Florida State Health Insurance Test

defamation

*Making a false or derogatory statement regarding an insurer's financial condition in order to injure anyone engaged in the insurance business is called? ie. unfair practice

Tax deductions that can be taken for unreimbursed medical expenses

-AD&D coverage are not considered qualifying medical expense. -deduction is limited to the amount exceeding 10% of adjusted gross income i.e. $4,000 (10% of $40,000)

free look policy

-Begins when the policy is delivered -can cancel w/o penalty. -LTC and Medicare supplement require 30 days -all other policies require 10 days.

Blanket health insurance:

-Form of group accident insurance that covers very specific conditions. -limited to common carriers -airplane, train, employees at a social function like a company picnic, members of a school's athletic team, summer camp attendees, volunteer firefighters.

Group insurance vs. individual insurance

-Group insurance involves experience rating for establishing premiums. -employer selects the type of insurance coverage under a group plan while a an individual selects the coverage for an individual policy. -individual underwriting and individual evidence of insurability are generally not required under a group plan.

Managed care plans

-HMOs, PPOs, and POS plans -comprehensive medical services to their members. -apply financial incentives that encourage providers to keep both the quantity and cost of services in check and motivate members to select cost-effective providers.

Classifications for group insurance

-Job duties -type of payroll -full time employees -length of service NOT allowable is sex or age.

PPO dental plan

-Obtain care from a select group of dentists ( lower copays and deductible.) -allows participants to get care from any dentist though coverage may be less with the non plan (out of plan) dentists

HMOs (health maintenance organization)

-Place special emphasis on preventative health care. -subscribers pay a fixed, periodic fee of the broad range of health care services provided.

Franchise Health Plans

-Provide health insurance coverage to members of an association or professional society. -They are issue to individual members; -association or society simple serve as sponsor for the plan -premiums rates are discounted.

comprehensive plan

-Provided by commercial insurance companies -operate like medical health insurance plans. -routine examinations and cleanings may be covered in full. -other routine care is covered only after the insured satisfies an annual deductible. -has a coinsurance.

comprehensive medical expense covers all the following

-Surgical fees -Hospital miscellaneous expenses. -hospital room and board

Twisting

-The act of persuading a policy owner to drop and replace an existing policy by misrepresenting the terms or conditions of another. -simply to induce the sale of a policy w/o any regard to the potential disadvantage of the policy owner. -Illegal and unethical. -misrepresenting the provisions of a policy owner's existing policy to promote the sale of another policy. -making an incomplete comparison of 2 different policies. -misrepresenting the terms of a proposed policy to the prospect.

consultant

-advises others about their insurance needs. -compensated by the people advised rather than by agents or insurers. -advise is not directly to the amount of the insurance sold. -independent contractor paid a fee from his client to provide advice about insurance.

Representations

-all statement in an application for life or health insurance are considered to be this. -applicant must act in good faith when making these. -insurer relies on them in determining whether to accept the app for coverage. May not be altered after insurance is in effect.

mutual companies

-also knowns as "participating companies." -policy owners participate in dividends. -does not have permanent stock.

health insurance may be written by the following

-casualty insurance -life insurance company -monoline companies that specialize in medical expense and disability insurance. NOT ANNUITY COMPANIES

major medical deductible maybe

-corridor -integrated -flat BUT NOT DECREASING

Part A Medicare

-covers cost of care in a skilled nursing facility as long as the patient was first hospitalized for 3 consecutive days.

disability income insurance

-covers loss of income resulting from accident or illness. -In contrast, the purpose of this is to provide periodic payments to an insured who cannot work because of disability. -contracts written on a residual basis.

Medicare

-covers treatment in a skilled nursing home facility for the first 20 days. -day 21-100 patient makes a copay. -no coverage at a skilled nursing for patient beyond 100 days. -after the deductible is met it covers first 60 days of hospitalization. -days 61-90 Medicare covers but the patient needs to contribute a daily amount. -91+ patients will tap into a lifetime reserve days up to 60 additional days with a higher amount of daily copayments totaling 150 days for 1 stay.

Unfair Claim Settlement Practices

-denying claims w/o conduct reasonable investigations based upon available information. -failing to acknowledge and act promptly upon communications with respect to claims -making a material misrepresentation to an insured about the payment of proceeds due to him. -failing to provide written response to a claimant's written request -failing to respond with the proper forms to claimants -failing to adopt standards for the proper investigation of claims. -misrepresenting any facts or policy provisions relating to coverage. -attempting to settle claims based of an application or other document that was altered w/o insurer's consent

Coordination of Benefits

-employer-sponsored plan is considered the primary payor and Medicare is secondary payor. -secondary pays what the employer sponsored plan does not cover.

Florida Law "small employers"

-employers with 1 to 50 employees. Majority need to live in FLorida sole proprietors, independent contractors and self employed individuals.

medicare supplement insurance

-fills the gaps in coverage left by medicare, which provides hospital and medical expense benefits for persons aged 65 and older. -coverage for the reasonable cost of the first 3 pints of blood -Plans A through L offer increasing premiums for comprehensive coverage. -customers need Medicare Part A -there is a 6 month open enrollment -cannot be denied coverage because of health problems -has a 30 day free look period.

disability buy-out

-generally longer than that for individual plans and may be as long as 2 years. -shorter elimination periods. -plans include the option to have benefits paid either periodically or in a lump sum at the end of a specified period.

Insurers on political contributions

-illegal to pay, offer, use money to help political parties, communities, organizations, or to further any political purposes.

Unfair Trade Practices Act

-inducing an insured, through misrepresentations, to drop existing insurance. -failing to pay a claim in a timely manner -application may be corrected with the applicant's consent -replacing a policy is lawful if done so according to the rule and regulations issued by the superintendent's office.

Insurer

-insurance producer who solicits insurance on behalf of an insurer represents the:

rebating

-involves giving applicant or newly insured something of value as an inducement to buy insurance. -illegal in some circumstances. -may be given to all insured within the same actuarial class. -agents schedule must be prominently displayed in public view in the agent's place of business. i.e. giving anything of value including a portion of the agent's commission may be done if specified

voidable contract

-is binding unless the party with the right to set it aside wishes to do so.

Group life insurance

-issued to employer employees given certificates of insurance as evidence of their coverage.

estoppel

-legal principle that precludes a person. It prevents someone from arguing something contrary to what they claimed before. -when the insurer is _______ from denying the claim.

insurable interest

-must exist at the inception of the contract. time of app -does not need to continue for duration of the contract or insured's death to claim proceeds.

financial prospectus of the insurance company

-not required during the marketing of the life insurance policy. -tied into the florida rules of disclosure.

state comprehensive health insurance plan

-offers an annually renewable policy major medical expense coverage. -provides coverage for hospitalization and medical service to eligible persons -cover persons who are not eligible for Medicare.

Stock Insurance Company

-owned by stockholders. -dividends declared are paid to the stockholders. -stockholders provide the capital for the company, and in turn share in the company's profits or losses. -stockholders elect board of directors. -stockholders may or may not be policy owner. i.e. buy shares but are not entitled to receive policy dividends.

Initial premium

-paid with applications, applicant satisfies all the conditions of the conditional receipt, and the policy is eventually issued as applied for. -policy needs to be delivered to applicant for coverage to take effect.

medical reimbursement benefitf

-percentage of the monthly income benefit. -it is only paid for injuries and in lieu of other benefits under the policy.

Tax treatment of medical expenses

-personal medical and dental expenses reimbursed by insurance are not deductible. -unreimbursed medical and dental expenses are deductible to the extent they exceed 10% of an individual's adjusted gross income. -benefits received under the individual Accident and health plan are not considered taxable income to the recipient.

Producer reponsibilities

-provide an agent's report to the insurer explaining what he observed that may not be detected by the home office. -ask an applicant to reconsider an answer. -best judgement is to be taken into consideration for difficult situations. -illegal for producers to change a response on a signed app w/o applicant consent.

Commissioner

-report any violations of insurance laws to the attorney general -conducting investigations of all domestic insurers. -reporting violations of insurance laws to the state police. -compliance with state laws. -examines insurers records. -reviewing annual statements. -may suspend an insurance producer's license for committing one of the following. a. using coercive practices while transacting insurance. b. making a false statement in the licensing application. c. misrepresenting the terms of an insurance contract.

Florida Chief Financial Officer

-service as head of the Department of Financial Services and member of Financial Services Commission. -Is an independently elected official. NOT appointed by governor -member of the Governor's cabinet -enforce Insurance Code and carryout duties set forth by it. -collect, propose, publish, or disseminate info regarding duties imposed upon the insurance code.

home health care

-services provided to insured at their residence. -must be prescribed by the person's attending physician as a part of a written plan of care.

COBRA (Consolidated Omnibus Budge Reconciliation Act of 1985 ) allow continued coverage for

-terminated employees of companies with at least 20 employees -divorced spouses -employees who are laid off. NOT COVERED: EMPLOYEES FIRED FOR GROSS MISCONDUCT.

if a business entity purchases disability insurance on the lives of the business owners to fund a disability buy-out

-the business cannot take a deduction for the premiums paid. -proceeds are exempt from regularly calculated income tax. -premiums are non deductible.

Agent Responsibilities to policyowner

-the policy and its provisions -any applicable rate ups that apply to the policy. -any riders that have been attached to the policy.

consideration

-the price requested and given in exchange for a promise or an act. -In terms of insurance, it is the price of the contract, or the premium, the insured pays to keep the contract and its promised benefits in force. -lists effective date of the contract. i.e. price of the contract(premium)

Multiple-employer welfare association (MEWA)

-type of multiple-employer trust or MET -cover union employees, -self funded -tax exempt status -employees covered by this are required by law to have an employment related bond.

reciprocal insurer

-unincorporated group of subscribers who provide reciprocal insurance among themselves.

waiver

-voluntary relinquishment of a known right. -refuses a legal right under a an insurance policy, it cannot deny a future claim based on violation of that right.

Statue Legislatures

-write insurance laws.

Elective Continuing education course consist of how many hours?

19 hours.

Incontestable policy

2 years

how many hours do all agents need of Continuing Education every 2 years in Florida?

24 hours

How many hours of Law and Ethics are required for the CE course?

5 hours

individual practice association model HMO

A group of individual physicians with each physician operating from his or her own office paid a fee-for-service basis with the fees negotiated in advance.

franchise insurance

Administered by group methods to individuals with or without evidence of insurability. issued as individual accident and health insurance policies distributed on a mass merchandising basis.

representations

All statements made by an applicant in an application for life insurance generally are considered to be: only written statements are considered this.

neighbor

An individual may purchase a life insurance policy on all of the following persons EXCEPT: a)dependent b)spouse c) business partner d) neighbor

After comparing policies, Carol finally found an insurance policy she would like to purchase. she submits the app with the initial premium:

Carol has made an offer that the insurance company who can accept or reject.

Medical Savings Accounts (MSAs)

Created to help employees for small employers or self employed individuals pay for medical care expense. -They are tax free accounts set up with financial institutions. -they consist of a high deductible health plan and a savings account. -funds can be withdrawn tax free to pay for qualified medical expenses

PPOs are contract with:

Employers. insurers, and health insurance benefits providers. -system of doctors and hospitals in a designated area contracted with insurers to provide medical services at a prearranged medical cost. Government programs CANNOT USE PPOs i.e. Medicare, Medicaid, Marketplace.

Florida Employee Health Care Access Act include

Governs group health insurance provisions provided by insurers or HMOs to small employers. Small group health benefits: -plan must be issued on a guarantee-issue basis -for small employers with 2-50 employees, preexisting exclusions are limited to 12 months for conditions that manifested themselves during the previous 6 months. -within certain limits, are allowed to rate 1 employee groups separately from the rating pool for groups with 2-50 employees for life insurance. Passed in 1992 and amended in 1993

prepaid basis

HMO managed health care and the associated costs.

closed panel

HMO that provides health care services from a limited number of health care providers chosen by the HMO

Impairment rider has to be attached to a health policy

Has been explained and the applicant's signature has been obtained. Simply placing in the applicants hands or mailing it does not constitute delivery.

Director

Has the authority to investigate possible unfair trade practices and fine, suspend, or revoke violators' licenses if the practices continue.

Controlled Business

Health insurance written on: -themselves -agent's family -agent's spouse -agent's business partner or family business partners. -agent's company that he works selling to co workers. Florida law allows for an agent to write controlled business if the amount of other similar business is at least equal to the amount of controlled business written. Failure to company with Florida's status regarding controlled business subject to the agent's license to revocation.

conditional contract

Insurance is a contact that has obligations of the insurance company that hinge on the certain acts of the policy owner, beneficiary, or both such as payment of premiums and furnishing proof of loss.

capitation

Method of payment in which a provider is paid a specific monthly fee for each subscriber.

small employer group

Must not use case characteristics other than age, geographic location, and family composition. it may not use any rating factors other than actual claims experience without prior approval of the Commissioner. i.e. all these characteristics are acceptable from above except 10 year medical history is not a characteristic.

Florida rules of disclosure

Prospective buyer of health insurance -a "Buyer's guide" -policy summary -a 10 day free look period.

long term care

Refers to care provided for an extended period of time, normally more than 90 days. Depending on the severity of the impairment, assistance may be given at home, at an adult care center, or in a nursing home. This pays for rehabilitative or recuperative care needed after a long illness or hospital.

Health insurance policy exclusions:

Specify the conditions, times, and circumstances under which the insured is not covered by the policy. -war, acts of war -self-inflicted injuries -military service -overseas residence. injured out of state is NOT this

Benefits paid for customary charges incurred during examination by an ophthalmologists and optometrist are included in:

Vision Care insurance-included with group health plan

UCR-usual, customary, and reasonable

When a surgical benefit are not listed by a specific dollar amount in a schedule, a policy will pay what is considered _______ based on geographic area.

a) 30 days

a licensed agent must notify the Department of Financial Service of his change of address within how many days? a)30 days b)10days c) 15 days d) 60 days

public adjuster

acts on behalf of insured in settlement of a claim for loss of damage under an insurance policy

point of service plan (POS)

along with HMOs both use primary care physicians as gatekeepers to provide cost control. Members of an HMO can generally not use health care providers outside the organization. HMO has employees, while this service plan generally contracts with independent providers. HMOs are nonprofit and this plan is for profit.

network model HMO

an HMO that contracts with several medical groups to increase accessibility to providers as a convenience to subscribers. Each of the medical groups is paid a capitation fee to provide services to its Star subscribers.

Florida Healhthy Kids Program

child is eligible if he is uninsured, between 5-18, not eligible for Medicaid, not an ineligible noncitizen of Florida, or not a child of state employee.

staff model HMO

contracting physicians that are paid employees working on the staff of the HMO. Operate at the clinic setting at the physical facility.

group model HMO

contracts with an independent medical group that specializes in a variety of medical services in order to provide those services to its HMO subscribers.

long term care

described as broad range of medical, personal, and environmental service designed to assist individual who have lost their ability to remain completely independent in the community.

social security benefits are financed by a special tax paid by

employees, employers and those who are self-employed.

Medical expense policies typically pay a benefit as a reimbursement of actual expenses.

ie. a $1,000 a day for 10 day of hospitalization.=$10,000..policy will pay full amount.

misrepresentation

if a producer states that policy dividends are guaranteed when in fact they are not, this is an example of: *When an agent tells a prospect that benefits, conditions, rating or advantages exist in a product when in fact they don't.

inflation protection

increases benefits to keep up with the anticipated cost increases for long term care services is said to have:

workers compensation

insurance pays for care related to a worker's injuries, disabilities, or illness incurred the job regardless of fault. -benefits include medical care costs and disability income. -all states have workers' compensation laws. -laws are designed to return injured persons to work. -most states offer disabled employees to receive workers comp Monthly.

Business overhead expense

insurance reimburses businesses for actual overhead expenses in the event the business owner becomes disabled. Actual expenses total $1500.

insurance transaction

insurer is represented by the agent NOT the broker

fraternal benefit society

it consist of Lodge system, managed solely for the benefit of its members, has representative form of government and makes provisions for the payment of benefits. I.E. NO CAPITAL STOCK (NO PROFIT-MAKING)

disability benefit payments

payments attributed to employee contributions are not taxable but benefit payments that are attributed to employer contributions are taxable. -often coordinate and reduce, the payment benefits if social security and other government benefits are paid. i.e. when a group disability insurance plan is paid entirely by the employer, benefits paid to disable employees are:

open panel plans

permit insureds to receive dental care from any dentist.

preexisting condition

regarding long term care insurance, the existence of symptoms that would cause an ordinarily prudent person to seek diagnosis or treatment, or a condition for which medical advice or treatment was recommended by or received from a provider of health care service within six months before the effective date of an insured's coverage is known as:

the purpose of medical expense insurance is to:

reimburse the insured for expenses incurred for medical care, hospital care, and related services. In contrast, the purpose of disability income insurance is to provide periodic payments to an insured who cannot work because of disability. Long term care insurance pays for rehabilitative or recuperative care needed after a long illness or hospital stay. -written on a residual basis.

Choice of beneficiary

this is a policyholder right which can be changed by the beneficiary without consent of the beneficiary or insurer unless the original designation is irrevocable.

broker

transacts insurance on behalf of another person not on the insurer's behalf.

a)through a federally funded clinic

when a policy covers chemotherapy cancer hormone treatments and other approved cancel treatments, benefits are available when treatment is received at all of the following except: a)through a federally funded clinic b) through outpatient treatment at a hospital c)through hospital inpatient treatment. d)in a doctor's office.