Accident and Health Insurance Basics

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How many types of losses and benefits are there?

4

What are the two major perils under a health insurance policy?

Accidental Injury and Sickness

What are the types of loss and benifits?

Loss of income from Disability, Medical Expense, Dental expense, and long term care expenses

Medical Information Bureau (MIB) contu....

MIB can request a report on an applicant and recieve coded information from any other Applications for insurance submitted to other MIB members.

Outline of Coverage

Must be delivered at the time of application or upon delivery of the policy.

What details best describe the underwriting process for life insurance

Selection, classification, and rating of risks

What are the majority of health insurance claims coming from?

Sickness rather than accidental injury

Standard risk

Standard risks reflect average exposures and may be insured at standard rates and premiums

Who must pay for the cost of a medical examination required in the process of underwriting?

The Insurer

What is the proper process when replacing the insured's current insurance policy with a new one?

The old policy should stay in force until the new policy is issued

Accidental Death and Dismemberment policies pay what to the Principal(insured) if the insurer has an accidental death?

The principal sum

What are Life and Health Guaranty Associations designed for?

To protect policy owners, insured, and beneficiaries against insolvent insurer within certain limitations.

Benefits, Limitations and Exclusions

When an agent attempts to replace the insured's current health insurance policy with a new one, the agent needs to be careful not to mislead the insured or provide coverage that is to the insured's detriment.

The most The Insurance Guaranty Association will pay for net cash surrender values is?

$100,000

If an agent misrepresents the details of an insured's new insurance contract that will be replacing the current contract? What would most likely happen to the agent?

A suspension of license

Which term describes a situation in which people who are the most likely to have claims are also the most likely to seek insurance?

Adverse selection

What does an Investagative Consumer (Inspection) Report include

Information on the applicant's Character, General reputation, Personal habits and mode of living that is obtained through investigation.

Who is involved in completing the agents report?

Only the agent

Medical Information Bureau (MIB)

Report on previous insurance information can be obtained from here

What does preferred status indicate?

That the insured is in excellent physical condition and employs a healthy lifestyle and habits.

What is the agents responsibility in regards to Benefits, Limitations and Exclusions

To compare the benefits, limitations and exclusions found in the current and the proposed replacement policy.

What is the definition of Sickness?

an illness, which manifests itself while the policy is in force

What is an Accidental bodily injury?

an unforseen and unintended injury that resulted from an accident rather than a sickness

Routine and major restorative care

includes such as treatments of cavities, oral surgaries, bridges and dentures. These procedures are covered up to a specific maximim, subject to an annual deductible per insured family member and a coinsurance

What can cause an applicant to be rated substandard?

poor health history or a dangerous vocation or avocation

Classifications of Risks

Once the umderwriters have collected and reviewed all the necessary information on the applicant, they will make a decision to either accept or decline the applicant for insurance.

What happens once the delivery of a policy is made?

The free-look period begins

What is NOT true regarding an insured who is considered to be a standard risk?

The insurer may have to pay slightly higher premiums

A hospital indemnity policy will pay

A benefit for each day the insured is in a hospitial

Accidental Death and Dismemberment policies pay what to the Principal(insured)if the insured was to loss a limb or eye?

A capital amount

An Outline of coverage must include all of the following

A description of the benifits and coverage A statement of the exclusions, reductions, and limitations A statement of the terms under which the policy or certificate my be continued enforce or discontinued

Specified (Dread) Disease

A dread disease, or limited risk, policy provides a variety of benefits for a specific disease such as cancer policy or heart disease policy

Why is it essential for an insurer to document all correspondence with an insured?

Errors and omissions

Orthodontic care

If included, will have a separate maximum and a separate deductible, which may differ from the deductible for restorative care

What are the Three categories to Classifications of Risks?

Preferred, stamndard or substandard

Which of the following do the Standard and Preferred risk categories share?

Premiums are not elevated

What does a Standard rating indicate?

That an individual represents a similar level of health and lifestyle quality as other members of the same age cohort

Common Situations for Errors/Omissions

The SALES INTERVIEW AND THE POLICY DELIVERY are the most common occasions for errors and omissions situuations.

Attending Physician Statement(APS)

This source of information is best for accurate information on the applicant's medical history.

What are Substandard risks?

Those that reflect an increased risk of loss(ie. DUIs Smoking ect.)


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