What does COB stand for?

COB stands for Coordination of Benefits. This term is essential in the context of health insurance and related fields. Coordination of Benefits refers to the process used to determine which insurance policy is primarily responsible for covering a claim when a person is insured under multiple health plans. This process helps ensure that the insured individual does not receive more in benefits than the actual amount of the expenses incurred.

In practice, when an individual has coverage from more than one insurer, COB rules come into play to establish the order in which the insurance policies will pay out. This is crucial to prevent overpayment scenarios and to allow insurers to manage their costs effectively while providing the necessary coverage to the insured.

Understanding COB is pivotal for professionals in the insurance field, as it enables them to guide clients through claims processing effectively and ensures compliance with insurance regulations.