Which of the following is not a characteristic of a major medical expense policy?

• A. Deductible
• B. Coinsurance
• C. Elimination periods
• D. Copayments

Answer: (C)

An elimination period is a waiting period before benefits begin, a concept you’ll often see in disability income policies or long-term care coverage. Major medical expense policies, on the other hand, are built around cost-sharing features like a deductible, coinsurance, and sometimes copayments. The plan pays after you’ve met the deductible, with the insurer covering a percentage of remaining costs (coinsurance) and/or you paying fixed amounts for certain services (copayments), up to the out-of-pocket limit. Introducing an elimination period would delay any benefits, which isn’t how major medical plans are typically structured. Therefore elimination periods aren’t a characteristic of a major medical expense policy.