Accidental Death and Dismemberment (AD&D):  A supplementary benefit rider designed to pay benefits in the event of death or the loss of a limb or sight caused by an unintended, unforeseen, and unexpected event.

Administration: These charges represent your insurer's cost of implementing and maintaining your plan. This fee encompasses printing, data processing, claims payment, accounting and record keeping generally expressed as a percentage of claims.

Adjudication: The assessment of claims for accuracy.  Actions taken to validate claims, validate eligibility, and allow or disallow claims as per contract specifications.

Capping: A maximum dollar amount placed on a specific benefit. A cost containment measure to control utilization.

Contribution plan: A group insurance plan that requires that the employee participates in premium payments for a percentage of the required premium monthly.

Dependant Life: A form of term insurance in a group plan that covers an employee's spouse and each unmarried child as defined by the policy.

Disability: A medically determinable physical or mental impairment caused by injury or illness, preventing one from performing duties of any occupation.

Drug Identification numbers (DINs): The Drug Identification Number (DIN) is the number located on the label of prescription and over-the-counter drug products that have been evaluated by the Therapeutic Products Directorate (TPD) and approved for sale in Canada. 

Experience: Dollar value of total claims made against a plan by entitled participants. Experience may be reported as PAID or as INCURRED. Paid claims are actual dollars paid. Incurred claims are claims that have been grossed up to reflect inflation and utilization projections, administration fees, reserve fees  profit or a combination of factors depending on the carrier.

Experience Rated: The process of rating experience. Experience rated benefits are not insurance. Health and dental rates are based on your experience (claims) grossed up to cover costs, inflation, unpredictable claims and profit.

First Manifest Provision: Provision that eliminates disability claims for injuries or sicknesses manifesting prior to the policy effective date.

Inflation: Inflation is the increase in the price of goods and services over a period of time and the resulting loss of purchasing power of Money. 

Incurred: Incurred claims, Incurred but not reported claim reserves or IBNR. A method of accounting l used to recognize liability at the time it occurs. Changes in the IBNR are added to Paid Claims to estimate the carrier's potential liability during a reporting period. Paid Claims are adjusted by the IBNR and stated as Incurred Claims.

Injury: Accidental Bodily harm causing sustainable damage.  An injury can be the cause of disability but it must be assessed as the cause by a physician and supported by objective medical evidence.

Insurance Provider: The Company that issues an insurance policy and assumes the risks associated with the insured.

Life Insurance: Provides coverage where the risk insured against is the death of a particular person (the life insured). Upon the death of the life insured, while the policy is in force, the insurance company (the insurer) will pay the death benefit to the beneficiary named in the insurance policy.

Long Term Disability: Typically provides coverage for 2 years, 5 years, or to the claimant's age 65, according to disability as defined in the policy. Provides monthly payments to replace lost income due to disability.

Pooling or Pooled Benefits: These Benefits are covered by Insurance for catastrophic events representing risks that are unanticipated by nature. To realize a level of predictability an insurer consolidates all policy holders premiums into one massive pool. A Pooled benefit represents the sharing of risk between policy holders and is the essence of insurance.

Pooling Experience Rated Benefits: Pooling part of your drug and health benefits in a traditional premium plan is insurance against catastrophic large claims or stop-loss insurance. This removes the cost of claims above the stop-loss amount from a companies experience rated claims. Occurrences of catastrophic claims are exceptions, unanticipated and unpredictable. The cost of re-insurance, plus profit and handling is then added to the cost of experience rated premiums. This form of stop-loss may protect the insurance carrier from profit erosion more than it protects a plan holder.

Predictable Claims: Predictable claims are those with high frequency of use but with a low dollar value. These claims are easily trended and analyzed. These are Experience Rated claims such as routine Drug claims, Maintenance Drug claims, Routine Dental Care, normal Vision Care, and Short Term Disability.

Reserve Adjustment: At renewal an insurer will protect themselves from the deferred liability of claims run off should a plan be cancelled. The insurer is still responsible for unpaid claims not yet reported. This risk is mitigated by a surcharge to your rates, better known as a reserve adjustment expressed as a percentage of your prior years claims and must be adjusted to meet the insurer's requirements at each renewal.

Sickness: A disease or illness causing bodily harm and eventually permanent damage.  If a sickness leads to disability, the ?First Manifest Provision? may be exercised.  A sickness also must be assessed by a physician.

Stop-Loss:  An Insured dollar amount above which the cost of claims are the responsibility of an Insurance carrier. A Company can mitigate risk by carefully analyzing the amount of risk that is reasonable and profitable beyond which stop-loss insurance is purchased to cover extraordinary claims.

Unpredictable Claims: Unpredictable claim are large, unanticipated and can pose significant financial hardship. Claims for loss of life, disability claims, large drug claims, Out of Country emergencies, and nursing services, are examples of unpredictable claims. Self funding these potential claims are not recommended for Small or Mid Size Companies. Insurance coverage is the recommended risk management tool for this class of benefit.

Utilization: Use, the act of using. Utilization trends effect the cost of a tradional benefit program. Increased use would result in an increase while decreased utilization may or may not result in reduced rates.

Weekly Indemnity: Weekly Indemnity or Short Term Disability (STD) coverage is protection against disabilities for a shorter duration of time as described by the master policy.