General Insurance
Events or conditions that increase the chances of an insured loss occurring are referred to as
Hazards
What is the typical deductible for basic surgical expense insurance?
$0
Accordance to insurance code, it is an unfair or deceptive act in the business of insurance for an insurer to advertise insurance that it does not market. Such action is a violation of the code, and will result in a fine too.
$10,000
An insurer has been found guilty of a code violation regarding replacement. The insure than repeat the violation. What will be the minimum penalty
$10,000
To attain currently insured status under Social Security, a worker must have earned at least how many credits during the last 13 wuarters
6
hospital indemnity policy will pay
A benefit for each day the insured is in a hospital.
Which of the following would be among the prohibitive provisions for long-term care insurance policies delivered to the insured in California?
All these
Harry has a disability that prevents him from doing certain kinds of work. Because of his qualifications, he responds to a recruitment ad and is hired for the position. What federal act allows him to apply for the job?
Americans with Disabilities Act
What is another term for the general enrollment period for Medicare part B
Annual Enrollment Period
For the purpose of a contract, which of the following can be considered a "person"
Any of these would qualify as a person
All the following employees may use a 403(b) plan for their retirement except
CEO of a private corporation
Which statement regarding insurable risk is not correct
Insureds cannot be randomly selected
Which of the following does not need to be identified an insurance policy?
Insurer's financial rating
The part of Medicare that helps pay for inpatient hospital care, inpatient care in a skilled nursing facility, home health care and hospice care, is known as
Part A
Profitable distribution of exposures serves the purpose of
Protecting the insurer against adverse selection
According to California insurance code, which of the following can be classified as an insurable event?
Pure risks
When employee covered under a health reimbursement account changes employers, the HRA
Return to the insurer
Which of the following would qualify as an implied warranty insurance contract?
The applicant signature
Which answer is true about extension of benefits and group disability policies?
The benefits are extended if a disabled person's coverage terminates as a result of a discontinued group plan.
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then
The benefits is received as taxable income
All the following are true statements regarding the accumulation of interest option, except
The interest is not taxable since it remains inside the insurance policy.
An audit ant dies before the effective date of purchase annuity. Assuming it in annuitantswife is the beneficiary, what will occur
The premiums will increase
The annual contribution limit of a Dependent Care Flexible Spending Account is set by
IRS
When the policy owners specifies the dollar amount in which installments are to be paid, he/she has chosen, which settlement option
Fixed him out
A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges, which fall within the standard range fees normally charge for a specific procedure by a doctor of similar training and experience in the geographic area is known as
Gatekeepers
Which of the following annuity writers ensures that the owner will receive an annuity at least the amount paid for the annuity?
Guaranteed minimum accumulation
Which type of a hospital policy pays a fixed amount you stayed at the insured is in the hospital
Indemnity
Who will be affected by the share of cost requirement for Medi-Cal?
Individuals whose income exceed the Medi-Cal limit
Which of the following is NOT allowed in credit life insurance? 1. Creditor requiring that a debtor buys insurance from a certain insurer 2. Creditor having a collateral assignment on the policy 3. Creditor requiring that a debtor has a life insurance 4. Creditor becoming a policy beneficiary
1. Creditor requiring that a debtor buys insurance from a certain insurer
Which of the following types of LTC is NOT provided in an institutional setting? 1. Custodial care 2. Skilled nursing care 3. Intermediate care 4. Home healthcare
1. Custodial care
For how many days of skilled nursing facility care will Medicare pay benefits?
100
The limits of a health reimbursement account are set by 1. Federal regulation. 2. The employer. 3. State statutes. 4. The insurer.
2. The employer
An insured has Medicare part D coverage. Upon reaching the initial benefit limit, what percentage of the prescription drug causes the insured responsible for paying?
25%
An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This indicates that his policy is written with a 30-day 1. Probationary period. 2. Waiver of benefits period. 3. Elimination period. 4. Blackout period.
3. Elimination period
For how long is an insurance company allowed to differ policy loan requests?
30 days
According to the California Insurance Code, every applicant must notify the Commissioner in writing of any change of address? 1. Within 60 days. 2. Within 10 days. 3. Within 30 days. 4. Immediately.
4. Immediately.
And internal revenue code provision, that specifically provides for an individual retirement plan for public school teachers is a
403B plan TSA
The minimum number of credits required for partially insured status for Social Security disability benefits is
6 credits
The legal definition of "person" would not include which of the following?
A business entity
Which of the following annuity riders ensures that the owner will receive from an annuity at least the amount paid for the annuity?
Guareented lifetime withdrawal
Medical Savings Accounts (MSAs) are available to small business employees and self-employed individuals who have
High deductible health insurance
Units with the same or similar exposure to loss are referred to as
Homogeneous
A formal arrangement of providing healthcare benefits, without providing any financial protection to the principal is referred to as what type of plan?
Risk pooling
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT
Signed waiver of premium
What information is provided by the explanation of medical benefits?
Specific services covered and the amounts approved for each service
Which of the following is incorrect concerning noncontributory group plan
The employees receive individual policies
For an individual who is eligible for Medicare, at age 65, and he was still employed in covered under the employers plan, which of the following is true
The employer plan continues, and Medicare is not available until the individual is retired
Which of the following will vary the length of the grace period in health insurance policies?
The mode of the premium payment
What is the amount a physician or supplier bills for a particular service or supply?
actual charge
An insured misstates her age at the time the life insurance application is taken. This misstatement may result in
adjustment in the amount of death benefit
Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?
apparent
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?
eight
In health underwriting, it would be inappropriate to decline a risk using any of the following factors EXCEPT
mental illness
Which of the following premium modes would result in the highest annual cost for an insurance policy?
monthly
Which of the following best describes a waiting period?
A period of time the insured has to wait before payments of benefits begin after a disability.
Every expressed warranty made at or before the execution of a policy must be
Contained in and referred to in the policy or other document and signed by the insured.
Which of the following is not a characteristic or service of an HMO plan?
Contracting with insurance companies
What is the term for a sales campaign conducted through the mail?
Direct-mail
What is another term for the cash payment settlement option?
Face amount
All of the following statements are true regarding installments for a fixed. Annuity settlement option, except.
It is a life contingency plan
Applicants for insurance who are blind, may be rated so standard for life insurance
Only if they're blindness resulted from injury
How are contributions to a tax-sheltered annuity treated with regards to taxation?
They are not included as income for the employee, but are taxable upon distribution.
What is the purpose of COBRA?
To allow continuation of health insurance coverage for terminated employees
What is the difference between the Medicare approve them out for a service or supply in the actual charge?
Actual charge
At age 30, an applicant wants to start an insurance program, but realizing that his insurance needs will likely change, he wants a policy that can be modified to accommodate those changes as they occur. Which of the following policies would most likely fit his needs?
Adjustable Life
Which of the following long-term care benefits would provide coverage for care for functionally impaired adults on a less than 24 hour basis
Adult day care
How can a new physician be added to the PPO's approved list?
Agree to follow the PPO standards and charge the appropriate fees.
Bob was rendered totally disabled at the time his group health insurance plan was discontinued. Since benefits began to be paid while the policy was in force, which of the following would be required?
An extension of benefits
When insured incurs medical expenses during the last 90 days of a calendar year, the carry over provision allows them to
Apply such expenses to the new year's deductible
A policyowner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision?
Automatic premium loan
Any insurer who engages in the insurance business and violates the Code with respect to insurance replacement shall on the first violation
Be fined a sum of $10,000.
All the following apply to short term disability plans, except
Both group and individual plans are renewable
Company A enters into a reinsurance agreement with company B, where company B reinsurance company, capital a policy which of the following is true
Company A is the primary insurer, and company B is the reinsurer
A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of her life insurance policy has been raised 7% as a result. Which policy rider caused this change?
Cost of Living Rider
Which rider, when added to a disability income policy, provides for changes in the benefits payable based on changes in the consumer price index?
Cost of living adjustment rider
All the following statements concerning dividends are true, except
Dividend amounts are guaranteed in the policy
What is the goal of the HMO?
Early detection through regular checkups
In the Executive Bonus plan, who is the owner of the policy, and who pays the premium?
Executive is the owner, and the executive pays the premium
An applicant is denied insurance because of information found on a consumer report. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company?
Fair Credit Reporting Act
Issuance of health policies to insureds with chronic or ongoing conditions could result in all of the following EXCEPT:
Lower overall costs and premiums
Which of the following is not correct concerning a medical savings account?
MSAs are only available to groups with at least 100 employees
An insured is covered by a disability income policy that contains an accidental means clause. The insured exits a bus by jumping down the steps and breaks an ankle. What coverage will apply?
No coverage will apply, since the injury could have been foreseen.
During the grace period, the policyowner can
Pay a late premium without penalty
ERISA was designed to establish fiduciary standards that would protect
Plan participants and beneficiaries
Not all losses are insurable, and there are certain requirements that must be met before a risk is a proper subject for insurance. These requirements include all of the following EXCEPT
The loss may be intentional
Which of the following determines the cash value of the variable life policy?
The performance of the policy portfolio
All the following statements concerning the use of life insurance as an executive bonus are correct, except
The policy is owned by the company
An insurer wishes to compare the information given in an insurance application with previous insurance application by the same applicant before different companies. What organization can help the insurer accomplish this?
The state department of insurance
Which of the following is NOT a goal of risk retention?
To minimize the insured's level of liability in the event of loss
What is the purpose of a fixed period settlement option
To provide a guaranteed income for a certain amount of time
Social Security was created to provide all the following benefits, except
Unemployment income
If an applicant for a life insurance policy and the potential insured are two different people, what would be the underwriter's main concern?
Whether an insurable interest exists between the individuals
Can an individual who belongs to a POS plan use an out of network physician
Yes, and they may use any preferred physician, even if not part of the HMO
When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income?
Interest only
The insurer may suspect that a moral hazard exists if the policyholder
Is not honest about his health on an application for insurance
Under which of the following organizations are the practicing providers compensated on a fee for service basis
PPO
An insured purchased a 10-year level term life policy that is guaranteed renewable and convertible. What happens at the end of the 10-year term?
The insured may renew the policy for another 10 years, but at a higher premium rate.
If one takes Social Security retirement benefits at age 62, what needs to be done at age 65 to qualify for Medicare?
nothing
Which renewability provision are you most likely to see on a travel accident policy?
period of time
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
The interest earned on policy dividends is
taxable
As it pertains to IRA eligibility, which of the following would not be considered earned income
unemployment benefits
If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this?
Jumping juvenile policy
