CH. 20 FFL

How long must a policy be in force before an insurer is prohibited from denying claims based on misstatements made on the health policy application?

2 years

According to PPACA, how long can an adult be covered as a dependent under their parents' insurance plan?

26

How long must life agents keep their transaction records?

5 years

According to the California Insurance Code, what is the maximum penalty per violation for anyone who unwillfully commits an unfair method of competition?

5000

What is an "insurance broker" according to the California Insurance Code?

A person compensated for transacting insurance on behalf of another person with an insurer

When an insurer has met the qualifications necessary to transact business in California, it is set to be

Admitted

An insurance company entitled to transact business in California is called a(n)

Admitted carrie An admitted california carrier is one that submits to specific requirements set forth by the california department of insurance (CDI)

Which of the following is NOT considered to be an unfair claims settlement practice?

Advising a claimant to hire an attorney

Failure to report background changes within 30 days as required under section 1729.2 of the California insurance code could subject a license or applicant to

All of these (fine, suspension, denial)

According to PPACA, what is a health benefits exchange?

An entity to which individuals and small businesses can have access to affordable health coverage PPACA creates new entities called American Health Benefits Exchange through which individuals, small business, & those who do not have access to employer coverage can purchase coverage

Life insurance surplus must be distributed to policyowners at what frequency

Annually

Insurance agents and brokers must make their insurance records available to the Commissioner

At all times

Which of the following is not allowed by health insurance counseling and advocacy program (HiCAP) counselors

Charge a fee Hicap provides free information on medicare

Before an insurer is allowed to test an individual for HIV, what must be completed?

Consent form

An agent's attempt to stop the replacement of an existing life insurance policy is known a

Conservation

Which entity has jurisdiction over health care coverage providers?

Department of insurance

Why is life insurance policy's delivery date important ?

Free look period begins on policy delivery date The Cali insurance code gives an individual between 10 and 30 days to return a life policy for cancellation

According to the PPACA, the medical enrollment tier that has 80% actuarial value is called

Gold

What prevents a life insurance policy from being rescinded by the insurer after being in force for two years?

Incontestability clause Insurers are prohibited from denying claims or rescinding a policy based on misstatements in a life, accident, or disability policy application after the policy has been in force for two years. This is called the incontestability clause.

Who does a life settlement broker represent?

Individual wanting to sell their life policy to a third party

An insurance policy issued in California may be called comprehensive long term care insurance policy if benefits are provided for

Institutional (nursing facilities) and home care

Which of the following is not protected under the Cali life and health guaranty association

Insurers (policy owners, insureds, and prim beneficiaries are protected)

Jim is applying to become an insurance agent and has a past misdemeanor conviction that was later expunged due to California Penal Code 1203.4. Which of the following statements is correct?

Jim must still disclose the conviction on his insurance license application

The California Insurance Code has authorized standards for names used by life insurance agents. Which of the following, if any, are automatically acceptable for Lance Manyon, a holder of the CLU designation?

Layon Manyon Insurance Services If the word "Insurance" is included in the name, the California Department of Insurance then checks to make sure one of the six definitive words ("Agency," "Services," "Marketing," "Sales", "Center" or "Solutions") is also included in the name. In this instance, Lance Manyon Insurance Services would be acceptable.

MRMIP stands for

Major Risk Medical Insurance Program This is a program designed to provide health insurance for individuals who cannot obtain health coverage on the open market bc of their medical conditions

Both the Federal and state governments jointly finance which health insurance entitlement program?

Medical

Which of the following does the California Department of Insurance (CDI) have NO jurisdiction over?

Medicare

What is required after a life agent sells an insurance policy to an applicant without being appointed by the insurer?

Notice of appointment must be submitted to the Commissioner If a life agent sells an insurance policy on behalf of an insurer w/ out an appointment, the insurer must submit a notice of appointment to the commissioner within 14 days

Which of the following is NOT an accurate description of access for infants and mothers program (AIM)

Only women who have private insurance plans with maternity-only deductible or copayment greater than $1,500 are eligible

What is the purpose of the Pre-Existing Condition Insurance Plan

PCIP was created by PPACA for people rejected by private health insurers due to pre existing conditions

According to the California Insurance Code, how is the word "may" interpreted?

Permissive (allowed but not obligatory; optional.)

What effect did the Pregnancy Discrimination Act have on the health industry

Pregnancy must be treated as any other medical condition

What does the term "illustration" mean when used in the phrase "life insurance policy illustration", according to the California Insurance Code?

Presentation of policy features that includes non-guaranteed elements

Which type of jurisdiction requires an insurer to have its rates accepted by the Insurance Department prior to using them?

Prior approval

Which of the following is NOT considered to be an act of insurance solicitation

Publishing a magazine where one of the advertisers is an insurer

When intentional concealment is involved, what course of action is the injured party entitled to?

Recession of contract concealment , whether intentional or unintentional, entitles the injured party to rescind insurance

Kimberly is an employee on leave under the Family and Medical Leave Act (FMLA). What will happen to her group health coverage?

She continues to be enrolled during the leave

Which of the following does NOT have to be included in life insurance policy illustrations?

Statements that all values and benefits are guarantees Not all benefits and values are guaranteed in life insurance policies. Some have non guarantee values which must be described in the illustration

In California, an insurer organized under the state laws of Oregon is called a(n)

foreign insurer

An agent has advertised that the insurer to which the agent is appointed is a member of the Insurance Guarantee Association. This agent has committed a(n)

unfair method of competition

Paul has an existing annuity and is sold a new one, in which the new policy holds no greater financial benefit to him than the existing contract. This is considered a(n)

unnecessary replacement