chapter 9 practice questions

According to the Affordable Care Act, children are allowed to stay on their parents insurance policy until they turn

26

At what point does whole life insurance pay the death benefit?

A) When the insured turns 100 years old b) When the maximum stated age is reached by the insured C) upon due proof of death of the insured

you know you desperately need life insurance but don't have much money available for premiums. What is the best thing you can do to find affordable insurance?

A) buy directly from the insurance company. b) buy term insurance. C) use the Internet to shop around for the best quotes. *****d) All of the above

life insurance may not be necessary if

A) you're single and don't have any dependents. b) you're married, a double income couple, with no children. C) you're married but aren't employed. d) you're retired. ****e) all of the above

Riley knows her ex-husband would not think about taking out a life insurance policy on himself to protect their two children in the event of his untimely death. As a result, Riley is taking out a policy on him and paying for it herself. That makes Riley the __________ and her children are the _________.

Policy owner, beneficiaries

What are the disadvantages of group term insurance?

The cost to covert from group coverage to individual coverage if you leave the company may be cost prohibited ; relying on group insurance may hinder your decision to leave the company

A flexible spending account saves you money on qualifying healthcare and childcare expenses

True

A universal life insurance policy is a type of cash-value insurance combining term insurance with a tax-deferred savings feature in a package in which both the premiums and the benefits are flexible

True

Cash-value insurance is any policy that provides both a death benefit and an opportunity to accumulate cash value

True

Term life insurance provides protection for a specified amount of time; typically 1-30 years.

True

The beneficiary is the individual designated by the owner of the life insurance policy to receive the insurance policys proceeds upon the death of the insured

True

The earnings multiple approach is based on the notion that you want to replace a stream of annual income thats lost due to the death of a breadwinner

True

With a PPO, it is much more expensive to go to out of network healthcare providers.

True

james is employed by the university. Yesterday he fell outside of his office due to water on the floor. He broke his leg in two places. What type of health care plan will cover James expenses?

Workers compensation

The primary advantage of term insurance is

affordability

Term life insurance has a life insurance component and a savings plan

false

sally heath has the option of obtaining life insurance through her place of employment. she will not need to take a physical exam. This type of policy would be a/an __________ policy

group term life

If you have a good comprehensive health care policy, paying extra for disability income coverage is not a good use of your scarce insurance budget.

Fale

The advantage of whole life insurance is that it is generally cheaper than term life insurance per dollar of coverage.

False

group insurance premiums are generally more expensive than individual policies with the same coverage

False

one of the best features of term insurance is that you are able to borrow against the face value

False

under a managed health care or prepaid plan you have a good deal of freedom to choose your doctors and hospitals

False

Who needs disability insurance?

Anyone who relies on income from a job

All of the following are true regarding health savings Accounts except

unspent HSA funds are lost as the end of the year.

Andrew and Alice have health issues that may be passed on to their children. When the children are born would they be wise to obtain life insurance immediately on the infants prior to any of the medical conditions arising?

yes, this would be wise as the infant is not likely to have to pass a physical exam

using the needs approach to determine the amount of coverage looks from the perspective of the

Beneficiary

health insurance that provides payments to the insured in the event that the insureds income is interrupted by illness, sickness, or accident is called ___________ insurance.

Disability

life insurance and health insurance are designed to transfer the catastrophic risk you cant afford to keep onto the insurance companies

True

long-term care insurance provides money to help pay for nursing home and home health care expenses

True

one of the provisions of the Affordable Care Act is to prevent insurance companies from denying coverage to consumers with preexisting conditions

True

your insurances copayment and deductible are the expenses that the insured must pay before the insurance company will pay any benefits

True