(Health) 7 - Health Insurance Underwriting

T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?

Benefits are taxable to T When a disability income insurance plan is paid for entirely by the employer, the premiums are deductible to the employer. The benefits, in turn, are taxable to the recipient.

Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for a Disability Income policy?

Issue the policy with an altered Time of Payment of Claims provision The insurance company may take all of these actions EXCEPT issue the policy with an altered Time of Payment of Claims provision.

Which mode of payment is NOT used by health insurance policies?

Single premium Single premium is not used when paying for health insurance policies.

Which of the following BEST describes how pre-admission certifications are used?

Used to prevent nonessential medical costs Pre-admission certification is used to prevent unnecessary medical costs.

A producer takes an individual Disability Income application, collects the appropriate premium, and issues the prospective insured a conditional receipt. The next step the insurance company will take is to

determine if the applicant is an acceptable risk by completing standard underwriting procedures With a conditional receipt, the insurance company will complete standard underwriting procedures before making a decision about whether to insure the applicant.