Insurance Flashcards
Social Security waiting period for disability
5 months
FSA
No FICA, No FUTA
Single Life
(Pure Life)
highest form of payment
2 parts to FSA
Medical & Dependent Care
HO-6 Loss of Use Coverage
40% Coverage C
Premiums on a Split Dollar policy
NOT tax deductible
Is Alzheimers excluded from long-term care?
No
Commercial property replacement cost %
90%
Irrevocable beneficiary on a life insurance policy
The policy owner cannot change the beneficiary’s designation without the beneficiary’s consent
Residual Disability
a proportionate benefit is paid to an insured whose earned income is reduced because of a disability
Under the Health Insurance Portability and Accountability Act (HIPAA), a chronically ill person is unable to perform _______ activities of daily living (ADLs) for a period of at least ______ days.
2, 90
Punitive damages
Punitive damages are designed to punish the negligent party
Part B Auto
Medical Payments
Part D Auto
Damage to your auto
HSA income tax consequences
HSA distributions used to pay for qualified medical expenses are excluded from gross income. Employer contributions to an HSA are excluded from employee gross income. Deductions are taken above the line and do not need to be itemized.
long term care free look period
30 days
long term care expected loss ratio
60%
Which is the most expensive death benefit, A or B?
Option B
Coverage F Homeowners
Medical payments to others. Does not cover the insured or family of the insured
6 ADL’s
The 6 ADLs are eating, bathing, dressing, transferring from bed to chair, using the toilet, and maintaining continence.
Human life value
Human life value is the family’s share of the earnings of the breadwinner. The projected value of the breadwinner’s future earnings is discounted to its present value to determine the human life value.
To receive workers’ compensation benefits, two eligibility requirements must be met:
the disabled person must work in a covered occupation and the worker must have a job-related accident or disease.
phantom stock plan
The plan pays benefits in cash and has an exercise date that is controlled by the employer. It is based on the value and transactions of an imaginary stock which mirrors the value and transaction of the employer’s stock.
Which of the following settlement options offers the greatest flexibility in life insurance policies?
interest only option
A PAP with limits of 200/500/50
provides liability coverage of up to $200,000 for bodily injury to one person, coverage of up to $500,000 total for all persons injured in an accident, and $50,000 for property damage, all based on a single accident.
When a beneficiary receives the death benefit from a life insurance policy funded within a qualified plan
the taxable portion equals the cash surrender value minus any costs included in the participant’s income during the participant’s life
Moral Hazard
A moral hazard occurs when dishonesty causes a loss or causes the amount of the loss to be overstated on a claim. Intentionally causing a loss is an example of a moral hazard.
partial disability benefits
are paid at a reduced rate
Residual disability benefits
Residual disability benefits are paid on a proportional (e.g., 50%) basis to an insured whose income is reduced because of a disability.
what does the traditional net-cost comparison method ignore?
the time value of money
Who does Malpractice insurance cover?
Malpractice insurance covers professionals whose negligence primarily causes physical harm, such as physicians, dentists, and physical therapists.
Who does Errors and omissions insurance cover?
Errors and omissions insurance covers professionals whose negligence primarily causes financial harm, such as accountants, lawyers, and financial planners.
what is the purpose of the grace period?
The purpose of the grace period is to allow the insurance policy to remain in effect even though the premium payments are in arrears.
Torts
Torts include all civil wrongs not based on contracts and are a broad residual classification of many private wrongs against another person or organization. Torts occur independently of contractual obligations and can result from intentional acts or omissions, strict liability imposed by law, or negligence. Torts are not considered criminal matters but rather private, civil wrongs.
Part time employees for COBRA
Each part-time employee counts as a 1/2 employee for purposes of the 20-employee rule
The collateral source rule
The collateral source rule provides that damages assessed against a negligent party will not be reduced simply because the injured party has other sources of recovery available.
Who may ISO’s be granted to?
Only employees
Who may nonqualified stock options (NQSOs) be granted to?
More broad, family member of employee, independent contractor, a beneficiary of an independent contractor or employee, etc.)
What do special damages represent?
measurable losses, such as medical bills
