Flashcards
A disability that recurs within 90 days of when a person returns to work. There is no waiting period.
A form of insurance available as a non-forfeiture option. It provides for continuation of the original insurance plan, but for a reduced amount, without further premiums.
A written order from your primary care doctor for an insured to see a specialist or get certain medical services. In many Health Maintenance Organizations (HMOs), the insured must get a referral before they can get medical care from anyone except their primary care doctor. If they don’t get a referral first, the plan may not pay for the services.
Restoring a lapsed policy to its original premium paying status, upon payment by the policy owner, with interest, of all unpaid premiums and policy loans, and presentation of satisfactory evidence of insurability by the insured.
Reinsurance occurs when the insurance company buys insurance on the risks it insures, done to reduce the insurance company’s risk.
Term insurance that may be renewed, regardless of health, by paying the next premium based upon the insured’s higher age.
The act of replacing one life insurance policy with another. Replacement is perfectly legal if the rules are followed. Replacement that is to the detriment of the insured is illegal and called twisting.
Representations are the truth to the best of your knowledge. Life and health insurance applications ask the applicant to make representations.
Funds held by the insurance company to help fulfill future claims.
A disability that affects the ability of a person to work full-time. Residual disability must be preceded by the insured’s total disability. Residual disability is more accurate than partial.
Retention of risk is the net amount of any risk that an insurance company does not reinsure but keeps for its own account.
Retrospective review examines coverage after treatment. The review includes evaluating requests for medical treatment and determining, on a case-by-case basis, whether that treatment is necessary.
The return of premium rider when added to life insurance ensures that if the insured lives to the end of the policy period all premiums paid will be returned to the insured tax-free. This rider costs extra.
A beneficiary designation that does not affect the policyowner’s rights. A revocable beneficiary can be changed at any time.
A rider is an amendment to an insurance policy. Some riders cost extra and make a policy better, for example, an accidental death benefit rider. Impairment riders are free and take away coverage.
Risk is the chance of loss. Pure risk is insurable. Pure risk involves no chance of gain.
The process by which a company decides how its premium rates for life insurance should differ according to the risk characteristics of individuals insured (e.g., age, occupation, sex, state of health) and then applies the resulting rules to individual applications.
The basic premise of insurance, a large number contribute to cover the losses of a few.
An individual retirement arrangement established with funds transferred from another IRA or qualified plan that the owner has terminated.
A retirement account that may be funded by individuals whose earned income is less than that year’s threshold. Roth IRAs are always funded with after-tax dollars. Qualified distributions are federally income tax-free.
Deferred compensation plans for employees of state or local governments. Funded with pre-tax employee contributions.
A type of plan usually present in larger companies where the employer itself collects premiums from enrollees and takes on the responsibility of paying employees’ and dependents’ medical claims. These employers can contract for insurance services such as enrollment, claims processing, and provider networks with a third-party administrator, or they can be self-administered.
Simplified Employee Pension Plan. A SEP-IRA is a qualified retirement plan for the self-employed or a small business.
A geographic area where a health insurance plan accepts members if it limits membership based on where people live. For plans that limit which doctors and hospitals may be used, it’s also generally the area where an enrollee can get routine (non-emergency) services. The plan may end the coverage if the enrollee moves out of the plan’s service area.
The several ways, other than immediate payment in cash, in which a policyholder or beneficiary may choose to have policy benefits paid. These options typically include the following:
Interest: Death benefit left on deposit at interest with the insurance company with earnings paid to the beneficiary annually.
Fixed Amount: Death benefit paid in a series of fixed amount installments until the proceeds and interest earned terminate.
Fixed Period: Death benefit left on deposit with the insurance company with the death benefit plus interest paid out in equal payments for the period of time selected.
Annuity (Life Income Payout): Death benefit plus interest paid through a life annuity. Income continues under a straight life income option for as long as the beneficiary lives or whether or not the beneficiary lives, under a life income with a period certain option.
The short-term disability income policy provides benefits, often a portion of lost income, for a temporary time defined in the policy. The likelihood is that the insured can return to work or restore the lost income.
Savings Incentive Match Plan for Employers. A SIMPLE is a qualified retirement plan for a business with up to 100 employees.
A type of limited-payment policy that requires only one premium payment.
Services from licensed nurses in a person’s own home or a nursing home. Skilled care services are from technicians and therapists in a person’s own home or in a nursing home.
Skilled nursing care and rehabilitation services are provided on a continuous, daily basis in a skilled nursing facility. Examples of skilled nursing facility care include physical therapy or intravenous injections that can only be given by a registered nurse or doctor.
Social Security provides financial protection, supporting Americans throughout all of life’s journeys. While working, a person pays taxes into the Social Security system. When they retire or become disabled, the person, their spouse, and the dependent children may get monthly benefits that are based on the reported earnings. Survivors may be able to collect Social Security benefits if a person dies. Social security includes various benefits including retirement, disability, survivor, and family benefits, as well as Medicare. Sometimes you will see Social Security referred to as OASDHI (old age, survivor, disability, and health insurance).
The amount an enrollee gets from Social Security Disability, Retirement (including Railroad retirement), or Survivor’s Benefits each month.
Social Security benefits based on a decedent’s record that are paid to their widow/widower age 60 or older, 50 or older if disabled, or any age if caring for a child under age 16 or disabled before age 22; children, if they are unmarried and under age 18, under 19 but still in school, or 18 or older but disabled before age 22; and parents if the decedent provided at least one-half of their support. An ex-spouse could also be eligible for a widow/widower’s benefit on the decedent’s record. A special one-time lump sum death payment of $255 may be made to your spouse or minor children.
A physician specialist focuses on a specific area of medicine or a group of patients to diagnose, manage, prevent, or treat certain types of symptoms and conditions. A non-physician specialist is a provider who has more training in a specific area of health care.
A type of risk that involves a chance of gain or loss. Gambling involves speculative risk. Speculative risk is not insurable.
This provision states that the policy proceeds shall not be subject to the claims of creditors of the beneficiary or policyowner, to the extent permitted by law
When there is a non-working spouse, they can fund a spousal IRA, it is a traditional account.
A type of dental plan that’s not included as part of a health plan.
The classification of a person applying for a life insurance policy who fits the physical, occupational, and other standards on which the normal premium rates are based.
An insurance company owned by its stockholders. Stock insurers issue nonparticipating policies. Dividends, when paid, are paid to the stockholders, not the policyholders.
STOLI stands for stranger-owned life insurance, it is also sometimes referenced as stranger-originated life insurance or stranger-oriented life insurance. A STOLI is a life policy in which strangers have an interest. STOLIs are illegal in many states due to a lack of insurable interest. IOLI stands for investor-owned life insurance.
The classification of a person applying for a life insurance policy who does not meet the requirements set for the standard risk. An additional premium is charged on substandard risks to provide for the probability that such a person will have a shorter life span than a standard risk.
Life insurance policy wording that specifies that the proceeds of the policy will not be paid if the insured takes his or her own life within a specified period of time after the policy´s date of issue.
An easy-to-read summary that helps a person to make apples-to-apples comparisons of costs and coverage between health plans. Options can be compared based on price, benefits, and other features that may be important. The “Summary of Benefits and Coverage” (SBC) is made available when a person shops for coverage on their own or through their job, renews or changes coverage, or requests an SBC from the health insurance company.
A monthly benefit paid by Social Security to people with limited income and resources who are disabled, blind, or 65 or older. SSI benefits aren’t the same as Social Security retirement or disability benefits.
A type of life insurance that provides a guaranteed fixed or decreasing amount of life insurance for a stated time period or term. Guaranteed premiums usually increase annually with the insured’s age and term products do not accumulate cash value or surrender values.
This would be the third in line to receive the death benefit, after the secondary beneficiary.
Insurance owned by a person other than the insured.
A retirement account that may be funded by anyone with earned income.
A transfer of risk shifts responsibility for losses from one party to another in return for payment. Insurance involves the transfer of risk from the insured to the insurer.