Chapter 9. Other Health Insurance Concepts Flashcards
When a business receives benefits from its key person disability insurance, how are those benefits taxed?
The key person disability insurance benefits are received tax free.
What is subrogation in health insurance?
The legal process that gives the insurer the right to seek recovery from a third party that was responsible for the loss after the insurer has paid the insured for the loss
According to the Coordination of Benefits provision, if both parents have coverage for a child from their employers’ policies, which policy will pay first?
The order of payment will be determined by the birthday rule: the coverage of the parent whose birthday is earlier in the year will be considered primary
What is the tax advantage of the employer paying premiums for its employees for disability income insurance?
Premiums are deductible as a business expense
If the insureds share in the cost of health insurance premiums with the employer, this would be known as what type of group health plan?
Contributory
What type of health insurance covers partners or corporate officers of a closely held business?
Disability buy-sell
Under a fully contributory health plan, how are benefits received by the employee?
Income tax free
What are the four types of workers compensation benefits?
Medical, income, rehabilitation and death benefits
Under what employer-provided plan are the benefits taxable to an employee in proportion to the amount of premium paid by the employer?
Disability income
What type of insurance covers an employee who is hurt on the job?
Workers compensation
What is the purpose of managed care health insurance plans?
To control health insurance claims expenses
How are benefits received by the business from a key person disability insurance?
Income tax free
What type of health insurance is sold to small business owners to reimburse them for the overhead expenses?
BOE - Business Overhead Expense insurance
In health insurance, when would an excess plan pay benefits?
After the primary plan has paid its full promised benefit, the excess plan will pay the balance
How are individually-owned disability income benefits taxed once received by the insured?
Disability benefits are not taxed; they are received income tax free
