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Health Insurance Glossary

Definitions for common health insurance terms

maximum dollar limit

DEFINITION: The maximum dollar limit is the maximum amount of money that an insurance company (or self-insured company) will pay for claims within a specific time period. Maximum dollar limits vary greatly. They may be based on or specified in terms of types of illnesses or types of services. Sometimes they are specified in terms of lifetime, sometimes for a year.

New or renewing plans are not allowed to have any lifetime limits on essential benefits as of September 2010. Annual limits on essential benefits have been phased out over the last three years, and will be prohibited entirely starting in 2014.