simulate test #6
Insurance policy is
A written instrument in which a contract of insurance is set forth.
#126. The insured under a $100,000 life insurance policy with a triple indemnity rider for accidental death was killed in a car accident. It was determined that the accident was his fault. The triple indemnity rider in the policy specifies that the death must not be contributed to by the insured in any manner. In this case, what will the policy beneficiary receive?
$100.000
An insured has a primary group health plan and an excess plan, each covering losses up to $10,000. The insured suffered a loss of $15,000. Disregarding any copayments or deductibles, how much will the excess plan pay?
$5.000
How many eligible employees must be included in a contributory plan?
75%
Which of the following elements in an Indexed Universal Life policy is tied to an index?
Cash values
What size companies are eligible for health reimbursement accounts (HRAs)?
Companies of all sizes
What is the contract provision that allows the insurer to nonrenew health coverage if certain events occur?
Conditionally renewable
All of the following statements concerning Accidental Death and Dismemberment coverage are correct EXCEPT
Death benefits are paid only if death occurs within 24 hours of an accident.
An individual has been making periodic premium payments on an annuity. The annuity income payments are scheduled to begin after 1 year since the annuity was purchased. What type of annuity is it?
Deferred
Health coverage becomes effective when the
First premium has been paid and the application has been approved.
An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits?
Full benefits
An insured has a Modified Endowment Contract. He wants to withdraw some money in order to pay medical bills. Which of the following is true?
He will have to pay a penalty if he is younger than 59½/.
Which of the following types of LTC is NOT provided in an institutional setting?
Home health care
Which of the following methods of calculating the amount of life insurance needed takes into account the insured's wages, years until retirement, and inflation?
Human life value approach (HLVA)
When agents are acting within the scope of their contract, their actions will be assumed to be the acts of the
Insurer.
All of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT
It is a life contingency option.
Which of the following insurance coverages would be allowed with an MSA?
Long-term care
Untrue statements on the application unintentionally made by insureds that, if discovered, would alter the underwriting decision of the insurance company, are called
Material misrepresentations.
Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by an underwriter?
Medical history
An individual's tendency to be dishonest would be indicative of a
Moral hazard.
Any person who knowingly and willfully obtains information about an individual from an insurance company, agent or organization supporting insurance under false pretenses shall be fined
Not more than $10,000, imprisonment not to exceed one year or both.
Under a pure life annuity, an income is payable by the company
Only for the life of the annuitant.
Which of the following statements is INCORRECT concerning Medicare Part B coverage?
Part B coverage is provided free of charge when an individual turns age 65.
An insured purchased a life policy in 2010 and died in 2020. The insurance company discovers at that time that the insured had misstated information about her insurance history on the application. What will the insurer do?
Pay the death benefit
When an insured under a life insurance policy died, the designated beneficiary received the face amount of the policy, as well as a refund of all of the premiums paid. Which rider is attached to the policy?
Return of premium
Which of the following is NOT covered under Part B of a Medicare policy?
Routine dental care
The annual contribution limit of a Dependent Care Flexible Spending Account is set by
The IRS.
Which of the following information will be stated in the consideration clause of a life insurance policy?
The amount of premium payment
What is the "elimination period" under a long term care policy?
The amount of time during which no benefits will be paid.
The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true?
The annuitant must be a natural person.
In a fixed annuity, which of the following is true regarding the guaranteed interest rate on the investment?
The annuitant will receive the higher of either the guaranteed minimum rate or current rate.
What happens if a non-member physician is utilized under the Point-Of-Service plan?
The attending physician will be paid a fee for service, but the member patient will have to pay a higher coinsurance amount.
An insured receives individual disability income benefits. Which of the following describes the taxation status of the benefits that the insured receives?
The benefits are income tax-exempt.
An insured who has an Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this policy?
The capital amount in a lump sum
Which of the following is an example of liquidity in a life insurance contract?
The cash value available to the policyowner
All of the following are TRUE statements regarding the accumulation at interest option EXCEPT
The interest is not taxable since it remains inside the insurance policy.
All of the following are true regarding a decreasing term policy EXCEPT
The payable premium amount steadily declines throughout the duration of the contract.
All of the following are true of key person insurance EXCEPT
The plan is funded by permanent insurance only.
Medi-Cal may be available to persons over age 65 if
They have medical or long-term care claims not paid by Medicare.
What is the purpose of the rehabilitation benefit in disability insurance?
To cover the expenses of retraining the insured to return to work
Under what condition are group disability income benefits received by an employee NOT taxable as income?
When the benefits received are equal or less than the employee's percentage of the contribution.
An Investigative Consumer Report is considered to be
a part of an insurance application. This report is used in the underwriting process in order to assess non-medical risk factors related to moral standing and avocations. Friends and colleagues are interviewed in order to evaluate the applicant's character. reputation, and habits. The applicant must be informed in writing if the insurer decides to conduct the investigation.
Human life value approach is
determined by the loss of income that would result with the death of the insured, after making adjustments for expenses, inflation, etc.
Deferred annuities may be purchased with
either a single lump sum or periodic payments, but they do not begin the income payments until sometime after 1 year from the date of purchase.
Presumptive Disability plans offer
full benefits for specified conditions. These policies typically require the loss of at least two limbs (Loss of use does not qualify in some policies.). total and permanent blindness, or loss of speech or hearing. Benefits are paid, even if the insured is able to work.
The Return of Premium Rider pays the beneficiary
not only the face amount of the policy but also the amount that had been paid in premiums. The rider stipulates that death must occur prior to a certain age in order for the premium amount to be returned. The Return of Premium Rider is funded by using increasing term insurance.
The triple indemnity accidental death rider obligates
obligates the company to pay three times the face amount of the policy if the insured dies as a result of an accident. The death must be accidental and not contributed to by any other factors and must occur within 90 days of the accident. In this case, since the insured contributed to his own death, the triple indemnity rider is void, but the beneficiary will still receive the policy's death benefit.
Liquidity in life insurance refers
to availability of cash to the insured. Some life insurance policies offer cash values that can be borrowed at any time and used for immediate needs.
The conditionally renewable provision is
very similar to the optionally renewable provision. The primary difference is that conditionally renewable policies may be canceled for specific conditions contained in the policy, but optionally renewable policies do not specify a condition or reason for cancellation.
Most policies will pay the accidental death benefits as long as the death is caused by the accident and occurs within
90 davs.
A guaranteed renewable health insurance policy allows the
Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class.
The term "illustration" in a life insurance policy refers to
A presentation of nonguaranteed elements of a policy.
The protection of the insurer from adverse selection is provided in part by
A profitable distribution of exposures.