Insurance Providers

Commercial Insurance

MR. WATSON: Individual health insurance can be issued by commercial companies, non-government provided plans.

• Major Medical Plans
• Basic Medical Expense plans
• Health Maintenance Plans (HMO)
• Preferred Provider Plans (PPO)
• Point of Service Plans (POS)
• Medicare Supplement plans

Government Provided

MR. WATSON: Health insurance is also provided through the state and federal government. The State handles Medicaid and Federal handles Medicare.

• Medicare (federal)
• Medicaid (state run & state & federal funded)
• Social Security

Renewability Provisions

MR. WATSON: Again, as you're going through these policies in later chapters, you must know which of the following categories they fall into.

MR. WATSON: Health insurance is known for its renewability provisions, the ability to renew or not renew them. Each health policy will fall into one of these categories. The first two are not so common, but you need to know them for the exam.

MR. WATSON: There are four basic renewability provisions: CONG, C-O-N-G.

• Cancelable - at any time the company desires
• Optionally renewable - company's option on the anniversary date of the policy
• Non-cancelable - can't raise premiums or cancel the policy (disability income)
• Guaranteed renewable - can raise premiums only by "class"

MR. WATSON: The first two are self explanatory, but know the time frame for a Cancelable policy.

MR. WATSON: The Noncancelable and guaranteed renewable contract . Can they cancel it? No. That's why they call it noncancelable.

MR. WATSON: But the insurance company limits who can buy it. Usually by occupation. Doctors, lawyers, professionals. Only certain people in certain occupations can buy these policies. Individual Disability Income policies.

MR. WATSON: Guaranteed renewable contract . The company guarantees to renew it up to a certain age. But they reserve the right to increase the premiums, but only by class. All women age 20 to 24. All women age 25 to 29. All women age 30 to 34. Whatever class we happen to be in. These are the most common. Most health policies fall into this category.

MR. WATSON: So later on we're going to talk about these types of policies, whether they are cancelable or noncancelable, etc. Generally, the only noncancelable policy is a disability income policy. They can't cancel it. They can't raise the premiums. High-end professions like doctors or lawyers qualify for these. Cancer policies, Medicare Supplement policies, & Long Term Care policies are generally guaranteed renewable policies, but NOT non-cancelable.

MR. WATSON: They reserve the right to increase the premiums, but only by class. Medicare supplement policies & Long-term care policies are guaranteed renewable. So just about the only type that is noncancelable would be the disability policies. Be careful with these two classifications. Write them down.