Health Insurance - TX

Question 1

Insurance providing payment if the insured’s death results from an accident or if the insured accidentally severs a limb above the wrist or ankle joints or permanent blindness

Answer 1

Accidental death and dismemberment (AD&D)

Question 2

In the proof of loss provision, thee insured must submit written proof of loss within this timeframe

Answer 2

90 days

Question 3

A definition of total disability. The insured must be unable to perform any job for which he is “reasonably suited by reason of education, training, or experience.” It is more difficult for the insured to collect benefits under this definition

Answer 3

Any occupation

Question 4

Insurance premiums will always be unequal to the benefits received. Benefits will usually be larger than the premium.

Answer 4

Aleatory

Question 5

Situation wherein one party (an agent) has the power to act for another (the principal) in dealing with third parties.

Answer 5

Agency

Question 6

Selection against the company. Tendency of less favorable insurance risks to seek or continue insurance to a greater extent than others. Also, tendency of policy owners to take advantage of favorable options in insurance contracts

Answer 6

Adverse selection

Question 7

Accident policies require that claims must result from an accident, rather than illness. I.e. a dismemberment policy will not pay for amputation of a diseased limb.

Answer 7

Accidental Means provision

Question 8

Medical care leading to recovery which is received on a daily basis

Answer 8

Skilled nursing care

Question 9

Managed care organizations may control hospitalization costs by these methods: 1) Prospective review: Pre-approval before admission 2) Concurrent review: Continuing review during the period of hospitalization

Answer 9

Utilization Review

Question 10

A department found within an insurance company that reviews applications to evaluate risk and eliminates those that do not meet standards

Answer 10

Underwriting

Question 11

Person who is considered an under-average or impaired insurance risk and is charged a higher than standard premium

Answer 11

Substandard risk

Question 12

Lost of cash allowances payable for various types of benefits which does not reimburse the insured for actual expenses but pays what is listed

Answer 12

Scheduled benefit

Question 13

Limits the maximum out-of-pocket expense an insured must pay for health care and once this threshold has been met, the health insurance policy covers all expenses for the remainder of the year at 100%

Answer 13

Stop-loss provision

Question 14

Definition of disability where the insured is unable to work

Answer 14

Total disability

Question 15

A unique characteristic of insurance, stating insurers are required by law to pay legitimate claims where the policyowner is not required by law to pay a premium. Only the insurer makes a legally enforceable promise

Answer 15

Unilateral

Question 16

The insurer excludes a specified preexisting condition

Answer 16

Exclusion rider

Question 17

An insurance policy provision stating the rules in which both the Insurer and insured will follow and includes the policy, application, and any attached riders

Answer 17

Entire contract provision

Question 18

The specific authority given in writing to the agent in the contract of agency

Answer 18

Express authority

Question 19

The method of establishing the premium for a group based on the group’s previous claims experience

Answer 19

Experience rating

Question 20

A status of complete eligibility where a worker has paid social security taxes for at least 40 quarters of covered employment. Social Security benefits include; death benefits, retirement benefits, disability benefits, and Medicare benefits

Answer 20

Fully insured

Question 21

An act of deceit; concealment or misrepresentation of a material fact

Answer 21

Fraud

Question 22

Any factor that gives rise to a peril; making the situation more dangerous

Answer 22

Hazard

Question 23

Insurance contract where the insurer may not cancel the contract as long as premiums have been paid. the insurer is only entitled to an increase of premiums if the increase applies to all insureds in the same class

Answer 23

Guaranteed renewable