Dental Insurance

Choosing a Dental Plan

If you learned a few things about health insurance, then learning about dental insurance should be easier. Many of the same terms and concepts are applied throughout each. Both might be offered as benefits from your employer, both have in-network and out-of-network choices, and both have co-pays and deductibles. They do have differences, so let’s view this from the eye of a newbie looking to understand dental insurance. Smile, here we go!

When selecting a dental plan, you will likely be presented with three options:

Dental health maintenance organization (DHMO)

Coverage on this plan requires visits to dentists who are in-network with your insurance plan. These plans may be more restrictive with servicer providers but usually cost the least.

Dental preferred provider organization (DPPO)

This coverage allows visits to in- or out-of-network care providers, and the premiums are higher. A pro for this plan is you get more selection of providers, while a con is that you will typically pay more for the services with out-of-network providers.

Dental indemnity plan (traditional)

Also known as a “traditional” plan, this coverage is provided for any dentist you choose, with no difference in cost for services. The premiums for this plan are usually the highest.

While plans may vary by names, services, and costs, a good dental plan should offer these essential benefits:

• Diagnostic and preventative (cleaning, exams, basic x-rays, sealants)
• Basic services (fillings, extractions, root canals, periodontal services)
• Major services (implants, dentures, advanced surgery, crowns)
• Orthodontics (braces, permanent retainers)

Dental plans differ from health insurance plans on three major factors: yearly maximums, waiting periods for coverage, and deductibles.

Annual Maximum

Dental plans generally have a set maximum on the amount insurance will pay for services and treatment. The amount will vary per plan but generally ranges between $500 to $2000. Once the yearly maximum is reached, patients must pay 100% of any remaining services. Some insurance companies offer policies that roll over a portion of the unused annual maximum to the next year.

Waiting Period

It’s common for dental insurance policies to have a waiting period of six to twelve months before some or any standard coverage begins. For major dental work, the waiting period can be up to two years. Why the waiting? The idea is to encourage people to have regular insurance and not simply sign up when they need care only to drop coverage after the services are complete. Waiting periods also help insurance companies offer competitive premiums, turn a profit, and offset the cost of claims.

Final Notes

There are many who say because of the limits of coverage, high deductible, and low maximum payout, that you are better off paying for the dental services you need. (Read more at Banknote.)  Whatever choice you make, pay as you go or a dental plan, make the choice that works best for you and your family.

Actual Cash Value (ACV) – The amount of money an insurer will pay in the event of a loss, replacement, or repair.

Annual Maximum  – The most money a dental plan pays for dental care under the terms of your policy within a 12-month benefit period. Any amount over the annual maximum is paid by the insured.

Beneficiary – Any person(s) receiving benefits provided by an insurance policy.

Bundling – Purchasing two or more insurance policies with the same company for a price discount.

Claim – A request for insurance company compensation as part of policy coverage for a covered loss.

Collision Coverage  – Insurance to repair or replace a vehicle damaged in a collision, regardless of who is at fault.

Comprehensive Coverage – Insurance protection for vehicle damages that occur in an event other than a collision. Including theft, natural disasters, vandalism, and most things not covered by collision coverage.

Co-payment – A fixed amount of payment made by a beneficiary (especially for health services) in addition to that made by an insurer.

Coverage – The protection against financial loss provided by an insurance contract for policy specific inclusions.

Deductible – A set amount of money required by you to pay towards care, damages, replacement, or repair costs before your insurance coverage kicks in to cover additional or remaining costs.

Dental health maintenance organization (DHMO) – A structured type of dental plan with provider approved dentists and services negotiated to offer reduced prices to the policyholder.

Dental indemnity plan – A dental insurance plan offering the policyholder a more personal selection of dentists and services, with insurance also paying more of the costs. This plan typically has the highest premiums.

Dental preferred provider organization (DPPO) – A dental insurance plan allowing policyholders to work with dentists that are in or out of the plan’s network, with out-of-network providers costing the policyholder more for services.

Depreciation – A decrease in the value of property (e.g., house, car, roof, water heater, etc.) due to wear and tear or becoming obsolete.

Elimination period – The time period between an injury and the receipt of benefit coverage or payments.

HMO: Health Maintenance Organization – Health Maintenance Organization (HMO). A type of health insurance plan that usually limits coverage to care from doctors who work for or contract with the HMO.

In-network  – Refers to healthcare service providers whose services are contracted with your insurance company, and services are less expensive than out-of-network providers.

Insurance Rider – A rider is an insurance policy provision that adds benefits to or amends the terms of a basic insurance policy. For an additional cost, riders provide insured parties with options such as additional coverage, or they may even restrict or limit coverage. A rider is also referred to as an insurance endorsement. It can be added to policies that cover life, homes, autos, and rental units.

Lapse – The portion of uninsured time between policies caused by the termination of a policy for non-payment or other unmet contractual requirements.

Liability Coverage – A basic level of vehicle insurance where a minimum amount of coverage is required by law.  Often set by each state individually and can vary widely.

Loss – The injury or damage sustained by the insured that the insurance company agrees to cover.

Market Value – The estimation of how much your property is worth if sold today.

Negligence – A lack of reasonable care exercised by a person/party in a given situation.

No-Fault Insurance – A type of car insurance for covering the costs of medical, hospital, and funeral expenses that result from a car accident —regardless of who is at fault.  Also called Personal Injury Protection (PIP) Insurance.

Out-of-network – Refers to healthcare service providers who do not have negotiated rates with an insurance company, with services often costing more than in-network providers.

Personal Injury Protection (PIP) Insurance – See No-Fault Insurance.

Policy – A formal contract of insurance consisting of terms, conditions, and coverage specifics.

Policy Length – Or policy duration is the length of time during which an insurance policy remains valid—ranging from months to years depending on insurance type.

Policy Owner – Person or party named in the policy, having the authority to make policy changes.

PPO: Preferred Provider Organization – A healthcare provider who has a contract with your insurance company to provide services to you at a discount.

Premium – The amount of money an insurance company charges for providing coverage.

Reinstatement – The reactivation of a policy after a lapse in coverage.

Replacement Cost Value (RCV) – Coverage paying for the replacement or repair costs to restore damaged property to pre-damaged condition.

Term – The length of time for policy coverage. Also, see policy length.

Total Loss/Totaled – Property damage determined by the insurance provider to be destroyed or exceeds the cost of repair.

Underinsured Motorist Coverage – Coverage for bodily injury or property losses caused by a motorist with coverage insufficient in covering the full amount of damage costs.

Uninsured Motorist Coverage – Similar to underinsured coverage, uninsured coverage can help pay for damages when an at-fault driver uninsured, so instead of their policy covering the costs, your policy would.

Waiting Period – A period of time an insured must wait before some or all of coverage is available. The insured may not receive benefits for claims filed during the waiting period.