LLQP Accident & Sickness key terms

The tendency for people with higher-than-average health risk to seek or keep insurance more eagerly than low-risk people, which can raise claims costs and force insurers to tighten underwriting or adjust premiums.

A medical report completed by a claimant's own doctor that describes diagnosis, treatment, restrictions and prognosis, used by insurers to assess a claim or an application for coverage.

The maximum length of time for which an insurer will pay disability or long-term care benefits once a claim has been approved, often stated in months or years rather than dollars.

A provision that lowers or stops benefit payments when the insured's income from other sources, such as a group plan or government program, raises total income above a stated level.

A rule that prevents duplicate payment when a person is covered by more than one health or disability plan, by designating which plan pays first and limiting total benefits to actual expenses or income loss.

Coverage that pays a lump sum when the insured survives a waiting period and is diagnosed with a listed condition, such as cancer, heart attack or stroke, with the money usable for any purpose.

Coverage that replaces a portion of earned income when illness or injury prevents the insured from working, typically paid monthly after an elimination period while the disability lasts.

The waiting period, expressed in days or weeks, that must pass after a disability or long-term care event begins before benefits become payable, functioning like a time-based deductible.

Information about an applicant's health, occupation and lifestyle that an insurer uses to decide whether to issue coverage and on what terms, often required beyond a guaranteed-issue limit.

An amendment attached to a policy that permanently or temporarily removes coverage for a specified condition, body part or activity, usually because of information disclosed during underwriting.

A short window after a policy is delivered during which the owner may cancel for any reason and receive a full refund of premiums paid, giving time to review the contract.

The period after a premium due date during which the policy stays in force even though payment is late; if the insured dies or claims within it, unpaid premium may be deducted from the benefit.

Employer or association coverage that provides income replacement to a class of members, usually with limited underwriting, benefits tied to earnings and terms defined in a master contract.

A rider that lets the policyholder buy additional coverage at set dates or events without providing new medical evidence, protecting against future uninsurability.

A provision stating that after the policy has been in force for a set period, usually two years, the insurer cannot void coverage for misrepresentation on the application except in cases of fraud.

A contract issued to one person or family that pays specified benefits for accidental injury or sickness, with premiums and renewal rights determined by the policy's classification.

A financial or legal stake in the continued health or life of the person insured, which must exist when coverage is arranged so the contract is not a wager.

Coverage that helps pay for custodial or skilled care when the insured can no longer perform basic daily tasks or has cognitive impairment, often provided in a facility or at home.

Basic self-care tasks such as bathing, dressing, eating, toileting, transferring and continence; inability to perform a stated number of them commonly triggers long-term care benefits.

The single contract issued to an employer, union or association in group insurance that sets out coverage, eligibility and terms for all covered members; members receive certificates rather than policies.

The risk that an insured person will behave less carefully or claim more readily because insurance will absorb the loss, which insurers manage through deductibles, exclusions and claims review.

A policy the insurer must renew while premiums are paid, with the right to raise premiums or change terms reserved only to the policyholder; the strongest renewal guarantee for individuals.

A clause that protects the value already built in a policy if premiums stop, for example by continuing reduced paid-up coverage or returning a portion of premiums rather than cancelling outright.

A disability standard under which the insured qualifies for benefits when unable to perform the material duties of their own specific occupation, regardless of ability to work elsewhere.

A health condition for which the insured received diagnosis, care or treatment, or showed symptoms, before the policy took effect; coverage may be excluded or limited for a stated period.

A clause allowing a lapsed policy to be restored after payment of overdue premiums, often with new evidence of insurability and a fresh contestable period for statements on the reinstatement application.

A partial disability benefit that pays a proportionate amount when the insured returns to work but earns less than before the disability, based on the percentage of income lost.

The policyholder's contractual right to review a newly delivered policy for a stated number of days and return it for a full premium refund, often called the free look provision.

The process of gathering a client's needs, finances, objectives and risk tolerance to recommend coverage that fits, documented so the advice can be justified to regulators and the client.

The number of days an insured must live after diagnosis of a covered critical illness before the lump-sum benefit becomes payable, commonly 14 to 30 days.

A condition in which illness or injury prevents the insured from performing the duties of their occupation or any occupation, depending on the policy wording, and is the usual trigger for income benefits.

The process of grouping applicants by expected claim cost, such as preferred, standard, substandard or declined, so that each class pays a premium matching its expected risk.

The mutual duty of applicant and insurer to disclose all material facts honestly and completely, since the insurer relies on the applicant's answers to assess and price the risk.

A rider or provision that suspends premium payments while the insured is totally disabled for a specified period, keeping the policy in force without cost during the disability.

A stated interval after the policy starts or after a sickness begins during which no benefits are payable, distinct from the elimination period that follows a covered event.