Health field underwriting procedures

Elements of a contract

-agreement offer and acceptance -consideration -competent parties Legal purpose

WIthin how many days of requesting an investigative consumer Report must an insurer notify the consumer in writing that the report will be obtained

3 days

Agent/producer

A legal representative of an insurance company; the classification of producer usually includes agents and brokers; agents are the agents of the insurer

Applicant or proposed insured

A person applying for insurance

Insured

A person covered by the insurance policy; may or may not be the policyowner

An insured pays 100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. what characteristic of an insurance contract does this describe

Aleatory

Warranty

An absolutely true statement upon which the validity of the insurance policy depends

if an insurance company wishes to order a consumer report on an applicant to assist in the underwring process, and if a notice of insurance information practices has been provided, the report may contain all of teh following information EXCEPT

Ancestry

An agent is ready to deliver a policy to an applicant but has not yet received paymemt. Upon delivery, the agent collects the applicant's premium check, answers any quiestions the applicatn may have, adn then leaves. What did he forget to do?

Ask her to sign a statement of good Health

In a replacement situation all of the following would be considerd

Benefits limitations and exclusions

contracts that are prepared by one party and submitted to the other party on take it or leave it basis are classified as

Contracts of adhestion

intentional misrepresentation

Fraud

Underwriting

Important when replacement is involved it is an underwriters duty to evaluate risk and decide whether or not a person is eligible for coverage. an insured may not be paying the same premium or receiving the same benefits

HIV test

Must have written consent for teh test. the form must explain the purpose of the test and inform the applicant about teh confidentiality of teh results. Underwriting for HIV or AIDS is permitted as long as it is not unfairly discriminatory.

Acceptance

Takes place when an insurer's underwriter approves the application and issues a policy

Insurable interest can be best described by which of the following

The applicant must experience a financial loss due to an acciden or sickness that befalls the insured

Consideration

The binding force in any contract. something of value that each party gives to the other

if only one party to an insurance contract has made a legally enforceable promise what kind of contract is it

Unilateral

Which of the following is a statement that is guaranteed to be true, and if untrue may breach an insurance contract

Warranty

insurance policy

a contract between a policoner and an insurance company which agrees to pay teh insured or the beneficiary for loss caused by specific events

Pre-existing conditions

a medical condition for which the insured sought medical advice or treatment within a specified period of time prior to the policy issue

Fair credit reporting Act

all sources used to verify insurabily must adhere to this

Medical Exam report

are conducted by physicians or paramedics at teh insurance company's expence. more common with life insurance underwriting. if the insurer request a medical examination the insurer is reponsible for the costs of the exam

Representation

are statements believed to be true to the best of one's knowledge, but are not guaranteed to be true.

Conditional contract

certain conditions must be met by teh policyowner and the company in order for the contract to be executed Example the insured must pay the premium and provide proof o floss in order for the insurer to cover a claim

paramedical report

completed by a paramedic or a registed nurse

changes in apps

draw a line through incorrect anser and insert teh correct one. the applicant must initial the correct anser

signatures

every health insurance application requires the signature of the proposed insured, teh policyowner and the agent who solicits teh insuracne

app

form which the company provides and completed by the agent as questions are asked of teh applicant. then is submitted to the insurance company

attending physicians statement

from medical practitioner who treated the applicant for a prior medical problem

Material misrepresentation

if discovered would alter the underwriting decision of the insurance company

ENtire contract

if the policy is issued, a copy of this application is stapled in teh back of the policy

Attending physician report

if the underwriter deems it necessary this will be sent to eh applicant's doctor to be completed

no initial premium with application

in cases where a premium did not accompany the application for insurance, upon delivery, teh agent must collect the premium adn obtain a statement of continued good health

Which of the following entities can legally bind coverage

insurer

Adhesion

is prepared by one of the parties and accepted or refected by the other party. Take it or leave it

the parties of a contract

legal age, mentally competent to undersatnd the contract, adn not under the influence of drugs of alcohol

replacement

must be careful not to mislead the insured or provide coverage that is to the insured's detriment. agent must carefully compare the benefits, limitations adn exclusions found in teh current and the proposed replacement policy. the agent also must make sure that teh current policy is not cancelled before the new policy is issued. THE AGENT ALSO MUST MAKE SURE THAT THE CURRENT POLICY IS NOT CANCELLED BEFORE THE NEW POLICY IS ISSUED.

Notice to the applicant

must be issued to all applicants for health insurance coverage. informs the applicant that a credit report will be ordered concerning his or her past history and any other health insurance for which they have previosly applied.

Legal

not agains public policy. must have insurable interest and consent

unilateral contract

only one fo teh parties to the contract is legally bound to do anything. the insured makes no legally binding promises. However an insurer is legally bound to pay losses covered by a policy in force

Consurmer Reports

only used by someone with a legitimate business purpose, including insuranc eunderwriting , employent screening, and credit transactions. written or oral info regarding a consumer's credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports, and other public sources

Investigative consumer reports

only used by someone with a legitimate business purpose, including insuranc eunderwriting , employent screening, and credit transactionsthe information is obtained through an investigation and interviews with associates, friends and neighbors of the consumer. these repots canot be made unless teh consumer is advised in writing about the report within 3 days of the date the report was requested. the insurer or reporting agency has 5 days to provide the consumer with the additional information

Medical information Bureau

owned by member insurance companies. nonprofit trade organizationreceives adverse medical info from insurance companies and maintains condidential medical impairment info on individuals. an applicant cannot be refused simply because of some adverse information discovered through teh MIB

consent

permission to do something

Fair credit reporting ACT

procedures that consumer-reporting agencies must follow in order to ensure that recods are confidential, accurate, relevant, and properly used.

Insurable interest

proven by love and affection, economic or financial loss.

Medical information bureau report

the applicant must be advised of the sources to be used and how the information is gathered

Insurer(principal)

the company who issues an insurance policy

Premium

the money paid to the insurance company for the insurance policy

policyowner

the person entitled to exercise the rights and privilges in the policy

insuance interest

the policyowner facing the possibility of losin gsomething of value in the event of loss

Aleatory

there is an exchange of unequal amounts of values

HIPAA

under the privacy rule protected information includes all individually identifiable heath information. in any form or media, whether electronic, paper or oral. this is called protected health informaion Individually identifiable health information including demographic data that relates to past, present or future physical or mental health or condition, or payment information that could easily identify the individual

Misrepresentations

untrue statement that could void the contract.