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Questions and Answers
How soon is the insured required to give notice of claim?
How soon is the insured required to give notice of claim?
20 days
If forms are not furnished, what should the insured do?
If forms are not furnished, what should the insured do?
Submit written proof of the occurrence, nature of the loss, and extent of loss.
Premium payments for personally-owned disability income policies are tax deductible.
Premium payments for personally-owned disability income policies are tax deductible.
False (B)
How long after a policy's effective date may an insurer cancel the policy?
How long after a policy's effective date may an insurer cancel the policy?
Under an individual disability policy, what is the minimum schedule of time in which claim payments must be made to an insured?
Under an individual disability policy, what is the minimum schedule of time in which claim payments must be made to an insured?
What is the name of the statement that indicates 'this is a limited policy'?
What is the name of the statement that indicates 'this is a limited policy'?
Which health insurance provision describes the insured's right to cancel coverage?
Which health insurance provision describes the insured's right to cancel coverage?
Which of the following groups may be eligible for benefits under the Healthy New York Program?
Which of the following groups may be eligible for benefits under the Healthy New York Program?
How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?
How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?
In a life settlement transaction, the owner must be made aware of his or her right to rescind the contract within how many days after the receipt of the life settlement proceeds?
In a life settlement transaction, the owner must be made aware of his or her right to rescind the contract within how many days after the receipt of the life settlement proceeds?
Which of the following is not covered under Basic Hospital Expense coverage?
Which of the following is not covered under Basic Hospital Expense coverage?
Optional policy provisions can be changed by an insurer, as long as the changes do not adversely affect the policyholder.
Optional policy provisions can be changed by an insurer, as long as the changes do not adversely affect the policyholder.
Benefits from Business Overhead Expense (BOE) policies are usually limited to 6 months.
Benefits from Business Overhead Expense (BOE) policies are usually limited to 6 months.
What is the difference between the Medicare approved amount for a service or supply and the actual charge?
What is the difference between the Medicare approved amount for a service or supply and the actual charge?
What is the amount a physician or supplier bills for a particular service or supply?
What is the amount a physician or supplier bills for a particular service or supply?
What types of services may NOT be provided under long-term care's assisted living care?
What types of services may NOT be provided under long-term care's assisted living care?
A policy which covers medical costs related to a specific condition is called what?
A policy which covers medical costs related to a specific condition is called what?
In a replacement situation, all of the following must be considered EXCEPT?
In a replacement situation, all of the following must be considered EXCEPT?
The Patient Protection and Affordable Care Act mandates that insurers provide coverage for adult children up to the age of?
The Patient Protection and Affordable Care Act mandates that insurers provide coverage for adult children up to the age of?
Every authorized domestic insurer and every rate service organization which makes or files rates will be examined at least..?
Every authorized domestic insurer and every rate service organization which makes or files rates will be examined at least..?
A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges for a specific procedure is known as?
A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges for a specific procedure is known as?
Cassie accumulates medical bills but is not classified as 'disabled'. Which of the following would cover at least a portion of Cassie's medical expenses?
Cassie accumulates medical bills but is not classified as 'disabled'. Which of the following would cover at least a portion of Cassie's medical expenses?
How are the three basic charges for medical expense insurance grouped?
How are the three basic charges for medical expense insurance grouped?
Which provision concerns the insured's duty to provide the insurer with reasonable notice in the event of a loss?
Which provision concerns the insured's duty to provide the insurer with reasonable notice in the event of a loss?
Health insurance could provide payments for loss of income.
Health insurance could provide payments for loss of income.
An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. Will the group health plan pay?
An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. Will the group health plan pay?
A reinstated policy provides immediate coverage for illness.
A reinstated policy provides immediate coverage for illness.
Premium payments for personally-owned disability income policies are?
Premium payments for personally-owned disability income policies are?
What is the maximum amount of co-insurance in New York's major medical plans?
What is the maximum amount of co-insurance in New York's major medical plans?
Which of the following would be a covered employment under the NYS Disability Benefit Law?
Which of the following would be a covered employment under the NYS Disability Benefit Law?
Medicare Advantage is known as?
Medicare Advantage is known as?
Every insurer must file a fraud prevention plan within how many days?
Every insurer must file a fraud prevention plan within how many days?
Which of the following would be entitled to mental health benefits through Timothy's Law?
Which of the following would be entitled to mental health benefits through Timothy's Law?
Which of the following answers does NOT describe a principal goal of a Preferred Provider Organization?
Which of the following answers does NOT describe a principal goal of a Preferred Provider Organization?
Regarding long-term care coverage, as the elimination period gets shorter, the premium?
Regarding long-term care coverage, as the elimination period gets shorter, the premium?
An employer offers a short-term disability plan to its employees. How much of a given employee's income would be covered under the plan?
An employer offers a short-term disability plan to its employees. How much of a given employee's income would be covered under the plan?
Do benefits stop at the annuitant's death with an annuity certain?
Do benefits stop at the annuitant's death with an annuity certain?
What is a Payor Benefit Rider?
What is a Payor Benefit Rider?
What does the Guaranteed Insurability Rider allow?
What does the Guaranteed Insurability Rider allow?
What rider increases the death benefit to keep pace with __________?
What rider increases the death benefit to keep pace with __________?
What happens under an Accidental Death Rider?
What happens under an Accidental Death Rider?
When does the insurer pay the death benefit under a survivorship life policy?
When does the insurer pay the death benefit under a survivorship life policy?
What type of annuity starts paying benefits immediately after purchase?
What type of annuity starts paying benefits immediately after purchase?
How many days after a civil penalty ruling can it be enforced as a judgment?
How many days after a civil penalty ruling can it be enforced as a judgment?
What is true about the cash value in a Universal Life policy?
What is true about the cash value in a Universal Life policy?
A certificate of appointment is valid until which condition is met?
A certificate of appointment is valid until which condition is met?
What settlement option should a policy owner choose to pay a portion of proceeds to a spouse annually?
What settlement option should a policy owner choose to pay a portion of proceeds to a spouse annually?
What is the penalty tax for nonqualified distributions to a health savings account?
What is the penalty tax for nonqualified distributions to a health savings account?
What can contribute proof of death for insurance benefits payment?
What can contribute proof of death for insurance benefits payment?
When must proof of loss under a health insurance policy be filed?
When must proof of loss under a health insurance policy be filed?
Which provision must be included on the first page of a Medicare supplement policy?
Which provision must be included on the first page of a Medicare supplement policy?
If an insured incurs $4,000 of medical expenses with a $500 deductible and 80/20 coinsurance, how much would the insurer pay?
If an insured incurs $4,000 of medical expenses with a $500 deductible and 80/20 coinsurance, how much would the insurer pay?
To sign up for a Medicare prescription drug plan, individuals must first be enrolled in?
To sign up for a Medicare prescription drug plan, individuals must first be enrolled in?
The One Year Term Option allows the policy owner to purchase a __________ policy for one year.
The One Year Term Option allows the policy owner to purchase a __________ policy for one year.
When do health care insurers negotiate contracts with providers?
When do health care insurers negotiate contracts with providers?
Which option best describes 'first-dollar coverage' in basic medical insurance?
Which option best describes 'first-dollar coverage' in basic medical insurance?
What are the three basic types of coverage?
What are the three basic types of coverage?
What happens if a policy provision conflicts with state statutes?
What happens if a policy provision conflicts with state statutes?
Which of the following is a feature of a variable annuity?
Which of the following is a feature of a variable annuity?
Which of the following statements about fixed period annuity settlement options is false?
Which of the following statements about fixed period annuity settlement options is false?
What should a client consider if planning to retire at age 50?
What should a client consider if planning to retire at age 50?
What would be true if John receives benefits from his group disability income policy?
What would be true if John receives benefits from his group disability income policy?
Do benefits stop at the annuitant's death with an annuity certain?
Do benefits stop at the annuitant's death with an annuity certain?
What does life contingency mean?
What does life contingency mean?
Is there a limit on when benefits are paid in a Business Overhead Expense plan?
Is there a limit on when benefits are paid in a Business Overhead Expense plan?
What decreases in a decreasing term policy?
What decreases in a decreasing term policy?
What may limit or exclude coverage for sickness in a health insurance policy?
What may limit or exclude coverage for sickness in a health insurance policy?
How long does the insurer have to comply with a request for additional information on an Investigative Consumer Report?
How long does the insurer have to comply with a request for additional information on an Investigative Consumer Report?
The insurance principle that limits compensation to the financial loss incurred is called __________.
The insurance principle that limits compensation to the financial loss incurred is called __________.
How long must life settlement brokers keep records of commission disclosures?
How long must life settlement brokers keep records of commission disclosures?
What would cover a portion of Cassie's medical expenses?
What would cover a portion of Cassie's medical expenses?
Which of the following is typically not covered under Basic Hospital Expense coverage?
Which of the following is typically not covered under Basic Hospital Expense coverage?
What document ensures full disclosure to a policy recipient?
What document ensures full disclosure to a policy recipient?
How many days of inpatient care for mental or emotional disorders is required under Timothy's Law?
How many days of inpatient care for mental or emotional disorders is required under Timothy's Law?
When will Medicare cover nursing home care?
When will Medicare cover nursing home care?
What determines benefits under group disability income insurance?
What determines benefits under group disability income insurance?
What are the characteristics of a group long-term disability plan?
What are the characteristics of a group long-term disability plan?
What is the maximum coinsurance amount in New York's major medical plans?
What is the maximum coinsurance amount in New York's major medical plans?
Under SIMPLE plans, what is the employer contribution limit as a percent of annual wages?
Under SIMPLE plans, what is the employer contribution limit as a percent of annual wages?
What type of review process evaluates the effectiveness of the utilization review process?
What type of review process evaluates the effectiveness of the utilization review process?
Using a class designation for beneficiaries involves __________ beneficiaries as a group.
Using a class designation for beneficiaries involves __________ beneficiaries as a group.
Does the premium change in a decreasing term policy?
Does the premium change in a decreasing term policy?
What does the guarantee of insurability option in long-term care policies allow?
What does the guarantee of insurability option in long-term care policies allow?
What is called when a policy owner instructs the insurance company to transfer cash value to an annuity?
What is called when a policy owner instructs the insurance company to transfer cash value to an annuity?
How long do benefit periods for individual short-term disability policies usually last?
How long do benefit periods for individual short-term disability policies usually last?
Which nonforfeiture option provides coverage for the longest time?
Which nonforfeiture option provides coverage for the longest time?
Who can share in the commission from the sale of a life insurance policy?
Who can share in the commission from the sale of a life insurance policy?
What types of services may NOT be provided under long-term care's assisted living care?
What types of services may NOT be provided under long-term care's assisted living care?
What is reinsurance?
What is reinsurance?
Which life insurance settlement option guarantees lifetime payments and specifies a guaranteed period?
Which life insurance settlement option guarantees lifetime payments and specifies a guaranteed period?
What concept applies when a court orders payment for an uncovered loss?
What concept applies when a court orders payment for an uncovered loss?
What type of annuity has income payments beginning two years after purchase?
What type of annuity has income payments beginning two years after purchase?
What is the goal of the New York State Partnership for LTC?
What is the goal of the New York State Partnership for LTC?
What is an example of a peril?
What is an example of a peril?
Which Medicare supplement plans must be available to a 91-year-old female?
Which Medicare supplement plans must be available to a 91-year-old female?
When may a policy owner sell a life insurance policy for a life settlement contract?
When may a policy owner sell a life insurance policy for a life settlement contract?
What does the Life Income Joint and Survivor settlement option guarantee?
What does the Life Income Joint and Survivor settlement option guarantee?
What is true for both equity indexed annuities and fixed annuities?
What is true for both equity indexed annuities and fixed annuities?
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Study Notes
Insurance Riders and Provisions
- Payor Benefit Rider: Premiums are waived if the payor becomes disabled or dies; death benefit does not increase.
- Guaranteed Insurability Rider: Allows policyowner to increase the death benefit (DB) at specified ages or events.
- Cost of Living Rider: Adjusts the DB to keep pace with inflation.
- Accidental Death Rider: Provides a multiple of the face amount if the insured dies from an accident.
- Interest-Only Option: Policy proceeds pay interest regularly to a spouse, with principal paid to children at a designated age.
Annuities
- Immediate Annuity: Payments begin within 12 months of the purchase; distribution starts two months after payment.
- Deferred Annuity: Income payments start more than one year after the purchase; involves periodic premium payments.
Legal and Policy Guidelines
- Civil Liability Judgement: A ruling from a hearing can be entered as judgment after 120 days without court proceedings.
- Proof of Loss: Generally must be filed within 90 days under health insurance policies.
- Medicare Supplement Policies: Must include a Continuation Provision on the first page, stating the insurer's right to change premiums.
Benefits and Distributions
- Universal Life Insurance: Cash value grows with a current interest rate, which is non-guaranteed but backed by a lower guaranteed rate.
- Fixed Settlement Option: Liquidates both principal and interest over a selected period; offers uniform installments to recipients.
- Major Medical Policy: Deductibles and coinsurance amounts impact how much insurers pay after out-of-pocket expenses.
Health Insurance Specifics
- HSA Penalty Tax: Nonqualified distributions from a Health Savings Account incur a 20% penalty tax.
- Medicare Drug Plan Enrollment: Requires enrollment in Medicare Part A before signup.
- Timothy's Law: Health insurance must cover at least 30 days of inpatient care for mental health disorders.
Tax and Financial Aspects
- Disability Income Taxation: Employer-funded disability income premiums are tax-deductible for businesses; benefits received may be taxable.
- Reduced Paid-Up Option: Provides the longest coverage period among nonforfeiture options, although the benefit amount is reduced.
Specific Coverage Scenarios
- Cross Purchase Plan: Partners protect against the death of each other by buying life insurance policies equaling half the business value.
- Long-Term Care Services: Assisted living care does not include visits by a registered nurse, focusing more on non-medical assistance.
Policyholder Rights and Responsibilities
- Life Settlement Contracts: The 2-year waiting period does not apply in cases such as divorce or terminal illness.
- Claim Notice Requirements: Insured must notify the insurer of a claim within 20 days of loss occurrence.
Additional Definitions and Provisions
- Annuity Certain: Provides income for a specific time period without life contingencies; payouts continue regardless of the annuitant's death.
- Reinsurance: Agreement between ceding and assuming insurers for risk management.
- Equity Indexed Annuities: Offers a guaranteed minimum interest rate similar to fixed annuities while allowing for higher indexed earnings.
These notes summarize essential concepts, aiding students in understanding key components for the Life & Health Exam.### Life Settlement Transactions
- Owners can rescind life settlement contracts within 15 days of receiving proceeds.
Insurance Coverage
- Basic Hospital Expense coverage excludes surgeons' fees.
- Optional policy provisions can be modified by insurers without adversely impacting policyholders.
Business Overhead Expense Policies
- Not limited to 6 months; these policies reimburse small business owners for overhead during total disability.
- Premiums are tax-deductible, while received premiums are taxable income.
- Coverage includes overhead expenses but excludes employer salaries and profits.
Medical Insurance Definitions
- Excess Charge refers to the difference between the Medicare approved amount and the actual charge billed.
- Actual Charge is the specific amount billed by a physician or supplier.
- Usual, customary, and reasonable (UCR) policies base benefits on prevailing local charges for a procedure.
Long-term Care and Health Policies
- Assisted living care does not cover visits from registered nurses.
- Dread Disease Policies cover medical costs for specific conditions.
- Group health policies do not typically cover work-related injuries; workers' compensation is required.
Patient Protection and Affordable Care Act
- Mandates coverage for adult children up to age 26 under health insurance plans.
Insurance Regulations
- Authorized insurers and rate service organizations undergo examinations every 5 years.
- Insurers must file a fraud prevention plan within 120 days.
Health Insurance Benefits
- Medical expense insurance covers hospital, surgical, and medical charges.
- Health insurance may provide payments for loss of income.
Disability and Annuity Policies
- Short-term disability plans generally cover about 70% of an employee's income.
- Annuities Certain do not stop benefits at the annuitant's death, paying for a fixed period or amount.
Timothy's Law
- New York residents with group health insurance are entitled to mental health benefits under Timothy's Law.
Preferred Provider Organizations
- A principal goal of a Preferred Provider Organization is to provide a wide range of medical benefits, not just those from network physicians.
Coverage Considerations
- In replacement situations, assets do not need to be reviewed as thoroughly as other factors.
- The elimination period affects premium rates; shorter periods lead to higher premiums.
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