Other Insurance Concepts
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How does the premium mode effect the total premium paid for the year?
Higher Frequency=Higher Premium
According to the Coordination of Benefits (COB) provision, if both parents have coverage where they are employed, under whom will the children will be covered?
The owner of Payment will usually be determined by the birthday rule, i.e. the coverage of the parent whose birthday is earlier in the year will be considered primary.
What is the difference between occupational and nonoccupational coverage?
- occupational coverage-provides benefits for illness, injury or disability resulting from accidents or sickness that occure on or off the job.
- nonoccupational coverage-only covers claims that result from accidents or nonoccupational basis, most group plans are nonoccupational only.
How are personally-owned diability benefits received by the individual taxed?
Premium payments on the personally owned diability income policies are non-deductibe by the individual. However, diability income benefits are received income tax free by the individual.
Under what circumstances are medical expense premium payments paid by the individual policyholder tax deductible?
When added to all other unreimbursed medical expenses, the total exeeds 7.5% of the taxpayer's adjusted gross income.
In an employer group health insurance policy, how are premiums paid by the employer for disability income insurance taxed?
They are deductible as a businsess expense and are not considered as taxable income to the employee.
For sole proprietors and partners, what percentage of the cost of a medical expense plan is deductible?
May deduct 100% of the cost of a medical expense plan provided to them and their families because they are considered self-employed individuals, not employees. The deduction may not exceed the taxpayer's earned income for the year.
Are key person diability premiums deductibe to be the business?How are the benefits received?
No. They are received income tax free by the buisness.
Are the premiums paid for business overhead expense insurance taxes deductible?Are the benefits received taxable?
Does not reimburse the buisness owner for his or her salary, compensation, or other form of income that is lost as a result of disability.Yes.
Describe residual disability.
It is a type of disability income policy that when a persom returns to work after a total disability, but is still not able to work as long or at the same level he/she worked before becoming disabled.
What policy covers an employee that is hurt on the job?
What is the definition of a small employer?
Any person,firm,corporation,partnership or association that is actively engaged in business that on at least 50% of its working days during the proceding calendar year, employed no more than 50 eligible employees, the majority of whom were employed within the state.
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