Health and Accident Insurance Practice Exam

The term for the period before a new employee becomes eligible for group health insurance coverage is known as the waiting period. This is a defined time frame established by an employer during which a new employee must wait before they can access the health insurance benefits offered as part of their employment. The waiting period allows employers to manage costs and ensure that employees commit to their roles for a certain duration before receiving benefits.

A waiting period is a common practice in employee benefit plans, as it helps employers minimize the risk associated with employees enrolling in health insurance only when they anticipate needing medical care. The other terms listed, such as grace period, elimination period, and coverage period, refer to different concepts in insurance and do not specifically denote the waiting time before health insurance eligibility. The grace period typically refers to the time after a payment due date during which a policyholder can still make their payment without penalty, while an elimination period often pertains to disability insurance, indicating a time frame before benefits are payable. Coverage period refers to the duration during which the insurance benefits remain active once the policy is in effect.