final review 9 - Health insurance basics

Chapter Recap

This chapter explained the basics of health insurance and underwriting procedures for health insurance policies. Let's recap them:

TYPES OF LOSSES AND EXCLUSIONS
Principal Types of Losses and Benefits	Disability loss of income - caused by insured's inability to work Medical - medical or hospital expenses incurred from an accident or sickness Dental - usually stand-alone plans; cover diagnostic and preventive care Long-term care - covers expenses for care in a nursing home or in the insured's own home
Classes of Health InsurancePolicies	Individual vs. group Private vs. government Limited vs. comprehensive
Types of Limited Policies	Accident - coverage for disability, medical care, death or dismemberment resulting from an accident Dread disease policy - variety of benefits for a specific disease such as cancer policy or heart disease policy Critical illness - pays a lump sum to the insured upon diagnosis and survival of a critical illness Hospital indemnity - provides a specific amount on a daily, weekly or monthly basis while the insured is confined to a hospital Dental plans - covers the treatment, care and prevention of dental disease and injury to the insured's teeth Vision/hearing plans - type of group health insurance that covers eye examinations and eyeglasses, or hearing aids on a limited basis Credit disability - covers payments on loans if the insured becomes disabled Prescription drugs - the insured pays a copay and the insurer pays the rest of the prescription balance
Common Exclusions	Injuries resulting from war or active military service Intentionally self-inflicted injuries Elective cosmetic surgery Experimental procedures Conditions covered by workers compensation insurance Expenses paid for by government plans Injuries caused by participation in criminal activity
UNDERWRITING
Steps in the UnderwritingProcess	Field underwriting – by agent Company underwriting Premium determination Policy delivery: Effective date of coverage - if the premium is not paid with the application, the agent must obtain the premium and a statement of continued good health at the time of policy delivery
Sources of InsurabilityInformation	Application - must be completed and signed Producers/agent's report -agent's observations about the applicant that can assist in underwriting Attending Physician Report - best for accurate information on the applicant's medical history Investigative consumer report - includes information on an applicant's character, general reputation, personal habits, and mode of living that is obtained through investigation MIB report - helps companies share adverse medical information on insureds
REPLACEMENT
Agent’s Responsibility	Compare benefits, limitations and exclusions found in the current and the proposed replacement policy Provide Notice Regarding Replacement Ensure that the current policy is not cancelled before the new policy is issued