEC are taxed gains-first, with a possible 10% penalty before age 59½, though the death benefit is generally still income-tax-free. Learn more: max-funded IUL and the MEC limit →

Mortgage protection insurance (MPI)

Life insurance sold to pay off your mortgage if you die, often as decreasing term whose benefit shrinks with the loan while the premium stays level. It typically costs more per $1,000 of coverage than level term, and it's different from PMI, which protects the lender. Learn more: mortgage protection insurance →

Back to A–Z ↑

N

Network

The doctors, hospitals, labs and pharmacies a health plan contracts with at negotiated rates. Plan types differ mainly in how they treat care outside the network: HMOs and EPOs generally don't cover it except emergencies, while PPOs and POS plans may pay part of it. Learn more: how health plan networks work →

No Surprises Act

A federal law, in effect since 2022, that protects you from surprise out-of-network bills for emergency care and for certain out-of-network providers at in-network hospitals and facilities. Protected bills are processed at in-network cost sharing, and the law doesn't apply to short-term plans. Learn more: balance billing and the No Surprises Act →

No-exam life insurance

Life insurance you can get without a medical exam, through accelerated underwriting, simplified issue or guaranteed issue. Healthy applicants often get prices comparable to exam-based policies through accelerated underwriting, while guaranteed issue costs the most per $1,000 of coverage. Learn more: no-exam life insurance tiers →

Back to A–Z ↑

O

Off-exchange plan

An ACA-compliant individual plan bought directly from an insurer, or through a broker, outside the Marketplace. It follows the same ACA rules, but premium tax credits aren't available off the exchange. Learn more: off-exchange health insurance →

Open Enrollment Period (OEP)

The yearly window to buy or change an ACA Marketplace plan. For 2027 coverage it runs November 1, 2026 to January 15, 2027 on HealthCare.gov; enroll by December 15 for coverage starting January 1. State-run exchanges can set different dates. Learn more: 2027 Open Enrollment →

Out-of-network

Providers that don't have a contract with your health plan. HMOs and EPOs generally don't cover out-of-network care except emergencies; PPOs may cover it at a higher cost, often with a separate deductible, plus possible balance billing. Learn more: PPO out-of-network coverage →

Out-of-pocket maximum

The most you'll pay for covered in-network care in a plan year through deductibles, copays and coinsurance; after that, the plan pays 100%. For 2027 ACA plans the limit is $12,000 for one person and $24,000 for a family, and premiums, balance bills and non-covered care don't count toward it. Learn more: how the out-of-pocket maximum works →

Own-occupation (disability)

A disability definition that pays benefits if you can't perform the duties of your own occupation, even if you could work in a different job. It's more generous than an any-occupation definition and matters most for specialized professionals such as surgeons, dentists and attorneys. Learn more: own-occupation long term disability →

Back to A–Z ↑

P

Participation requirement

The minimum share of eligible employees, typically about 50%–75%, who must enroll before a carrier will issue or renew a small-group health plan. Carriers also generally want at least 2 employees on payroll. Learn more: small-group participation rules →

PEO (professional employer organization)

An outside firm that co-employs your staff and handles payroll, HR and benefits, often putting your employees on its master health plan alongside other client companies. Admin fees come on top of premiums; ADP cites 2%–12% of payroll. Learn more: PEO health insurance →

Permanent life insurance

Life insurance designed to last your whole life as long as premiums are paid, such as whole, universal and indexed universal life. It builds cash value you can borrow against and costs much more than term for the same death benefit. Learn more: what permanent life insurance is →

Policy loan

Money you borrow from a life insurer using your permanent policy's cash value as collateral. Loans are generally income-tax-free if the policy is structured properly (it isn't a MEC) and stays in force. Interest accrues, unpaid balances reduce the death benefit, and a loan that outgrows the cash value can lapse the policy, which can create taxable income. Learn more: borrowing against cash value →

POS (point of service) plan

A hybrid of an HMO and a PPO: you choose a primary care physician who refers you to specialists, but the plan still pays part of out-of-network care at a higher cost share. Learn more: point of service plans →

PPO (preferred provider organization)

A health plan with a provider network that generally lets you see specialists without referrals and may pay part of out-of-network care at a higher cost. A "PPO" label doesn't guarantee out-of-network coverage, so read the plan's out-of-network column before you buy. Learn more: what PPO insurance is →

Pre-existing condition

A health problem you had before your coverage starts, such as diabetes, asthma or cancer. ACA Marketplace plans must cover treatment for pre-existing conditions; short-term plans, health care sharing ministries and some other non-ACA plans can exclude them. Learn more: pre-existing conditions on non-ACA plans →

Premium

The amount you pay, usually monthly, to keep an insurance policy in force, whether or not you use it. Health insurance premiums don't count toward your deductible or out-of-pocket maximum. Learn more: what health insurance costs →

Premium tax credit (PTC)

A federal tax credit that lowers the premium on a Marketplace plan. Under current law as of fall 2026, it's available for 2027 coverage at household incomes from 100% to 400% of the federal poverty level, about $15,960–$63,840 for one person, and you can take it in advance (APTC) or when you file. Learn more: who qualifies for a premium tax credit →

Preventive care

Routine services such as screenings, certain vaccines and checkups that ACA plans must cover at no cost to you when you use an in-network provider, even before you meet your deductible. Learn more: what ACA plans cover →

Primary care physician (PCP)

The doctor who handles your routine care and, in HMO and POS plans, refers you to specialists. A referral is that doctor's approval to see a specialist; PPOs and many EPOs don't require one. Learn more: HMO network and referral rules →

Prior authorization

Approval your health plan requires before certain services, procedures or drugs are covered, such as imaging, surgery or some specialty medications. Skipping it can mean a denied claim or a penalty, so confirm it's on file before your appointment. Learn more: how referrals and prior authorization work →

Private health insurance

Any health coverage sold by a private company rather than run by the government, including Marketplace plans, employer plans and plans sold outside the Marketplace. People often use the term to mean non-Marketplace plans, which can't be paired with premium tax credits. If you qualify for a tax credit or have a pre-existing condition, an ACA plan is usually the safer buy. Learn more: private health insurance options →

Back to A–Z ↑

Q

QSEHRA (qualified small employer HRA)

An HRA that lets employers with fewer than 50 full-time equivalent employees and no group health plan reimburse employees for individual premiums and medical costs, tax-free when the employee has minimum essential coverage. For 2026 the caps are $6,450 self-only and $13,100 family. Learn more: QSEHRA rules and 2026 limits →

Qualifying life event (QLE)

A change such as losing health coverage, moving, getting married, or having or adopting a child that can make you eligible for a Special Enrollment Period. You usually have 60 days to pick a Marketplace plan, and some coverage losses let you enroll up to 60 days before the loss. Learn more: qualifying life events →

Back to A–Z ↑

R

Rate class (underwriting class)

The health category a life insurer places you in, such as Preferred Plus, Preferred or Standard, based on your health history, labs, medications and habits. Each step down raises your premium, and each insurer draws the lines differently. Learn more: life insurance cost by age and health class →

Rented provider network

A provider network, such as the Cigna PPO, First Health or PHCS network, that a plan pays to use instead of building its own. The network supplies contracted doctors and negotiated rates. The Cigna PPO, First Health and PHCS networks are provider networks, not insurance companies, and they don't pay claims: a plan that uses one of them sets its own benefits and pays claims through its own administrator. Before you get care, confirm your doctor or facility is in network using the directory and phone number on your plan ID card. Learn more: First Health and other rented networks →

Rider

An add-on to a life insurance policy that changes or adds benefits, such as a conversion rider, waiver of premium or accelerated death benefit. Some riders are included at no cost; others raise the premium. Learn more: term life insurance riders →

Back to A–Z ↑

S

Section 125 plan (cafeteria plan)

An employer plan that lets employees pay their share of health, dental and other eligible premiums with pre-tax dollars, lowering their taxable pay. Health FSAs are also offered through Section 125 plans. Learn more: how group plans handle pre-tax premiums →

Self-funded plan

A group health plan in which the employer pays employees' claims itself, usually through a third-party administrator and with stop-loss insurance to cap large claims, instead of paying premiums to an insurer. Private-employer self-funded plans are generally governed by federal ERISA rules rather than state insurance law, and they aren't required to cover the full essential health benefits package. Learn more: self-funded and level-funded plans →

Short-term disability insurance (STD)

Insurance that replaces part of your paycheck, typically 60%–70% of income, when an illness, injury, surgery or pregnancy keeps you from working. Benefits usually begin after a 0–14 day elimination period and last 3–12 months. Learn more: short term disability insurance →

Short-term health insurance

Medically underwritten coverage, often used as a bridge between jobs or other plans, that can exclude pre-existing conditions and isn't ACA-compliant. Short-term plans are temporary coverage, and how long you can keep one depends on your state and the plan, from 3 months or less in some states to longer terms with renewals where state law allows. Learn more: short-term health insurance →

Simplified issue

Life insurance you qualify for by answering health questions, typically 10–30 yes/no questions, instead of taking a medical exam. Approval often takes minutes to a few days, with face amounts commonly $25,000–$500,000. Learn more: simplified issue life insurance →

Small-group health insurance

Group health coverage for employers with generally up to 50 employees (up to 100 in some states). Insured small-group plans must cover the essential health benefits and can vary premiums only by age, tobacco use, family size and location, not by the group's health. Learn more: small business group health insurance →

Special Enrollment Period (SEP)

A window outside Open Enrollment to sign up for or change a Marketplace plan after a qualifying life event, usually 60 days. If you lost Medicaid or CHIP coverage, you may have 90 days. Learn more: Special Enrollment Periods →

Subsidy cliff

The point at 400% of the federal poverty level where premium tax credits stop entirely under current law. For 2027 coverage that's about $63,840 for one person or $132,000 for a family of four; $1 over the line and the credit is $0. Learn more: how to stay under the 2027 subsidy cliff →

Suicide clause

A life insurance provision that limits the payout, usually to a refund of premiums, if the insured dies by suicide within the first 2 policy years. Some states shorten it; Colorado and Missouri limit the exclusion to 1 year. Learn more: how the suicide clause works →

Summary of Benefits and Coverage (SBC)

A standardized document that lays out a health plan's deductibles, copays, coinsurance, out-of-pocket limits and coverage examples in the same format across plans. It also states whether the plan provides minimum essential coverage, so read it before you buy. Learn more: reading a plan's cost-sharing terms →

Supplemental insurance

Extra coverage, such as accident, critical illness, hospital indemnity, dental or vision, that you add on top of a main health plan. Most supplemental health policies pay fixed cash benefits and don't count as minimum essential coverage on their own. Learn more: supplemental insurance →

Surrender charge

A fee a permanent life insurer subtracts if you cancel the policy, or take out too much, in its early years, typically the first 10–15 years. It's a big reason surrendering early often returns less than you paid in. Learn more: cash value, loans and surrender →

Back to A–Z ↑

T

Term life insurance

Life insurance that covers you for a set period, such as 10, 20 or 30 years, and pays only if you die during that term. It has no cash value and is the lowest-cost way to buy a large death benefit. Learn more: term life insurance →

Back to A–Z ↑

U

Universal life insurance

Permanent life insurance with flexible premiums and an adjustable death benefit, whose cash value earns interest set by the insurer. Paying too little for too long can let the policy lapse, so review it regularly. Learn more: permanent life insurance types →

Back to A–Z ↑

V

Voluntary benefits

Optional coverage employees can buy through work, such as accident, critical illness, hospital indemnity, dental or extra life insurance. It's usually 100% employee-paid through payroll deduction, so it typically costs the employer little or nothing to offer. Learn more: voluntary benefits for small business →

Back to A–Z ↑

W

Waiver of premium

A life insurance rider under which the insurer pays your premiums if you become disabled and can't work, keeping the policy in force. Learn more: riders worth weighing →

Whole life insurance

Permanent life insurance with a guaranteed level premium, a guaranteed death benefit and cash value that grows at the rate the contract guarantees; participating policies may also pay dividends, which aren't guaranteed. It costs much more than term for the same death benefit. Learn more: whole life insurance →

Work requirements (Medicaid)

A 2025 federal law requires many Medicaid expansion adults ages 19–64 to show 80 hours a month of work, community service, a work program or at least half-time school, with exemptions for groups such as pregnant people, parents of children under 14 and people who are medically frail. States must start by January 1, 2027, unless they get a good-faith extension, which can run no later than December 31, 2028. As of fall 2026, the requirement isn't in effect in most states yet. Learn more: 2027 Medicaid rules and income limits →

Back to A–Z ↑

How FreedInsure Helps

FreedInsure LLC is an independent insurance broker (NPN 20230457) licensed in 42 states. We compare 14+ carriers for health, life and supplemental coverage, explain every term on your quote in plain English, and our help is free to you.

Ready to get started? Call (844) 788-3733 or complete the form below. A licensed advisor will call within 15 minutes with personalized options. No pressure, no spam, no data selling. Just expert guidance that's 100% free.

Get Your Free Quote

A licensed advisor explains the terms on your quote and compares 14+ carriers side by side. Free, no obligation.