Insurance Flashcards
HSAs entail which risk management techniques?
Risk retention and risk transfer.
A client is 62 years old and is covered under his company’s group health plan. How long does he need to work to maintain his health insurance?
To 63-1/2
Does form ho-3 provides open peril’s coverage on insured’s personal property?
No.
Premiums for which business insurance policies are tax deductible?
Workers compensation insurance, unemployment insurance, commercial umbrella insurance, and a bop policy.
Which ho covers broad form policy? What does it cover?
Ho-2. Wharves.
Does ho-4 exclude coverage on structures?
Yes
Homeowners section I and II coverage.
I = dwelling, other structures, personal property, and loss of use.
II = personal liability and medical payment.
Does personal auto policy cover earthquake, flood, and falling objects?
No.
Difference b/t ho-2 and ho-3.
Damage to an attached garage is covered under for coverage A in an ho-2 policy, but damage to a detached garage is protected under coverage B under ho-3 policy.
Characteristics of umbrella liability insurance policy.
It provides excess coverage when the limits of the insured’s basic liability coverage are adequate and inadequate. it also provides broader coverage than basic underlying policies.
The 80% to 20% applies to what limit?
The stop loss
Client: 55 years old, healthy, single, plans to retire around 62, max. 401(k) contribution. What benefit should he continue?
His PPO plan
Medicare part B characteristics:
- Benefits are subject to a calendar- year deductible, and only 80% of the Medicare approved charges are paid.
- The cost of doctor visit is covered both in and out of a hospital.
- Part B is a voluntary program of health insurance.
- Outpatient services by a participating hospital are a covered expense.
For how many days does the cobra election period last?
60 days after the actual notice of the event to the qualified beneficiary by the plan administrator.
Is the disability insurance premium taxable when it is added to the salary in the form of bonus?
No
Client is 85. Alzheimer’s disease. Falls repeatedly. Admitted to nursing home because he is unable to care for himself. Can he be covered by Medicare or Medicaid?
He could be covered by Medicaid if he qualifies.
Which disability insurance clauses are included and which can increase premium?
Included are the presumptive disability clause and the continuance provisions clause. Cola is a rider (extra cost) and the non-cancellable provision.
What is the most important factor in determine whether a variable life policy is suitable?
Risk tolerance
What policy is most suitable for a buy-sell agreement?
Variable life due to its cash value component along with the growth potential.
Which Life Insurance riders need extra premiums and which are not?
Standard contract provision: conversion provision, APL, grace period, reinstatement clause, misstatement of age clause, incontestable clause, suicide clause
Extra cost: disability waiver provision, accidental death benefit, and guaranteed insurability
A client wants to borrow substantially from a whole life policy. Concerned about a reduced DB. Which dividend option to select?
5th dividend as paid-up additions may or may not be equal to the amount of the loan.
Functions and purposes of the NAIC.
I. Oversees state accreditation program
II. Promotes law and regulation uniformity
III. Transmits information to regulators
IV. Protects the interest of policy owners while preserving state regulations
