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What is dental insurance? Here are the basics

Simply put, dental insurance is insurance that provides coverage for dental expenses, such as those rendered by dentists, orthodontists, periodontists, and other medical care providers.

Traditional health insurance rarely covers dental expenses; thus the need for separate dental policies. Dental plans exist as individual plans, family plans, and group plans. Group plans are most likely to be offered at your place of employment. Like vision insurance, dental insurance is added as a perk to some employee benefit plans.

What does it cover?

Dental insurance coverage varies according to plan. Basic procedures include fillings, oral surgery, periodontics, endodontics, and preventive treatment. Some plans offer preventive treatment for free. Major procedures usually include dentures, crowns, implants, cosmetics, and some surgeries.

Plans usually have limits on the number of dental visits and treatments that are covered. Some plans do not cover pre-existing conditions, and some plans only cover the least expensive option for a given treatment.

Fee schedule

Dental insurance companies have a fee schedule — a list of prices that they will pay for dental services and products. This schedule is based on what's called "usual and customary dental services."

Dentists have fee schedules of their own, but when they contract with a dental insurance company, they agree to charge the insurance company's prices, which are almost always lower. Though they are getting paid less, they can usually count on drawing in more customers because of the lower cost and because the plan makes referrals to them.

Once they have accepted the insurance company's prices, they become an "in-network provider." If you have your coverage with this company, you are expected to use in-network providers. Some plans let you use out-of-network providers, but you will have to pay some or all of the cost of them, unless your insurance policy specifies otherwise.

Dentist and practice owner, Dr. Abigail Brier, informs 88-year-old veteran Lloyd Wilkens that he has been selected to receive a significant corrective dental procedure free on Saturday, June 9, 2018 in Bloomingdale, Ill. (Photo: Ross Dettman/AP Images for Aspen Dental)
Dentist and practice owner, Dr. Abigail Brier, informs 88-year-old veteran Lloyd Wilkens that he has been selected to receive a significant corrective dental procedure free on Saturday, June 9, 2018 in Bloomingdale, Ill. (Photo: Ross Dettman/AP Images for Aspen Dental)

Waiting periods and maximum benefit limits

Some dental insurance companies have waiting periods, in which you must wait a certain length of time before a service is covered. They may also have annual benefit limits, meaning they cap the amount that they will cover each year. At the end of the year, the cap disappears and the annual benefit limits starts over.

As with traditional health insurance plans, there may also be a deductible that you have to meet. There may also be separate annual benefit limits for different types of services, for example, orthodontist services. There may also be co-pays.

How much does it cost?

Dental insurance costs vary depending on the type of plan and how much coverage is offered. Costs are well below those of regular health insurance.

Because it is less expensive than traditional health insurance, some employers add it to their benefits packages to attract good employees.

Dive deeper: Health, dental, and vision insurance: A comprehensive guide

This content was created in partnership with the Financial Fitness Group, a leading e-learning provider of FINRA compliant financial wellness solutions that help improve financial literacy.

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