A&H Policy ProvisionsQuestion 40 of 716
What is the primary purpose of Coordination of Benefits (COB) provisions?
a.To require every insurer covering the same insured to divide the premium dollars collected among them equally
b.To void the secondary policy automatically once the primary plan has paid the claim in full, ending that coverage
c.To increase the total benefits payable to an insured who happens to be covered by more than one group health plan
d.To prevent an insured from collecting more than the actual loss when multiple plans cover the same expense
Explanation
COB rules prevent over-insurance. They order multiple plans into primary and secondary roles so the combined payments do not exceed 100% of the actual covered expense.
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PrepPass team · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)