Other heath insurance concepts

The mode of premium payment

Is defined as the frequency and the amount of the premium payment.

S is a sole business proprietor who owns medical expense plan. What percentage of the cost of the plan may he deduct?

100%

Under which of the following employer-provided plans are the benefits taxable to an employee in proportion to the amount of premium paid by the employer?

Disability Income

Which of the following statements about occupational vs. nonoccupational coverage is TRUE?

Disability insurance can be written as occupational or nonoccupational.

A husband and wife are insured under group health insurance plans at their own places of employment, and as dependents under their spouse's coverage. If one of them incurs hospital expenses, how will those expenses likely be paid?

The benefits will be coordinated.

Which of the following statements regarding the Change of Beneficiaries Provision is false?

The policyowner has the right to change beneficiaries in any case.

Premiums paid by self-employed sole proprietors or partners for medical expense insurance are

Totally tax deductible.

Which of the following premium modes would result in the highest annual cost for an insurance policy?

Monthly

In an individual long-term care insurance plan, the insured is able to deduct the premiums from taxes. What income taxation will be imposed on the benefits received?

No tax

The coverage provided by a disability income policy that does not pay benefits for losses occurring as the result of the insured's employment is called

Nonoccupational coverage.

Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability?

Residual disability

Premium payments for personally-owned disability income policies are

Not tax deductible.

The sole proprietor of a business makes a total salary of $50,000 a year. This year, his medical expenses have reached a total of $75,000. What amount may the sole proprietor deduct in regards to his medical expenses?

$50,000

An insured is covered under 2 group health plans - under his own and his spouse's. He had suffered a loss of $2,000. After the insured paid the total of $500 in deductibles and coinsurance, the primary insurer covered $1,500 of medical expenses. What amount, if any, would be paid by the secondary insurer?

$500

Individuals who itemize deductions can claim deductions for medical expenses not covered by health insurance that exceed what percent of their adjusted gross income?

10%

When a disabled dependent child reaches the age limit for coverage, how long does the policyowner have to provide proof of dependency in order for the dependent to remain covered under the policy?

31 days

Disability income coverage specifies that the policy covers the insured if he is unable to perform any job for which he is qualified. In this case, total disability is defined as

Any occupation more restrictive than other definitions.

Under a Key Person disability income policy, premium payments

Are made by the business and are not tax-deductible.

Which of the following is not true of Disability Buy-Sell coverage?

Benefits are considered taxable income to the business.

Which of the following is NOT true regarding Workers Compensation?

Benefits are offered by the insurer.

Which of the following applies to partial disability benefits?

Payment is limited to a certain period of time.

Which of the following describes taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable.

Which of the following is CORRECT regarding Business Overhead Expense insurance?

Premiums are tax deductible.

Which of the following are the main factors taken into account when calculating residual disability benefits?

Present earnings and earnings prior to disability

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true?

The group plan will not pay because the employee was injured at work.

Which of the following is NOT true regarding partial disability?

This is a form of insurance that covers part-time workers.

Under what condition are group disability income benefits received by an employee NOT taxable as income?

When the benefits received are equal or less than the employee's percentage of the contribution.

Workers compensation insurance covers a worker's medical expenses resulting from work related sickness or injuries and covers loss of income from

Work-related disabilities.

A brain surgeon has an accident and develops tremors in her right arm. Which disability income policy definition of total disability will cover her for all losses?

"Own occupation" - less restrictive than other definitions

An insured has a primary group health plan and an excess plan, each covering losses up to $10,000. The insured suffered a loss of $15,000. Disregarding any copayments or deductibles, how much will the excess plan pay?

$5,000

All of the following statements concerning workers compensation are correct EXCEPT

A worker receives benefits only if the work related injury was not his/her fault.

Concerning group Medical and Dental insurance, which of the following statements is INCORRECT?

Employee benefits are tax deductible the year in which they were received.

Which statement accurately describes the Change of Beneficiary provision?

Any policy that has a death benefit must also have a Change of Beneficiary provision.

All of the following are true of the Key Person disability income policy EXCEPT

Benefits are considered taxable income to the business.

An individual is insured under his employer's group Disability Income policy. The insured suffered an accident while on vacation that left him unable to work for 4 months. If the disability income policy pays the benefit, which of the following would be true?

Benefits that are attributable to employer contributions are fully taxable to the employee as income.

Which of the following is INCORRECT concerning taxation of disability income benefits?

If paid by the individual, the premiums are tax deductible.

Under workers compensation, which of the following benefits are NOT included?

Legal benefits

A woman's health insurance policy dictates which doctors she is allowed to see. Her health providers share an assumed risk for their patients and encourage preventive care. What best describes the health system that the woman is using?

Managed care

Which of the following is correct regarding the taxation of group medical expense premiums and benefits?

Premiums are tax deductible and benefits are not taxed.

Workers Compensation benefits are regulated by which entity?

State government

A provision found in insurance policies which prevents the insured from collecting twice for the same loss is called

Subrogation.

A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim,

The insurance through his company is primary.

Which of the following definitions would make it easier to qualify for total disability benefits?

The more liberal "own occupation"

A policyowner names his five children as primary beneficiaries and his wife as a contingent beneficiary. If the policyowner and one of his children die, who would receive policy benefits?

The remaining 4 primary beneficiaries

A policyowner has a health insurance policy with his wife listed as the primary beneficiary. He would like to change the primary beneficiary to his sister. Which of the following is true?

Unless the policy designated the current beneficiary as irrevocable, the policyowner can make the change at any time.

Which characteristic does NOT describe managed care?

Unlimited access to providers

When may an insured deduct unreimbursed medical expenses paid under a long-term care policy?

When the expenses exceed a certain percentage of the insured's adjusted gross income