Life & Health Insurance Exam Life & Health Insurance Health Insurance Fundamentals 2

Question 1

What does the term 'coinsurance' mean in a health insurance policy?

Accepted Answer

The policyholder shares a percentage of costs after the deductible

Answer

Coinsurance is the percentage of covered costs the insured pays after meeting the deductible, such as 20% while the insurer pays 80%.

Question 2

Which type of health plan requires members to choose a primary care physician (PCP)?

Accepted Answer

HMO

Answer

HMOs (Health Maintenance Organizations) require members to select a PCP who coordinates all care and provides referrals to specialists.

Question 3

What is the maximum annual out-of-pocket limit designed to protect the insured against?

Accepted Answer

Catastrophic medical expenses

Answer

The out-of-pocket maximum caps the total amount an insured must pay in a plan year, protecting against catastrophic medical bills.

Question 4

A health insurance policy that pays a fixed dollar amount per day of hospitalization regardless of actual charges is called a:

Accepted Answer

Hospital indemnity policy

Answer

A hospital indemnity policy pays a predetermined daily benefit for each day the insured is hospitalized, without regard to actual expenses.

Question 5

Under HIPAA portability rules, how long must an employee be enrolled in group coverage before prior creditable coverage counts toward a preexisting condition exclusion period?

Accepted Answer

No minimum — all prior coverage counts

Answer

HIPAA allows creditable coverage to reduce or eliminate preexisting condition exclusion periods, and there is no minimum enrollment length required for that prior coverage to count.

Life & Health Insurance Exam Practice Test

Life & Health Insurance Exam Practice Test

Life & Health Insurance Exam Life & Health Insurance Health Insurance Fundamentals 2