Insurance Guaranteed Questions

Riley reads and agreement on the first page of her policy which includes a list of losses that will be covered by her insurer. What is the name of this agreement?

Insuring Clause

If a life insurance company uses HIV testing as a part of its underwriting when must an applicant be notified of the procedure?

Prior to performance of the test

An individual covered under a group Dental Expense plan needs to have bridgework done. This is covered as

Prosthodontics

What is another term for a health insurance policy subscriber

Participant

In insurance, what is the term used for the cause of a loss?

Peril

Which of the following types of insurance is investment based, has a level fixed premium, and nonguaranteed cash value?

Variable whole life

When an insured terminates membership in the insured group, the insured can convert to

Whole life without proof of insurability

How long is the grace period for an individual life insurance policy?

1 month

Penalty for violating fair credit reporting act

$2,500

An IRA owner who is 57 years old want to make a withdrawal form her traditional IRA. What penalty will be imposed

10%

What guarantees that the information explained in the insurance contract is true

A warranty

Which rider, when added to a disability policy, pays income during the six-month waiting period before Social Security benefits can begin?

Additional Monthly Benefit

If a licensee wants to transact insurance under a name different from that on the insurance license, the licensee must first notify the

Director

Which of the following is NOT a crucial factor in health insurance underwriting?

Income

HMO's are known as what type of plans?

Service

What does Medicare part A not cover

private room, private nurse

Which portion of a nonqualified annuity payment is taxable?

Interest earned on principal

Which of the following time periods is the general enrollment period for Medicare Part B

January 1 through March 31 each year

Which of the following entities becomes involved in the event of insurer insolvencies?

The South Carolina Life and Health Guaranty Association

In life insurance, who is not required to have an insurable interest in the insured?

The beneficiary

Spendthrift clause protects who?

The beneficiary

An employer is no longer able to afford the group health insurance plan and the plan terminates. However, one of the employees continues to receive coverage under the plan. Which of the following explains the reason for the continued coverage?

The employee is totally disabled

Cash Value guarantees in a wholelife policy are called

Nonforfeiture values

What is the maximum fine for signing blank application forms by a producer?

$200

Which of the following would not trigger the payment of accelerated death benefits?

Being permanently disabled

An employee dies having 6 quarters of coverage during the previous 13-quarter period. What status of coverage does the employee have under Social Security?

Currently insured

Which of the following is a provision found in a life insurance policies?

Reinstatement

An IRA contribution can be made from which of the following?

Cash

Which of the following statements is incorrect regarding group health insurance?

Each individual must be accepted into or rejected by a group policy

A medicare supplement plan must have at least which of the following renewal provisions?

Guaranteed renewable

Which type of insurance policies provides pure life insurance protection without a savings element?

Term

An elimination period may not have to be satisfied for a disability in which of the following?

An insured suffers a relapse of a prior disability within 6-months of the initial covered disability

What does an annuity protect the annuitant against?

Living longer than expected

The benefits in Medical Expense Insurance are

Received income tax free by the individual

An individual was denied coverage under Social Security because his disability did not meet the strict definition of total disability used by Social Security. Which of the following would provide disability income coverage?

SIS rider

Combination dental plan contains both

Scheduled and nonscheduled plans

What is not a characteristic of group health insurance plans

The parties that hold a group health insurance contract are the employees and the employer

Who is the annuity owner?

The person who buys an annuity

Which service is not provided by an HMQ

Unlimited coverage for treatment for drug rehabilitation

Considering the principles of liquidity, how would the policyowner use today's cash values in a life insurance policy?

Use it for emergency expenses

Which of the following employee benefits essentially provides the employee with a wage increase and directs that wage increase to be spent on a life insurance policy?

Executive bonus

Under the mandatory uniform provision Proof of Loss, the claimant must submit proof of loss within what time period after the loss?

90 days

If a person qualifies for Social Security disability benefits after the 5 months elimination period, when will benefits begin?

Benefits begin at the beginning of the 6th month and are not retroactive to the beginning of the disability

Which of the following is the distinguishing characteristic of the interest-adjusted net cost method?

Considering the time value of money in comparing life insurance costs

Which is not true regarding a deferred annuity?

Income payments begin within 1 year from the date of purchase

All of the following are true about Group Life insurance except

The employer is the beneficiary

To purchase insurance, the policyowner must face the possibility of losing money or something of value in the event of loss. What is this concept called?

Insurable interest

A core Medicare supplement policy (Plan A) will cover all of the expenses except

Part A deductible

If the insurance premiums were not tax deductible, what other taxation will this affect?

Taxation of benefits

With Adjustible Life, the owner can change all of the following except

The insured

An insurer's Certificate of Authority can be cancelled by the Director for all of the following except

The insurer has a policy form that is disapproved

Who would not be eligible for coverage under key person?

The owner of a shop

What isn't true of the survivorship life policy

The premium is based on the age of each insured

In a viatical settlement the face amount

Face amount is less

J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did J choose?

Fixed amount

Because of the imposed blackout period, the surviving spouse will not receive social security benefits until

He or she qualifies for retirement benefits

Which is true of level term insurance?

It is temporary protection

An insurance agent visits a potential client and explains various types of policies. The customer displays a lack of interest, so the agent guarantees higher dividends than he knows would be possible. Which term describes what the agent has done?

Misrepresentation

An insured falls down a flight of stairs and sustains a neck injury that renders him severely disabled. The insured owns a Whole Life policy. Is it possible for the policy to include a Waiver of Const of Insurance rider, and if so, what insurance costs would be waived?

No; it is not possible for this waiver to be included in a whole life policy

Dividends received on participating life insurance policies are

Not taxable because they are a return of unused premiums

How long is the free-look period of a Medicare supplement policy?

30 days

What is it called when a doctor accepts the Medicare approved amount?

Assignment

The guaranteed insurability rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following except

Purchase of a new home

Life insurance creates an immediate estate. Which of the following best explains this statement?

The face value of the policy is payable to the beneficiary upon the death of the insured

Who doesn't have to sign an application for health insurance

Insurer

Which is not correct concerning taxation of disability income benefits?

If paid the individual, the premiums are tax deductible

An insured's hospital policy states that it will pay him a flat fee of $75 per day for each day he is hospitalized. The policy pays benefits on what basis?

Indemnity

Which is not true regarding an optionally renewable policy?

Insurer can only cancel the policy for reasons stipulated in the contract

Which statement is required to be printed on the first page of a health insurance policy, which signals to the insured that the policy's benefits are limited?

Limited Policy Notice

Upon the surrender of a life insurance policy, any cash value accumulated in excess of the premium payments is

Taxed as ordinary income

Which of the following is true regarding pure life annuity settlement option?

It provides the highest monthly benefit

If an insured dies, and it is discovered that the insured misstated their age or gender, the life insurance company will:

Adjust the death benefit to what the premium would have purchased at the actual age or gender

How soon should you submit proof of loss

Within 60 days

Your client wants to provide a retirement income for his elderly parents in case something happens to him. He wants to make sure that both beneficiaries are guaranteed an income for life. Which settlement option should this policymaker select?

Joint and survivor

Who wouldn't be able to qualify as a group for the purpose of purchasing group health insurance

An association of 35 people

Riley reads an agreement on the first page of her policy which includes a list of losses that will be covered by her insurer. What is the name of this agreement?

Insuring clause

Which is provided by skilled medical personnel to those who need occasional medical assistance or rehabilitative care?

Intermediate care

Which of the following statements describes one of the reasons individuals purchase life insurance?

It creates an immediate estate

Who would be the insured in business disability insurance?

Key employees

An applicant completes an application for a disability policy and pays the initial premium. The producer gives the applicant a conditional receipt. Insurance coverage for the applicant will become effective when

The insurance company accepts the risk

Restoring an insured financially after a claim is known as

indemnity

Which of the following used to be called Medicare + Choice Plans?

Medicare Advantage Plans

When a settlement option is chosen at death, how are the monthly income payments taxed?

The principal portion is generally income tax-free while the interest portion is taxed as ordinary income

The elimination period in a disability income policy is better known as

The period of time an insured must wait after the onset of an illness or injury before benefits begin

An employee that becomes ineligible for group coverage because of termination of employment or change in status, must exercise extension of benefits under COBRA

Within 60 days