Accident and Health Insurance Exam Questions
N has a major medical policy through an insolvent insurer. The maximum the Guarantee Association will pay on N's losses is: A: $500,000 B: $300,000 C: $200,000 D: $100,000
A: $500,000
Company A has decided to cease group coverage in IL. On August 1, Company A notifies all group contract holders of discontinuation. How many days does the contract holder have to notify enrollees? A: 10 days B: 20 days C: 30 days D: 31 days
A: 10 days
J has HMO coverage under his employer. J was notified that because of a payroll error, payment for this month's premium was not paid. The minimum possible grace period that J may have to prevent lapse is: A: 10 days B: 15 days C: 30 days D: 31 days
A: 10 days
If an agent has completed the initial continuing education for long term care, next renewal they must complete ongoing education that is ____ of continuing education. A: 4 hours B: 8 hours C: 12 hours D: 24 hours
A: 4 hours
All of the following benefits may require a referral EXCEPT: A: A doctor seen in-network under a PPO B: A subscriber uses their point of service plan for a covered specialist C: A subscriber utilizes their HMO coverage for a cardiologist. D: None of the Above
A: A doctor seen in-network under a PPO
Which of the following defines a potential definition of a total disability? A: Any Occupation B: Residual C: Partial D: Social Security Disability
A: Any Occupation
If the carrier has a reasonable charge that is below the providers contractual reasonable charge, the insured may be responsible for the difference of medical cost, this is known as: A: Balance Billing B: Reasonable Charges C: Usual Charges D: Customary Charge
A: Balance Billing
On March 1 C, who holds an Illinois non-resident license moves from Idaho to Iowa. By which date must C notify the Illinois Director of Insurance about this move? A: By March 31 B: C does not have to notify Illinois since he was a non-resident license holder. C: By May 1 D: By March 16
A: By March 31
When an agent sells an Accident and Health policy, he/she should do which of the following with the application? A: Complete it and have the applicant review and sign it B: The agent should initial any and all changes he/she may make later C: Have the applicant sign and then carefully put in the required information in as thoroughly and accurately a manner as possible D: Advise the applicant to provide information in such a manner to make certain the policy will be issued without restrictions
A: Complete it and have the applicant review and sign it
J has medical benefits that provide a first dollar coverage but then also applies a deductible and coinsurance for major benefits. J has: A: Comprehensive Major Medical B: Combined Medical Policy C: Comparative Medical D: Major Medical
A: Comprehensive Major Medical
K has a policy that will pay a lump sum tax free benefit if he is diagnosed and then survives cancer. K has a: A: Critical Illness Policy B: Specified Disease Plan C: Cancer Policy D: Major Medical
A: Critical Illness Policy
C has a LTC policy that cannot be terminated and has guaranteed premiums. C has which of the following rights of renewability? A: Noncancelable B: Guaranteed Renewable C: Cancelable D: Period of Time
A: Noncancelable
Medicaid is: A: State Subsidized and partially federally reimbursed B: Federally subsidized only C: Run By Congress D: None of the Above
A: State Subsidized and partially federally reimbursed
Which of the following is considered to be a mandatory provision in a health policy? A: Time Limit on Certain Defenses B: Change of Occupation C: Illegal Occupation D: Intoxicant/Narcotic Usage
A: Time Limit on Certain Defenses
T has recently replaced her Medicare Supplement policy which was in force for 7 months. The contract has a probationary waiting period on all illness related losses for the first ten days of coverage. On day 5, T suffers an illness. The replacing insurer is most likely to: A: cover the loss B: deny the claim C: require T pay more premium to cover the loss D: None of the Above
A: cover the loss
H has had group LTC coverage for the last 5 months. H has decided to leave his job and find a new career. Upon leaving his group, H would like to convert his group LTC policy to an individual plan. The insurer is most likely to: A: deny conversion B: allow conversion C: allow conversion, but they may increase the premium D: allow conversion as long as H converts within 30 days of leaving they group
A: deny conversion
If there is a dispute on medical necessity under a HMO, there must be a system in place for a second opinion. If the second opinion determines that a covered service is in fact medically necessary, the HMO must provide service. The only way that benefits are paid for an out-of-network physician is: A: if a referral is given B: state law dictates when coverage out of area exists C: if it is an emergency D: None of the Above
A: if a referral is given
A noncancelable policy means the company A: may not raise the premium or terminate the policy except for nonpayment of premium B: may not cancel before the insured reaches age 50 C: may pay limited benefits and cannot cancel all benefits D: can only terminate coverage if the insured switches occupations
A: may not raise the premium or terminate the policy except for nonpayment of premium
The purpose of preventing an insured from collecting twice on losses that are Subrogated is to: A: reinforce indemnity B: to hinder the insured's rights C: to allow the insurer to collect twice D: None of the Above
A: reinforce indemnity
A business can provide group insurance to their employees if: A: the purchase of insurance is incidental to the business B: the purchase of insurance is entirely made by the employer C: the purchase of insurance is made regardless of business ownership D: None of the Above
A: the purchase of insurance is incidental to the business
If an insurer discontinues a group policy they are only liable for: A: their extent of benefits under the old contract B: half of the new carrier's covered losses C: nothing D: all losses up to a year
A: their extent of benefits under the old contract
If an insured is purchasing a LTC policy, an outline of coverage must be delivered by the agent at: A: time of solicitation B: underwriting C: delivery D: Any of the above
A: time of solicitation
In a health policy, the probationary period begins: A: upon issuance of a policy B: upon delivery of a policy C: when underwriting takes place D: upon payment of first premium
A: upon issuance of a policy
The fee, every 2 years, for a business entity license is A: $100 B: $150 C: $180 D: $250
B: $150
The resident licensing fee for a Limited Lines Car Rental license is A: $50 every year B: $180 every two years C: $50 every two years D: $250 every year.
B: $180 every two years
A producer violates the written order from the Director pertaining to their market conduct activities. What is the maximum civil penalty that can be assessed by the Director against a producer in this circumstance? A: $10,000 B: $20,000 C: $50,000 D: $100,000
B: $20,000
Under law, a LTC policy must provide consecutive coverage for at least: A: 6 months B: 12 months C: 24 months D: 36 months
B: 12 months
Under the Claim Forms provision in an Accident and Health policy, an insurance company must supply an insured with claim forms within a MAXIMUM of how many days after receiving notice of the loss? A: 10 B: 15 C: 20 D: 30
B: 15
If an applicant is under age 65, they must apply for a supplement within _______ of enrolling for Part B. A: 3 months B: 6 months C: 12 months D: 18 months
B: 6 months
All of the following statements are true about a specified disease plan EXCEPT: A: Cancer may be covered up to a fixed dollar benefit amount. B: A specified disease plan is a good substitute for a major medical policy because it is cheaper premiums. C: A specified disease plan will only cover one specific loss. D: No policy will cover a specified disease if diagnosed occurred before the policy was applied for.
B: A specified disease plan is a good substitute for a major medical policy because it is cheaper premiums.
Lifetime, Per Cause, and Annual maximums are all examples of: A: Benefit Exclusions B: Benefit Limits C: Out of Pocket Expenses D: Contractual Losses
B: Benefit Limits
Which of the following policy provisions are optional in a individual health policy? A: Entire Contract B: Change of Occupation C: Entire Contract D: Reinstatement
B: Change of Occupation
The part of a contract that specifies which expenses may or may not be covered is known as the: A: Exclusion B: Eligible Expense provision C: Insuring Agreement D: Consideration Clause
B: Eligible Expense provision
Doctors in a Preferred Provider Organization are paid: A: Capitation B: Fee for Service C: Salary D: Reimbursement
B: Fee for Service
Which policy rider would offer an insured the option to increase their benefits of the original policy? A: Impairment Rider B: Guaranteed Insurability Rider C: Waiver of Premium D: None of the Above
B: Guaranteed Insurability Rider
Which of the following is not true regarding Medicare Supplement minimum standards? A: Supplements can only exclude illness or treatment that are excluded under Medicare. B: If a group Supplement was terminated, the insurer does not have to offer certificate holders a right to convert to an individual policy. C: Supplements cannot base payments on standards such as reasonable and customary. D: A preexisting condition is limited to 6 months before effective date of coverage.
B: If a group Supplement was terminated, the insurer does not have to offer certificate holders a right to convert to an individual policy.
Y is injured while robbing a bank and his claim is denied. Which of the following provisions would deny Y's claim? A: Change of Occupation B: Illegal Occupation C: Felony Exclusion D: Illegal Action
B: Illegal Occupation
Most Accident and Health policies require that claims must be paid _________ upon written proof of loss. A: 30 days B: Immediately C: 60 days D: 90 days
B: Immediately
A producer tells his client that his disability income policy will pay for all of his medical bills if disabled. The producer is guilty of A: Twisting B: Misrepresentation C: Defamation D: False Advertising
B: Misrepresentation
Which of the following rights of renewability stipulate that the insured has the sole right to end coverage? A: Period of Time B: Noncancelable C: Cancelable D: Conditionally Renewable
B: Noncancelable
The mandatory provision that stipulates the insurer's rights during underwriting and proving fraud is the: A: Proof of Loss provision B: Physical Examination and Autopsy C: Entire Contract Provision D: Legal Action Provision
B: Physical Examination and Autopsy
K has a policy that covers doctors visits but limits the number of visits per calendar year and pays a limited indemnification limit per visit. K has: A: Basic Medical Expense B: Physician Nonsurgical Coverage C: Basic Surgical Policy D: Basic Hospital Coverage
B: Physician Nonsurgical Coverage
T has just returned back to work after a total disability but is only able to work half the day. T's policy pays the difference between what the employer pays T and what T earned prior to disability. T has: A: Own Occupation B: Residual Disability C: Partial Disability D: Any Occupation
B: Residual Disability
G had his policy reinstated on August 1. On August 5, G falls ill and needs to spend a few nights in the hospital. Which of the following is most likely to happen? A: The insurer will pay full benefits for G's loss B: The insurer will not pay for G's loss C: G will have to pay more premium to have the loss covered D: None of the Above
B: The insurer will not pay for G's loss
Another name for a Binder is: A: Conditional Receipt B: Unconditional Receipt C: Temporary Coverage Binder D: Pre-Conditional Receipt
B: Unconditional Receipt
If an insurance company issues deceptive statements about its assets, this action is A: false advertising. B: an unfair trade practice. C: unfair discrimination. D: falsification.
B: an unfair trade practice.
The party that dictates what a reasonable or customary charge is for a health policy is the: A: insured B: insurer C: Department of Insurance D: federal government
B: insurer
The insured should be aware of the issue date upon delivery a policy and the date should be listed on: A: the policy summary B: the first page of the contract C: the delivery receipt D: upon conditional receipt
B: the first page of the contract
Health Care FSA contributions are limited to _______ per year. A: $5,000 B: $3,000 C: $2,700 D: $3,250
C: $2,700
Other than when an agent or insurer sells a supplement not approved by the director, all other violations may incur a maximum fine of: A: $500 B: $1,000 C: $5,000 D: $10,000
C: $5,000
If a policy owner of a Medicare Supplement becomes eligible for Medicaid, a supplement can be suspended for up to ______ as long as they give the insurer notice within 90 days of being eligible for Medicaid. A: 6 months B: 12 months C: 24 months D: 36 months
C: 24 months
Under minimum standards, the probationary waiting period for illness may not exceed A: 10 days B: 20 days C: 30 days D: 40 days
C: 30 days
V has individual coverage under an HMO plan. V forgot to pay her premium on time and does not want to lose coverage. Under law, an individual policy must have a grace period of at least: A: 15 days B: 30 days C: 31 days D: 45 days
C: 31 days
What is a contract's grace period if a premium is paid on a quarterly basis? A: 7 days B: 10 days C: 31 days D: 90 days
C: 31 days
On March 1 the Director mailed a notice of producer license suspension to R which he received on March 4. If R wishes to request a hearing on the matter, by which date must R make this demand in writing? A: 24-Mar B: 30-Mar C: 31-Mar D: 3-Apr
C: 31-Mar
HMOs must provide coverage for low-dose, baseline mammography for all women ages: A: 25-29 B: 31-36 C: 35-39 D: 40 or older
C: 35-39
If a carrier elects to discontinue all health coverage they must notify the director 180 prior to discontinuance. If the insurer then discontinues they are barred from reentry into the IL market for: A: 1 year B: 3 years C: 5 years D: forever
C: 5 years
The Proof of Loss provision in an individual Accident and Health policy requires that written proof of loss be submitted to the insurance company within how many days after the date of loss? A: 30 B: 60 C: 90 D: 120
C: 90
If an insured has a limited group plan and the carrier discontinues group benefits, as long as the insured has not used up all of their benefits under the policy, in the case of total disability, coverage applies up to ______ after discontinuation or end of disability, whichever occurs first. A: 30 days B: 60 days C: 90 days D: 12 months
C: 90 days
To sell a LHSO plan, a producer must be licensed in: A: Accident and Health insurance B: Limited Lines producer license C: Accident and Health or Limited Lines License D: None of the Above
C: Accident and Health or Limited Lines License
A LTC policy that will only pay for ADL given occasionally by a licensed professional is: A: Skilled Care B: Intermediate Care C: Custodial Care D: None of the Above
C: Custodial Care
The rider that an insurer uses to specifically name and exclude a preexisting condition from coverage is known as: A: Exclusionary Rider B: Preexisting Condition Rider C: Impairment Rider D: Exclusion Rider
C: Impairment Rider
All of the following are required disclosure forms at application EXCEPT: A: HIPAA B: HIV C: MIB D: None of the Above
C: MIB
Company Q, a health insurer headquartered in Indiana is advertising directly to Illinois residents about their health plans but Company Q is not a licensed insurance company in Illinois. Company Q is violating which of the following Illinois insurance regulations? A: False Advertising B: Twisting C: Misrepresentation D: Defamation
C: Misrepresentation
Which of the rights of renewable will guarantee premiums remain level? A: Guaranteed Renewable B: Cancelable C: Noncan D: None of the Above
C: Noncan
Each of the following is true regarding a cancelable policy EXCEPT: A: The insured can cancel for any reason B: The insurer can cancel the policy at anytime C: The insurer can only terminate because of nonpayment of premium D: Cancelable is usually the most inexpensive renewability option.
C: The insurer can only terminate because of nonpayment of premium
What action would be required of a producer who fails to reinstate a lapsed producer license within the statutory allowed time period? A: The person is barred from entering the insurance business for 5 years. B: The person is barred from entering the insurance business for life. C: The person would be required to take a certified prelicensing course and state exam for each line or authority sought and then to submit an application with the payment of a $180 license fee. D: The person would be required to take a certified prelicensing course and state exam for each line or authority sought and then to submit an application with the payment of a $360 license fee.
C: The person would be required to take a certified prelicensing course and state exam for each line or authority sought and then to submit an application with the payment of a $180 license fee.
Which of the following circumstances may lead to the renewal of a producer license without the requirement of completing continuing education requirements? A: There are no exceptions to the continuing education law. B: The producer suffers a stroke and is incapable of completing any coursework. C: The producer is called up to military duty and secures a military waiver. D: Once a producer has been licensed for more than 30 consecutive years and is at least 65 years of age, they are exempt from continuing education requirements.
C: The producer is called up to military duty and secures a military waiver.
All of the following are true regarding Social Security disability EXCEPT: A: A insured must wait 5 months before collecting benefits B: To qualify an insured must be unable to do any job in the American economy C: To qualify an insured must be disabled for a year or longer or die within a two year period. D: The insured must have a certain amount of Social Security credits based off age.
C: To qualify an insured must be disabled for a year or longer or die within a two year period.
The policy has all of the following rights EXCEPT: A: Right to solely renew a guaranteed renewable policy. B: Right to terminate a policy C: Unilateral right to renew an Optionally renewable policy D: Right to assign a contract
C: Unilateral right to renew an Optionally renewable policy
Which of the following losses are excluded under minimum standard law? A: hospitalization B: accidental injuries C: eye care D: None of the Above
C: eye care
A CORRECT statement about benefits payable under a Disability Buy-Out policy that is owned by a business entity is that they are: A: related directly to salary B: paid in installments C: paid to the corporation D: paid directly to the employee
C: paid to the corporation
Consideration for the insurer is to: A: guarantee coverage B: cover losses that are excluded C: pay covered losses D: share in premium payment
C: pay covered losses
H has suffered a covered disability away from her job and will shortly begin collecting benefits. The insurer sends a letter to H stating that she will not receive any benefit amounts greater than her income. This clause is known as: A: Over-insurance clause B: free look C: relation of earning to insurance D: relation of economic value
C: relation of earning to insurance
What is the largest dollar civil penalty that will be assessed for a single act of misrepresentation? A: $1,000 B: $2,500 C: $5,000 D: $10,000
D: $10,000
V has an HMO who has been financial impaired, the most the HMO Guarantee Association will pay for V's claims is: A: $100,000 B: $250,000 C: $300,000 D: $500,000
D: $500,000
The maximum number of in-hospital days coverage provided by an individual policy under minimum standards is: A: 30 days B: 45 days C: 90 days D: 180 days
D: 180 days
The insured must wait to file a lawsuit against an insurer however, the insurer has ______ from proof of loss to file the lawsuit. A: 30 days B: 60 days C: 2 years D: 3 years
D: 3 years
N has a disability policy and suffers a covered loss. After elimination, what is the maximum time the insurer has to make a claim payment under the Time Payment of Claims provision? A: Immediately B: 15 days C: 20 days D: 30 days
D: 30 days
J let their health policy lapse. To reinstate the contract, the insurer is requiring J to reapply. J pays a new premium with the hope that she will get her policy back into force. The insurer has ______ days from receipt to deny reinstatement. A: 7 B: 10 C: 31 D: 45
D: 45
If a carrier is terminating a individual policy because of an allowable reason under HIPAA regulations, how many days advance notice must they give the insured? A: 10 days B: 20 days C: 60 days D: 90 days
D: 90 days
Renewability of a Long Term Care policy must be at least: A: Noncancelable B: Guaranteed Renewable C: Cancellable D: A and B only
D: A and B only
The purpose of the Fair Credit Reporting Act is to: A: protect the consumer from having an adverse action against them based of obsolete credit information B: to ensure that credit information used in underwriting is accurate and updated C: make sure that any financial institution handles an individual's credit in a correct, proper manner D: All of the Above
D: All of the Above
Which of the following are exclusions under a health policy? A: an annual eye exam B: a biannual dental check-up C: a worker that is injured while working on the job D: All of the Above
D: All of the Above
Which of the following is an a example of a unfair trade practice? A: a company rates an individual based on partial blindness B: a company rates an individual with a disability C: an agent discriminates a client because of they are totally blind D: All of the Above
D: All of the Above
Which of the following policies' premiums are tax deductible for the employer? A: Group Health insurance B: Group Disability Policy C: Business Overhead Expense D: All of the Above
D: All of the Above
Which of the following services would be covered under an LHSO? A: ambulance B: vision care C: podiatric care D: All of the Above
D: All of the Above
All of the following are CORRECT about Medicare EXCEPT: A: An insured who is age 30 but collecting Social Security disability for the last two years is eligible for Medicare. B: An insured who is age 60 and is at the end stage of renal failure is eligible for Medicare. C: An insured who turns age 65 and is still employed is eligible for Medicare. D: An insured who has Medicare Part A is eligible to enroll for Medigap policies within six months of enrolling in Part A.
D: An insured who has Medicare Part A is eligible to enroll for Medigap policies within six months of enrolling in Part A.
Which of the following may be considered an eligible expense found in a health policy? A: Cosmetic Surgery B: Premium payment C: cold cream D: Bus fare to receive treatment for a covered loss
D: Bus fare to receive treatment for a covered loss
N has a HMO and has a terrible sinus infection. N decides to go straight to an Ear, Nose and Throat specialist for an office visit. Which of the following is most likely to occur? A: The HMO will cover the doctor visit fully. B: The HMO will pay half of the visit because it is out of service area. C: The HMO will pay the claim if N pays extra premium. D: N will be declined to be seen by the specialist for this office visit.
D: N will be declined to be seen by the specialist for this office visit.
All of the following provisions found in a health policy are optional EXCEPT: A: Change of Occupation B: Illegal Occupation C: Intoxicant and Narcotic Usage D: None of the Above
D: None of the Above
Part B of Medicare covers all of the following benefits EXCEPT: A: Doctor's visit B: psychiatric care C: home health services D: None of the Above
D: None of the Above
Which of the following elements is part of the entire contract clause? A: The exchange of value between the parties B: The agreement between the policyholder and insurer C: The amount of time the insured has to send a policy back for a full refund D: None of the Above
D: None of the Above
Part A of Medicare covers: A: Hospital Care B: Inpatient skilled nursing and home health visits C: doctor visit D: Only Answers A and B
D: Only Answers A and B
If a producer demands a hearing to challenge the reasonableness of a license suspension, when will the hearing take place? A: Within 20 to 30 days of the date the producer demands a hearing. B: A time to be determined by the Director with 20 days prior notice C: A time to be determined by the Director with 10 days prior notice D: The hearing takes place within 20 to 30 days from the date the Director's mailing of the hearing notification.
D: The hearing takes place within 20 to 30 days from the date the Director's mailing of the hearing notification.
In the Change of Occupation provision, if an insured switches to a less hazardous job and a claim occurs the insurer will: A: increase the premium of the policy B: increase the benefits of the policy C: decrease the benefits of the policy D: decrease the premium of the policy
D: decrease the premium of the policy
Z has a Major Medical policy and incurs her first covered loss of the year. Z must pay: A: the Deductible B: the Deductible plus any remaining required co-pay on the loss C: any Co-Insurance D: the Deductible plus any remaining required co-insurance on the loss.
D: the Deductible plus any remaining required co-insurance on the loss.
