Question

1.Ed is considering the health insurance options offered by his employer. He travels frequently and would like to be able to go to any physician of his choice, including those outside of his home area. He does not want a policy that mandates care be provided by employees of the insurer, since he believes that could result in a potential conflict of interest. He does not want large out of pocket or coinsurance payments and does not mind patronizing physicians who have agreed to provide discounted services to members of the plan provided that they are not employed by the plan. Out of the following health plans offered by his employer, which should Ed choose?

a.	Major Medical Insurance

b.	Indemnity Health Insurance

c.	Health Maintenance Organization (HMO)

d.	Preferred Provider Organization (PPO).

2. David is comparing two health insurance policies that have similar benefit provisions, but one is guaranteed renewable while the other is non-cancellable. David is not sure of the difference between these provisions, and has come to you for help. Which of the following statements is correct?

a.	Non-cancellable policies guarantee policy renewal until age 65 with no premium increases.

b.	Guaranteed renewable policies permit the insurance company to increase the premium based on the insured’s claim experience, but must offer to renew the policy.

c.	Non-cancellable policies are generally less expensive than guaranteed renewable policies.

d.	Guaranteed renewable policies may be renewed in the sole discretion of the insurer.

3. Sal (who will turn age 65 in 3 months) is married to Norma (age 65), and they have 2 children, Lisa and Jennifer. Since Sal and Norma were married later in life, Lisa (age 19) and Jennifer (age 21) are both under age 24 and are currently enrolled in college. Sal worked for a large automobile manufacturer, and participated in several employee benefit programs, including an employer sponsored health insurance plan. Sal will be retiring on his 65th birthday, and has come to you with questions about the options available for him to provide health insurance coverage for his daughters until they graduate from college. Which of the following statements is correct?

a.	Sal’s only option is to purchase individual coverage for his children.

b.	Sal can elect to continue to purchase coverage for his children under his employer’s group plan for up to 18 months.

c.	Sal can elect to continue to purchase coverage for his children under his employer’s group plan for up to 29 months.

d.	Sal can elect to continue to purchase coverage for his children under his employer’s group plan for up to 36 months.

4. Which of the following statements concerning Long Term Care Coverage is correct?

a.	Clients with a family history indicating longevity do not need to consider purchasing long term care insurance.

b.	Wealthy individuals do not need long term care since they can afford to pay for services themselves.

c.	Long term care can preserve a client’s ability to choose care providers.

d.	Long term care is considered to be a medical insurance policy, and thus the premium of any LTC policy is deductible for income tax purposes.

Answer 1