Readiness exam

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

Medicare Advantage Plans

Guaranteeing future dividends is considered to be an unfair or deceptive act known as

Misrepresentation

Which of the following terms relates to disability income insurance?

residual benefit

A retail shop owner is insured under a business overhead expense policy that pays a maximum monthly benefit of $2,500. His actual monthly expenses are $3,000. If the owner becomes disabled, the monthly benefit payable under his policy will be

$2,500

If an insured pays a health insurance premium each month, how long would the grace period be under the policy?

10 days

Medicare Part A services do NOT include which of the following?

Private duty nursing

During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, and makes it sounds worse than it is. This is an example of an unfair trade practice of

defamation

An insurer incorporated under the laws of another state but doing business in this state is considered

foreign

All of the following must sign an application for health insurance EXCEPT

insurer

Under the Payment of Claims provision, to whom will the insured's benefits be paid if the insured is deceased?

The insured's primary beneficiary

If an applicant submits the initial premium with an application, which action constitutes acceptance?

The underwriters approve the application

Which of the following services will NOT be provided by an HMO?

Unlimited coverage for treatment for drug rehabilitation

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

What term is used for insurance companies that have a Certificate of Authority to transact insurance?

admitted

Which of the following premium modes would result in the lowest overall premium?

annual

Under the mandatory uniform provision Legal Actions, an insured is prevented from bringing a suit against the insurer to recover on a health policy prior to

60 days after written proof of loss has been submitted

The annual open enrollment period for state insurance exchanges runs from November through

January

Which of the following is consideration on the part of an insurer?

Paying a claim

In order to support informed underwriting decisions, an insurer may require an applicant to answer questions concerning all of the following EXCEPT

Sexual orientation

Upon payment of a loss, the insured is obligated to surrender to the insurer the right to sue a negligent party. This is called?

Subrogation

If a basic medical insurance plan's benefits are exhausted, what type of plan will then begin covering those losses?

Supplementary Major Medical

Which of the following individuals may act as a producer without a license?

An insurance company president who is solely responsible for the administration of the company

A dentist is off work for 4 months due to a disability. His dental assistants salary would be covered by

Business Overhead Insurance

In addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health?

By requiring that the insurance be incidental to the group

On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the

principal sum

The purpose of the Fair Credit Reporting Act is to

protect consumers against the circulation of inaccurate or obsolete personal or financial information

What is the purpose of requiring licenses for persons who transact insurance?

protect the general public

An agent tells an insured that if he replaces his current insurance policy with a newer one, his dividends will be higher and his premiums will be slightly lower. The policy, however, would not offer either one of these things. What type of misrepresentation is being committed?

twisting

An agent who knowingly misrepresents material information for the purpose of inducing an insured to lapse, forfeit, change or surrender a life insurance policy or annuity has committed an illegal practice known as

twisting

Regarding the consideration clause, which of the following is NOT correct?

Consideration of the insurer and insured must be equal

If an insured is not entirely satisfied with a policy issued, the insured may return it to the insurance company and receive a refund of the entire premium paid, at which of the following times?

Within 10 days of when the policy was delivered

every medicare supplement policy must have a notice to buyer on the front page that states which of the following

this policy may not cover all of your medical expenses

Medicare is a health insurance program for all the following individuals EXCEPT

those with low income and low assets

Which of the following statements is NOT true

A licensed consultant may hold a producer license

Which of the following is NOT true regarding the requirements for resident producers in Indiana?

A licensed resident producer in good standing in another state may also be a resident producer in Indiana

All of the following are true regarding continuing education (CE) requirements in Indiana EXCEPT

A limited lines credit producer is not required to complete CE courses

An applicant misstates his age on his application for a health insurance policy. He states that he is 39, but his actual age is 49. When he files a claim, what will most likely happen?

Benefits paid will be those that would have been purchased at the correct age

What is the purpose of the gatekeeper in an HMO?

Controlling Costs *Initially the member chooses a primary care physician or gatekeeper. If the member needs the attention of a specialist, the primary care physician must refer the member. This helps keep the member away from the higher priced specialists unless it is truly necessary

To be valid, an insurance policy must have all of the following EXCEPT

countersignature

A limited health insurance policy that will pay a lump sum to an insured diagnosed with a heart attack, stroke, or renal failure is known as

critical illness insurance

A husband and wife both incur expenses that are attributed to a single major medical insurance deductible. Which type of deductible do they have in their policy?

family

Following a covered loss, the Time Payment of Claims Provision requires that an insurance company pay disability income benefits no less frequently than

monthly

Under the Affordable Care Act, when would pregnancy be considered a pre-existing condition?

never

What does Basic Medical Expense cover?

nonsurgical services a physician provides

Premiums paid by an employer for group health insurance are

tax-deductible to the employer

Whose responsibility is it to ensure that the application for health insurance is complete and accurate?

the agent's

An insured wants to cancel her health insurance policy. Which portion of the contract would explain cancellation rights?

Renewability provision

All of the following could qualify as a group for the purpose of purchasing group health insurance EXCEPT

An association of 35 people

According to the Time Limit on Certain Defenses provision, statements or misstatements made in the application at the time of issue cannot be used to deny a claim after the policy has been in force for a minimum of how many years?

2 years

An insurer must notify the consumer in writing that an investigative consumer report has been requested, within how many days of the initial request?

3 days

All of the following are features of a health insurance plan purchased on the health insurance marketplace EXCEPT

Dollar limits on essential benefits

The Uniform Provision Law that prevents an insurance company from altering its agreement with a policyholder by referring to documents or other items not contained in the policy is called the

Entire Contract provision

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

January 1 through March 31 each year

An example of an alien insurer doing business in this state is one formed under the laws of

Mexico

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

Is it ever possible for more than one producer to split commissions on a case in this state?

No, it is not possible under any circumstances

In group insurance, the primary purpose of the Coordination of Benefits provision is to

Prevent overinsurance

An insured, who is 44 years, falls while mountain climbing on vacation. He is left paralyzed. After a year, doctors feel he will never recover from his injuries. From which of the following programs will he be able to collect disability income?

Social security

Which of the following actions does NOT constitute false advertising?

Stating that dividends are not guaranteed

Which of the following statements is INCORRECT

The insurer does not have the right to conduct an autopsy

In health insurance, the length of the grace period varies according to the

The mode of the premium payment

Which of the following is a requirement for replacement of health policies?

The old policy must stay in force until the new policy is issued

All of following are characteristics of group health insurance plans EXCEPT

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

Which of the following would be considered a misleading advertisement in a health insurance policy according to Rule 18?

The use of testimonials

What is the purpose of a disability buy-sell agreement?

To allow the business buyout in case of the owner's disability

A lender who conditions approval of a loan on the condition that the borrower purchase insurance from that lender may be guilty of

coercion

Refusing to pay claims without conducting reasonable investigation based upon all available information is an example of

An unfair claims practice

Conrad received $50,000 from a $100,000 Accidental Death and Dismemberment policy as a result of the loss of his left arm in an accident. Conrad has received the

Capital Amount

Insurance producers who willfully and recklessly violate the Indiana Insurance Code are guilty of

Class A misdemeanor

Chris works part-time in her father's insurance agency, but she does not have an insurance producer license. She may perform all of the following activities EXCEPT

Collect premiums for in-force policies and explain coverages to clients that have existing policies written by her father

A person receives his Medicare supplement policy and is not satisfied with the provisions. He can return for a full premium refund if he does so within how many days?

30

An employee is covered under COBRA. His previous premium payment was $100 per month. His employer now collects $102 each month. Why does the employer collect an extra $2.

To cover the employer's administration costs

Which of the following may NOT be used in determining premium amounts?

Tobacco use

Ed is covered under a health plan provided by his employer. He was told that his insurance would pay the majority of the covered expenses if he would choose to see a provider in his plan's list. If Ed chose to be treated by a provider who was not on the list, his portion of the bill would be greater. Ed is covered under a/an

preferred provider plan

Joe, age 63, was disabled and can no longer work. He meets the Social Security definition of total disability. How many work credits must Joe have accumulated to have the status of fully insured?

40

What is the maximum age that a disabled insured worker may receive Social Security disability benefits?

65

In health insurance, what is coinsurance?

A percentage of the cost of service that the insured and the insurer share

Which of the following best defines the Probationary Period in group health policies?

A specified period of time that a person joining a group has to wait before becoming eligible for coverage

Which of the following meets the insured's personal needs, and is provided by nonmedical personnel?

Custodial care

All of the following are changes to health insurance plans introduced by the PPACA EXCEPT

Full-cost Coverage for all medical expenses

In order for an alumni association to be eligible to purchase group health insurance for its members, all of these statements must be true EXCEPT when the association

Has been active for five years minimum

An agent delivers a life policy. He explains a policy change was made and asks the applicant to sign a statement acknowledging the changes were explained. The agent says the premium has not been paid and must be paid before the policy goes into effect. He collects a Statement of Good Health, relinquishes the policy, and leaves. What did he do wrong?

He left the policy with the insured without collecting the premium

Under the long-term care marketing regulations, which of the following questions would a producer NOT have to ask the applicant in order to determine if the purchase is suitable?

How much are you able to pay in premiums?

Which of the following is NOT true regarding a producer's appointment and termination?

Insurance producers may act as agents of an insurer without an appointment

Which of the following is NOT true regarding a noncancellable policy?

Insurer can increase the premium above what is stated in the policy if claims experience is greater than expected