Q:Even though Dave works part-time, he has a group health plan that has an annual deductible of $65 and a co-insurance factor that pays 70%. Kim, his spouse, works full-time, has a group plan that covers spouses and dependents, with a $50 annual deductible and no co-insurance factor. Both plans contain coordination-of-benefits (COB) clauses. Dave has eligible expenses of $255. Calculate the amount of money each plan will pay to Dave for his expenses, assuming that this is the first claim on either plan.

Kim's plan pays $122; Dave's plan pays $133.

Kim's plan pays $205; Dave's plan pays $35.

Kim's plan pays $205; Dave's plan pays $50.

Kim's plan pays $205; Dave's plan pays $0.

Determine the primary carrier. Dave's plan is the primary carrier. The primary carrier of someone who is covered by two plans and works part-time is the plan where he or she is employed part-time.Dave's plan pays:$255 submitted- $65 deductible$190- $57 (co-insurance calculated at $190 x 30%)= $133Dave's plan pays $133.Kim's plan pays the lesser of what it would have paid if it were the primary carrier or 100% of eligible expenses, less what has already been received from Dave's plan.If Kim's plan was the primary carrier, it would have paid:$255 submitted- $50 deductible- $0 co-insurance= $205The other option for Kim's plan is for it to pay 100% of eligible expenses, less what has already been received from Dave's plan. This is calculated as: $255 - $133 = $122.The insurer will obviously choose to pay the lesser of the two amounts ($205 or $122), so Kim's plan pays $122.

Q:Marty Hope is a paralegal working in a large firm of lawyers and other paralegals. His annual salary is $84,000, and he is enrolled in a non-contributory group disability plan that provides a 70% wage-loss-replacement benefit after a 30-day waiting period. He also receives life coverage to two times his salary, and major medical. When Marty has a stroke that leaves him seriously disabled, what will he receive as a monthly benefit from his group plan and how much of the benefit will be taxable?$7,000 per month, of which 70% is taxable income$2,450 per month, of which 35% is taxable income$4,900 per month, of which 100% is taxable income$2,100 per month, of which 100% is taxable incomeIn a non-contributory plan, the employer pays the total premium cost.Thus, Marty's benefit is 70% of $7,000, or $4,900, and 100% is taxable income, because the premium was paid by the employer.

Q:Reg is employed in a mid-size distribution centre as supervisor. He earns $46,700 annually and has excellent group benefits provided by his employer. His wife, Sharon, is employed as a part-time cashier, and receives no benefits, but earns $19.50 an hour. They have three children, the youngest of whom is a severe asthmatic. Drugs for this child in the form of inhalers and other medications can cost as much as $350 per month.

Reg's group plan has a $50 single deductible and a $100 family deductible. In the first claim that Reg makes this year, his wife had $55 in prescriptions, and there was another $166.50 for the children. On the next claim, Reg must claim $42.00 for himself and $197.80 for the children. How much will Reg receive from the insurer for the second claim?

$211.30

$50.00

$161.30

$239.80

You are correct!!!The answer is$239.80Rationale:Rationale for All Answers:The family deductible reduces claims; once claims exceed the deductible, then reimbursement is made to the insured. Reg's first claim was $221.50, and his family deductible of $100 was used up against this claim. Therefore there would be no deductible to be applied to the next claim.

The second claim is another $239.80; so he receives $239.80Q:Mary and James Robertson are both employed in large companies with group disability and health plans. Mary's plan has a $50 single deductible, a $100 family deductible, and a 90% co-insurance factor. James's plan also has a $50 single deductible, a $100 family deductible, and an 80% co-insurance factor. Mary's birthday is April 12, 1969. James's birthday is November 2, 1971. Mary's first claim for the year is $493.70. How much will be received as reimbursement from each carrier?

Primary carrier: $399.33; secondary carrier: $94.37

Primary carrier: $334.96; secondary carrier: $158.74

Primary carrier: $354.96; secondary carrier: $138.74

Primary carrier: $94.37; secondary carrier: $399.33

You are correct!!!The answer isPrimary carrier: $399.33; secondary carrier: $94.37Rationale:Rationale for Correct Answer:AMary's plan is the primary carrier.

Claim: $493.70Minus $50 single deductible, since the claim is for Mary= $443.70$443.70 90% co-insurance= $399.33 benefit from her plan

Then the claim is submitted to James's plan: Two calculations are required to find out which calculation produces the lesser amount of reimbursement to Mary.

a)the amount that would have been paid if the secondary carrier was the primary carrier:$493.70minus $50 deductible= $443.70$443.70 - 80%= $354.96

b)100% of all eligible expenses reduced by payments made by the primary carrier$493.70minus $399.33=$94.37

Clearly the second amount is the lesser of the two calculations so this is the amount James's plan will pay for Mary's claim.

Q:Reg is employed in a mid-size distribution centre as supervisor. He earns $46,700 annually and has excellent group benefits provided by his employer. His wife, Sharon, is employed as a part-time cashier, and receives no benefits, but earns $19.50 an hour. They have three children, the youngest of whom is a severe asthmatic. Drugs for this child in the form of inhalers and other medications can cost as much as $350 per month.

Reg's group plan has a $50 single deductible and a $100 family deductible. In the first claim Reg made this year, Reg claimed $89 (including a $9.95 dispensing fee for fifteen Viagra). In the next claim, Sharon submits prescriptions for $93 (birth-control pills). The final claim in this three-month period, was for $66 for a medication to treat their one-month-old child's diaper rash. How much will Reg receive for claim one, claim two, and claim three?Claim one: $39; claim two: $93; claim three: $66Claim one: $39; claim two: $43; claim three: $66Claim one: $0; claim two: $0; claim three: $66Claim one: $0; claim two: $43; claim three: $16Oops, You are wrong :(Your answer was :Claim one: $39; claim two: $93; claim three: $66The correct answer is :Claim one: $39; claim two: $43; claim three: $66Rationale:Rationale for All Answers:Claim one, for $89, is reduced by Reg's single deductible: $89 $50 = $39 as reimbursement.Claim two, for $93, is reduced by $50 or Reg is reimbursed $93 - $50 = $43Claim three, for $66, is fully paid as no deductible is applicable, as the family deductible of $100 has been used up in the first two claims.

Q:Roger is about to join a company with an extensive employee benefits plan, including group life insurance, extended medical, short term and long term disability coverage. However, he is concerned about his eligibility for this coverage due to his poor health, family history of health problems, and shortened life expectancy. Roger's heavy smoking has led to some heart problems, a condition that resulted in the early death of both his parents. What, if any, of the group insurance plans will Roger be eligible to join? (group)Roger will receive all benefits with an exclusion for conditions related to his heart problems.Roger will not be eligible for any coverage.Roger will receive extended medical and disability coverage, as well as the minimum amount of life insurance available without evidence of insurability.Roger will receive extended medical coverage, but will not be eligible for life or disability insurance.

You are correct!!!The answer isRoger will receive extended medical and disability coverage, as well as the minimum amount of life insurance available without evidence of insurability.Rationale:The correct answer is "Roger will receive extended medical and disability coverage, as well as the minimum amount of life insurance available without evidence of insurability."Since group plans do not carry out a medical up to non evidence maximum, Roger will get life insurance up to the non evidence maximum. He will receive disability and medical insurance from the group plan.

Q:Tonya and Curtis, a married couple, both have group health insurance through their respective employers. Each plan covers both the employee and his/her spouse. Both plans have co-ordination of benefits. Tonya's plan covers 75% of eligible expenses after a $25 annual deductible. Curtis' plan covers 100% of eligible expenses after a $40 annual deductible. Curtis has already claimed $500 for this year. Tonya is now filing her first claim of the year for $300. How much reimbursement will she receive? (group, medical, COB)$275 from her own plan and $25 from Curtis' plan$0 from her own plan and $300 from Curtis' plan$206.25 from her own plan and $93.75 from Curtis' plan$225 from her own plan and $75 from Curtis' planr

Oops, You are wrong :(Your answer was :$206.25 from her own plan and $93.75 from Curtis' planThe correct answer is :$225 from her own plan and $75 from Curtis' planRationale:The correct answer is "$225 from her own plan and $75 from Curtis' plan."Both plans have co-ordination of benefits. So Curtis's first claim of $500 is paid by his plan as the primary carrier and Tonya's plan as the secondary carrier. So the deductibles get used up in both the plans. For Tonya's claim of $300, Tonya's plan is the primary carrier and will reimburse 75% of $300 or $225 and Curtis's plan will reimburse the out-of-pocket expense or $300-$225 = $75.Q:Mary and James Robertson are both employed in large companies with group disability and health plans. Mary's plan has a $100 single deductible, a $200 family deductible, and an 80% co-insurance factor. James's plan has a $25 single deductible, a $50 family deductible, and a 90% co-insurance factor. Mary's birthday is April 12, 1969. James's birthday is November 2, 1971. Mary's first claim for the year is $312.90 for their son, Jacob. How much will be received as reimbursement from each carrier?Primary carrier: $262.58; primary carrier $50.32Primary carrier: $50.32; secondary carrier: $262.58Primary carrier: $170.32; secondary carrier: $142.58Primary carrier: $236.61; secondary carrier: $142.58You are correct!!!The answer isPrimary carrier: $170.32; secondary carrier: $142.58Rationale:Rationale for Correct Answer:The primary carrier is Mary because her birthday falls first in the year.

Claim: $312.90Minus $100 deductible= $212.90$212.90 80% coinsurance= $170.32 benefit from her plan

Then the claim is submitted to James's plan: Two calculations are required to find out which calculation produces the lesser amount of reimbursement to Mary.

a)the amount that would have been paid if the secondary carrier was the primary carrier:$312.90minus $25 deductible= $287.90$287.90 90%= $259.11

b)100% of all eligible expenses reduced by payments made by the primary carrier$312.90minus $170.32=$142.58

Clearly, the second amount is the lesser of the two calculations, so this is the amount James' plan will pay for Jacob's claim.

You are correct!!!The answer isEI does not offset any disability benefits received from other sources such as Canda Pension Plan or Workers compensation payments.Rationale:The correct answer is "EI does not offset any disability benefits received from other sources such as Canda Pension Plan or Workers compensation payments."The provision of Disability benefits of EI are:

Employee must have contributed to EI for 600 hours in the qualifying period. The qualifying period is 52 weeks or since last claim. The elimination period is 14 days (2 weeks) EI pays 55% of insurable earnings EI pays benefits for 15 weeks or recovery, whichever is earlier. EI offsets payments received from CPP disability benefits, Worker's compensation income payment, salary, wages and commissions. The employee receives a non-refundable tax credit on th premiums contributed for EI.Q:Peter injures his back in a motorcycle accident and files a disability claim from his group disability insurance. Peter's employer pays the premiums for the disability coverage and does not report this amount as a taxable benefit. The insurance provides for a benefit of 65% of Peter's earnings for a maximum of two years. Peter is currently earning $7,000 per month, and his average tax rate is 25%. How much will Peter have available each month to cover his expenses?

$1,137.50

$4,550.00

$3,412.50

$5,250.00

You are correct!!!The answer is$3,412.50Rationale:The correct answer is "$3,412.50"As the employer pays the premium and does not report it as a taxable benefit to the employee the disability benefit is taxable to Peter. Peter's disability benefit is 65% x $7,000/month = $4,550/month. As the benefit is taxable he will pay 25% in tax which leaves 75% of the benefit to cover his expenses. So he can use 75% x $4,550/month = $3,412.50 to cover his expenseQ:Ralph has a group life insurance policy in the amount of $200,000 with his employer. When Ralph dies suddenly on a canoe trip, the insurer discovers that Ralph's age was mistakenly recorded as 35 instead of 45 on the initial application. What will be the outcome of this error? (group, life)

The death benefit will not be paid out to Ralph's beneficiary.

There will be no adjustment to either the death benefit or the premium.

The premium will be adjusted retroactively.

The death benefit will be reduced.

Oops, You are wrong :(Your answer was :There will be no adjustment to either the death benefit or the premium.The correct answer is :The premium will be adjusted retroactively.Rationale:The correct answer is "The premium will be adjusted retroactively."Since the premiums for a group policy are based on average age and sex of the group, a misstatement of age by a member of the group does not impact the premium significantly. For this reason, group policies pay the full death benefit to the deceased group member and collect the difference in premium from the employer.

Q:There are various methods of determining the amount of coverage offered by a group life insurance policy. Which one of the methods below is not typically used?

A stated amount per person insured

An amount chosen by the person insured

A stated amount for each job classification

A formula based on a multiple of salary

Oops, You are wrong :(Your answer was :A stated amount for each job classificationThe correct answer is :An amount chosen by the person insuredRationale:The correct answer is "An amount chosen by the person insured."Group insurance is based on the concept of anti-selection. The employer decides on the benefit and it is applied to all members of a group plan

Q:Reg is employed in a mid-size distribution centre as supervisor. He earns $46,700 annually and has excellent group benefits provided by his employer. His wife, Sharon, is employed as a part-time cashier, and receives no benefits, but earns $19.50 an hour. They have three children, the youngest of whom is a severe asthmatic. Drugs for this child in the form of inhalers and other medications can cost as much as $350 per month.

Reg's group plan has a $50 single deductible and a $100 family deductible. In the first claim that Reg makes this year, his wife had $55 in prescriptions, and there was another $166.50 for the children. How much will Reg receive from the insurer on this claim?

$0

$171.50

$221.50

$121.50

Oops, You are wrong :(Your answer was :$0The correct answer is :$121.50Rationale:Rationale for All Answers:The family deductible reduces claims; once claims exceed the deductible, then reimbursement is made to the insured. Reg receives a total of $121.50 after the deductibles are applied to the claims.Calculations:Claim-1 (Wife)Claim =$55

Deductible=$50

Reimbursed$5

Claim-2 (Children)Claim =$166

Deductible=$50

Reimbursed$116.50

Total reimbursed = $5 + $116.50 = $121.50