Which policy feature allows an insured to defer current health charges to the following year's deductible instead of the current year's deductible?

• A. Embedded deductible
• B. Carryover provision
• C. Grace period
• D. Deductible reset

Answer: (B)

The key idea here is the carryover provision. This feature lets the portion of the deductible that isn’t met by year-end be carried forward and applied to the next year’s deductible. It’s helpful when you incur a lot of medical costs late in the year because those remaining deductible amounts don’t disappear at year-end; instead, they reduce what you’ll have to meet in the new year before benefits kick in.

For example, if the annual deductible is 1,000 and you’ve incurred 600 toward it in December, you have 400 left for the year. With a carryover provision, that remaining 400 is carried forward to the next year and counted toward the next year’s deductible. In the new year, you’d start with 400 already applied to your deductible, so you’d need 600 more of deductible spending before benefits begin.

The other features don’t address deferring deductible charges to the next year. An embedded deductible relates to how deductibles are structured among family members, not carrying over amounts. The grace period concerns premium payments, not deductibles. A deductible reset would start the deductible over, rather than carrying amounts into the next year.