Some Insurance Terms
Updated: Sep 28
Dental Insurance: Dental insurance is a type of insurance coverage that helps individuals pay for dental care expenses, including preventive services, basic procedures, and major treatments.
Premium: The premium is the amount of money an individual or employer pays to an insurance company in exchange for dental insurance coverage. It is typically paid monthly or annually.
Deductible: A deductible is the amount of money that an individual must pay out of pocket for dental care before the insurance coverage begins. Once the deductible is met, the insurance company starts covering a portion of the expenses.
Copayment: A copayment, also known as a copay, is a fixed amount of money an individual pays at the time of receiving dental services. The copayment can vary depending on the type of service rendered.
Coinsurance: Coinsurance is the percentage of dental care expenses that an individual is responsible for paying after the deductible has been met. For example, if the coinsurance is 20%, the insurance company pays 80% of the cost, and the individual pays the remaining 20%.
Maximum Allowable Charge (MAC): The maximum allowable charge is the highest amount that an insurance company is willing to pay for a specific dental service. If a dentist's fee exceeds the MAC, the patient may be responsible for paying the difference.
Preauthorization: Preauthorization is the process of obtaining approval from the insurance company before undergoing certain dental procedures or treatments. The insurance company evaluates the necessity and appropriateness of the proposed treatment.
In-network Provider: An in-network provider refers to a dentist or dental facility that has a contractual agreement with an insurance company to provide dental services at pre-negotiated rates. Visiting an in-network provider often results in lower out-of-pocket costs for the insured individual.
Out-of-network Provider: An out-of-network provider refers to a dentist or dental facility that does not have a contractual agreement with an insurance company. While dental insurance may still provide coverage for out-of-network services, the costs are typically higher for the insured individual.
Waiting Period: A waiting period is the time an individual must wait after purchasing dental insurance before they can access certain types of coverage. Waiting periods are commonly applied to major procedures to prevent individuals from purchasing insurance solely for expensive treatments.
Pre-existing Condition: A pre-existing condition refers to a dental condition or oral health issue that existed before the start of the dental insurance coverage. Some dental insurance plans may exclude coverage for pre-existing conditions or impose waiting periods before coverage becomes effective.
Annual Maximum: The annual maximum is the maximum amount of money that an insurance company will pay for dental care expenses within a specific coverage period, typically one year. Once the annual maximum is reached, the insured individual is responsible for all further costs.
Grievance: A grievance is a formal complaint or dispute that an individual may file against an insurance company if they feel the insurer has mishandled their dental insurance coverage or denied their claims unfairly.
Explanation of Benefits (EOB): An Explanation of Benefits is a statement or document provided by the insurance company after a dental claim has been processed. It outlines the services rendered, the amount billed, the amount covered by insurance, and the amount the insured individual is responsible for paying.