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Flashcards in Other Accident & Health Topics Deck (23):
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Requirements of a contract

Agreement - offer and acceptance
Consideration
Competent Parties
Legal Purpose

1

parties to a contract

must be capable of entering into a contract in the eyes of the law.
legal age, mentally competent to understand the contract, not under the influence of any drugs

2

Insurable interest

is proven by love and affection, economic or financial loss
in life and health it is required at the time of policy issue

3

MIB Medical Information Bureau

nonprofit organization, consisting of members of insurance companies. which receives and maintains adverse medical information from insurance companies. it is a systematic way for insurance companies to share information that may have been discovered by other companies.

4

association group coverage

can buy group insurance for its members:
must have at least 100 members
be organized for a reason other than buying insurance
have been active for at least two years
have a constitution, by-laws and hold at least annual meetings

5

Coordination of Benefits

if both parents name their children as dependents for health insurance the order of payment will be determined by the birthday rule. the coverage of the parent whose birthday is earlier in the year will be considered primary. occasionally the gender rule may apply, then the father's coverage is primary.

6

COBRA benefits

coverage is extended for up to 18 months. the former employee must exercise extension of benefits within 60 days of separation.

for death or divorce the period is 36 months for the dependents.

7

MEWA coverage

multiple employer welfare associations. a group of companies organize in order to provide benefits to themselves and employees at a lower cost.

8

Individual Disability Income

Premiums - not deductible

Benefits - not taxable

9

Group Disability Income

Premium - Deductible for employer

Benefits - taxable

10

Individual Medical

Premiums - not deductible

Benefits - not taxable

11

Group Medical

Premiums - deductible by employer

Benefits - not taxable

12

Individual Long-term care

Premiums - not deductible

Benefits - not taxable

13

group long-term care

Premiums - deductible for employer

Benefits - not taxable

14

Individual medicare supplement

Premiums - not deductible

Benefits - not taxable

15

group medicare supplement

Premiums - deductible for employer

Benefits - not taxable

16

Buy-sell

Premiums - not deductible

Benefits - not taxable

17

Key person

Premiums - not deductible

Benefits - not taxable

18

Business overhead expense

Premiums - deductible for employer

Benefits - taxable

19

MSAs

Premiums - deductible

Benefits - not taxable when used for medical expenses
taxable when taken out at end of year

20

FSAs

Premiums - not deductible

Benefits - not taxable

21

HRAs

Premiums - deductible

Benefits - not taxable

22

HSAs

Premiums - deductible

Benefits - not taxable when used for medical expenses
taxable plus 20% penalty under 65, no penalty over 65 for non medical use