PSI Ohio Insurance Practice Exam

Which of the following options often leads to inadequate insurance protection?

1. Having too many riders in a policy.

2. Relying solely on employer-based insurance plans.

3. Choosing a term policy over a whole life policy.

4. Not maximizing health coverage options.

The correct answer is: Relying solely on employer-based insurance plans.

Relying solely on employer-based insurance plans can lead to inadequate insurance protection because these plans may not provide comprehensive coverage. Employer-based plans often have limitations, such as specific tiers of coverage, high deductibles, or insufficient benefits that may not adequately meet an individual’s or family's healthcare needs. Additionally, if an employee changes jobs or is laid off, they may lose their insurance coverage altogether, leaving them vulnerable to financial hardship in case of medical emergencies. This reliance can result in gaps in coverage, insufficient protection from high medical costs, or lack of access to necessary services not covered by the employer plan. In contrast, having too many riders might complicate a policy but doesn't inherently lead to inadequate coverage. Choosing a term policy over whole life might affect lifelong coverage aspects but doesn’t necessarily result in inadequate protection, as term policies can still provide substantial benefits during their effective period. Not maximizing health coverage options also indicates a missed opportunity but does not directly imply reliance on a potentially limited one-size-fits-all employer-based insurance model.