Accident and Health practice questions

a Massachusetts producer has violated an unfair trade practice law. this producer may be fined up to _____ per violation.

1,000

in Massachusetts a small employer is comprised of

1-50 employees

the superintendent must be notified by the insurer within _____ days of a producers appointment

15

How many days notice must a producer be given prior to a scheduled hearing

21 days

a producer has received the first year commission paid on Medicare supplement policy. renewal commissions must then be provided for at least____ years after the first year

5

What is the actuarial value of bronze level health plan

60

What does the term "field underwriting" refer to in the health insurance industry

A producer's contact with the applicant

Which of the following is NOT covered by a comprehensive long-term care policy?

Acute Care

Insurance is not characterized as which of the following

As the number of insureds increases the number of of losses decreases

Julie is in need of assistance with one or two activities of daily living. She may be eligible for a(n)

Assisted living facility

If a disability income policy contains a cost-of-living adjustment rider, benefits must typically be increased

At least once per year from when benefits began

According to the affordable care act new health insurance market places are established by the

CCIIO

Which of the following provisions allows an insured or the insurer to terminate the policy?

Cancelable provision

the insurers obligation to pay a claim depends on whether the insured or beneficiary has complied with all policy conditions. this makes the policy

Conditional Contract

What must be given to an accident and health insurance applicant when the producer receives an application and the initial premium?

Conditional receipt

An accident and health insurance policy's premium requirements are set forth in which of the following provisions?

Consideration clause

Which report contains information regarding an individual's general reputation and credit standing?

Consumer report

Which of the following reduces the opportunity for overinsurance?

Coordination of benefits provision

which statement is true about a permanent disability under workers compensation coverage

Coverage excludes nonoccupational injuries

Health providers are compensated by a preferred provider organization (PPO) for normal dental procedures by what means?

Decreased fee schedules

To which of the following group plans do HIPAA rules NOT apply?

Disability income

Which of these is NOT a factor during the health insurance underwriting process?

Former residence

Emily is disabled. In order to become eligible for Social Security disability income benefits, she must be

Fully insured, according to Social Security

When the disclosure of an insured's nonpublic information is involved, what is the insurer obligated to do?

Give notice, explain, and allow opting out

most Medicare supplement information used by an insurer must be approved by the state. which of the following types of information does not require state approval

Government publications

Kyle is an insured who disregarded an accident and health insurance policy provision that requires him to seek a second surgical opinion. What will the end result be?

He may be reimbursed for the surgical procedure at a reduced benefit level

In a staff model HMO, enrollees normally have which of the following pharmacy options available to them?

In-house pharmacy

The type of health insurance in which underwriting procedures are the most restrictive is

Individual

Which of the following provisions permits an insurer to return a portion of the premium and pay benefits on a pro rata basis if it finds that an insured has duplicate coverage?

Insurance with other insurers

Who must sign a rider attached to a health insurance policy in order for it to be valid?

Insured and producer

Which health policy clause specifies the amount of benefits to be paid?

Insuring

Ken is age 65 and has 2 years until he receives Social security retirement income benefits. at his current age, which is true about Medicare part a hospital insurance coverage

It is available through application to Social Security

Bert's spouse passed away recently. Bert was covered under his spouse's group family health insurance plan but now is covered under COBRA. How much of the active-employee cost may be passed on to Bert for continued coverage?

Maximum of 102%

Which of these is a type of private insurance that covers the cost-sharing amounts under Medicare?

Medicare Supplement

Which of these actions is considered unfair to be an Unfair Claims Settlement Practice?

Misrepresenting pertinent policy provisions relating to coverage after a loss

Which of the following health insurance plans charges a premium that cannot be increased?

Noncancelable

Which of these plans allow a participant to choose either a network or non-network provider at the time when medical care is needed?

Point-of-service

When issuing disability income coverage to a substandard risk, an insurance company may

Shorten the benefit period

Which of the following does a Medicare Advantage enrollee typically pay for?

Small co-pay per visit or per service

Which statement concerning the Entire Contract provision in an individual accident and health insurance policy is TRUE?

The agent doesn't have the authority to change the policy or waive its provisions

The insureds consideration given for a health insurance policy for

The first premium payment and the application

Who may terminate coverage under a cancelable health insurance policy?

The insurer or the insured

Darrell has a group long-term disability income policy paid by his employer. Which of these statements is true?

The specified benefit amount is a percentage of his wages

A producer gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?

When the conditions of the receipt are met

an example of misrepresentation is

a producer misleading or failing to adequately disclose the title and true nature of a policy offered to a potential insured

which of the following is an example of defamation

a producer who publicly and erroneously announces that an insurance company is insolvent

before an individual is permitted to act as an insurance agent they must hold a valid insurance license and be____by an authorized insurer

appointed

Which of the following is not required for the renewal of a producers license

appointment by an insurer

which of the following is not the responsibility of an insurer

assuming liability for a producers unauthorized acts

at what point must a newborn be covered under and individual or group health policy

at the moment of birth

Continued health insurance coverage is available for dependent children beyond the age of 26 if the child

cannot support themselves because of a handicap

a superintendent has reason to believe a producer violated Mass insurance law the superintendent may issue a(n)

cease and desist order

a foreign insurer wishing to conduct business in MA must obtain a

certificate of authority

upon receipt of written notice of claim an insurer is required to provide the claimant with

claim forms

a prospective client was intimated by a producer to purchase an insurance contract. the producer could be found guilt of

coercion

Which of these is not a punishment for committing an unfair and deceptive insurance practice

community service

which of these is not considered a federal punishment for unfair and deceptive insurance practices

community service

individual and group health insurance typically exclude coverage for which of the following?

cosmetic surgery

Reductions in coverage are one feature of _______ in Health insurance policies.

cost containment

Major medical plans typically exclude coverage for which of the following benefits

custodial care

the "notice to buyer?" on the first page of each long term care policy delivered in Massachusetts

explains that some long term care costs may not be covered

when a producer is appointed the _____is considered the principal

insurer

who is required to notify the producer in the event of appointment termination

insurer

In order for a person to sell insurance in MA they must have a

letter signed by the superintendent

An insurance policy may be issued with a preferred insurance premium in all of these situations EXCEPT

living in a rural area

risk___is the process of analyzing exposures that create risk and designing programs to handle them

management

a producer is proposing that a policy owner replace an existing individual health insurance policy with a new one. under the new contract a pre existing conditions exclusion

may reduce the insured's benefits

Field underwriting by a producer

may result in the disclosure of hazardous activities of the applicant

all the following are covered under most dental plans except for

mouth cancer

In MA the human immunodefiency virus (HIV) consent form

must disclose who will be receiving a copy of the test results

If the commissioner requests access to a producers business records the producer

must provide access to the records upon request

An insured is covered with a health insurance policy. If the insured would like to cancel the policy, he/she must

notify the insurance company in writing

which of the following is not covered by MA workers compensation laws

on the job injury that was both intentional and self inflicted

The ______ is responsible for determining the appropriateness of a Medicare Supplement policy for an applicant.

producer

in order for a handicapped child to continue health insurance coverage beyond the policy limiting age the insurer may require

proof of incapacity

which of these situations would not potentially involve a prison sentence under federal law

selling insurance with a nonresident license

which entity is responsible for regulating claims settlement practices of insurers

state insurance departments

once a child is born and covered under a health insurance plan any reduction in benefits on the newborn is

strictly prohibited

the____ has the ability to examine the records of authorized insurers because of the powers granted through state statutes

superintendent

a married couple adopts a child that was voluntarily surrendered by birth mother. the married couple is already covered under a group health insurance policy. at what point is the child considered a dependent under this coverage

the date the child is placed in the couples home

In accident and health insurance, field underwriting is very important because of

the risk of a moral hazard

a notice of information practices must be given to a policy owner at least every____years

three

How long is individual medical expense insurance normally written for

1 year

Individuals seeking Social Security disability income benefits must have a disability that will eventually lead to death, or be expected to last at least

12 months

Nonqualified medical expense distributions from a Health Savings Account (HSA) have a tax penalty of

20%

Kate received a group accident and health termination notice. How many days does she have to apply for a converted policy?

31

Larry wants to purchase an individual disability income policy to provide continuous income while disabled. He is also covered by a two-month wage continuation benefit from his employer. What should the policy elimination period be for his individual policy?

60 days

What are reasonable and customary charges for health insurance primarily based on?

Average charges within a geographic region

In long-term care insurance, what is the length of time for which claims will be paid?

Benefit period

Which of these statements regarding Major Medical Expense insurance is NOT true?

Benefits are paid on a capitation basis

A policyowner suffers a covered accident and health insurance loss on June 30 and submits the proof of loss to the insurer July 10. If the policyowner cancelled the coverage on July 2, how will the insurance company handle the claim?

Claim must be paid after proof of loss is received

The courts will normally interpret a policy in favor of the insured when the meaning of the policy is not clear. This is because an insurance policy is an?

Contact of adhesion

When dealing with long-term care coverage, which of the following are classified as ADLs?

Eating, bathing, dressing, and mobility

Non-occupational disability coverage is designed for

Employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation

Terry suffers an injury at his workplace which is covered by workers compensation. Terry also has a medical expense insurance policy. Under medical expense insurance policies, losses that are covered by workers compensation are typically

Excluded from coverage

Tonya has been diagnosed with kidney failure and is covered by group accident and health insurance through her large employer. Which of these accident and health plans will be primary during the months immediately following her diagnosis?

Her employer's group accident and health plan

A family counseling benefit is typically offered under which of these coverages?

Hospice care

Which of the following is NOT true of a preferred provider plan?

Hospitals can only initiate preferred provider plans

which of the following is a syndicate established by a group of insurers to share underwriting duties

Lloyd's organization

Which of the following covers the Part A deductible of Medicare

Medicare supplement core benefits

Which of the following does NOT meet the requirements of "skilled nursing care"?

Must be provided exclusively in a hospital

Jerome is covered by a disability income policy that does NOT provide benefits for losses occurring as the result of his employment. What kind of coverage is this?

Nonoccupational Coverage

Which of the following is NOT true of participants in multiple-employer trusts?

Participants must purchase all coverages the trust offers

Mark is covered by a policy that uses the regular occupation (own-occ) definition of total disability. Using this definition, he will be considered disabled if unable to

Perform the substantial and material duties of his regular occupation

Which would NOT be a location where skilled nursing care is provided?

Personal Residence

Patrick purchased a long-term care policy. He has a health condition for which medical treatment was recommended by a physician within 6 months prior to the policy's effective date. This condition is called a(n)

Pre-existing condition

An individual may receive Medicare Part A Hospital benefits, regardless of age, as long as the person has received which of the following benefits for at least 24 months?

Social Security Disability

Qualified long-term care premiums are treated for tax purposes as

Tax-deductible to the extent they exceed 7 1/2% AGI

Jonas is covered with disability insurance through his employer. The employer pays 75% of the premium, while Jonas pays the other 25%. What is Jonas' tax liability for any benefits paid from the disability plan?

Taxes must be paid on 75% of the benefits received

All parts of the Medicare program (except for public information and enrollment) are administered by which federal agency?

The Centers for Medicare and Medicaid Services

What is taken into consideration when defining "total disability" in a disability income insurance policy?

The insured's education, training, and experience

Which of the following best describes the presumptive disability provision?

Waives the typical total disability requirements

an insurance company can be liable for a producers unauthorized acts

When the agency contact is unclear concerning the authority given

Medicare supplement insurance that provides a preventative medical care benefit will often cover

Yearly Physical Examinations

Mike recently lost sight in both eyes. He has a policy that pays a lump sum benefit for this injury. What type of insurance does Mike have?

accidental death and dismemberment

a producer working for an insurance company may be personally liable for

acts performed which are prohibited in the agency contract

what qualifies as acceptance of an insurance contract

an issued policy

Use of XYZ Insurance Company brochures, business cards, and rating guides is an example of

apparent authority

which of these statements regarding insurance is false

as the number of insured units increases, the number of losses decreases

Which of the following is considered a limited accident and health plan

cancer plan

Which of the following types of insurers limits the exposures it writes to those of its owners

captive insurer

Jill has a group health plan with an employer that covers employees in more than one state. Which of the following is NOT affected by the state regulatory jurisdiction established for this plan?

continuation of coverage under COBRA

An employer pays the accident and health insurance premiums for its employees. The premiums paid by the employer are

deductible to the business

An HMO prescription drug plan is generally characterized by

drugs dispensed through participating pharmacies

A group health insurance policy is a contract between an

employer and insurance company

Which parties are directly involved in a group accident and health insurance contract?

employer and insurer

an agreement is reached when an insurance contract is formed. which of the following is not considered to be an element of an agreement

equity

the powers directly given to a producer is an agency contract are called

express

when a ceding insurer transfers a portion of its risk to an assuming insurer on a case by case basis, this process is referred to as

facultative

A major medical expense plan typically includes coverage for hospital room and board. Which of the following is normally covered under the category "room and board"?

general nursing care

Which of the following statements is NOT true concerning the relationship between group health insurance plans and Medicare? (assuming the business has more than 20 employees)

group health coverage is NOT available for workers over the age of 65

for instance purposes, similar objects which are exposed to the same group of perils are referred to as

homogeneous exposure units

Medicare part a typically covers

impatient drugs

XYZ Insurance Company gives direct authority to its producers to sell insurance through an agency contract, but nothing is stated regarding the collection of premiums. Which authority grants the producer the right to collect premiums?

implied authority

James owns a business and purchased a policy that covers the business expense of finding a permanent or temporary employee to replace a disabled one. This type of disability coverage is called

key employee coverage

Inpatient psychiatric care is covered under Part A Medicare Insurance for 190 days per

lifetime

an insurance contract may be voided if a misrepresentation found on the application is determined to be

material

Which of the following is excluded in a medical expense plan

military duty

which of the following can be defined as a cause of loss

peril

The___may change a revocable beneficiary as part of an accident and health policy

policy owner

Which of the following accurately describes a participating insurance policy

policyowners may be entitles to receive dividends

A pre-existing condition exclusion in an accident and health insurance policy pertains to

prior health matters

Which of the following outlines the authority given to the producer on behalf of the insurer

producer contract

A Medicare supplement policy is required to do which of the following?

provide a 30 day free-look period

which of the following types of risk is insurable

pure

ambiguities in insurance contracts are typically interpreted in favor of the insured. this rule is referred to as

reasonable expectations

an insured is entitled to coverage under a policy that a prudent person would expect it to provide. the principle is called

reasonable expectations

Which of the following disability income provisions allows two periods of disability to be counted as one

recurrent disability

an___insurer assumes risk from another insurance company

reinsurance

an insurer has contractual agreement which transfers a portion of its risk exposure to another insurer. What type of contractual arrangement is this

reinsurance contract

What is the accounting measurement of an insurance company's future obligations to its policy owners

reserves

Which of the following would provide a reimbursement of some premiums when a long-term care policy is cancelled

return of premium rider

a group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a

risk retention group

Dividends from a stock insurance company are normally sent to

shareholders

Medicare part a covers which type of care

skilled nursed facility care

What type of risk involves the potential for loss and possibility of gain

speculative

which one of these is not considered to be an element of an insurable risk

speculative

In order to contribute to a health savings account (HSA)

the applicant must have no sickness and accident coverage

under the law of agency the principal is considered to be

the insurer

Under which circumstance can an insurance company offer group Health insurance?

the sponsoring group provides an employer-employee relationship

Under HIPPA requirements, eligibility for the pre-existing conditions exclusions waiver under new coverage is lost if

there is a break in coverage of more than 63 days

a business becoming incorporated is an example of risk

transfer

a hold-harmless clause is an example of risk

transfer

giving up a known right on a voluntary basis is called

waiver

the following are all elements of a valid contract except

written evidence