Introduction to Health Insurance Chapter 12 1-48

Question 1

Kurt’s medical expense policy states that it will pay him a flat $50 a day for each day he is hospitalized. The policy pays benefits on which basis?

A. service

B. partial

C. indemnity

D. reimbursement

Answer 1

C

Question 2

A health insurance plan may pay benefits for all the following except

A. nursing home care

B. over the counter drugs

C. a disabling injury or sickness

D. dental work

Answer 2

B

Question 3

Limited plans are characterized by all of the following except

A. limited perils

B. very broad or open perils

C. limited benefits

D. notice to the insured

Answer 3

B

Question 4

Which of the following is not a basic form of health insurance coverage?

A. accident only

B. limited pay health

C. medical expense

D. disability income

Answer 4

B

Question 5

Marco’s medical expense policy states that it will pay a flat $75 per day for room and board for each day of hospitalization. The policy pays benefits on which basis?

A. reimbursement

B. service

C. indemnity

D. invoice

Answer 5

C

Question 6

All of the following are examples of government insurance except

A. medicaid

B. medicare

C. blue cross and blue shield coverage

D. social security disability

Answer 6

C

Question 7

Hearing aids might be covered under what type of health policy?

A. hospital indemnity

B. prescription drug

C. shore-term medical expense

D. hearing insurance

Answer 7

D

Question 8

All of the following are types of limited benefit policies except

A. accident-only

B. umbrella

C. credit disability

D. vision

Answer 8

B

Question 9

Which of the following entities would not be offered a blanket health insurance policy?

A. the employees of a factory

B. a soccer team

C. an airline

D. a college

Answer 9

A

Question 10

Don just bought a new car. On the way home from the dealer, he had an accident and was disabled. Under the credit disability plan that he purchased at the time he picked up the car, the insurer will pay

A. benefits to Don to meet his living expenses

B. benefits to cover Don’s medical expenses

C. benefits directly to the lender to cover Don’s car payments while he is disabled

D. a lump sum to pay off the car loan

Answer 10

C

Question 11

Which of the following falls under the definition of a limited policy?

A. a prescription drug plan

B. long-term care insurance

C. a flat-benefit disability policy

D. accidental death and dismemberment (AD&D) insurance

Answer 11

A

Question 12

Which of the following is the best reason to purchase a vision care policy?

A. to obtain coverage that will pay 100% of routine vision care

B. to help pay the cost of medically necessary eye surgery

C. to obtain coverage that will pay for corrective surgery

D. to supplement existing major medical coverage

Answer 12

D

Question 13

When compared to the premiums for major medical expense coverage policies, the premiums for dread disease policies are typically

A. about the same

B. higher

C. identical

D. lower

Answer 13

D

Question 14

Dread disease policies generally cover diseases that

A. do not occur frequently, but involve significant costs when they do occur

B. occur frequently, and involve significant costs when they occur

C. do not occur frequently, and do not involve significant costs when they do occur

D. occur frequently, but do not involve significant costs when they occur

Answer 14

A

Question 15

Which of the following is not a common health insurance exclusion?

A. cosmetic surgery to reduce wrinkles

B. medical care after the insured breaks her arm while at work

C. plastic surgery to repair scar tissue

D. treatment for burns sustained while the insured was committing arson

Answer 15

C

Question 16

Which of the following policies pays a fixed hospital benefit directly to the insured, regardless of the actual hospital expenses incurred?

A. basic hospital

B. industrial health

C. supplementary major medical

D. hospital indemnity

Answer 16

D

Question 17

Which of the following situations involves a loss that would typically not be excluded under a health insurance policy?

A. the insured is injured in combat while serving in the military

B. the insured is injured with a self-inflicted injury

C. the insured is injured while vacationing in a state that is not her state of residence

D. the insured intentionally injures himself while committing a felony

Answer 17

C

Question 18

Vision coverage includes all of the following coverages except

A. loss of sight caused by disease

B. the cost of lenses and frames

C. contact lenses

D. eye examinations

Answer 18

A

Question 19

What is credit disability insurance?

A. disability insurance on a debtor

B. disability insurance that is paid for with a credit card

C. life insurance on the life of a creditor

D. homeowners insurance for a mortgagee

Answer 19

A

Question 20

Agnes purchases a round-trip travel accident policy at the airport before leaving on a business trip. Her policy would be which type of insurance?

A. limited risk

B. industrial health

C. credit accident and health

D. business overhead expense

Answer 20

A

Question 21

What kind of policy provides coverage only for death, dismemberment, disability, or hospital and medical care caused by accidents?

A. accident-only policy

B. specialized death policy

C. Medicare supplement policy

D. Major medical type II policy

Answer 21

A

Question 22

Credit health insurance

A. provides payments on loans if the debtor dies

B. covers both debtors and creditors

C. covers creditors only

D. provides payments on loans that become due while the debtor is disabled

Answer 22

D

Question 23

Which of the following statements regarding blanket health insurance is correct?

A. coverage is for all events occurring within a specific or limited period

B. it usually provides benefits for both accidents and sickness

C. new members of a group do not need to fill out an application

D. blanket health insurance benefits for a volunteer fire department require individual applications and underwriting

Answer 23

C

Question 24

Exclusions for pre-existing conditions help to avoid

A. insuring persons who are accident prone

B. claims for long hospital confinements

C. more complicated underwriting procedures

D. adverse selection against an insurer

Answer 24

D

Question 25

The purpose of medical expense insurance is to

A. pay for the recuperative or nursing care needed after a long illness

B. reimburse the insured for expenses incurred for medical care, hospital care, and related services

C. pay for the medical costs of injuries or disabilities contracted in the course of a workers employment

D. provide periodic payments to an insured who is disabled and unable to work

Answer 25

B

Question 26

A policy that covers one specific type of life-threatening or serious condition is known by all of the following names except

A. obscure disease policy

B. dread disease policy

C. specified disease policy

D. critical illness plan

Answer 26

A

Question 27

Which of the following statements is correct?

A. disability income insurance reimburses the insured for medical care, hospital care, and related services for disabled insureds

B. hospital and medical expense coverage helps pay doctor and hospital bills

C. long-term care insurance provides benefits to the insured for hospital care immediately following a surgical procedure

D. medical expense insurance provides periodic payments to the insured when he is unable to work due to sickness or an injury

Answer 27

B

Question 28

Which of the following is the most valid reason for a person to purchase a specified (dread) disease health insurance policy?

A. she has been diagnosed with heart disease

B. she wants coverage against the risk of illnesses such as aids, tuberculosis and diabetes

C. her family has a history of cancer, and she is concerned that she might contract the disease

D. she wants to make sure that she and her family are protected against a major illness

Answer 28

C

Question 29

Common exclusions in health insurance include all of the following except

A. a workers compensation

B. elective cosmetic surgery

C. cosmetic surgery to repair a cleft palate

D. intentionally self-inflicted injuries

Answer 29

C

Question 30

A hospital indemnity insurance policy may be recommended to a client for all the following reasons except

A. the policy will pay the full amount of a hospital stay

B. benefits are paid directly to the insured and may be used for any purpose

C. the premiums are affordable

D. the policy can be an ideal supplement to other health insurance

Answer 30

A

Question 31

Which of the following statements regarding blanket health insurance is correct?

A. benefits change as the group changes

B. it provides insurance for members of associations

C. persons insured are named in the policy

D. it covers a group of people who may be exposed to the same risks

Answer 31

D

Question 32

Debbie is concerned that her health insurance coverage is inadequate. Which of the following is the best reason for her to purchase an indemnity type medical expense policy?

A. it will pay a percentage of her coinsurance

B. it will pay the difference between what her other insurance covers and her actual expenses

C. it will pay all or part of her deductible

D. it will pay a specified per-day benefit

Answer 32

D

Question 33

Which of the following statements concerning credit accident and health insurance is correct?

A. it covers health care costs of unemployed individuals

B. it can only be purchased from surplus lines agents

C. it is purchased by a creditor to protect against loss resulting from the creditors disability

D. it can be purchased by a debtor to cover payments due on a specific loan while the debtor is disabled

Answer 33

D

Question 34

All of the following types of health insurance coverage can be written on an individual basis except

A. medical expense

B. social security

C. accidental death and dismemberment

D. disability income

Answer 34

B

Question 35

Lisa’s private dental expense plan might deny a portion of her claim for all the following reasons except

A. the claim was for replacement of lost dentures

B. her care was diagnostic

C. her teeth were injured in an occupational accident

D. she did not comply with the predetermination of benefits provision in her policy

Answer 35

B

Question 36

All of the following statements regarding a hospital indemnity plan are correct except

A. the plan pays a flat dollar amount as a daily benefit each day the insured is hospitalized

B. another name for the plan is a hospital expense plan

C. payment is made directly to the insured, not the insurer

D. the benefits from the policy may be used toward deductibles and coinsurance payments

Answer 36

B

Question 37

Agnes purchases a round trip travel accident policy at the airport before leaving on a business trip. Her policy would be which type of insurance?

A. business overhead expense

B. credit accident and health

C. industrial health

D. limited risk

Answer 37

D

Question 38

One of the major differences between individual and group health coverages is that with group coverage,

A. once an individual becomes eligible to enroll, no evidence of insurability is required

B. each group member is given a policy

C. group members have the option to renew or cancel coverage

D. all accidents are covered regardless of when or where they occur

Answer 38

A

Question 39

Carson is a driller on an oil rig. While coverage through his group plan is adequate, he wants an inexpensive way to continue at least some of his income and possibly pick up some of the expenses his group plan may not cover in the event he is injured. Which of the following policies would best meet his objectives?

A. accident-only insurance

B. accidental death and dismemberment coverage

C. disability income insurance

D. long term care insurance

Answer 39

A

Question 40

Blanket health insurance is a type of

A. group health and life insurance

B. individual accident insurance

C. individual health and life insurance

D. group accident insurance

Answer 40

D

Question 41

All of the following statements regarding individual health coverage plans are true except

A. health coverage benefits may be tailored to meet the individuals specific needs

B. accidents are covered regardless of when or where they occur

C. the insurance company provides every insured with a certificate of insurance as evidence of coverage

D. an individuals health might prompt the need for a medical exam

Answer 41

C

Question 42

Which of the following statements about blanket accident and sickness insurance policies is not correct?

A. they can be issued on a group basis or an individual basis

B. individual applications are not required

C. the insurer does not need to furnish each person with a certificate

D. they are issued to groups such as common carriers and educational institutions

Answer 42

A

Question 43

All of the following are classified as types of accident and sickness insurance coverage except

A. disability income insurance

B. dental insurance

C. medical expense insurance

D. survivorship insurance

Answer 43

D

Question 44

An accident-only policy would pay for

A. hospitalization due to a heart attack

B. expenses related to HIV

C. expenses related to cancer

D. necessary medical care for dismemberment due to a motorcycle accident

Answer 44

D

Question 45

Which of the following statements regarding individual and group health plans is not correct?

A. all accidents are covered in a group plan

B. in a group plan, there is no individual underwriting

C. in an individual policy, coverage is renewable at the option of the insured or insurer

D. an individual plan issues a policy

Answer 45

A