Chapter 8 Flashcards
What are Blanket Health Policies?
These policies cover a group exposed to the same risks, with a continually changing composition. Examples include coverage for airline passengers or school students. No certificates of coverage are issued in a blanket health plan.
What is a Certificate of Insurance?
A document issued by an insurance company/broker to verify insurance coverage for individuals under specific conditions. The group (typically the employer) is the policy owner and maintains a master policy.
What is a Contributory Plan?
A group insurance plan where both the employer and employees contribute to the cost. Generally, 75% of eligible employees must be insured.
What is a Conversion Privilege?
A privilege allowing a policy owner to elect a new policy before the original expires, continuing insurance coverage. Conversion can be at attained age or original age.
What are Credit Policies?
Policies designed to help pay off a loan if the insured is disabled or dies. They provide monthly benefit payments equal to loan payments or a lump-sum to the creditor.
What is Franchise Insurance?
A life or health insurance plan for groups with individual policies that are uniform in provisions but may differ in benefits. Typically written for groups too small for regular group coverage.
What is a Master Policy?
Issued to the employer under a group plan, it contains all insuring clauses defining employee benefits. Individual employees receive certificates outlining coverage highlights.
What is a Non-Contributory Plan?
An employee benefit plan where the employer bears the full cost of benefits, covering 100% of eligible employees without employee contributions.
What does Persistency mean in insurance?
The percentage of policies an insurer has in force after a specified period. Higher persistency indicates stability and profitability.
