RISK MANAGEMENT AND INSURANCE -
CHAPTER 15 QUESTIONS WITH 100%
ACCURATE ANSWERS
Annual out-of-pocket limit (stop-loss) limit - Accurate answers 100% of the covered medical
expenses in excess of the deductible are paid after the insured pays a certain annual amount of out-of-
pocket expenses
Calendar-year deductible - Accurate answers amount payable by an insured during a calendar year
before a group or individual health insurance policy begins to pay for medical expenses
Coinsurance - Accurate answers the percentage of the bill in excess of the deductible, which the
insured must pay out-of-pocket up to some maximum annual dollar limit
Conditionally renewable policy - Accurate answers the policyholder can renew the policy until a
specified age; however, the insurer has the right to decline renewal under conditions specified in the
contract
Copayment - Accurate answers Flat amount that the insured must pay for certain benefits, such as
an office visit or prescription drug
Disability-income insurance - Accurate answers health insurance that protects against the
economic insecurity of a severe disability
Elimination period - Accurate answers brief period of time during which an employee can sign up
for group insurance without furnishing evidence of insurability
Guaranteed issue - Accurate answers a term used to describe applicants for health insurance;
coverage for medical expense insurance is guaranteed, and applicants cannot be turned down
regardless of their medical condition
Guaranteed renewable policy - Accurate answers - policy in which the insurer guarantees to renew
the policy at each anniversary date
- the insurer has the right to increase premium rates for the underwriting class in which the insured is
placed
Health savings accounts (HSA) - Accurate answers a tax-exempt or custodial account established
exclusively for the purpose of paying qualified medical expenses of the account beneficiary who is
covered under a high-deductible health insurance plan
Individual medical expense insurance - Accurate answers protects an individual or family for
covered medical expenses because of sickness or injury
CHAPTER 15 QUESTIONS WITH 100%
ACCURATE ANSWERS
Annual out-of-pocket limit (stop-loss) limit - Accurate answers 100% of the covered medical
expenses in excess of the deductible are paid after the insured pays a certain annual amount of out-of-
pocket expenses
Calendar-year deductible - Accurate answers amount payable by an insured during a calendar year
before a group or individual health insurance policy begins to pay for medical expenses
Coinsurance - Accurate answers the percentage of the bill in excess of the deductible, which the
insured must pay out-of-pocket up to some maximum annual dollar limit
Conditionally renewable policy - Accurate answers the policyholder can renew the policy until a
specified age; however, the insurer has the right to decline renewal under conditions specified in the
contract
Copayment - Accurate answers Flat amount that the insured must pay for certain benefits, such as
an office visit or prescription drug
Disability-income insurance - Accurate answers health insurance that protects against the
economic insecurity of a severe disability
Elimination period - Accurate answers brief period of time during which an employee can sign up
for group insurance without furnishing evidence of insurability
Guaranteed issue - Accurate answers a term used to describe applicants for health insurance;
coverage for medical expense insurance is guaranteed, and applicants cannot be turned down
regardless of their medical condition
Guaranteed renewable policy - Accurate answers - policy in which the insurer guarantees to renew
the policy at each anniversary date
- the insurer has the right to increase premium rates for the underwriting class in which the insured is
placed
Health savings accounts (HSA) - Accurate answers a tax-exempt or custodial account established
exclusively for the purpose of paying qualified medical expenses of the account beneficiary who is
covered under a high-deductible health insurance plan
Individual medical expense insurance - Accurate answers protects an individual or family for
covered medical expenses because of sickness or injury
