FL 2-15 Insurance Practice
a limited pay life policy
A life insurance policy that continues to provide protection after the premium period has ended is called:
Portability
A major feature of the "Access Act" is that earned preexisting condition restrictions can be carried from employer to employer. This is known as __________.
policy design
A major way to control health insurance cost is by ___________.
7/10/31
A minimum grace period is mandated in all health insurance policies. Grace's birthday is __/__/__
The misrepresentation was material to the to the issue of the contract
A misrepresentation on an application may only prevent recovery if any of the following apply except:
primary
A multiple location agency must designate a _______ agent for each location.
60
A new benefit period will start after a Medicare recipient has not been hospitalized for ______ days.
100
A non-contributory plan is one in which the employer is paying all of the premiums and must cover _____% of the eligible employees.
A long elimination period.
A normal distinguishing feature of the Disability Buyout Plan is:
beneficiary
A parent would make a Per Capita designation of "Spouse, if living, otherwise the children born of this marriage share and share alike the survivor or survivors," to avoid the need to change the __________ as successive children are born.
Manifested
A preexisting illness or preexisting condition is defined as "Any disease that was diagnosed by a physician or treated within a stated period, prior to health insurance taking effect." It must have _______ prior to the issue date of the policy.
Deny the claim, rescind the contract, and refund all premium paid
A prospect for disability income insurance has a mild form of diabetes that is controlled by diet. When completing the application he doesn't mention the diabetes (a material fact) because he doesn't regard it as a serious condition. The insurance company issues a standard policy and 18 months later the insured's diabetic condition worsens and he lapses into a coma. If his wife files a claim for total disability benefits for her husband, the insurance company will most likely do which of the following?
90
A provider may refuse to renew if it provides _______ days notice and offers policyholders any other coverage available.
is enrolled in
A subscriber is one who ________ an HMO.
Inflation
A variable annuity offers a possible hedge against which of the following?
is at least currently insured and totally disabled
A worker can receive Social Security Disability if he or she:
5 months
A worker may first apply for Social Security Disability after how long of a waiting period?
chronic
A(n) ________ condition is one that is treatable, but not curable.
preexisting
A(n) _________ condition in an individual policy is one that was not disclosed on the application.
Employee Group Insurance
AD&D Insurance is most frequently marketed in which of the following areas?
the cost of doing business, assumed interest rates, mortality rates
Basic factors in computing life premiums (rate making) include:
Cosmetic care
Basic health services are defined under the law as being restricted to all but:
Cosmetic care.
Basic health services are defined under the law as being restricted to all but:
provide insurance coverage at an earlier date than that of policy delivery
Besides acknowledging payment of the initial premium, the purpose of a conditional receipt is to:
provide insurance coverage at an earlier date than that of policy delivery.
Besides acknowledging payment of the initial premium, the purpose of a conditional receipt is to:
Provide insurance coverage at an earlier date than that of policy delivery
Besides acknowledging payment of the initial premium, the purpose of a conditional receipt is to?
A $10,000 Whole Life policy.
Bill Drake purchased a $10,000 life insurance policy in 1993 and paid premiums for several years. Although the policy had lapsed before he died in January 2004, a $10,000 death benefit was paid. Mr. Drake's policy was most likely which of the following?
Group travel providers
Blanket policies are usually marketed to:
It contains a maximum total benefit
Business Overhead Insurance is considered a "valued" contract because?
Stock Redemption Plans
Business continuation plans may be designed as "entity plans." In close held corporations, they are classified as:
the fixed amount paid to the provider by the HMO
CAPITATION means:
Fixed
Capitation is the _______ amount paid by the HMO to a health care provider in exchange for the medical services that are rendered.
A Money-Purchase Plan contribution must be made to each employee's fund each year.
The following statements are true about qualified retirement plans:
An insurable interest
The health insurance contract requires _______ confirmation when a third party is purchasing the insurance.
inflation risk
The risk assumed by the fixed annuity buyer is __________.
Business Overhead Expense
Which of the following forms of insurance cannot be written as group insurance?
15
1999 group regulations now permit a _______ percent plus or minus rate variance from the approved community rate, to compensate for health changes and/or claims experience.
a Health Maintenance Organization (HMO)
A health service that charges a flat fee for medical care it provides at its own clinic is referred to as:
2 years.
A life insurance policy is considered incontestable after it has been in force for a period of:
Accidental death and dismemberment
Which of the following health policies would require a beneficiary designation?
Payments for a fixed amount
Which of the following is a type of temporary annuity payout?
be disenrolled from
"Notice to Buyer: When you enroll in this HMO, you will ___________ Medicare."
Replacing policies after full disclosure of all relevant facts
"Twisting" in policy replacement does not involve which of the below?
Both state insurance regulators and the SEC
Who regulates Variable Life products?
20
A "Notice of Claims" must be given to the insurer within _______ days for claims that are pending. No bills required.
Is a Hospital or Institution licensed in Florida who provides health care services, Is an Organization licensed in Florida who provides health care services, Is a Physician licensed in Florida who provides health care services
A "provider" is one who?
Is an Organization licensed in Florida who provides health care services, Is a Physician licensed in Florida who provides health care services, Is a Hospital or Institution licensed in Florida who provides health care services
A "provider" is one who?
Total or partial income loss because of disability
A Disability Income policy is designed to provide benefits for which of the following occurrences?
no deductible
A FIRST DOLLAR Policy refers to a policy that has:
an Irrevocable Beneficiary Designation
A Whole Life policy must include all of the following features except:
24, 24
A _______ month exclusion and a _______ month "look back" is permitted for preexisting conditions for one person groups.
60, 120
A claimant lawsuit must not be filed quicker than _______ days after proof of loss has been provided on an uncontested claim, and _______ days on a contested claim.
He is at least 65 years old.
A disabled worker would not be eligible for Social Security Disability Income if which of the following conditions is true?
the Accelerated Death Benefit.
A few years ago the insurance industry introduced a new rider that allows an insured policyowner to become, in part, their own beneficiary. It is called:
licensed to conduct business in state other than the one in which it is incorporated
A foreign insurer is a company that is:
10
A grace period of not less than _______ days must be expressly included in a Medicare HMO Supplement.
115%
A health rated small group premium may not exceed _______ of the regular group rate.
annually
Actuaries, when using the interest factor as one of the three factors in designing and pricing the product make two basic assumptions with regards to the interest. First, it assumes a specific net rate of interest that will remain constant during the life of the policy. Secondly, insurance premiums are presumed to be paid _________ in advance.
60 days
After the deductible, Medicare Part A will pay 100% of the bill for how long?
If the proposal includes dividends, it must be clear that they are guaranteed.
Agent responsibilities include the following, Except?
felony charges
Aiding as an agent for, or acting as an unauthorized insurer, will subject the perpetrator to ___________ and loss of all insurance licenses.
non-profit businesses.
All fraternal insurance organizations operate as:
conversion
All health policies must offer dependents the right to conversion if they become ineligible to remain on the insured's policy.
Certificate holders need not be notified if the policy expires
All of the following are correct about Group Life Insurance, except?
HMO
All of the normal activities prohibited in the Florida Professional Insurance Association's Code of Ethics also apply to ______ contract sales.
A complete package of home and community-based services including trained caregivers etc.
Alternative Care is which of the following:
Notify the insurance company for a review and prorate recommendation
An agent has just been told by a policy owner that she is 2 years younger than was listed on the policy. The agent should:
If a sale cannot be made with honesty, fairness, and objectivity, it must not be made at all.
An agent's personal creed should contain which of the following?
employer, who then receives and retains a master contract.
An application for group coverage is signed by the:
NAIC
An association of the 50 state commissioners that make recommendations, usually adapted by the states, for the standardization of policy provision and consumer protection rules is:
He has reached (FRA) full retirement age.
An eligible disabled worker will be denied Social Security Disability income if which of the following conditions exist?
$50,000
An employer may provide and deduct as a business expense the cost of any amount of group insurance. The maximum amount an employee may receive before he or she must report an excess economic benefit is:
10%
An individual may claim a tax deductible medical expense, only to the extent that the premium cost for insurance and any unreimbursed charges exceed _________of his/her adjusted gross income.
Domestic insurer
An insurance company that is incorporated in and does business in your state is classified as a/an:
Foreign insurer
An insurance company that is incorporated in another state but does business in your state is classified as a:
A domestic insurance company
An insurance company that is incorporated under the laws of Florida and has its home office in the state is called which of the following?
Case management.
An insurer control that often reduces excessive expense for ongoing illness is:
permanent flat
An often-used method of rating applicants is based on their occupation or their hobbies. Those ratings are called:
Multiple Employer Trust (MET)
An organization designed to combine small employers together into a group to purchase medical expense insurance for their employees is called a:
absolute
An owner may assign some of his or her rights in a policy. There are two types of assignment: (1) One is a collateral assignment used to secure amortized loans and (2) The other effectively changes the ownership of the contract. It is called a(n) ___________ assignment.
Lump sum distribution
Annuities need not be annuitized for life. Which of the below is not an annuity alternative?
Limited pay whole
Another and very common method of payment is _________________ life in which the owner chooses to pay fewer but larger premiums during his/her most productive years to finance the policy for life or to age 100.
expenses
As noted earlier, the covered Medicare eligible individual still has many possible ________.
both individual and group
At the present time, do HMO's operate most extensively through individual or through group enrollment plans?
bills
BCBS subscribers do not receive ____.
An agent uses mental force or threat of force to transact insurance.
Coercion is an unfair trade practices that occurs when:
reimbursement
Commercial insurance companies function on the 2-stage ___________ approach.
10
Composite rating may not be used for groups under _______ employees.
Office of Insurance Regulation
Contracts to operate an HMO in Florida, must be approved by the ______________?
Standard
Core benefits are _______ in Medicare Supplement contracts.
Decreasing-term
Credit life, which is sold to secure amortized loans is a form of __________________.
Private insurers., Self-insuring., State programs.
Depending on the state, Workers' Compensation coverages may be purchased through:
Business continuation arrangement
Disability buyout plans are a form of?
Entity
Disability buyouts are normally _______ purchases.
The recipient's employer has paid the premiums.
Disability income benefits are considered taxable income to the disabled person when:
delayed disability
Disability policies allow a certain amount of eligibility time during which disability may develop from an accident. This is known as _______________.
definition
Disability policies sometimes differ as to the __________ of what accidents are covered (cause of disability).
Yes, IRS has a maximum nontaxable benefit limit.
Does the IRS become involved with Long-Term Care policy benefits?
Indemnity
Duplication of benefit provisions are excluded from ________ policies.
corporate board structure
ERISA qualification regulations are not concerned with which of the following:
Outline of Coverage
Every health contract issued must contain a(n) _______ page which is a shortened version of the contract.
14
Everyone who purchases a life insurance policy must receive a Buyer's Guide. The Buyer's Guide may be given at the time of application. If the state law requires a __ day free look after delivery, then the policy guide may be presented to the applicant at policy delivery.
do not have an upper limit on the Medicare portion
FICA taxes:
15 members
Federal law requires maternity benefits in group insurance for groups with over:
units
Fixed annuity language deals in dollars and interest percentages. Variable annuities deal in ______ - either accumulation or annuity.
24, 24
Florida law prohibits individual health insurance policies, other than disability income, from excluding coverage for a preexisting condition for longer than ___ months, following the effective date of coverage for a condition that had manifested ___ months prior to coverage.
change of agents name
Florida law requires notification to the DOI within 60 days regarding:
unauthorized
Florida law specifically prohibits _________ mail insurers from soliciting in Florida.
Free insurance
Florida law strictly prohibits offering an applicant what?
14
Florida state law requires a __ day "Free look" for a full refund after policy delivery.
30 days every 18 months
For how long, and how often, must an HMO offer an open enrollment period?
Disability Buy-Outs and Business Overhead Expense
Forms of Medical Insurance which are considered Valued Policies are:
Disability Buy-Outs and Business Overhead Expense
Forms of Medical Insurance which are considered Valued Policies are?
a cash withdrawal or a loan
Funds may be removed from a variable universal life policy's cash value through:
Modified Community
Group Carriers must use the "_______ Rating" methodology. (Same price for everyone in the category).
12, 6
Group policies (2-50) may exclude preexisting conditions for no longer than _____ months with a _______ month "look back."
18
HIPAA requires that any person with _______ months of creditable coverage, who does not have access to other health insurance, must be given access to an insurance policy.
Closed Panel systems are staffed by M.D.s who function as employees in the HMO facility.
HMO type health providers are classified in several different ways. Which of the below is correct?
Pre-certification review.
HMOs and PPOs often control cost by the application of non-emergency:
Annual
HMOs are required to make _______ reports of their activities.
18 months
HMOs must provide a minimum open enrollment of 30 days every:
All of these answers are correct.
Health insurance underwriting is more intensive than life insurance because: Select one: A. Several family members are often insured on the same contract. B. Many expensive illnesses do not result in death. C. All of these answers are correct. D. Multiple claims usually occur during the policy's effective period.
Coverage can be issued with a rider excluding a specified condition.
How can a person with a recurring ailment purchase health insurance at a standard rate?
Designate a named beneficiary
How can an insured protect the proceeds of his life insurance policy from his/her creditors?
90 days
How far in advance does an insurance provider have to notify an insured if they are going to refuse to renew the contract?
60 days
How many days can a qualified account be withdrawn and held for between custodial accounts before the ten percent excise penalty is applied?
21
How many days must the grace period be extended for persons 64 years of age or older?
20
How many employees does a business have to have in order to be covered by COBRA?
One
How many guarantees are there in the Variable Life Product?
24
How many hours of continuing education must a newly licensed agent acquire every two years?
100
How many members are association groups required to have (choose one answer)?
Up to 18 months.
How many months can a terminated employee stay on COBRA?
5
How many visits to a dermatologist without a Primary Care Physicians referral are HMOs required to provide each year?
any, majority
How might total disability descriptions differ from contract to contract? Some contracts require the inability to perform the major functions of _____ occupation(s). Other contracts will pay the disability if you're unable to perform a ______ of the functions of your own occupation.
5 years.
How often are HMOs required to have a complete audit?
65
How old does one have to be to qualify for Medicare?
age 100
If a person selects a 30 Pay Life Contract at age 30 the policy will endow at:
Option to convert
If a person wishes to eventually own a cash value or equity type of policy, what feature would he want to be sure to have on his term insurance?
elimination
If a relapse occurs within the contractual period specified after returning to work, there will not be a new ________ period.
None of these answers are correct.
If an application for life insurance is submitted to an insurance company with no premium payment, coverage under the policy begins at which of the following times, if any? Select one: A. After the medical information requirements are met. B. None of these answers are correct. Correct. C. After acceptance of the application by the insurer. D. After completion of any required medical examination of the applicant.
The applicant's selected physician
If an insurance company declines to issue insurance to an applicant on the basis of a Medical Information Bureau (MIB) report, the MIB will release medical information contained in the report to which of the following, if any?
180, 5
If an insurer withdraws a policy form and cancels existing contracts without offering a replacement, it must provide _______ days notice and is prohibited from issuing any coverage in Florida for _______ years.
3
If people own their insurance, and transfer it out of their estate just before death by making an absolute assignment to one of their children or someone else outside of their estate, the IRS will recapture that just as they do any other gifts if the transfer takes place less than _________ years prior to death.
the policy lapses.
If the cash value account of a flexible premium universal life policy reaches zero, the policy-owner must make a premium payment or:
beneficiary
If there is a death benefit attached to any health policy such as an Accidental Death or Dismemberment policy, then it must name a(n) _________.
6 months
In Florida all members of a group must be insured, however in groups of 2 to 50 the insurer can consider preexisting conditions for as long as 12 months and "look back" prior to issue for as long as:
No minimum number
In Florida what is the minimum number of employees required to have a state approved group?
14 days
In Florida, how much time is permitted to return a contract for a full refund?
The Transition Period
In a Disability Income Policy which of the following is considered a form of deductible?
will rarely have the same value from month to month
In a Variable Annuity the Accumulation Units
Coinsurance Clause
In a health policy, which of the following states that the insured and the insurance company will share the cost of covered losses?
Insuring Clause
In a life insurance policy, the promise by the insurance company to pay certain benefit is the:
Insuring Clause
In a life insurance policy, the promise by the insurance company to pay certain benefits is the:
3 Contracts
In a three-person partnership, an "Entity Purchase" plan would require how many contracts?
3 contracts
In a three-person partnership, an ENTITY PURCHASE plan would require:
accumulation units
In a variable annuity, a contract owner's interest in his/her separate account is stated in terms of
single-premium
In addition to Straight whole life and Limited Pay, the third method of financing a whole life contract is ________.
The Capital Sum
In an Accidental Death and Dismemberment contract which of the following is the reason for categorizing this contract as a Health policy?
The Principal Sum
In an Accidental Death and Dismemberment contract, which of the following is the Death benefit?
the application and the initial premium
In an insurance contract, the consideration given by the applicant in exchange for the insurers promise to pay benefits is:
Average monthly wages (AMW) is the most recent index used.
In determining Social Security retirement benefits which of the following statement is not correct?
Free gifts
In promotional materials, any limitations and conditions that might affect the growth or benefit the contract must be made clear. Which of the following should not appear?
adverse
In summary, most insurer rules are imposed to aid them in avoiding _______ selection.
The beneficiary receives a guaranteed income no matter how long he/she lives.
In the Settlement Option known as Life Income Option:
Numbers
Insurance "Risk Pooling" functions on the "Law of Large __________"
Risk
Insurance provides protection from the total loss from risk through the concept of _____ Pooling.
seventy-five percent
Insurers, to avoid adverse selection, in contributory group plans will often have a minimum participation requirement of:
Joint-life
It is possible to write one life contract on two persons. This policy is known as a ____________ contract.
Payor
Juvenile Insurance written on individuals 15 years of age and under will often have a ____________ rider.
60, 120
Legal actions must be delayed for _______ days. If the insurance company is challenging the claims, then legal action cannot be filed for ________ days.
Personal
Life insurance contracts may be assigned because they are not ________ contracts.
aleatory
Like all other insurance contracts health policies are:
dread disease policies
Limited Risk policies are also known as:
The contract may require prior hospitalization before becoming effective.
Long-term care policies have principal restrictions including all the following except:
Comprehensive
Major Medical plans, when not used to supplement First Dollar Plans, are called _________ Major Medical.
Conditional
Many contracts never result in any action because they are __________ contracts.
Skilled nursing under 100 days duration
Many elderly are not aware of Medicare and exclusions which include those listed except:
only show recent dividend history without any future commitment
Many mutual companies can show dividend histories for over 100 years, therefore they can
only show recent dividend history without any future commitment
Many mutual companies can show dividend histories for over 100 years, therefore they can:
deny the claim because it involves a pre-existing condition
Maria is disabled thirty months after her disability income policy is issued. The disability is caused by a condition that existed prior to the policy issue date but was not specifically revealed on the application. In this situation, the insurance company will most likely:
Small businesses and sole proprietors
Medical Savings Accounts were developed to help which of the following?
Workers' Compensation
Medical care costs, disability income, and rehabilitation benefits are all a part of what program?
65
Medicare Part A is mandatory for recipients of social security over age ___.
physician's
Medicare Part B covers _______ services in or out of a hospital.
provide for the gaps in Medicare.
Medicare Supplement policies are primarily designed to
30 day free look
Medicare Supplements and Long-term Health Care policies have a mandated:
Part B
Medicare _______ pays for things such as diagnostic lab tests, x-rays, ambulance services, medical supplies, medical equipment and so forth.
30
Medicare supplements and long-term care policies have a _______-day free look rather than the normal 10 days.
guaranteed renewable
Medicare supplements must be:
Duration
Morbidity tables reflect the average _______ of disability.
group, individual
More Americans are protected under _____ medical expense plans than on ________ policies.
developed from the deaths of millions of persons over long periods of time
Mortality figures are normally developed by studying and interpreting statistics
developed from the deaths of millions of persons over long periods of time.
Mortality figures are normally developed by studying and interpreting statistics:
Comprehensive
Most Major Medical policies written today are described as which of the below?
long-term
Most __________ disability contracts restrict the amount purchased to an amount less than the insured's income.
NAIC
Most state legislatures follow the recommendations of the ____ when it comes to changing Insurance Codes.
"Full and fair disclosure of all of the facts of both the old and the new contracts."
Most states have two requirements when a policy replacement takes place. One is, the existing and the replacing insurer must be notified of the replacement. The other is:
Level-term
Multiple protection policies combine whole life with a ____________ rider on one insured.
premium
Non-cancelable and guaranteed renewable provisions are similar and must be renewed, except that the _________ is fixed in the non-cancelable policy.
The applicant is self-employed in a hazardous occupation and needs health coverage.
Occupational versus Non-Occupational coverage becomes an issue when:
health, life
Occupations and lifestyle are more important in _______ insurance than in ______ insurance underwriting.
manual labor
Occupations involving strenuous _______ influence the length of recuperation periods for disabled workers.
Avoidance
Of the 4 methods of treating Risk which of the below is the least practical?
Master
One of the major characteristics that distinguishes group insurance from individual policies is a __________ contract between the sponsor, who might be an employer or an association for the benefit of employees or association members.
judicial
One of the major obligations of the Office of Insurance Regulation is that it will rehabilitate or _________ insurers if necessary to protect consumers.
liquidate
One of the major obligations of the Office of Insurance Regulation is that it will rehabilitate or _________ insurers if necessary to protect consumers.
post-claims underwriting
One of the major prohibitions in the NAIC model Long-Term Care Regulations concerns:
benefits
One of the major secondary premium factors is the ________ provided in the policy.
50%
Partial disability will normally pay for only three to six months. What percentage of disability income is the normal payment for partial disability?
Sober
Parties who are applying for a policy must be:
The State and the Securities Exchange Commission
Who regulates the variable annuity?
Income tax free.
Personal insured financed disability income policy benefits are considered by IRS to be:
Accidental Means requires that an unintentional act led to the bodily injury; e.g., falling from a ladder
Policies that cover accidental death or accidental disability have varying definitions of the cause of death or disability. Which statement below is correct?
Accidental Means requires that an unintentional act led to the bodily injury; e.g., falling from a ladder.
Policies that cover accidental death or accidental disability have varying definitions of the cause of death or disability. Which statement below is correct?
Family
Policies that cover both spouses and children up to a specified age are called ____________Policies.
named beneficiary
Policy cash values and death benefits cannot be attached by the insured's creditors if left to a(n) ___________.
Moral
Poor credit or dishonest business practices would be considered a ________hazard.
30 days
Producer name or address changes must be filed with the insurance commission within:
Lower
Reentry permits a healthy insured to reenter the pool at a ___________ rate than the contracted rate by proving that he or she is still an insurable risk.
An increasing number of employers are offering voluntary (employee paid) LTC.
Regarding LTC long-term care provided as a group benefit:
25
Replacement is defined as any transaction or course of action that will cause a policy to be (1) lapsed or canceled; (2) converted to reduced paid up, or to extended term; (3) If it is amended to effect a reduction in benefits, or the length of time that the policy is going to stay in effect; or (4) whether it is re-issued with any reduction in cash value; and (5) a policy is considered replaced if as much as _____ percent of its existing cash value is used to finance the new contract.
The agents conviction that annuities fit the retirement needs of most potential clients.
Required standards for recommending an annuity include all the following except:
a proportion of the purchased benefit equal to the percent of total income lost because of the disability
Residual Disability contracts pay:
caregiver
Respite care benefits are for the benefit of the insured's __________.
Loss
Risk is the descriptive word for "Uncertainty Regarding a(n) ______"
Sandra can borrow from the policy only with James' permission.
Sandra, the policy owner, has named James an irrevocable beneficiary. Which of the below is correct?
125s
Section ____ plans contribute to employee morale by giving them choices that fit their individual perceived needs.
54
Sex is a premium factor. In the younger age groups, women's health insurance premiums tend to be about 20 to 25% higher than men's premiums for the same age. However, as the age rises the two health premiums become more equal, and at about age _______, they cross as men then become more susceptible to health problems than women.
"pay as you go" program
Social Security is a form of:
A stipulated secondary addressee need not received these notices.
Special rules to protect against the unintentional lapse of long-term care policies include the following except:
An outline of the benefits provided
Statements made on the insurance application generally provide all of the following except:
Face value
Term insurance is classified by its:
normally considered to be 100% in the variable annuity
The "Exclusion Ratio" in an annuity benefit payment is:
Policyowner
The "entire contract" means that no challenges can be made by the insurance company against anything that is not in the contract held by the ____________.
Pure
The 2 classes of Risk are: Speculative and _______
Moral
The 3 types of Hazards are: Physical, Morale, and ________.
dismemberments
The A.D.& D. Contract pays specific "Capital" amounts for designated
Custodial
The Adult Day Care facility's primary focus is __________ care.
unethical
The Association of Insurance and Financial Advisors has declared defamation to be:
only after
The COLA rider is effective in meeting the problem of inflation _______ the start of the disability.
Which insureds will die in any given year
The Commissioner's Standard Ordinary Mortality Table allows the insurance company to predict all of the following except:
standard
The Conditional Insurability Receipt functions only if the applicant is a _______ risk.
Office of Insurance Regulation
The Department of Financial Services and the _________________ are responsible for the enforcement of the Insurance Code.
sometimes paired with the waiver of premium rider as an added benefit
The Disability income rider added to a life insurance contract is:
All groups must be priced the same regardless of health status.
The Florida Employees Health Care Access Act does not involve or require which of the following?
19
The Florida Health Insurance Coverage Continuation Act applies to groups of _______ and under.
COBRA
The Florida Health Insurance Coverage Continuation Act is a mirror of the federal act known as:
Unsubstantiated disparaging statements regarding an insurer
The Florida administrative code regarding agents prohibits which of the following?
maintenance
The HMO contract is not an insurance policy. It is a health ________ contract on the subscriber's body.
preventive
The HMO, since the services are prepaid, encourages the individual to see a doctor early so that _______ measures may be taken.
it has strict requirements to guard the disclosure of patients health and medical information, the requirements apply only to agents
The Health Insurance Portability and Accountability Act (HIPPA)...(2 answers required)
None of these answers are correct
The National Association of Insurance Commissioners has carefully defined a standard risk for which of the below? Select one: A. Health insurers B. Life insurers C. None of these answers are correct D. Disability income insurers
forms
The OIR continuing regulation of insurance company activities includes policy _______ and provisions.
judicial
The OIR operating under the Insurance Code carries out the law as it relates to insurance. The OIR and the Chief Financial Officer have broad administrative and quasi-legislative power. They also have quasi __________ powers.
3
The Office of Insurance Regulation has an absolute right to examine any financial records regarding the insurance activities of an agent. The records must be kept for ______ years
Approving agent compensation
The Office of Insurance Regulation is not involved in which of the following?
the period of time starting on the policy effective date during which there is no coverage for illnesses
The Probationary period in a disability income policy is:
There is no age limit
The Roth IRA has to start distribution at what age?
Purchasing pools.
The Small Employers Access Act is intended to provide small employers the option and ability to provide health care benefits to their employees through the creation of _______.
made a counteroffer, rejected the application, considered the application
The Temporary Insurance Agreement will pay a benefit after a required 3rd-party medical even if the applicant is not an insurable risk, and if the applicant died before the company:
1990
The _______ Medigap Law made shopping for Medigap policies less confusing.
Co-payment
The _______ is a flat dollar amount that is paid to the provider by the recipient, at each service occurrence.
Entire Contract
The ________ provision prohibits the insurer from making any changes to the policy.
insurer
The _________ has the right to conduct an autopsy on the body of the insured to determine the cause of death.
corridor
The ___________ deductible is the most common with Supplemental Major Medical combined with 1st dollar plans.
Closed Panel HMO
The _____________ is often described as the most efficient method to deliver health care.
application
The _____________ must be attached to every insurance policy.
consideration
The _______________ clause states the amount and frequency of premium payments.
Options
The advantage of the Medicare + Plus Choice Program was to offer:
Five
The advantage of the Social Security rider is that its short elimination period will bridge the _______-month gap in Social Security disability.
Overlap or Duplicate
The agent must explain the extent to which proposed new coverage will _______ the existing coverage.
Employees
The agents in a general agency are considered insurance company:
distribution
The annuity distribution method is normally selected at the time of:
loading
The anticipated future expense or ________ is added to the net single premium to arrive at the gross premium.
States
The basic criteria to qualify for Medicaid are established by the:
Pooling of risk and the law of large numbers
The basic principles of insurance are which of the following?
Reasonable Cost
The basis for Medicare reimbursement under part A is _______.
Reasonable Cost.
The basis for Medicare reimbursement under part A is _______.
the home care provider
The beneficiary of Respite Care Provisions is normally
the home care provider
The beneficiary of Respite Care Provisions is normally:
provides the sequence of beneficiaries
The common disaster provision, in a beneficiary designation:
always free of any federal income tax if taken as a lump sum
The death benefits paid to a named beneficiary are:
a valued policy
The disability Buyout policy is considered:
A signed statement specifying the agents commission on the transaction
The duties of the replacing insurer include all the following except:
Probationary
The employer selects a period of time after which a new employee becomes eligible for the group benefits. The name of this period is the ______________ period.
1 month
The enrollment period which follows the probationary period is how long?
Centers For Medicare and Medicaid Services
The entity that finances Medicare is the?
100%
The exclusion ratio in a variable annuity is considered to be what percent?
Cash values are the same as nonforfeiture values.
The following statement regarding a life insurance contract is true?
variable annuity
The industry's answer to the problem of inflation reducing the annuitant's purchasing power in long-term annuity payouts is the _____________.
The agent and the applicant may compromise on the policy restrictions in order to provide coverage for everyone.
The insurance contract is a "Contract of Adhesion" therefore, which of the below is not true about the application?
promise to pay
The insuring clause is a statement on the first page of the health policy stipulating the conditions under which benefits are to be paid. It represents the company's ________.
Survivorship
The life insurance industry is able to distribute the sum of money (principal) and the interest over the lifetime of a person using the _________ tables of the life insurance industry.
Fixed annuities
The major hazard involved when using ___________ is the depletion of the purchasing power of the fixed dollar annuity income by inflation.
5
The mandatory waiting period for OASDI disability is how many months?
0
The minimum legal number of employees required for group insurance in Florida is?
5
The minimum number of ADLs a Long-term care contract must take into account is:
The value of the annuitant's separate account
The monthly income received by an annuitant with a variable annuity will increase when which of the following increases?
single
The net single premium can be defined as the _________ amount needed today to fund future death benefits.
provide indigent Medical Expense coverage
The objective of Medicaid is to:
Morale
The occupation or hobbies of the applicant may be _______ hazards.
the economy
The owners distribution selection is influenced all by the below factors except:
Security
The phrase "Peace of Mind" benefits of life insurance derives from the _________ it provides for those dependent upon the insured after death.
economically dead
The plan sets forth the terms for selling and buying a partner's or stockowner's share of a business, in the event he or she becomes ______________ (disabled but does not die).
Producer
The policy owner relies on the _________ to provide informed options, and trusts that the producer's recommendations for insurance are in his or her best interest.
and cannot be required to pay additional damages under the law
The principle of Workers Compensation laws is that the employer is considered liable for all on-the-job injuries.
and cannot be required to pay additional damages under the law
The principle of Workers Compensation laws is that the employer is considered liable for all on-the-job injuries:
Disability
The purpose of insurance is to provide economic protection from losses that may occur because of Death, ___________, Medical Expense, and home or auto damage.
Efficiency and Economy
The purpose of the Health Maintenance Organization Act was to increase _______ in the delivery of health care.
assignment
The right of ___________ is built into most commercial health policies.
$5
The total value of the separate account which funds Jack's variable annuity is 10 million. There are two million accumulation units outstanding for the separate account. What's the value of one unit?
guaranty of principal
The two annuity distribution methods fixed period and fixed amount have a___________.
convertible term policy
The type of policy that can be changed from non-cash value contract to one that is cash value developing without medical underwriting is known as a
personal contract
The unique characteristic that allows life insurance to be assigned or sold is that it is not a
Unilateral
The unique feature that allows the policy owner to drop a policy without notice is:
fixed dollar amount
The variable annuity principal exclusion in the periodic payments is a ________.
More complex
There are many physical conditions that can be extremely expensive on a reimbursement type of policy that will not kill you. Therefore, health insurance underwriting is much more _______ than life insurance.
long-term care
There are policies designed to help with the cost of nursing homes; they are designated as ___________ policies.
Extra percentage Tables
There are several ways to "rating" high risk applications. The most used for health issues involves a numeric system. It is also known as:
indemnity
There are two approaches to providing medical expense insurance. One of these is the medical reimbursement type of plan. What is the name of the other? The Medical ________ plan.
human life value method and the needs analysis
There are two basic methods for determining the proper amount of insurance for individuals. These two methods are:
The Defined Contribution & The Defined Benefit
There are two major types of qualified group pension plans. They are: The Defined Contribution The Defined Growth Annuity The Defined Benefit Deferred Compensation
Convert
There are two options common to most term contracts. One is the option to renew. The second important option found in many term policies is the option to ___________.
the Return of Premium Clause
There is a policy merchandising idea that returns to the beneficiary all of the premium paid during the insured's life as well as the policy's face value. It is called
occupation
To a greater degree than life insurance underwriting Health contracts are concerned with the applicant's:
6 of the last 13 quarters
To be eligible for Social Security Disabilty Benefits a worker is required to have a minimum of quarterly credits equal to:
COBRA
To qualify for mandated coverage under HIPAA, the last period of creditable coverage must have been under either a group health plan or _______.
The principle of pooling
To what does the statement "Spreading the income loss created by an individual's death among many persons so the cost for each individual is small" refer?
insurer
Under Agency Law the agent represents the:
When Basic First Dollar plans are coordinated with major medical, the major medical is called ________ Major Medical.
Under Insurance regulations, all group insurance for the members or their dependents is convertible within _______ days from the point of time the individual loses eligibility for the group coverage.
moment
Under an HMO, newborns are covered for services from ____________ they are born.
agency
Under the law of _______, an agent is the lawful representative of the principal.
dollar amount
Under the surgical schedule method, every surgical procedure is assigned a _________ by the insurer.
Guaranteed Renewable Policy
Unlike life policies, a fraudulent statement on a health insurance application is grounds for contest at any time, unless it is a(n):
invested in separate accounts selected by the policy owner
Variable Universal Life cash values are:
A level premium feeds the policy, It matures at age 100, It develops cash value
What are the three elements that make whole life insurance work?
Assets
What factors are used to determine the elimination period?The elimination period will be based on the beneficiary's average monthly expense and the amount of his/her _______.
Inflation
What is considered the main reason for accepting the risk involved in Variable Life insurance?
nursing care, part-time home health aid, therapy
What is included in post hospital home health services?
twisting
What is it called when a person uses misrepresentation of a contract to induce a person to change a policy to a different insurer?
The flow of insureds through the group
What is the concept that distinguishes group insurance?
Step rate
What is the description of the premium changes in level term insurance?
403b
What is the designation of the plan that is available only to employees of not-for-profit organizations?
2 years
What is the length of time an insurer can contest a life policy for fraud?
2 months
What is the maximum age of the reported fund values allowed in a variable products annual report?
50
What is the maximum number of employees a company can have to be defined as a small employer in the "Health Care Access Act"?
200%
What is the maximum percentage of premium increase permitted in group continuation contracts?
Fixed contracted premium
What is the most distinguishing feature of the non-cancelable contract?
60%
What is the normal amount of income that can be replaced by a long-term disability policy?
13 to 26 weeks.
What is the normal duration of Group Short Term Disability?
The present value of the applicant's future earnings
What is the principle involved in the use of the "Human Life Value" concept of determining the amount of life insurance to purchase?
10 days.
What is the shortest amount of time for a grace period?
Implied authority
What type of authority permits the agent to print business cards with the insurer's logo?
The named beneficiary
What will be the major difference in the policies written as a cross-purchase or as an entity buy-sell?
120 days
When a serviceperson leaves the military, their term insurance will remain in effect for:
irrevocable
When an owner must obtain the beneficiary's consent to change the beneficiary of life insurance policy, the designation is said to be:
20 days
When are HMOs required to pay their provider's claims?
20 days.
When are HMOs required to pay their provider's claims?
It is possible to convert $3,000 or more of industrial insurance policies to one ordinary life policy
When dealing with industrial insurance, which of the following applies when an insured wishes to convert to an ordinary policy?
When the rebate is available to all insureds in the same actuarial class.
When is it acceptable for a Florida or California producer to rebate a portion of his commission?
level premium funding
When purchasing whole life insurance that builds cash values and matures at age 100, what is the concept upon which the applicant is buying?
Permanent Flat Extra Premium
When rating a morale hazard the insurer will probably apply a:
making an offer to buy a life insurance policy from the insurer
When signing the application form, with an initial premium, the proposed insured is
Replacement
When the agent knows the applicant is going to cash in a policy and use the funds to purchase a new insurance policy, this would be under the ___________ rule?
All of these answers are correct
Which are major types of Health Service Providers? Select one: A. Health Maintenance Organization B. Blue Cross Blue Shield C. All of these answers are correct D. Preferred Provider Organization
Notice to Applicant Regarding Replacement of Life Insurance
Which form must be signed by the insured and retained by the insurer (for 5 years) with a Replacement Rule transaction?
Accidental Means
Which has the most restrictive definition?
Agents must follow the replacement procedure outlined in state Law
Which is the correct statement regarding policy replacement?
Accidental Means
Which of the AD&D policy definitions below is considered too restrictive for approval by most state insurance regulators?
D
Which of the below Medicare plans are still used today?
The Chief Financial Officer (CFO)
Which of the below administers insurance laws of the State of Florida?
age, sex, health
Which of the below are permissible premium factors?
A trust, A real person, An unincorporated business or a corporation
Which of the below can be a beneficiary of a life insurance policy?
Joe's neighbor
Which of the below does not have an insurable interest in Joe, a business owner who has a wife and two kids and lives in a suburban community?
Replacing policies after full disclosure of all relevant values & facts
Which of the below does not qualify as twisting in policy replacement?
Replacing policies after full disclosure of all relevant values and facts
Which of the below does not qualify as twisting in policy replacement?
Commission payment methodology
Which of the below has not been considered an insurance industry top ethical concern?
Deceptive sales presentations
Which of the below have generated the most complaints regarding unethical behavior?
Mental hazard
Which of the below is NOT considered a basic type of hazard?
Ethical behavior
Which of the below is considered the major key ingredient to a successful insurance career?
It generally has the capacity to be stable during inflation periods
Which of the below is not a Variable Universal Life (VUL) characteristic?
It generally has the capacity to be stable during inflation periods.
Which of the below is not a Variable Universal Life (VUL) characteristic?
Makes a profit for Stockholders
Which of the below is not a characteristic of a mutual insurance company?
Not taking time to discuss an insurance prospect's preconceived opinion regarding his or her requirements
Which of the below is not a desirable insurance sale attribute?
disability buyout
Which of the below is not a form that Health Insurance is available in group?
Workers compensation
Which of the below is not a part of OASDI?
A written notice from the agent warning of the impending lapse
Which of the below is not a requirement for the adjusted grace period for Florida life contract holders over 64 years of age?
The loss must be avoidable
Which of the below is not an element of an "Insurable Risk"?
The loss must be catastrophic
Which of the below is not an element of an "Insurable Risk"?
An adjustable face
Which of the below is not an element of the whole life contract?
Special Risk
Which of the below is not one of the 3 basic forms of health insurance?
Workers Compensation
Which of the below is not one of the 3 major federal health programs?
A master contract is issued to the association.
Which of the below is not true regarding Franchise (Wholesale) Health Insurance?
The states require the insurers to determine the amount of reserves.
Which of the below is not true regarding the reserves of insurers?
Preferred Provider Organization
Which of the below provide Insurance? Select one: A. All of them do B. Preferred Provider Organization C. Blue Cross Blue Shield D. Health Maintenance Organization
Life insurance companies, Specialized mono-line companies, Casualty insurance companies
Which of the commercial insurers below can write Health Insurance?
They are offered on either a group or individual basis.
Which of the following about Blue Cross/Blue Shield Service plans is correct?
Split a commission with another properly licensed agent
Which of the following actions by an agent is not in violation of the Code of Ethics?
The client's monthly expenses and liquid assets.
Which of the following are the most important factors for an agent to consider in helping a client determine what length elimination (waiting) period to request on a disability income policy?
Education
Which of the following data about an applicant is usually not required on a medical expense insurance application?
The NASD Occupation Description list
Which of the following descriptions of occupation is not important in disability income policies?
His best friend
Which of the following does not have an insurable interest in a young man?
A disgruntled ex-employee told everyone he knew that the company he was fired from used child labor, which was not true
Which of the following is an example of defamation?
The issuing entity bears the investment risk
Which of the following is characteristic of a fixed annuity?
Making a statement which is not entirely true about the terms of a policy
Which of the following is considered to be misrepresentation?
A stop-loss
Which of the following is not a Medicare Part A feature?
Genetic analysis
Which of the following is not a common source of underwriting information?
Co-insurance
Which of the following is not a feature of Medicare Part A?
The insureds are individually underwritten
Which of the following is not a feature of group insurance?
Short Term Disability
Which of the following is not a major benefit of Social Security?
SEC approved potential variable product rate value projections
Which of the following is not a prohibited sales tool?
Major
Which of the following is not a type of deductible?
Minimize federal taxes
Which of the following is not an objective of the NAIC?
A church
Which of the following is not considered a Group?
replacement income
Which of the following is not covered under Medical Expense Insurance?
The policyowner may increase contributions at his discretion.
Which of the following is not true about Traditional Variable Life insurance?
All employees must be treated the same.
Which of the following is not true regarding a Savings Incentive Match Plan for Employees. (SIMPLE) plan?
A summary statement of the renewal rates.
Which of the following might be omitted from an Outline of Coverage?
A 20 Year Endowment
Which of the following policies will pay the face amount of the policy to the owner after 20 years?
The Fair Credit Reporting Act
Which of the following requires an insurance company to notify an applicant in writing that an investigative consumer report may be made on him/her?
It is a written statement by the claimant covering the occurrence, nature, and extent of a loss.
Which of the following statements about "Proof of Loss" under a Disability Income policy is most accurate?
It furnished permanent protection in the sense that it does not have to be renewed or converted
Which of the following statements about a Whole Life policy is true?
It furnishes permanent protection in the sense that it does not have to be renewed or converted.
Which of the following statements about a whole life policy is true?
It requires that an applicant be advised that a credit report may be requested, if that is the case.
Which of the following statements about the Fair Credit Reporting Act is true?
A traditional IRA allows an individual to save money for retirement with pre-tax income.
Which of the following statements best describes a traditional IRA (Individual Retirement Account)?
Cash values are the same as nonforfeiture values
Which of the following statements regarding a life insurance contract is true?
As long as the policy is not surrendered, the cash values accumulate tax-free.
Which of the following statements regarding the tax treatment of cash values is true?
A coinsurance requirement may be 20% of the eligible medical expenses
Which of the following statements, if any, about health policy provisions is true?
Annual Renewable Term
Which of the following types of life insurance contracts is usually used for group life insurance?
Annual Renewable Term
Which of the following types of life insurance policies is usually used for group insurance?
Current bills
Which of the following would be considered a final expense?
Social Clubs
Which of the following would not be eligible for establishing Group Life Insurance?
physical
Which of the following would not be required by the Florida Department of Financial Services as part of a candidates licensing application?
Total disability
Which of the following, if any, is the minimum requirement for activation of the waiver of premium clause?
40/60
Which of the rates below is seldom a coinsurance rate?
Non-cancelable
Which of the renewal clauses below is most advantageous to the owner and requires the most stringent underwriting?
Time of Service
Which of the three methods below are not used to avoid discrimination in Group Life insurance?
Agent's address
Which one of the items below does not have to appear on the application?
The contract purchaser
Which party determines the elimination period?
Per Stirpes
Which term below would designate the children of a deceased named beneficiary recipient of the death benefit?
100
Whichever form of whole life policy is used, there must be an adequate amount of premium paid for the policy to endow at age _____.
owner
Who has the right to change an insurance policy?
The Securities Exchange Commission
Who must approve the prospectus?
Modified
Whole life insurance is merchandised to the public in many ways. One of the methods is the "Buy now pay later" way through the use of reduced early premiums. These contracts are called _________ Whole Life.
The insurance contract is an Aleatory contract
With insurance contracts there is a possibility for either of the parties to lose. Which of the following describes this feature of insurance contracts?
The insurance contract is an Aleatory contract.
With insurance contracts there is a possibility for either of the parties to lose. Which of the following describes this feature of insurance contracts?
Three
With three partners in a business, how many life insurance policies would be required to insure an entity buy-sell plan?
90
Within how many days must proof of loss (bills) be submitted?
Primary
Workers' Compensation and the V.A. are considered _______ providers to eligible recipients.
$5,000
Workers' compensation programs are state-regulated plans. If a worker is killed in an "on-the-job" accident, his or her family will receive what amount of money as a death benefit?
Residual
________ disability covers the portion of the lost income of an individual who is not totally disabled.
Qualified
_________ plans are subject to the requirements of the HIPAA act of 1996.
Health Maintenance Organization
__________ is another term for "Comprehensive Health Care."
Prepaid health clinics
___________ may not use the word "HMO " and should not be confused with an HMO that delivers the full range of services.
Automatic
___________ premium loan provisions are a safety factor for equity contracts that permit the company to borrow from cash values to pay the premium.
Misrepresentation
____________ involves a situation where one fails to clearly bring to mind a fact or condition either innocently or intentionally to deceive.
