Health and Accident Insurance
Coverage Types
Understand individual, group, and government health coverage. Know the major medical structure: deductible, coinsurance, copayment, out-of-pocket maximum, and benefit limits. Distinguish indemnity plans from managed care (HMO, PPO, POS). Know disability income insurance: own occupation versus any occupation definitions, elimination period, benefit period, and the typical 60–70% income replacement guideline.
Key Provisions
Master coordination of benefits (prevents double recovery when two plans cover the same person), pre-existing condition clauses, waiting periods, residual disability, and recurrent disability. Understand accidental death and dismemberment schedules and the principal sum versus capital sum distinction.
Underwriting and Claims
Health underwriting evaluates medical history, age, occupation, and lifestyle. Claims handling involves utilization review, precertification, and explanation of benefits. Know the difference between first-dollar coverage and plans requiring cost sharing.
Traps
Questions often confuse the elimination period (time before benefits begin) with the benefit period (how long benefits last). Another trap: own occupation is more favorable to the insured than any occupation. Watch for questions that treat a copay as coinsurance - they are different cost-sharing mechanisms.
Rule of Thumb
Longer elimination period = lower premium. Shorter benefit period = lower premium.