Insurance
APPLICATION PROCESS
When you apply for coverage, fill out the application accurately and completely. If you knowingly provide incorrect, incomplete, or misleading information, especially about a pre-existing condition, your coverage could be canceled or your benefits denied.

When purchasing an individual plan, never sign a blank policy application, and verify any information filled in by an agent. Make payments by check or money order payable directly to the insurance company or HMO, not the agent, and insist on a signed receipt on the carrier’s letterhead. Make sure you have the full name, address and phone number for both your agent and your carrier.

Never pay more than two months’ premiums until you have received a copy of your policy, HMO certificate or group membership certificate.

State law requires that you have a 10-day “free-look” to evaluate any individual coverage policy, during which you can change your mind and receive a refund. If you return a policy, send it by certified mail and request a return receipt.

DENTAL INSURANCE
Dental insurance differs from other types of insurance. Oral health care is fairly routine and predictable, which does not characteristically describe the intention of typical insurance. The term “dental plan” more accurately describes what most would call dental insurance. With the help of dental predictability, consumers are able to make calculated decisions about dental plans that suit them best.

The most commonly utilized types of managed dental plans are Direct Reimbursement, Preferred Provider Organization, Dental Health Maintenance Organization and Discount/Referral.

Direct Reimbursement plans are designed for its members to have the freedom to choose any dentist and for employers to offer a plan customized for their budget by deciding what percentage to reimburse at each level of cost. Employees choose a dentist, pay for the treatment and are then reimbursed a certain percentage of the dollar amount. Some plans also establish “Flex” accounts in which employees pay their share on a before-tax basis.

Preferred Provider Organization plans require a monthly payment that entitles the member to a network of dentists who have agreed to discount their fees. Non-participating dentist can still usually be visited for a higher deductible and copayment.

Dental Health Maintenance Organization (DHMO) plans pay contracted dentists a fixed amount (usually on a monthly basis) per enrolled family or individual, regardless of utilization. In return, the dentists agree to provide specific types of treatment to the patient. The patient may be required to pay a copayment. Theoretically, the DHMO rewards dentists who keep patients in good health, thereby keeping costs low.

Discount/Referral options are arrangements in which a limited number of providers who have agreed to discount their normal fees in exchange for the expectation of a larger patient pool. There is no reimbursement to the patient or to the provider. Many individuals and families that do not receive dental insurance from their employers turn to discount dental plans to reduce their out-of-pocket expenses.

The Colorado Dental Association and its 3,000 plus member dentists can provide information that will be most useful as you make decisions about which dentist to see, what preventive care you should take, and other matters that affect your dental health and that of your family, visit www.cdaonline.org.

LIFE INSURANCE
In the event of your death, life insurance coverage provides financial compensation to your family. Life insurance policy payouts are not subject to federal income tax, which provides the assurance that a surviving family will receive full benefit of the proceeds.

There are two major types of life insurance—term and whole life. Life insurance products for groups are different from life insurance sold to individuals.

— Term Insurance
Term insurance is the simplest form of life insurance. It pays only if death occurs during the term of the policy, which is usually from one to 20 years. Most term policies have no other benefit provisions. According to LIMRA International, insurance companies issued 9.4 million individual life insurance policies during 2009. Also, only 44 percent of U.S. households have individual life insurance, which is a 50-year low. In 2003, virtually all (97 percent) of the term life insurance bought was level term.

— Whole Life/Permanent Insurance
Whole Life Insurance pays a death benefit whenever you die—even if you live to 100. In 2007, the American Association for Long-Term Care Insurance reported that 8 million Americans were protected with long-term care insurance. There are three major types of whole life or permanent life insurance—traditional whole life, universal life and variable universal life—and there are variations within each type.

   
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