Chapter 9 - Other Insurance Based Policies

Question 1

What is a moratorium?

Answer 1

Moratorium is where a client of foregoes immediate medical evidence, possibly including medical examination, which enables the contract to be set up quickly and avoid inconvenience of medical examination for the client. However, underwriting is not forgotten as they will have to undergo the underwriting process when a claim is made, and at that point, the insured may find that they have little or no cover. This is superficially attractive to ensure advising clients like due to its speed.

Question 2

What is the difference between acute conditions and chronic conditions

Answer 2

Acute are characterised by the rapid onset and are usually amendable secure. Two minute is normally of short duration, and will often resolve the condition more or less fully such as a removal of an appendix.

Chronic conditions are long-lasting and usually incurable, and so not necessarily susceptible to successful treatment. This can be such as some forms of cancer, diabetes, or asthma.

Question 3

Does personal accident and sickness, cover mental impairment

Answer 3

No

Question 4

Define short-term general insurance policies and give examples

Answer 4

They are all yearly or monthly renewable contracts, an insurer cannot decide each year whether to renew and on what terms and on what premium these policies are usually subject to insurance premium tax at 12% 

Personal accident and sickness insurance

Private medical insurance

Health, cash, plans and dental plans

Mortgage, payment, protection insurance, and payment protection insurance

Accident, sickness and unemployment insurance

Question 5

How is personal accident and sickness insurance taxed

Answer 5

Subject to insurance, premium tax, put the benefits of paid tax free

Question 6

What does the Association of British insurers statement of best practice for sales of private medical insurance do

Answer 6

Sets out rules that are mandatory for ABI members companies who choose to comply with them

Question 7

No

Question 8

What are for a Events, normally covered by personal accident and sickness insurance

Answer 8

Death, permanent disablement, lots of an eye, loss of a limb

Question 9

To what tax or general insurance policy subject

Answer 9

Insurance, premium tax?

Question 10

Describe the tax treatment of private medical insurance group cover paid for by an employer

Answer 10

The premiums paid by the employer or taxable on the employee as a benefit in kind, but allowable as a business expense for the employer.

Claim payments are tax-free

Question 11

Which types of mortgages usually get mortgage payment protection insurance?

Answer 11

Mortgages of a main residence in the UK by someone under the age of 65, and he is employed or self-employed

Question 12

What are the three main types of PMI plans?

Answer 12

Basic, standard and comprehensive

Question 13

What is the minimum period of time that a 40-year-old claimant would need to be unemployed in order to become entitled to support from mortgage interest loan on a mortgage loan affected

Answer 13

39 weeks

Question 14

Which types of medical conditions is a private medical insurance policy designed to cover?

Answer 14

Acute conditions only

Question 15

How long must an accident sickness, and unemployment policy be active before it can be claimed the benefits?

Answer 15

Two years

Question 16

Private medical insurance premiums are being paid by the employer for an employee who is a higher rate taxpayer. What is the employees tax position with regard to these premiums?

Answer 16

The employee must pay income tax at his marginal rate

Question 17

What is the most appropriate policy for an employee who is concerned, only with maintaining her mortgage repayments over the short-term should she become ill?

Answer 17

A mortgage payment protection insurance policy, the key word here is short-term as employees will likely be due statutory sick pay.

Question 18

When a private medical insurance policy set up with a moratorium basis, what does this mean?

Answer 18

A typical moratorium excludes any conditions for which the applicant has received treatment for in the past five years. These conditions were made excluded for two years if no further treatment is required. 

Question 19

What level if any of PMI would typically pay for parent to stay with a young child in hospital

Answer 19

Comprehensive

Question 20

Maureen has taken out a budget plan, private medical insurance policy, if she makes a claim, which costs is unlikely to be covered?

Answer 20

Recover the very minimum amount and so it’s highly unlikely that home nursing will be available

Question 21

When making a claim for becoming unemployed on a mortgage payment to text insurance policy, what is the very maximum out of time for which benefits will usually be paid

Answer 21

24 months

Question 22

Under accident, sickness and unemployment insurance, how are the payments of the premiums and tax treatment of the benefits done

Answer 22

There is no tax relief of the premiums, and the benefits are tax-free

Question 23

A mortgage payment protection insurance provider can cancel the policy at a minimum of how many days notice

Answer 23

90 days

Question 24

What is a restriction of including children on accident sickness policy

Answer 24

They would usually be restricted to accidents only

Question 25

How many days notice must an insurer give if they want to make an amendment to the mortgage payment protection policy

Answer 25

30 days

Question 26

Callum , mortgage payment protection insurance policies be transferred to a new mortgage

Answer 26

Yes

Question 27

Mortgage payment to text insurance for typically require that the proposal to be what

Answer 27

Employed or self-employed for at least 16 hours a week

Question 28

Is outpatient treatment generally included in PMI cover

Answer 28

Yes

Question 29

When underwriting mortgage payment section insurance, normally what is the case

Answer 29

Pre-existing medical conditions are excluded

Question 30

A payment from a private medical insurance policy would be paid how

Answer 30

Tax-free

Question 31

What is the tax position regarding mortgage payment protection insurance

Answer 31

There is no tax relief on premiums and no tax on benefits