� Health insurance does not cover death due to sickness. That's life insurance.
That's life insurance.
� Depending upon the state, Health insurance is also known as Accident & Health (A&H) insurance or Disability insurance. All are synonyms.
All are synonyms.
� Health insurance covers two perils: accident & sickness. A peril is a cause of loss.
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� Mandatory provisions, such as the grace period, protect the client. Optional provisions, such as probationary periods, protect the company
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� If a submittal is approved and a policy is issued, the producer must collect the premium along with a Statement of Continued Good Health.
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� The Principle of Indemnity states that you cannot recover more than you lost.
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� The Coordination of Benefits Provision in a Group Medical Expense policy states that if you have two policies, one is primary and one is excess.
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� On a Disability Income policy, to reduce your premium, choose a longer Elimination (waiting) Period. The waiting period is like a deductible, in that it starts at the onset of your disability.
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� A Recurrent Disability is a prior injury that recurs again. The Elimination (waiting) Period is waived.
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� A Residual Disability is one that never goes away. Residual coverage pays the difference between what you used to make before your disability and what you can make now.
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� A Blanket Disability policy may be written to cover passengers on a common carrier, students at school, a debtor group or a sports team, like Little League. Blanket policies do not require individual applications, nor are Certificates of Insurance issue
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� Occupational coverage covers both on and off-the-job (for those not covered by Worker's Compensation). Non-occupational coverage covers off-the-job only (for those covered by Worker's Compensation).
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� Premiums for individual Disability Income or AD&D policies are not tax-deductible.
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� Business Overhead insurance will cover the ongoing business expenses of a self-employed person, such as rent or salaries, while the sole proprietor is disabled. Premiums are tax deductible, but benefits are taxable.
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� Premiums paid by an employer for a group health policy (such as Medical Expense or Disability Income) are tax-deductible, since these are fringe benefits for employees.
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� If a reinstatement application is required, you are reinstated when the company says or after 45 days, whichever comes first. When you are reinstated, a 10-day Probationary Period starts for sickness only.
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� If no reinstatement application is required, you are reinstated effective upon payment of your late premium to either the company or the producer.
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� Under the Time Payment of Claims Provision, claims must be paid immediately.
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� Under the Legal Actions Provision, if a claim is not paid immediately, the claimant must wait at least 60 days before filing a lawsuit. Such suits must be filed within three years, in most states.
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� Basic Medical Expense plans cover in-hospital only, with 1st dollar coverage. There is no deductible or coinsurance, but coverage is subject to inside (maximum) limits.
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� Major Medical & Comprehensive Major Medical plans have deductibles and coinsurance requirements.
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� When calculating how much the company will pay on a claim, always subtract the deductible first then apply the coinsurance percentage.
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� The Stop Loss feature on a Major Medical policy applies after the client first pays the deductible. It limits that amount of co-insurance the client has to pay on a large claim.
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� A Probationary Period (or pre-existing condition clause) applies to sickness only, not accidents, since there is no such thing as a pre-existing accident!
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� The Probationary Period is different from the Time Limit on Certain Defenses provision (Incontestability), the maximum Probationary Period is 12 months and the Incontestability Provision is usually two years.
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� The Incontestability Clause protects the insurance company. Under this clause, the company may contest a claim for the first two years, but not thereafter unless it can prove fraud. Companies are reluctant to charge fraud, however, since it requires pro
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� On Disability Income insurance, the Elimination Period is just another name for the waiting period.
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� On a Non-cancelable policy, the insurance company cannot change the coverage or the rates, but it does not have to offer renewal.
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� On a Guaranteed Renewable policy, the insurance company cannot change the coverage, but it can change the rates by class (not individually).
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� If a policy is Non-cancelable and Guaranteed Renewable, the company cannot change anything and it must offer renewal.
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� A Conditionally Renewable policy must be renewed if the insured meets the specified conditions.
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� Medical Expense policies are usually written as cancelable, which means the company can cancel at any time as long as it gives advance notice.
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� Unearned premiums must be refunded to a client who was cancelled midterm. A pro-rata refund is sent when the company cancels. A short-rate refund is sent when the client cancels.
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� Cancellation will have no effect on a pending claim.
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� On an AD&D policy, loss of eyesight due to an accident is covered. Loss of hearing is not covered, nor is loss of use of a limb.
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� AD&D and Hospital Indemnity policies do not follow the Principle of Indemnity. They pay in addition to other policies the insured may have.
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� Group health insurance usually has no Probationary Period and little underwriting. Group rates are usually lower than rates charged for individual policies and coverage is generally broader.
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� Health policies must cover newborn children from the moment of birth.
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� To continue coverage for a handicapped dependent child beyond the limiting age, you must submit Proof of Continued Dependency within 31 days.
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� COBRA (a federal regulation applying to Group Medical Expense policies) allows an employee to continue group coverage for 18 months after termination of employment.
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� Under COBRA, the dependents of a deceased or disabled employee may continue group coverage for another 36 months.
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� Credit Disability insurance will make your car payments if you are sick or injured and cannot work.
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� The maximum Probationary Period on Medicare Supplements and Long-term Care policies is six months.
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� OASDHI (Old Age, Survivors, Disability and Health Insurance) is an acronym for Social Security.
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� A disabled person must have fully-insured status in order to be eligible for Social Security disability benefits. The Waiting Period is five months, you cannot be able to work any job, and the disability must be expected to last at least one year or res
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� Medicare Part B (Physicians) has coinsurance (80/20) and a deductible.
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� Medicare Supplements and Long-term Care policies have a 30-day Free Look. Flight insurance sold in airport lobbies has no Free Look Provision since it provides coverage for only one day.
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� Medicaid is funded by state, local and federal money. It is medical welfare, available to low-income individuals and families. It is not part of Social Security.
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� A family deductible limits the total amount the family must pay during the year no matter how many family members become sick or injured.
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� Groups may not be formed just to buy insurance. They must exist for another reason.
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� There is a six-month open enrollment period for buying a Medicare Supplement (Medi-Gap) policy, starting when you turn 65 AND enroll in parts A and B of Medicare.
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� Persons 65 or older cannot be denied Medi-Gap coverage or up-rated during the open enrollment period for health problems.
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� The 20% Medicare Part B coinsurance requirement must be covered as a Medi-Gap Core Benefit.
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� An Accidental Means Clause excludes coverage if you meant to do whatever caused your injury. An Accidental Bodily Injury Clause is much broader.
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� A person who cannot perform Activities of Daily Living (ADLs) needs a LTC (Long Term Care) policy.
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� ADLs include mobility, dressing ones self, personal hygiene and eating.
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� Optional LTC coverage includes home health care, adult day care and hospice care.
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� Only 12 standardized Medi-Gap plans may be offered (Plans A through L). Plan A is the most limited (the core) and Plan J is the best and most expensive.
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� If your medical bills exceed what Medicare covers, you must pay the difference.
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� It is unlawful to sell a client more than one Medi-Gap policy.
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� Commercial insurers implemented PPOs to compete with HMOs.
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� Health Insurance underwriters may discriminate based on an applicant's health history.
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� AD&D benefits paid to a beneficiary are not taxable (same as life insurance proceeds). On Group Disability Income, if the employer deducts the premium, benefits are taxable.
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� The Time Limit on Certain Defenses Clause is another name for the Incontestability Clause (generally up to two years, except for fraud).
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� Pre-existing conditions are those that existed prior to policy inception.
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� Claims may be denied if they occur after policy expiration.
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� The Time Payment of Claims Provision allows the Claims department time to investigate.
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� If the applicant is in poor health, the policy may be issued with a modification (such as an exclusion or surcharge).
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� The Waiting Period and the Elimination Period on a Disability Income policy are the same thing.
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� If an insurer wants fewer Disability Income claims, they should lengthen the Elimination Period.
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� If an insurer wants to stress preventative care, they should waive the deductible for office visits.
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� Health insurance excludes war, self-inflicted injury, elective cosmetic surgery and criminal activity.
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� The Unpaid Premium Clause allows the insurer to subtract overdue premiums from claim payments.
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� A Cancelable Policy may be cancelled at any time by either party.
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� A Guaranteed Renewable policy is renewable at the option of the insured (by paying the premium) up to a certain, specified age (usually age 65), but the insurer may change rates by class.
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� On Medical Expense plans, a mandatory-second-opinion requirement will result in fewer claims.
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� LTC policies may exclude pre-existing illness, mental disorders, alcoholism, drug addiction, war related illness and self inflicted injuries, but not Alzheimers Disease.
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� Medicaid eligibility is based upon financial need. There is no age limit.
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� The Guaranteed Purchase Option is a rider that allows the insured to purchase additional coverage at certain intervals regardless of health.
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� Permanent (presumptive) disability does not go away, such as loss of a limb.
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� Short-term Disability policies have shorter Elimination & Benefit Periods than Long-term Disability.
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� Premiums paid on an individual Disability Income policy are not tax deductible, but benefits paid are not taxable.
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� Key Person disability Insurance indemnifies the business for the loss of services of a key employee due to disability. Premiums are not tax deductible, but benefits are not taxed.
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� Limited health insurance policies (like AD&D) only cover limited perils and amounts.
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� Medicare Part B (Doctors services) requires the insured to pay a monthly premium, but is also heavily subsidized by the federal government.
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� Certain persons under age 65 who are disabled or who have suffered kidney failure are also eligible for Medicare.
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� HMO primary care physicians may include those in family practice, pediatrics, obstretics and gynecology but not internists.
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� Employees covered by Multiple Employer Trusts do not have to purchase all coverages offered by the MET.
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� HMOs usually dont cover adult hearing exams as a preventative care service.
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� Overseas emergency care is covered by some Medi-Gap policies.
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