Advanced Concepts in Life and Health Insurance: Chapters 13-16 Quiz

Deductibles and co-insurance are mechanisms used by insurance companies to ensure that policyholders are financially responsible for a portion of the cost of their healthcare, which helps prevent overuse of the policy and encourages responsible use of healthcare services.

Children who are unable to care for themselves due to a mental or physical problem cannot be removed from their parent's policy as they require ongoing care and support.

In a Major Medical policy with 80/20 coinsurance, the company's share is calculated by taking 80% of the total amount to be paid. In this case, 80% of $5,000 is $4,000, which is the correct answer.

Base Plans usually have lower limits compared to Major Medical policies, which provide coverage for major medical expenses.

The correct limiting age at which a child can be removed from a parent's policy is 26. This is due to the Affordable Care Act (ACA) which allows children to stay on their parent's health insurance plan until they turn 26 years old.

The Base Plan is the only plan among the options that does not have a deductible, making it the correct answer.

Major Medical policies typically do not cover elective cosmetic surgeries as they are considered elective procedures that are chosen by the individual for aesthetic reasons rather than medical necessity. Emergency surgeries, reconstructive surgeries for medical purposes, and non-invasive procedures may be covered under certain circumstances by Major Medical policies.

The correct answer is 'Big' because major medical policies typically offer high limits of coverage to protect individuals against high healthcare expenses.

Base Plans typically offer low limits of coverage, meaning that the maximum amount of coverage provided is relatively low compared to other plans. This is to ensure that the cost of the plan remains affordable for the policyholder.

Major Medical insurance typically covers usual and customary charges, which are the standard fees charged by healthcare providers for a specific service or treatment. This ensures that policyholders are reimbursed for the typical cost of medical care.

Major Medical insurance policies typically have a deductible that needs to be met before coverage kicks in, unlike Base Plans, Accidental Death policies, or Term Life policies.

The correct date for coverage under Medical Expense plans is the 'Date of Placement' as that is when the child becomes a part of the family and is eligible for medical coverage under the plan.

Parents must notify the Insurance Company of their newborn's birth within 31 days to ensure coverage under their plan. Failure to do so could result in delays or denial of coverage for the newborn.

The term 'limiting age' refers to the specific age at which a child can no longer be covered under a certain policy. The other incorrect options do not accurately define this concept.

Comprehensive Major Medical insurance typically consists of a base plan which provides coverage for medical expenses. This base plan is the first to pay out benefits before any supplemental coverage or additional plans.

The stop loss is the threshold at which the company will reimburse 100% of eligible expenses, while deductible, co-payment, and out-of-pocket maximum are different terms related to healthcare costs.