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Questions and Answers
If a 45-year-old business owner purchases a disability income policy with a 90-day elimination period, when will benefits begin if they become disabled?
If a 45-year-old business owner purchases a disability income policy with a 90-day elimination period, when will benefits begin if they become disabled?
- Immediately upon disability.
- After one year.
- After 90 days. (correct)
- After 30 days.
Under COBRA, how long can a group health insurance policyholder continue coverage after losing their job?
Under COBRA, how long can a group health insurance policyholder continue coverage after losing their job?
- 12 months.
- Indefinitely.
- 18 months. (correct)
- 6 months.
What is a primary feature of an HMO plan?
What is a primary feature of an HMO plan?
- No coverage for preventative care.
- Higher premiums with no deductibles.
- Requirement to use network providers and referrals for specialists. (correct)
- Freedom to visit any doctor without a referral.
Which level of care is typically not covered by a long-term care insurance policy?
Which level of care is typically not covered by a long-term care insurance policy?
If an insured files a claim two years after their disability policy was issued and the insurer finds a misstatement of income, what is their most likely action?
If an insured files a claim two years after their disability policy was issued and the insurer finds a misstatement of income, what is their most likely action?
How many days does an insured have to review a Medicare Supplement policy under the 'free look' provision in Florida?
How many days does an insured have to review a Medicare Supplement policy under the 'free look' provision in Florida?
What type of policy provides a lump sum benefit after losing a limb in an accident?
What type of policy provides a lump sum benefit after losing a limb in an accident?
What must an insurer do under the Guaranteed Issue Rule for a small employer group applying for health insurance?
What must an insurer do under the Guaranteed Issue Rule for a small employer group applying for health insurance?
What action must an insured under an HMO take to see a specialist?
What action must an insured under an HMO take to see a specialist?
What happens if a health insurance policyholder fails to pay their premium during the grace period?
What happens if a health insurance policyholder fails to pay their premium during the grace period?
If a claimant files a lawsuit against an insurer for a denied claim after the legal time limit, what is the likely outcome?
If a claimant files a lawsuit against an insurer for a denied claim after the legal time limit, what is the likely outcome?
In a key employee disability insurance policy, who receives the benefit if the key employee becomes disabled?
In a key employee disability insurance policy, who receives the benefit if the key employee becomes disabled?
What term describes the coverage provided by a Medicare Supplement policy for charges above what Medicare pays?
What term describes the coverage provided by a Medicare Supplement policy for charges above what Medicare pays?
Why might an insurer deny coverage based on a pre-existing condition six months after the policy’s effective date?
Why might an insurer deny coverage based on a pre-existing condition six months after the policy’s effective date?
What is the maximum benefit limit for medical expenses covered by the Florida Guaranty Fund if an insurer becomes insolvent?
What is the maximum benefit limit for medical expenses covered by the Florida Guaranty Fund if an insurer becomes insolvent?
What must an employer offer employees under Florida law if a group health policy is terminated?
What must an employer offer employees under Florida law if a group health policy is terminated?
What type of policy pays benefits when the insured is diagnosed with cancer?
What type of policy pays benefits when the insured is diagnosed with cancer?
How are the premiums for a business overhead expense disability policy treated for tax purposes?
How are the premiums for a business overhead expense disability policy treated for tax purposes?
Flashcards
Elimination Period
Elimination Period
The time an insured must wait after becoming disabled before receiving benefits from a disability income policy.
COBRA (Consolidated Omnibus Budget Reconciliation Act)
COBRA (Consolidated Omnibus Budget Reconciliation Act)
A federal law allowing individuals who lose their job-based health insurance to continue coverage for a limited time.
HMO (Health Maintenance Organization)
HMO (Health Maintenance Organization)
A type of health insurance plan that requires enrollees to use in-network providers and obtain referrals for specialists.
Long-Term Care Coverage Exclusions
Long-Term Care Coverage Exclusions
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Misrepresentation in Disability Claims
Misrepresentation in Disability Claims
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Free Look Provision
Free Look Provision
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Accidental Death and Dismemberment (AD&D)
Accidental Death and Dismemberment (AD&D)
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Guaranteed Issue Rule
Guaranteed Issue Rule
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What is the first step an insured under an HMO must take to see a specialist?
What is the first step an insured under an HMO must take to see a specialist?
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What can an insurer do if a policyholder misses a premium payment during the grace period?
What can an insurer do if a policyholder misses a premium payment during the grace period?
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What happens if a claimant sues for a denied claim after the legal deadline?
What happens if a claimant sues for a denied claim after the legal deadline?
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Who receives the benefit from a key employee disability insurance policy?
Who receives the benefit from a key employee disability insurance policy?
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What are the additional charges covered by a Medicare Supplement policy called?
What are the additional charges covered by a Medicare Supplement policy called?
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Why might a claim be denied for a pre-existing condition six months after the policy started?
Why might a claim be denied for a pre-existing condition six months after the policy started?
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What is the maximum benefit limit for medical expenses covered by the Florida Guaranty Fund?
What is the maximum benefit limit for medical expenses covered by the Florida Guaranty Fund?
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What must an insurer offer employees under Florida law when a group health policy ends?
What must an insurer offer employees under Florida law when a group health policy ends?
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What type of policy pays benefits for a cancer diagnosis?
What type of policy pays benefits for a cancer diagnosis?
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What is an insurer's likely response to a claim for a loss due to an illegal occupation?
What is an insurer's likely response to a claim for a loss due to an illegal occupation?
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Study Notes
Disability Income Policies
- Disability income policies have elimination periods; benefits begin after the elimination period.
- A 90-day elimination period means benefits start 90 days after the disability begins.
COBRA Continuation Coverage
- COBRA allows former employees to keep their group health insurance for a limited time after losing their job.
- COBRA coverage can be maintained for up to 18 months.
Health Insurance Plans (HMO)
- HMOs require referrals from primary care physicians to see specialists and use network providers.
Long-Term Care Insurance
- Long-term care policies generally do not cover custodial care, focusing more on skilled and intermediate levels of care.
- Cosmetic care is typically not covered..
Claim Denials and Policy Violations
- Insurers can deny claims for misrepresentation of income; this can result in reduced benefits or a claim denial.
- Insurers may cancel policies if misrepresentation is significant.
Florida Law and Policy Review
- Florida law mandates a "free look" period for Medicare Supplement policies, allowing insured individuals to review the policy within 60 days.
Accident and Dismemberment Policies
- Accidental Death and Dismemberment (AD&D) policies provide lump-sum benefits for losses like limb loss.
Guaranteed Issue Rules (Group Health)
- Insurers are required to offer coverage to eligible small employer groups under Guaranteed Issue regulations. This usually involves providing coverage without excluding high-risk individuals.
Deductibles and Coinsurance
- Deductibles represent the amount the policyholder pays before the insurance company steps in to pay. This can be $2000.
- Coinsurance represents the percentage of expenses the policyholder pays above the deductible; this could be 20%.
Disability Policy Types
- "Total disability" policies typically cover periods when the insured cannot perform any occupation.
- "Own occupation" policies stipulate that disability must affect the specific occupation.
- "Residual disability" policies cover situations where the insured can perform some jobs, albeit not their previous one.
Long-Term Care Insurance (Home Healthcare)
- Home health care in long-term care policies usually covers services like daily nursing visits and light housekeeping, but not grocery deliveries or cosmetic treatments.
HMO Procedures
- HMO plan members seeking specialist care need a referral from their primary care physician.
Premium Non-Payment
- If premiums are not paid within the grace period, the insurer can cancel the policy.
Legal Time Limits for Claims
- Claims lawsuits must be filed within a certain timeframe; lawsuits filed outside the time limit could get dismissed per time-limit provision.
Key Employee Disability Insurance
- Key employee policies benefit the business in the event the employee becomes disabled.
Medicare Supplement Excess Benefits
- Medicare supplement policies typically cover expenses Medicare does not.
Pre-Existing Conditions
- Policy exclusions for pre-existing conditions frequently apply if the claim is filed after the minimum period of coverage has elapsed.
Florida Guaranty Fund Limits
- Florida’s Guaranty Fund provides a maximum benefit amount in case of insurer insolvency. This limit is typically $250,000.
Group Policy Termination
- When a group policy terminates, insurers must provide employees with conversion options for individual policies, generally.
Cancer Insurance
- Cancer insurance policies provide benefits based on a cancer diagnosis.
Illegal Occupation Claims
- Insurers generally deny claims related to unlawful activities.
Workers' Compensation and Health Insurance
- Health insurance coverage typically does not overlap with Workers' Compensation unless the expenses exceed the Workers' Compensation limits..
Medicare Advantage Switching
- Medicare Advantage (Part C) enrollees can switch back to Original Medicare during a specific Open Enrollment Period.
Hospital Indemnity Plans
- Hospital Indemnity plans offer a payment based on hospital stays, usually a flat amount per day.
Tax Treatment of Business Disability Premiums
- Business overhead expense disability policy premiums are typically tax-deductible.
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