Chapter 1 (Health and Accident)

Which type of policy would pay an employee's salary if the employer was injured in a bicycle accident and out of work for six weeks?

Business Overhead Expense

Which of the following statements does NOT accurately describe the tax treatment of premiums and benefits of individual Accident and Health insurance?

Disability income policy premiums are tax-deductible

Group/voluntary long-term care policy premiums are typically deducted from the employee's income and

are less costly as compared to individual long term care coverage

Which of the following medical expenses does Cancer insurance NOT cover?

arthritis

Group health plans typically contain a coordination of benefits (COB) provision. This provision's purpose is to

avoid duplication of benefit payments

Which of the following would be a likely candidate for disability income insurance on a key employee?

company executive

The benefits under a Disability Buy-Out policy are

payable to the company or another shareholder

The Coordination of Benefits provision:

prevents an insured covered by two health plans from making a profit on a covered loss

All students attending a large university could be covered by:

a blanket policy

T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?

$0

B has a $100,000 Accidental Death and Dismemberment policy that pays triple indemnity for common ier death. If B is killed from an accident on a commercial flight, what will the policy pay B's beneficiary?

$300,000

XYZ Company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is:

100%

Under which of the following circumstances will the benefits under COBRA continuation coverage end?

All group health plans are terminated by the employer

Accidental Death coverage is provided to commercial airline passengers in which of the following types

Blanket Accident Policy

G is an accountant who has ten employees and is concerned about how the business would survive financially if G became disabled. The type of policy which BEST addresses this concern is:

Business Overhead Expense

Which of these circumstances is a Business Disability Buy-Sell policy designed to help in the sale of a business?

Business owner becoming disabled

P loses an arm in a farm accident and is paid $10,000 from his Accidental Death and Dismemberment policy. This benefit is known as the

Capital Sum

When an employee is required to pay a portion of the premium for an employer/employee group health plan, the employee is covered under which of the following plans?

Contributory

Dental care coverage is designed to cover the costs of all of the following EXCEPT: A. Oral Surgery B. Preventative Care C. Orthodontia D. Loss of income

D. Loss of Income

Common exclusions to continuation of group coverage include:

Dental care, other prescription drugs

Which contract permits the remaining partners to buy-out the interest of a disabled business partner?

Disability Buy-Sell

How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy?

If the primary beneficiary dies before the insured

If the insured and primary beneficiary are both killed in the same accident and it cannot be dete who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?

Insured's Contingent Beneficiary

Which of the following claims are typically excluded from Medical expense policies?

Intentionally self-inflicted injuries

A policyowner's rights are limited under which beneficiary designation?

Irrevocable

What kind of Accidental Death and Dismemberment (AD&D) insurance beneficiary requires his/her consent when a change of beneficiary is made?

Irrevocable beneficiary

P is insured under a basic cancer plan. Which of the following conditions would be covered under this plan?

Operation for a malignant tumor

P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to:

P only

T is covered by two health insurance plans: a group plan through his employer and his spouse's plan as a dependent. Under the Model Group Coordination of Benefits provision, when T files a claim, his employer's plan is considered the:

Primary carrier

An insured covered by Accidental Death and Dismemberment (AD&D) insurance has just died. What will happen if the primary beneficiary had already died before the insured and contingent beneficiary

Proceeds will go to the contingent beneficiary

T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?

Request of the change will be refused

M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son?

Revocable

P is an employee who quits her job and wants to convert her group health coverage to an individual policy. After the expiration of COBRA benefits, which of the following statements is TRUE?

She DOES need to provide evidence of insurability

P is a new employee and will be obtaining non-contributory group Major Medical insurance from he ployer. Which of the following actions must she take during the open enrollment period?

Sign an enrollment card

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

Single Premium

Which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused by a third party?

Subrogation

The provision in a Group Health policy that allows the insurer to postpone coverage for a covered illness 30 days after the policy's effective date is referred to as the:

Waiting Period

The Health Insurance Portability and Accountability Act (HIPAA) gives privacy protection for:

health information

Which of these types of coverage is best described as a short term medical policy?

interim coverage

Which of the following statements is correct regarding an employer/employee group health plan?

the employer receives a master policy and the employees receive certificates