rfk life and health test

An IRA uses immediate annuities to pay out benefits; the IRA owner is nearly 75 years old when he decides to collect distributions. What kind of penalty would the IRA owner pay?

50% tax on the amount not distributed as required

What is the waiting period on a Waiver of Premium rider in life insurance policies?

6 months

According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan?

60%

If a telemarketer wants to make an unsolicited sales call to a potential customer, what is the earliest time the telemarketer can call the prospect's residence?

8 am

An investor buys a life policy on an elderly person in order to sell it for a life settlement. This is an example of

A STOLI policy.

Which of the following individuals will be eligible for coverage on the Health Insurance Marketplace?

A permanent resident lawfully present in the U.S.

Which of the following is NOT an allowable 1035 exchange?

A whole life insurance policy is exchanged for a term insurance policy.

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?

3 days

Replacing insurers that use producers must provide applicants with the right to return their policy within a few days of its delivery. How many days?

30

Which of the following statements about a suicide clause in a life insurance policy is TRUE?

Suicide is excluded for a specific period of years and covered thereafter.

Which of the following is NOT an activity of daily living (ADL)?

Talking

The advantage of qualified plans to employers is

Tax-deductible contributions.

How does a member of an HMO see a specialist?

The primary care physician refers the member.

A person buys an individual long-term care policy and is not satisfied with the provisions. Within how many days will the insured be able to return the policy for a full premium refund?

30 days

A provision in a life insurance policy that provides for the early payment of some portion of the policy face amount should the insured suffer from a terminal illness or injury is called

Accelerated Benefit provision.

If an annuitant dies during the accumulation period, what benefit (if any) will be included in the annuitant's estate?

Accumulated cash value

The Omnibus Budget Reconciliation Act of 1990 requires that large group health plans must provide primary coverage for disabled individuals under

Age 65 who are not retired.

Which of the following are unlawful with regard to the ADEA?

All of the above are unlawful.

A resident agent licensed in another state may obtain a nonresident license in Utah without taking the examination provided that

All of these requirements are met.

Which of the following applicants could the insurer charge a higher rate of premium and not violate regulations regarding unfair discrimination?

An applicant who is a smoker

Which of the following would be considered a routine procedure?

Annual check-up

When an annuity is written, whose life expectancy is taken into account?

Annuitant

Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?

Apparent

Which of the following is NOT required to be stated in the outline of coverage provided with a long-term care policy?

Basic information about supplementary policies

All of the following statements are correct regarding credit life insurance EXCEPT

Benefits are paid to the borrower's beneficiary.

A producer who fails to segregate premium monies from his own personal funds is guilty of

Commingling.

Which of the following provisions requires that any policy language that is in conflict with the state statutes of the state in which the insured resides is automatically amended to conform with those of the state of residence?

Conformity with State Statutes

The purpose of managed care health insurance plans is to

Control health insurance claims expenses.

A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of her life insurance policy has been raised 7% as a result. Which policy rider caused this change?

Cost of Living Rider

Which of the following will NOT be an appropriate use of a deferred annuity?

Creating an estate

Under the Civil Rights Act, if 41-year-old Jared applies to be a Union foreman, for which of the following reasons could Jared be denied employment?

Disability

Two individuals are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant factor. What is this called?

Discrimination

Which of the following scenarios will incur a 10% tax penalty on distributions?

Distributions are made on a policy before age 59½.

Which of the following terms is used to name the nontaxed return of unused premiums?

Dividend

Who can provide skilled nursing care?

Doctor

An insurance company assures its new policyholders that their premium costs will not increase for a period of at least five years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next two years. What term best describes this act?

Fraud

In a direct rollover, how is the money transferred from one plan to the new one?

From trustee to trustee

What required provision protects against unintentional lapse of the policy?

Grace period

Which of the following is TRUE of a qualified plan?

It has a tax benefit for both employer and employee.

Which of the following is NOT true regarding the accumulation period of an annuity?

It would not occur in a deferred annuity.

In respect to the consideration clause, which of the following is consideration on the part of the insurer?

Promising to pay in accordance with the contract terms

Under which provision can a physician submit claim information prior to providing treatment?

Prospective Review

Which of the following insurance options would be considered a risk-sharing arrangement?

Reciprocal

When an employee is still employed upon reaching age 65 and eligible for Medicare, which of the following is the employee's option?

Remain on the group health insurance plan and defer eligibility for Medicare until retirement

Annuities can be used to fund which of the following?

Retirement plans

Which of the following components of dental insurance does NOT require the payment of a deductible?

Routine and preventive maintenance

A domestic insurer issuing variable contracts must establish one or more

Separate accounts.

Which of the following is the best scenario for self-insurance?

Smaller, frequent losses

Which of the following would be a qualifying event as it relates to COBRA?

Termination of employment due to downsizing

All of the following employees may use a 403(b) plan for their retirement EXCEPT

The CEO of a private corporation.

If the annuitant dies during the accumulation period, who will receive the annuity benefits?

The beneficiary

An Adjustable Life policyowner can change which of the following policy features?

The coverage period

Which of the following is true regarding reinstatement of insurance coverage that lapsed due to the insured's being on active duty in the U.S. armed forces?

The coverage will be reinstated if applied for within 6 months of release from active duty.

An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries?

The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.

Which of the following statements regarding conditional receipts is true?

They are temporary insuring agreements.

What do long-term care policies offer to policyholders to account for inflation?

They offer the option of purchasing coverage that raises benefit levels accordingly

An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?

Time of Payment of Claims

Which of the following Life Insurance policies would be considered interest sensitive?

Universal life

An employee quits her job where she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a Traditional IRA, how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer?

$10,000, no tax consequence

Before he died, an annuitant had received $12,500 in monthly benefits from his $25,000 straight life annuity. He was also the insured under a $50,000 paid-up whole life policy that named his wife as primary beneficiary. Considering both contracts, how much will the annuitant's spouse receive in benefits?

$50,000

The sole proprietor of a business makes a total salary of $50,000 a year. This year, his medical expenses have reached a total of $75,000. What amount may the sole proprietor deduct in regards to his medical expenses?

$50,000

What is the shortest possible elimination period for group short-term disability benefits provided by an employer?

0 days

What percentage of individually-owned disability income benefits is taxable?

0%

An agent voluntarily surrendered her license. How soon after this surrender can her license be reinstated?

1 year

S is a sole business proprietor who owns a medical expense plan. What percentage of the cost of the plan may he deduct?

100%

A policyowner cancels his life policy but instructs the insurance company to transfer the cash value of his policy to an annuity. This nontaxable transaction is called

1035 exchange.

The Pregnancy Discrimination Act specifically prohibits pregnancy discrimination by employers with the minimum of how many employees?

15

What is a penalty tax for nonqualified distributions from a health savings account?

20%

Under SIMPLE plans, participating employees may defer up to a specified amount each year, and the employer then makes a matching contribution up to an amount equal to what percent of the employee's annual wages?

3

What is the term used for an applicant's written request to an insurer for the company to issue a contract, based on the information provided?

Application

In a replacement situation, all of the following must be considered EXCEPT

Assets

When must insurable interest exist in a life insurance policy?

At the time of application

Which of the following is considered a qualifying event under COBRA?

Divorce

A license may be denied, suspended, or revoked if the licensee

Engages in fraud. Was convicted of a felony Intentionally misrepresents an insurance policy. All of the above.

An annuity owner is funding an annuity that will supplement her retirement. Because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the Standard and Poor's 500 Index. She would likely purchase a(n)

Equity Indexed Annuity.

Which of the following best describes the aleatory nature of an insurance contract?

Exchange of unequal values

When an employer offers to give an employee a wage increase in the amount of the premium on a new life insurance policy, this is called a(n)

Executive bonus.

The authority granted to an agent through the agent's contract is referred to as

Express authority.

An agent selling variable annuities must be registered with

FINRA.

A producer is acting in what capacity when he or she is trying to obtain credible information about an applicant for health insurance?

Field underwriter

An applicant wants to buy a life insurance policy in which he can count on receiving the same benefits as stated in the contract. Which type should he buy?

Fixed

In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party?

Insurer to the insured

Which of the following is NOT a metal level of coverage offered under the Patient Protection and Affordable Care Act?

Iron

In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost

Is not covered.

When Y applied for insurance and paid the initial premium on August 14, he was issued a conditional receipt. During the underwriting process, the insurance company found no reason to reject the risk or classify it other than as standard. Y was killed in an automobile accident on August 22, before the policy was issued. In this case, the insurance company will

Issue the policy anyway and pay the face value to the beneficiary.

Medicare Advantage is also known as

Medicare Part C. Medicare consists of Hospital Insurance protection (Part A), Medical Insurance protection (Part B), and Medicare Advantage (Part C) (formerly known as Medicare+Choice). Medicare Part D is a "stand alone" drug insurance policy for persons who need the coverage and are eligible for Medicare Part A and/or Part B

Which of the following best describes gross annual premium?

Net premium plus expenses

Which renewal provision(s) must be included in a long-term care policy issued to an individual?

Noncancellable and guaranteed renewable

Under a straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive

Nothing; the payments will cease.

Underwriting is a major consideration when an insured wishes to replace her current policy for all of the following reasons EXCEPT

Premiums always stay the same.

All of the following are unfair claims settlement practices EXCEPT

Suggesting negotiations in settling the claim.

Which of the following is TRUE regarding the insurance amount in a credit life policy?

The creditor can only insure the debtor for the amount owed.

Which of the following describes the tax advantage of a qualified retirement plan?

The earnings in the plan accumulate tax deferred.

When a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit?

The insured's contingent beneficiary

All of the following are true regarding a decreasing term policy EXCEPT

The payable premium amount steadily declines throughout the duration of the contract.

If a policy is rated-up, which of the following is true?

The premium increases.

Which of the following is NOT the purpose of HIPAA?

To provide immediate coverage to new employees who had been previously covered for 18 months

Under a credit disability policy, until what point will payments to the creditor be made for the insured?

Until the disability ends or the debt is satisfied, whichever is sooner

Which of the following would least likely be considered a legitimate need that would be paid by insurance proceeds?

Vacation travel expenses

An insured receives a monthly summary for his life insurance policy. He notices that the cash value of the policy is significantly lower this month than it was last month. What type of policy does the insured have?

Variable

Which of the following products requires a securities license?

Variable annuity

Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?

Warranty

When would a 20-pay whole life policy endow?

When the insured reaches age 100

Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE?

Withdrawals are not taxable.

What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?

$2,500

Which of the following health care plans would most likely provide the insured/subscriber with comprehensive health care coverage?

Health Maintenance Organization plan

When would a misrepresentation on the insurance application be considered fraud?

If it is intentional and material

When can a small employer health benefit plan be discontinued by the carrier?

If the plan sponsor fails to pay premiums

Which of the following factors about the insured determines the amount of disability benefit that the insured will receive?

Income

A typical Accidental Death & Dismemberment policy covers all of the following losses EXCEPT

Income.

In an optionally renewable policy, the insurer has which of the following options?

Increase premiums

When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy?

It is reduced to the amount of what the cash value would buy as a single premium.

Which of the following statements is NOT correct concerning the COBRA Act of 1985?

It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.

Which of the following is excluded in a dental insurance plan?

Lost dentures

Death benefits payable to a beneficiary under a life insurance policy are generally

Not subject to income taxation by the Federal Government.

Who is involved in completing the agent's report?

Only the agent

An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called

Paid-up additions.

Prior to purchasing a Medigap policy, a person must be enrolled in which of the following?

Parts A and B of Medicare

In a group policy, who is issued a certificate of insurance?

The individual insured

Who chooses a primary care physician in an HMO?

The individual member

Who bears all of the investment risk in a fixed annuity?

The insurance company

The Patient Protection and Affordable Care Act includes all of the following provisions EXCEPT

Individual tax deduction for premiums paid.

The Medical Information Bureau (MIB) was created to protect

Insurance companies from adverse selection by high risk persons.

Which of the following is TRUE regarding the accumulation period of an annuity?

It is a period during which the payments into the annuity grow tax deferred.

Shortly after a replacement transaction on a Medicare supplement policy, the insured decided to cancel the policy, but is unsure whether the free-look provision applies. The insured could find that information in the

Notice Regarding Replacement.