Minimum Standards

What Does Minimum Standards Mean?

Minimum standards are the basic eligibility criteria for insurance coverage, as well as the standard coverage that insurers are required to provide to the insured, as prescribed by industry regulations.

Insuranceopedia Explains Minimum Standards

Applicants for insurance must meet certain standards. For example, in most states, applicants must be at least 18 years old to purchase coverage. Auto insurance is another common example, since every state sets its own minimum coverage requirements for drivers.

In return, the insurer must provide the required minimum coverage for the policy to be considered legitimate. Under the Affordable Care Act, for instance, health insurance policies must cover at least 60% of the total cost of health services for the policyholder. Additionally, insurers cannot deny coverage due to pre-existing conditions.