State Insurance Simulator

Beth is a surgeon who has an own-occupation disability income policy. She was injured six months ago and has been unable to return to her practice. Her monthly benefit from the policy is $15,000. During this time, Beth has been working part-time at a local boutique and receives $2,000 monthly. What is her ongoing monthly benefit while she is unable to perform her surgical duties?

$15,000

Larry has a Major Medical Expense policy for his family with a $1,000 per family/per year deductible and an 80/20 coinsurance provision. If Larry's family files four claims of $400, $800, $100, and $700 in one year, how much will the insurance company pay?

$800

first time home buyers are able to withdraw up to how much from their qualified IRA without incurring the 10% early withdraw penalty

10,000

Mary is the sole preproetot of her business and has a family plan. she would like to deduct the premiums from her taxes. what percentage of her premiums are tax deductible

100%

what minimum percentage of all eligible employees must participate in a group life insurance plan if the premiums are completely paid for by the employer

100%

indiviudals seeking social security disability income benefits must have a disability that will eventually lead to death, or be expected to last at least

12 months

a nonparticipating whole life insurance policy was surrendered for its $200,000 cash value. the total premiums paid had totaled $16,000. what were the federal income tax consequences to the policy owner

16,000 was received tax free and 4,000 as ordinary income

group disability (accident and health ) policies must allow an insured continuation privileges for up to ___ months

18

an intermediary must complete___ credit hours of continuing education for each licensing period

24 hours

A single-life annuity only has ONE

Annuitant

Jonas is covered with disability insurance through his employer. The employer pays 75% of the premium, while Jonas pays the other 25%. What is Jonas' tax liability for any benefits paid from the disability plan?

Taxes must be paid on 75% of the benefits recieved

which of the following combinations best describes a universal life insurance policy

a flexible premium deposit and a monthly renewable term insurance policy

short term group disability income benefits are

a percentage of weekly earnings up to to a stated maximum

which of the following best describes a point of service plan

a plan which combines indemnity plan feathers with those of an HMO

Kevin has an existing life insurance policy and assigns it to another insurer for a new contract. How would this transaction be treated for tax purposes?

a section 1035 exchange

A material change in a modified endowment contract (MEC) results in

a seven pay test, adjust for cash value applies again

A life insurance policy provision that has the ability to reduce the death benefit is called the

accelerated (living) benefit

a prepaid dental plan has an agreement in place with a network of dentists which

accepts an established amount as payment in full for the dental services redered

Mike recently lost sight in both eyes. He has a policy that pays a lump sum benefit for this injury. What type of insurance does Mike have?

accidental death and disbursement

an insured is covered under a group long-term disability policy. under thus type of policy the definition of disability based on any occupation typically applies

after two years of disability

An individual who purchases a modified life insurance policy expects

an improvement in future income

under the affordable care act, all of these are considered one of the 10 essential health benefits except

annual cat scans

which is an accurate description of the premium in a graded premium life insurance policy

annual increases in premium for a stated number of years then remains level

according to hippo regulations which of the following may reduce a medical plans pre-existing conditions exclusion

any period of coverage

under federal law which of the following actions may result in a producer becoming imprisoned

embezzling funds form an insurer

the intermediart licensing process exists to demonstrate to the commissione that an applicant meets specific criteria. which of the following is not one of these criteria

applicant has no prior bankrupcies

in order for an intermediary yo conduce insurance transactions, the intermediary must be

appointed by an insurer

Traditional Individual Retirement Account (IRA) distributions must start by

april 1st of the following year the participant attains age 70 1/2

in a qualified retirement plan, the yearly contributions to an employee account

are restricted maximum by the IRS

how may an insurance company classify an accidental death benefit on a life policy

as an optional policy rider

Julie is in need of assistance with one or two activities of daily living. She may be eligible for a(n)

assisted living facility

which of the following is a requirement for becoming an intermediary

be trustworthy and competent

when using the needs approach for life insurance plannign a lump sum may be created to provide for all of the following except

employee benefits

Christopher is issued an insurance policy that contains an attached agreement which alters the terms of the policy. The attached agreement is called?

endorsement

the benefit period of medicare part A begins on the first dat the insured

enters a hospital

when detemining the accumulation value of a deffered annuity the total is calculated by taking the premiums paid plus interest earned minus

expenses and withdrawals

which statement concerning a decreasing life policy is accurate

face amount decreases over the policy period

which tax is normally associated with an individuals death

federal estate tax

health care costs can be better controlled by utilizing peadmission testing. preadmission testing can reduced

length of hospitalization

how much is normally paid to a policy owner in a life (vaitical) settlement

less than the death benefit

what is another term used for pure life annuity

life income

an intermediary must hold which of the following license to sell variable life insurance policies

life, variable and securities license

which of these is not relevent when determining the amount of personal life insurance needed

local unemployment rates

tim is confiend to a nursing home but doesn't have a terminal illness. which life insurance rider is designed to help pay for this type of expense

long-term care benefit rider

which of the following is not required to be stated on a life insurance policy sold in wisconsin

premiums must be paid by the insured

which of the following outlines the authority given to the producer on behalf of the insurer

producer contract

what is considered the purpose of the wisconsin insurance security fund

protects consumers from insolvent insurers

the automatic premium loan provision can be accurately described as

provision that provides a loan policy to pay any premiums by the end of the grace period

what type of risk involves the potential for loss with no possibility for gain

pure risk

what is normally the consequence for not obtaining permission certification prior to receiving inpatient medical care

reduction of benefits

which of the following is not included as a hospice benefit under a major medical plan

rehabilitation

An insurer has a contractual agreement which transfers a portion of its risk exposure to another insurer. What type of contractual arrangement is this?

reinsurance contract

which of the following is not a basic underwriting action for accident and health insurance

removing uniform policy provisions

T is coverd by an accidental death and disbursement (AD&D) policy that contains an irrevocable beneficiary. What action will the insurance company take if T requests a change in beneficiary.

request of the change will be refusded

which of the following can be defined as the potential foe loss

risk

third-party administration has become fairly common in accident and health insurance side to growth of

self-funding of benefits

sylvis purchased an annuity for 100,000 from the proceeds of an inheritance no further payments are permitted and the income stream begins in 15 years. this contract is

single premium deferred annuity

if hospital expenses are covered under a disability (accident and health) policy the policy is required to cover

skilled nursing care

medicare part A covers which type of care

skilled nursing facility care

if replacement was involved in the sale of a life insurance policy, and intermediary must provide a replacement notice no later than

the application date

All parts of the Medicare program (except for public information and enrollment) are administered by which federal agency?

the centers for medicare and medicaid services

Access to premium tax credits and reduced cost sharing is made available ONLY if the consumer purchases health coverage in

the health insurance exchange

what would be considered an advantage of purchasing term life insurance

the initial premium is lower compared to an equivalent amount of whole life insurance

who must sign a rider attached to a health insurance policy in order for it to be valid

the insurer and the producer

who may determine coverage under a cancable health insurance policy

the insurer or the insured

Dan has a major medical expense policy with a $200 deductible and an 80/20 coinsurance provision. He incurs covered medical expenses of $100 in November and $400 in January. Under the carryover provision, what will the insurer pay?

240

How many days notice does the affordable care act require insurers to give before resigning coverage

30

kate refived a group accident and health termination notice. how many days does she have to apply for a converted policy

31

what is that face amount of a $50,000 graded death benefit life insurance policy when the policy is issued

50,000 but increases over time

an insurer may excluded preexisting conditions on a medicare supplement policy for up to __ months after policy issue

6

disability (accident and health) must policies cover lead poisoning screenings for children under ___ years of age

6

disability (accident and health) policies must cover lead poisoing screening for children under

6

How long do most states allow an insurance company to delay the payment of a cash surrender under the Delayed Payment provision?

6 months

how long can an insurer legally defer paying the cash value of a surrendered life insurance policy

6 months

which of the co-annuits listed below would receive the largest monthly benefit payment in a joint and 100% survivor annuity

71 - 73

an intermediary cannot sell ling-term care insurance unless that person has successfully completed an approved education course of

8 hours

According to ERISA regulations, a summary plan description must be provided to a new plan member within ___ days of the members eligibility date

90

which of these is not an advantage of term life insurance

A cash benefit will be provided if the insured is alive at the end of the policy period

if a disability income policy contains a cost of living adjustment rider, benefits must typically be increased

at least once per year when benefits begin

a policy owner pays the first annual premium life insurance policy and dies one month after the policy effective date. which of these statements is normally true

beneficiary receives 50,000 income tax free

which of the following statements best describes a double indemnity provision in travel accident insurance

benefits are doubled under certain circumstances stated in the policy

Pat is covered by a disability income insurance policy that covers disabilities arising from a work-related illness or injury. The amount of his disability income payments for an on-the-job injury may be reduced by

benefits paid under workers compensation

who normally pays the premiums for group credit life insurance

borrower

which of the following is not a condition that must be met for an accidental death benefit to be paid

cause of death must be from a job-related injury

An employee welfare plan exempt from ERISA regulations would be

church plans

which of these is not true statement of the war exclusion

civil insurrections aapply

what must be given to a life insurance applicant when the agent receives an application and the initial premium

conditional recipt

Jill has a group health plan with an employer that covers employees in more than one state. Which of the following is NOT affected by the state regulatory jurisdiction established for this plan?

continuation of coverage under COBRA

A statement must be signed by the ___ for any illustrations used in the sale of a life insurance policy

intermediary

an insurance application requires an applicant to make a full, accurate disclosure of the risk factor involved. using this criteria, an insurance policy is considered what type o contract

contract of utmost good faith

which of the following does not involve a life settlement transaction

converting term life to whole life insurance

Al surrenders his life insurance policy for its cash value. The total of the premiums paid into the policy minus total dividends received in cash or used to offset premiums is referred to as the

cost basis

Jerry has an indemnity plan which covers dental expenses. Typically, these type of plans

cover preventive care once every six months

what does the rehabilitation benefit cover in a disability income policy

covers the approved cost of the rehabilitation necessary to help a disabled turn to work

the main purpose of an annuity is to

create a stream of income

in what way is a life insurance policy affected by an accelerated benefit payment

decreases the death benefit

the amount of a covered loss to be paid by the insured before a major medical expense policy begins to pay is called the

deductible amount

which annuity allows a contributions to an IRA

deferred

which of these is typically required as a major treatment in an indeminiy dental plan

dentures

if a life insurance applicant is shown future premiums are to be paid out of non-guaranteed values, the illustration is used in the sales presentation must

disclose that the premium payments may need to be resumed depending on actual results

A qualified profit sharing plan is designed to

distribute a portion of company earnings to its employees

disability income policies provide protection for which of the following

economic death

how long does one premium payment cover a single premium whole life policy

fill life of the policy

An inrermediary is meeting with a client to determine whether an annuity will be suitable to purchase. Which of the following topics needs to be discussed with the client

financial status of the client

An annuitant is paid $495 per month until the contract value is exhausted at some undetermined date in the future. what type of payout is this

fixed amount

which life insurance settlement option pays a stated monthly benefit until both principal and interest are exausted

fixed amount installment option

Which of these is not a factor during the insurance underwriting process

former occupation

An insured may be required to sign which document at policy delivery to ensure there has not been any adverse medical conditions since the time of the application?

good health statement

which of the following statements is not true concerning the relationship between group health insurance plans and medicare

group health coverage is not available for workers over the age of 65

what is an insurer contract that idividuals by relationship to a specific organization

group insurance

in wisconsin any intermediary who sells a life insurance policy using misrepresentation

has committed an illegal act

For insurance purposes, similar objects which are exposed to the same group of perils are referred to as

homogeneous exposure units

a family counseling benefit is typically offered under which of these coverages

hospice care

which of the following is not true of a preferred provider plan

hospitals can only initiate preferred provider plans

with life insurance, the needs approach is used primarily in determining

how much life insurance a client should apply for

an intermediary has his license revoked because of failuer to pay the required license fees. how soon after the revocation may he apply for reinstatement

immediately

the medical information bureau consists of memers from which group

insurance companies

which of the following is not a valid reason for insurer to cancel an insurance policy midterm

insured change in marital status

which statement is not true regarding a cash value loan against a life insurance policy

interest payments made by policy owner are deductible

under which circumstance would an insurer be legally protected against

intermediarty and policy wonder acted together to defraud the insurer

In what way are insurance policies said to be aleatory?

involves the potential for the unequal exchange of value

When a policy loan is requested by a policyowner and it requires the consent of the beneficiary, what kind of beneficiary designation is this?

irrevocable beneficiary

an applicant for accidnet and health insurance has a risk factor that is similar to a majority of the insurers other applicants. what will be the likely outcome of this applicant

issued with a standard premium

the insurance coverage is a variable life insurance policy may vary based on the value of

its underlying investments

after the initial enrollment period for medicare part B has expired when may an individual purchase again

janurary through march of each year

A life insurance beneficiary died after receiving only six payments under the policy life income settlement option. What happens with the remaining balance of the death proceeds

kept by the insurance company

the death proceeds of a credit life insurance policy are typically paid to

lender

a life policy spendthrift clause would have no effect if the beneficiary is paid the proceeds as a

lump-sum payment

which of these policies is considered to be a comprehensive health policy

major medical policy

AN employer that offers retirement plan (as opposed to a non-qualified plan) to its employees its eligible to

make tax-deductible contributions to the plan

a trustee-to turstee of rollover funds is a qualified plans allows a participant to avoid

mandatory income tax withholding on the amount transferred

the pre-existing conditions exclusion under a small employer health plan

mat be partially or fully satisfied by having credible coverage with a previous employer

An insurance applicant has made a false statement on the application that will affect the insurers decision on whether to issue the policy. This false statement is considered to be

material misrepresentation

Karen is considering replacing her individual accident and health insurance policy with another individual policy. She has had issues in the past with her gall bladder that would be considered a pre-existing condition. How will a pre-existing conditions exclusion affect Karen's new insurance contract?

may reduce her benefits

field underwriting by a producer

may result in the disclosure of hazardous activities of the applicant

according to the affordable care act (ACA) the proprotion of premiums revenues spent on clinical services and quality improvements is called

medical loss ratio

which individual would be best suited for medicare supplement insurance

medicare enrollee

what is the eligibility requirement for medicare part B

must be eligible for medicare part A

which of the following does not meet the requirements of skilled nurnsig care

must be provided exclusively in a hospital

Tim is covered by an accident and health insurance policy that may not be changed in any way by the insurer up to a stated age, as long as the premiums are paid. What type of policy is this?

noncancleable

what is the proper procedure for an intermediary to change his/her mailing address

notify the commissioners office in writing within 30 days

Long term care policies normally cover expenses associated with

nursing homes

Who typically makes the purchase payments in an individual annuity?

owner

mark is covered by a policy that uses the regular occupation (own-icc) definition of total disability. Using this definition will he be considered disabled if unable to

perform the substantial and material duties of his regular occupation

under long term- care inflation rider, the benefit levels

periodically increase without proof of insurability

an intermediary sold life insurance policy but did not provide the applicant with a basic illustration. in this situation the insurer is required to provide the applicant with a policy summary no later than the

policy delivery date

If an insured dies during the grace period wtihout having paid the premium, how much will the insurer pay

policy face amount minus any premiums due

All of these statement s are true regarding a policy owners ability to return a disability (accident & health) policy except

policy owner may return the policy for a full refund at anytime

The standard provisions of an accident and health insurance policy require that the

policy, endorsements, and attached papers constitute the entire contract

the beneficiary of a life insurance policy is normally selected by whom

policyowner

which of the following guidelines does not apply under the pregnancy provision of civil rights act

post-termination extensions of medical benefits must apply equally to pregnancy

what topical changes at the re-enty option date found in some term life policies

premium

Kelly purchases a health insurance policy issued on a conditionally renewable basis. The insurance company has a right to refuse renewal of the policy for

specific reasons stated in then contract

Illustrations used in the sale of a life insurance policy must

state both the guaranteed and non-guaranteed elements

an insurer will typically asses and back-end a loan on a deferred annuity that is cancelled during the early contract years.what is the back end lead reffered to as

surrender charge

qualified long term care premiums are treated for tax purposes as

tax-deductible to the extent they exceed 7 1/2% AGI

How are monthly life annuity benefit payments treated under a tax sheltered annuity (TSA)?

taxed as ordinary income in the year received

when the testing for (HIV) wisconsin law requires a consent form

that discloses who mat receive a copy of the results

the surrender charge on may deferred annuity contracts are waived then the

the annuitant dies or becomes disabled

joe is a life insurance policy owner who has failed to pay interest on his policy loan. what will result from this nonpayment

the loan amount is increased to reflect the amount of interest due

who is normally considered to be the owner of a 403b tax sheltered annuity

the participating employee

how is collateral assignment used in a life insurance contract

transfers specific ownership rights to a creditor

how do birthing centers reduce medical costs

using certified nurse midwives

an insurance company can be liable for a producers unauthorized acts

when the agency contract is unclear concerning the authority given

under what circumstance does an accident and health insurer have the right tot request an autopsy

when the claim exceeds an amount specified in the policy

when does the producer give a premium receipt for a life insurance application

when the initial premium has been paid with the application

Pete is covered by an employer-provided group health insurance plan, which covers employees in multiple states. This plan is governed by the laws of which state? A. Where the certificate of coverage was mailed to B. Where most of the employees reside C. Where the master contract was issued D. Where the insurer's home office is located

where the master contract was issued

according to federal fraud and false statement regulation what is required for a prohibited person to transact insurance business in this state

written consent form the state insurance regulatory agency

the following are all elements of a valid contract except

written evidence

medicare supplement insurance that provides a prevenative medical care benefit will often cover

yearly examinations