Chapter 9 - Short Term Insurance Flashcards
How does a Personal Accident and Sickness (PAS) policy work?
Pays out if the insured suffers an accident or is off work due to sickness. Most contracts are annual but can be shorter (holiday).
What does a Personal Accident and Sickness (PAS) policy generally cover?
- Death
- Permanent disablement
- Loss of eye, limb or digit
- Other specified accidents or injuries
What does a Personal Accident and Sickness (PAS) policy generally exclude?
- Being under the influence of drugs/alcohol
- Wilful exposure to needless danger
- Pre-existing conditions
- Hazardous pursuits
- Normal pregnancy
- War invasion
Is there any tax relief on the premiums of a Personal Accident and Sickness (PAS) policy?
No, not tax benefits at all
If part of a non contributory group policy how is a Personal Accident and Sickness (PAS) policy taxed?
As a benefit in kind on the employee and an allowable business expense for the employer
A customer is asking if a Personal Accident and Sickness (PAS) policy would be a low cost alternative to PHI or Critical Illness. You inform them that……
PAS is not a substitute for PHI or CIC which are far more comprehensive insurances.
What is Private Medical Insurance (PMI)?
An insurance policy that provides cover against the cost of medical treatment. PMI is an indemnity policy which means you pay for the treatment yourself and then claim it back from the insurer.
What is the difference between acute and chronic medical conditions?
Acute medical conditions – rapid onset and are usually can be cured. Treatment is normally short and resolves the condition. Having an appendix out.
Chronic medical conditions – long lasting and usually incurable. May not be possible to treat, e.g. asthma or diabetes.
Are PMI policies aimed at treating acute or chronic medical conditions?
PMI is aimed at acute conditions that can be treated.
What are the 3 types of PMI plans available?
Basic, Standard, Comprehensive
What would a basic PMI plan typically cover?
These are budget plans with no extra benefits. Can have an high excess to reduce costs further. Cover is usually restricted to costs of accommodation, drugs, dressings and doctors fees. May be limits on costs.
What would a standard PMI plan typically cover?
Wider cover than basic plans. Claim periods will be longer with higher limits, wider choice of hospitals, outpatient treatment likely to be covered. Consultant fees, diagnostic tests and physio may be covered. Psychiatric care may also be covered.
What would a comprehensive PMI plan typically cover?
Fullest cover but most expensive. Longest claim periods and best choice of hospitals. Home nursing and ambulance costs may also be covered. May also cover thongs like dental treatment and travel abroad.
What is moratorium underwriting with regard to PMI policies?
A short term ban on pre-existing (within 5 years) conditions. Meaning they are usually not covered for the first 2 years. A check up may count as treatment though so the condition may end up never be covered
With regards to claims on PMI policies it is essential that clients do what before proceeding with any treatment?
It is vital that a client checks with their insurer that they are covered before proceeding with any treatment. It could be disastrous to proceed with treatment to learn at a later date they are not covered.
