Dictionary

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Earned Premium

That portion of the premium for which policy protection has already been given. For example, if you buy a one year Health policy for a premium of $1,200 and the insurer cancels you exactly six months later, they are entitled to keep $600 (the earned premium), but they must also refund you $600, which is called the “unearned” premium. If they covered you for the entire year, all the premium would be earned. This concept also applies to P&C insurance, but not to Life insurance, where all premiums are considered to be fully “earned” upon payment.

Effective Date

The date on which an insurance policy or bond goes into effect and from which protection is furnished.

Eligibility Period

The period during which the employee is eligible to obtain coverage under a Group Life or Health plan. Also known as the “open enrollment” period.

Employers Liability Coverage

Coverage provided under a Workers’ Compensation policy to cover the employer’s liability arising out of employees’ work-related injuries.

Employers Non-Ownership Liability

Provides coverage to an employer for liability arising out of an employee’s use of his own auto in the employer’s business. May be included under a Business Auto Policy of added to a Commercial General Liability.

Endorsement

A document, agreed to by both parties, that is attached to the policy and modifies or changes the original policy in some way. No change to a policy may become effective until approved by a company officer.

Endowment Policy

A cash value life policy for which premiums are paid for a limited number of years, such as to age 65. If the insured is alive at the end of this premium-paying period, he/she receives the face amount of the policy. If the insured dies before maturity of the policy, the beneficiary receives the proceeds. Generally the most expensive type of cash value life insurance, since the policy reaches maturity prior to age 100. Endowments are often purchased to supplement retirement or for children’s educational purposes.

Errors And Omissions

A Professional Liability coverage that protects the insured against liability for committing an error or omission in performance of professional duties.

Essential Health Benefits

The ACA requires all medical expense policies to include coverage for the following essential health benefits: ambulatory patient services (outpatient care you get without being admitted to a hospital), emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy), prescription drugs, rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills).

Exclusions

Causes, conditions, or property listed in the policy that are not covered and for which no benefits are payable.