2 - Accident & Health Policies

Question 1

4 commonly accepted definitions of disability

Answer 1

• permanent total
• temporary total
• permanent partial
• temporary partial

Question 2

permanent total

Answer 2

-will not work again

Question 3

temporary total

Answer 3

-after a given period of time will likely return to work

Question 4

permanent partial

Answer 4

-permanent injury but can return to work or be retrained

Question 5

temporary partial

Answer 5

-will return to work after recovery

Question 6

Definitions of Total Disability

Answer 6

• Own Occupation
• Any Occupation for which the insured is reasonably suited by reason of education, training or experience
• Any Occupation
• Combination Definition
• Disability Income Presumptive Disability

Question 7

Most expensive definition?

Answer 7

-Own Occupation

Question 8

Partial Disability Rider

Answer 8

-capped at 50% of monthly benefit

Question 9

Residual Disability Rider

Answer 9

-provided the insured with a benefit in proportion to the loss of income

Question 10

Recurrent Disability Provision

Answer 10

-if person has a relapse within a stipulated time after returning to work it will be treated as a continuation of same disability

Question 11

Elimination (waiting) Period

Answer 11

• time where no benefits will be paid and disability must continue past
• 30 day increments

Question 12

Probationary Period

Answer 12

• time period where no benefits will be paid for sickness

- 30 days or less

Question 13

Short Term Disability

Answer 13

• benefit period between 3 months to 2 years

- waiting period of 0-14 days

Question 14

Long Term Disability

Answer 14

• benefit periods for more than 2 years

- waiting period of at least 30 days

Question 15

Non-Occupational Policy

Answer 15

-provide coverage for disabilities that resulted from other than the insureds employment

Question 16

Full (Occupational) Coverage Policy

Answer 16

-provide for losses regardless of the time and location of the covered loss

Question 17

Common DI Exclusions

Answer 17

• war/military
• self-inflicted
• attempted suicide
• criminal activity
• mental illness or drug addiction
• preexisting condition
• if worker’s compensation applies

Question 18

Cost of Living Adjustment

Answer 18

• rider that provided automatic adjustment to benefits to keep pace with annual inflation numbers
• capped at 70% of income

Question 19

Guaranteed Insurability Rider

Answer 19

-allows the insured to purchase additional amounts of DI coverage without evidence of insurability

Question 20

Accidental Death & Dismemberment Rider

Answer 20

-pays benefit in the event death/dismemberment occurs from accident

Question 21

principal sum

Answer 21

-amounts paid for accidental death

Question 22

capital sum

Answer 22

-benefits for dismemberment

Question 23

Basic Medical Expense Insurance

Answer 23

-traditional health insurance policy that provides very basic coverage

Question 24

Difference between BMEI and MMEI?

Answer 24

-MMEI has deductibles, coinsurance and high benefit limits

Question 25

per injury or per sickness deductible

Answer 25

-per occurence

Question 26

cumulative deductible

Answer 26

-dollar amount to be paid by the insured during a state time period

Question 27

family maximum deductible

Answer 27

-all expenses used by family members contribute to satisfying the deductible

Question 28

Stop Loss Provision

Answer 28

-policy will pay all of covered expenses after a stated dollar amount

Question 29

Carryover Provisions

Answer 29

-if insured has a claim in the last quarter of a year and has not had any claims in the previous 3 years can apply the amount to the next years deductible

Question 30

HMO

Answer 30

-Health Maintenance Organizations

Question 31

PPO

Answer 31

-Preferred Provider Organizations

Question 32

Comprehensive Major Medical

Answer 32

-single policy that combines BMEI and MMEI