Medical Expense✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
A health policy contains an elimination period (probationary period). Which statement best describes how it works?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
The elimination period, also called a waiting or probationary period, is the time after the policy's effective date during which no benefits are payable for a covered sickness. Once the period is satisfied, coverage for illness begins. Accidental injuries are typically covered immediately, without regard to the elimination period. The provision is designed to discourage people from buying coverage only after they become ill — a form of adverse selection — by making the insured wait out a defined period before sickness benefits start.
Why the other options are wrong
- B) The elimination period is satisfied once at the start of the policy; it is not reset with each new claim.
- C) The elimination period is a waiting period before benefits begin; it does not reduce the lifetime maximum benefit.
- D) The elimination period grants the insured no special cancellation rights to the insurer.
Memory hook
Elimination period = a countdown clock at policy birth. Sit through it once, then sickness coverage switches on.