LLQP Accident & Sickness · Component 2.1 · 30% of the exam
A hospital indemnity contract differs from an extended health plan because it:
- APays only after the provincial plan has refused to cover the hospital admission
- BPays the insured's regular income for the duration of the hospital stay
- CReimburses the cost of drugs, dental care and paramedical services incurred in hospital
- Pays a fixed daily amount during confinement, without reference to any expense
Correct answer: D) Pays a fixed daily amount during confinement, without reference to any expense
The contract is a per-diem cash benefit triggered only by confinement, which makes it a narrow supplement rather than a substitute for health or disability coverage.
Why the other options are wrong
- AThe contract pays alongside provincial coverage, not after a refusal.
- BIt pays a flat daily amount unrelated to the insured's earnings.
- CReimbursing drugs and paramedical services is the function of an extended health plan.
Exam tip
Hospital indemnity is a daily cash payment, nothing more.
Common mistake
Presenting hospital indemnity as health or disability coverage.
What this tests
CISRO competency component 2.1 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Accident & Sickness module. Written against the published curriculum.
More from component 2
- A group benefits booklet lists AD&D coverage alongside life and LTD. The AD&D benefit pays:
- A hospital indemnity (hospital cash) policy pays:
- Employment Insurance sickness benefits are available to:
- Which government program coordinates with an individual DI policy through a possible offset AND also affects the definition of insurable income?
- A group plan's 'eligibility waiting period' (probationary period) is:
- A CI policy that is 'convertible' allows the insured to:
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.