CA Life, Health and Accidental Exam Prep 3
A noncontributory group disability income paln has a 30 day elimination period and offers benefits of $2000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive
$12,000.00 all of which is taxable
In a noncontributory health insurance plan, what percentage of eligible employees must participate in the plan before the plan can become effective?
100%
In order to collect Social Security disability benefits, the claimant must be able to demonstrate that the disability will last at least
12 months
In order to qualify for conversion from a group life that has been terminated to an individual policy of the same coverage, a person must have been insured under the group plan for how many years?
5 years
An insured purchased a variable life insurance policy with a face amount of $50,000.00. Over the life of the policy, stock performance declined, and the cash value fell to $10,000. If the insured dies, how much will be paid out?
50,000.00. even if investments devalue they cannot be lower than the initial guaranteed benefit amount
What is the waiting period on a Waiver of Premium rider in life insurance policies?
6 months
As part of the continuing education requirement, what is the minimum number of hours of continuing education specific to long-term care insurance to be completed prior to each license renewal?
8
As part of the continuing education requirement, what is the minimum number of hours of continuing education specific to long-term care insurance to be completed prior to each license renewal?
8 hours
A tornado that destroys a property would be an example of what?
A Peril
What is material misrepresentation?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
A physical or mental impairment which substantially limits one ore more major life activity or a record of such impairment or being considered as having such an impairment is the definition of a disability according to
ADA
Which of the following departments is responsible for developing mortality and morbidity tables?
Actuarial
The LEAST expensive first year premium is found in which of the following policies?
Annually Renewable Term
Which of the following is short-term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated?
Annuity certain
What is true of an annuity certain?
Annuity certain are short terms annuities which limit the amount paid to a certain fixed period or until a certain fixed amount, called share of cost (SOC) in the month when medical expenses occurred
What document describes an insured's medical history, including diagnoses and treatments?
Attending Physician's statement
In terms of Social Security, what is the interval spanning between the day when the youngest child of a family turns 16 and before the surviving spouse may receive retirement benefits?
Blackout Period
Which of the following categories of benefits are not covered by an LTC policy?
Care given in an acute care unit of hospital
An insured receives an annual life insurance dividend check. What term best describes this arrangement?
Cash Option allows insurer to send policyholder an annual nontaxable dividend check
If an applicant for a life insurance policy is found to be a substandard risk, the insurance company is most likely to
Charge a higher premium
An insured and his wife are both involved in a head-on collision. The husband dies instantly, and the wife dies 15 days later. The company pays the death benefit to the estate of the insured. This indicates that the life insurance policy had what provision?
Common Disaster
If more than one family member covered under the same major medical policy is injured in the same accident, the family only has to pay one deductible. This is due to the
Common accident provision
A life agent may use the name of corporation or association on any stationery or advertisement to identify the relationship in all of the following ways EXCEPT
Contracted by
All of the following are examples of risk retention?
Copayments, self insurance and deductibles
Concerning AIDS and HIV risks, all of the following acts may subject an insurer to liability claims or fines EXCEPT
Declining applicant for a positive HIV test result
The provision which states that both the policy and a copy of the application form the contract between the policyowner and the insurer is called the
Entire Contract
All of the following are dividend options EXCEPT
Fixed- period installment - it's a settlement option not dividend option
An individual is purchasing a permanent life insurance policy with a face value of $25,000.00. While this is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?
Guaranteed Insurability Option
Most LTC plans have which of the following features?
Guaranteed Renewability
First Dollar Coverage refers to a type of insurance which
Has no deductible
Which of the following is true regarding the Life with Guaranteed Minimum annuity settlement option?
If annuitant dies before principal amount has been paid out the remainder of the principal amount will be refunded to his/her beneficiary. Pure Life provides the highest monthly benefit for an individual annuitant
Which of the following is true regarding a policy with a face value less than $10,000?
If it's returned during the free look period, the agreement will be void.
Which insurance principle states that if a policy allows for greater compensation than the financial loss incurred, the insured may only receive benefits for the amount lost?
Indemnity
Who will be affected by the share of cost requirement for Medi-Cal?
Individuals whose income exceed the Medi-Cal limit
The Medical Information Bureau was created to protect
Insurance companies from adverse selection by high risk persons
Which statement regarding insurable risks is NOT correct?
Insured cannot be randomly selected
All of the following statements are true regarding installments for fixed amount
It has no life contingencies, a specific amount of benefit will be paid until funds are exhausted whether or not the annuitant is living
In Modified Life policies, what happens to the premium?
It is level at the beginning and increases after the first few years
The growing tendency of individuals to file lawsuits and to claim tremendous amounts for alleged damages is known as
Legal Hazard
Which type of care in NOT covered under Medicare?
Long Term Care
All of the following are true regarding the issuance of group life insurance to labor unions EXCEPT
Members cannot be excluded from coverage on basis of insurability
In health underwriting, it would be inappropriate to decline a risk using any of the following factors EXCEPT
Mental Illness
Which of the following terms most precisely fits the definition of "the incidence or probability of sicknesses or accidents within a group of people?
Morbidity
Henry has a disability income policy. As the result of a traffic accident, he lost his left arm. Henry's gross earned income before the disability was $3000 a month. How much will his disability income insurance pay per month?
Not to exceed 2100.00 (50-70% of income)
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
Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured?
Option B
What do living benefit riders do?
Pay part of the policy death benefit to insureds in order to help fund long-term care or nursing home care
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 because the incontestability clause is up after 2 years
The cause of loss insured against in an insurance policy are known as
Perils
HSAs are owned by the individual, not the employer, which means the individual is not dependent on a particular employer to enjoy the advantages of having an HSA. What term best describes this?
Portable
Under the Accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death?
Principal Sum
The price of insurance for each exposure unit is called the:
Rate
Which of the following insurance options would be considered a risk-sharing arrangement?
Reciprocal
When applying for disability insurance policy, the insurer is entitled to inquire about and verify the insured's
Source and amount of income, health history and off the job activities
The clauses that protects the proceeds of a life insurance policy from creditors after the death of the insured is known as the
Spendthrift Clause
What is the best way to change an application?
Start over with a fresh application
All of the following are TRUE statements regarding the accumulation at interest option
The interest credited under this option is TAXABLE, whether or not the policy owner receives it
Which of the following are characteristics of a group long term disability policy?
The max benefit is based upon monthly income
All of the following apply to short term disability plans
They are not renewable, Individual plans can provide benefit periods of up to 2 years, A benefit period of 26 weeks is most common for group plans, group plans can provide benefit periods up to 52 weeks
Regarding Medicare Select policies, what are restricted network provisions?
They condition the payment of benefits
Which of the following is a key distinction between variable whole life and variable universal life products?
Variable whole life has a guaranteed death benefit
When can earned surplus be returned to the policyholder?
Whenever it exists and is not needed for other expenses
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
