CARD Q090
A policy pays a stated dollar benefit for each covered hospital day, regardless of the hospital’s actual charges. What type is it?
- Major medical insurance
- Long-term care insurance
- Disability income insurance
- Hospital indemnity insurance
Hospital indemnity insurance
Hospital indemnity provides scheduled cash benefits under its terms. It does not replace comprehensive medical-expense coverage.
Why each choice is right or wrong
A. Major medical insurance
Incorrect. Major medical generally pays covered expenses subject to cost sharing, not solely a stated daily cash benefit.
B. Long-term care insurance
Incorrect. LTC responds to qualifying ongoing care needs, not simply each hospital day.
C. Disability income insurance
Incorrect. Disability income addresses earnings loss rather than a hospitalization schedule.
D. Hospital indemnity insurance
Correct. Hospital indemnity provides scheduled cash benefits under its terms. It does not replace comprehensive medical-expense coverage.
Review the related terms
Use these lessons to revisit the concepts and try additional practice questions.