Certified Financial Consultant (CFC) Practice Exam

If Bob was rendered totally disabled when his group health insurance plan was discontinued, what would be required for him?

1. A new health insurance policy

2. An extension of benefits

3. Disability benefits from social security

4. Immediate termination of all benefits

The correct answer is: An extension of benefits

An extension of benefits is correct in this scenario because it allows Bob to continue receiving health care coverage despite the discontinuation of his group health insurance plan. Many group health insurance plans include provisions that offer extended benefits to members who become disabled while still covered under the group plan. This is particularly relevant for Bob, as he was rendered totally disabled, which often triggers these continuation options to ensure that he can maintain access to necessary medical care during his disability. The necessity for an extension of benefits emphasizes the importance of policies designed to support individuals experiencing significant health challenges, ensuring that they do not lose coverage solely due to the timing of when their group insurance is no longer in effect. Such options typically align with legal requirements, protecting individuals in circumstances where their disability could lead to increased medical needs. In contrast, a new health insurance policy might not be immediately viable as he would have to undergo underwriting, which could be difficult due to his disability. Similarly, while disability benefits from Social Security could be an option, they do not directly address the continuation of health insurance coverage. Immediate termination of all benefits would not serve Bob's interests or needs in light of his disability status; rather, it would leave him without crucial healthcare resources.