Insurance Final round 1
A married couple owns a permanent policy which covers both of their lives and pays at the death of the first. Which policy is that. A: Joint Life Policy B: Survivorship Life Policy C: Second to die D: Family Income
A Joint life policies cover the lives of the two insureds; rates are blended. Upon the death of the first insured, the policy ends
In a non-contributory health insurance plan, what percentage of eligible employees must participate in the plan before it becomes effective? A: 100% B: 75% C: 50% D: 25%
A. 100% of eligible employees must participate in a non-contributory health insurance plan for it to become effective.
An Applicant has a history of heart disease in his family so he would like to buy a health insurance policy that strictly covers heart disease. What type of policy is this? A: Dread Disease coverage B: Single Indemnity Protection C: Term Health Coverage D: Scheduled Benefit Coverage
A. Limited coverage policies, such as dread disease policies, only cover specific medical costs, geared towards a specific illness such.
Insurance companies may be classified according to the legal form of their ownership. The type of company organized to return any surplus money to their policyholders is A: A mutual insurer B: a reciprocal company C: a fraternal insurer D: monthly premium waiver and monthly income
A. Mutual companies are owned and controlled by policyholders and any surplus is returned to them as dividends.
An insured is involved in a car accident. In addition, to a general, less serious injuries, he permanently loses the use of his right leg and is rendered completely blind. The blindness improves a month later. To what extent will he receive disability benefits? A: No benefits B: Full benefits C: Partial benefits D: Full benefits until the blindness ends
A. No benefits. For benefits, the person would have to lose multiple limbs and have permanent blindness or loss of speech/hearing. Benefits are still paid, but since the blindness recovered, no disability offered.
Which type of dental treatment addresses the supporting tissue of teeth> A: Periodontics B: Orthodontics C: Soft Dental D: Endodontics
A. Periodontic treatment addresses supporting teeth tissue.
What is the main purpose of regulation on the life insurance policy illustrations? A: To help customers make educated decisions in buying life insurance/ B: to compare life policies C: to help producers submit proper reports to the department of insurance D: to present a life policy in a visual way
A. The purpose pf the regulation on individual and group life insurance policy illustrations is to provide standards that will protect and educate consumers
Which of the following would not be a violation of state insurance regulation? A: Producer C uses her license to write controlled businesses only B: Producer D collects premiums due on policies and deposits the funds in his own personal account C: Producer A uses her license to write only insurance for herself and her immediate family. D: Producer B charges his clients, in addition to the premiums, consulting fees
A: The purpose of a license is to primarily write non-controlled business.
The term illustration in a life insurance policy refers to A: a presentation of non-guaranteed elements of a policy B: a depiction of the policy benefits and guarantees C: pictures accompanying a policy D: Charts and graphs
A: The term illustration means a presentation of depiction that includes non-guaranteed elements of a policy or group life insurance over a period of years. The illustration must also include name of the insurer and the agent, information about the proposed insured and the policy itself.
If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered.. A: rollover B: settlement option C: nontaxable exchange D: Nonforfiture option
B. A settlement option is exercised when an immediate annuity is purchased with the face amount at death or with the cash value at surrender.
Man decided to purchase $100,000 annually renewable term life policy to provide additional protection until his children finished college. He discovered is policy A: decreased death benefit at each renewal B: required a premium increase each year C: built cash values D: Required proof anually
B. Annually renewable policies premiums are adjusted in relation to the insured's attained age.
Every small employer carrier must actively offer to small employers at least how many plans? A:1 B:2 C:3 D:no minimum
B. Every small employer carrier is required to actively offer to small employers, at least 2 health benefit plans. One basic one standard health benefit.
Producer A is prosecuted for a crime. He most notify the director within what time frame after the initial pretrial hearing date? A: 10 days B: No later than 30 days C: 3 months D: Immediately
B. If a producer is prosecuted for a crime, the producer is responsible for notifying the director no later than 30 days after the initial pretrial hearing date.
The annuity owner dies during the accumulation period without naming a beneficiary. The cash value exceeds the premium, which is true? A: the cash value will be paid to the state government B: the cash value will be paid to the annuitant's estate C: the premium value will be paid to the annuitant's estate D: all benefits forfeited
B. If annuitant dies during the accumulation period, whichever is larger is placed into the estate.
Which of the following is not covered under part a in medigap insurance? A: first 3 pints of blood each year B: medicare part a deductibles C: approved hospital costs for 365 additional days after medicare benefits end D: 20% part b coinsurance amounts for medicare approved services
B. Medicare supplement A provides the core, basic benefits established by law. All of the above are basic benefits except for the medicare part a deductible which is a benefit offered through many plans
Fred and Jody are covered under a group health insurance plan at his place of employment. When Jody gave birth to their first child, what must they do in order to have coverage: A: notify the employer within 10 days B: notify the insurer immediately and provide proof of insurability C: notify insurer within 31 days in order to not have proof of insurability D: Notify the insurer on anniversary date of the plan.
B. Newborn coverage is provided at the moment of birth and will continue if the insurance company is notified within 31 days.
OBRA requires which disease to covered by an employer for 30 months before medicare becomes the primary mode of coverage A: End stage heart failure B: end stage renal failure C: black lung D:leukemia
B. ORBA requires end stage kidney failure (renal) to be covered by the employer for 30 months before medicare steps in.
Under the ACA which classification applies to health plans based on the amount of covered costs? A: risk classification B: Metal Level classification C: guaranteed and non-guaranteed D: grandathered and non grandfathered
B. Plans other than self insured plans will be classified into four levels determined by how much of one's expected health care costs are covered. The four plans are bronze, silver, gold and platinum. This is called metal level classification
Which statement is not true regarding a straight life policy? A: it has the lowest annual premium of the three basic whole life policies. B: its premium steadily declines over time as the cash grows C: the face policy isn't paid till 100 D: It usually develops cash value by the third year
B. Straight life policies charge a level annual premium throughout the insured's lifetime and provide a level, guaranteed death benefit
What is the max age for qualifying for a catastrophic plan? A:26 B:30 C: 45 D: 62
B. Young adults under age 30 and individuals who cannot obtain affordable coverage may be able to purchase individual catastrophic coverage that covers essential benefits
Who can make a fully deductible contribution to a traditional IRA A: A person whose contributions are funded by a return on investment. B: an individual not covered by an employer-sponsored plan who has earned income C: anybody D: someone making contributions to an educational IRA
B. individuals who are not covered by an employer-sponsored plan may deduct the amount of their IRA contributions regardless of their income level.
Which of the following is not covered under part B of a medicare policy? A: physician expenses B: routine dental care C: Home health care D: Lab services
B: Medicare part B covers dental expense resulting from an accident only.
When benefits are paid directly to the insured under a health insurance policy. the policy provides benefits on what type of basis? A: Scheduled B: Reimbursement C: Service D: Limited
B: The insured is responsible to pay the provider and the policy reimburses the insured for covered medical expenses.
A 35 year old spouse of the insured collects early distribution from her husband's retirement plan as a result of a divorce settlement. What penalties, if any will she have? A: age-based in the contract B: no penalty C: 10% penalty D: 15% penalty
B: Under normal circumstances, 10% is imposed with the age. However, one of the exceptions to this rule is if an individual is in a divorce.
An insured makes regular contributions to his health savings account. How are these contributed treated in regards to taxation? A: they are not deductible B: they are taxed as income C: they are tax deductible D: They are considered after tax contributions
C. An individual covered by a high deductible health plan can make a tax deductible contribution to an HSA and use it to pay for out of pocket medical expenses.
Which of the following health care plans would most likely provide the insured/subscriber with comprehensive care coverage A: medical surgical expense plan B: basic medical expense plan C: health maintenance organization plan D: group dental insurance plan
C. HMOs provide a package of comprehensive health care services that include routine physicals, immunizations, well baby care, family planning etc, as well as the traetment of sickness and injury.
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued? A:Deny any claims and cancel the policy B:Deny paying a claim based on misrepresentation C:Pay the full amount of a claim because the contestable period has ended D:Adjust the claim benefit to reflect the insured's true age
C. The misstatement of age provision allows insurers to adjust the benefit no matter when it was discovered or if the client did it on purpose.
Why do group health providers usually require a certain amount of participation in the plan by eligible employees? A: To ensure a higher profit for the insurer B: to ensure the employer is being fair to the employees C: to guard against adverse selection and reduce costs D: to promote preventative care
C. The reason for the minimum participation requirement is to guard against adverse selection and to reduce administrative costs for the insurer.
After a divorce, when can a surviving spouse of a certificate holder, qualify for continuance of coverage under a group policy that provides coverage for medical expenses? A: if the spouse is disabled B: immediately after the death of the certificate holder C: when the spouse is 55 years old D: under no circumstances
C. The surviving spouse must be 55 years old to qualify to convert the policy after a divorce or separation
A medical expense policy establishes the amount of benefits paid based upon the prevailing charges which fall within the standard range of fees normally charged for a specific procedure by a doctor of similar training and experience in that geographic area is known as... A: benefit schedule B: gatekeepers C: usual, customary and reasonable D: Relative value schedule
C. The usual, customary and reasonable approach for determining insurance benefits is based upon the fees normally charged for specific procedures in the geographic location where the services are provided.
Your client is planning to retire. She has accumulated $100,000 in a retirement annuity, and now wants to select the benefit option that will pay the largest monthly amount for as long as she lives. As her agent, you should recommend A: Installment refund B: joint and survivor C: straight life D: life income with period certain
C. With the straight life option, the annuity payments cease at death. However, because there are no guarantees that might incur additional charges, this option provides the highest monthly benefitrs for an individual annuitant.
When a producer's office changes, he must notify the department within. A: 10 days B: 15 days C: 30 days D: 60 days
C. producers have 30 days to notify the department if their residence or work address has changed.
All of the following statements concerning medicaid are correct except? A: individuals claiming benefits must prove they do not have the ability or means to pay for their own medical care B: persons at least 54 who are blind/disabled may qualify C: Medicaid is a state funded program that provides health care to persons over age 65, only D: individual states design and administer the Medicaid program under broad federal rules
C: Medicaid is a government funded program (both federal and state) designed to provide health care to poor people of all ages.
which agreement specifies how a business will transfer hands when one of the owners dies or becomes disabled? A: Absolute Assignment B: Transfer of Ownership C: Disability Buy-Sell D: Proprietary transfer
C:The Disability Buy-Sell agreement specifies how a business will pass between business owners if one of the owners dies or becomes disabled
What is the maximum period of coverage under Oregon state continuation rules for group health insurance A: 36 months B: 1 year C: 6 months D: 18 months
Continuation of coverage lasts 6 months after the date that coverage would have ended if the person has not applied for continued coverage.
All other factors being equal, the least expensive first year premium is found in.. A: increasing term B: decreasing term C: level-term D: annually renewable term
D. Annually renewable term is the purest form of term insurance. death benefits will remain level, but the premium will increase with age. The first year premium is always low in these, regardless if it's increasing or decreasing
Which of the following must the patient pay under medicare part B A: 80% above deductible B: all reasonable charges above deductible C: a per benefit deductible D: 20% of covered charges above deductible
D. As established by medicare, the patient must pay 20% of covered charges above the deductible
Which of the following expenses is NOT covered by a health insurance policy? A: Hospital B: Disability C: Dental D: Funeral
D. Health Insurance policies cover losses caused by accidents and or sickness. Funeral services are not expressly covered in health insurance.
Which of the following is available to employers of all sizes? A: MSAs B: LPAs C: HSAs D: HRAs
D. Health Reimbursement Accounts consist of funds set aside by employers to reimburse employers for qualified medical expenses, they are available to all sizes of employers
All of the following statements regarding installments for a fixed amount EXCEPT: A: Value of the account and future earnings will determine the time period for the benefits B: this option pays a specific amount until the funds are exhausted C: The annuitant may select how big the payments will be D: The payments will stop when the annuitant dies
D. Installments for a fixed amount option has no life contingencies. A specific amount of benefits will be paid until funds are exhausted whether or not the annuitant is still alive.
In an optionally renewable policy, the insurer has which of the following options? A:increase the grace period. B: after the due date, so it can be canceled C: shorten the notice that the insured receives D: increase premiums/
D. Optionally renewable policies allow the insurer to cancel the policy for any reason. Only can do this on anniversary or premium/renewal dates. Insurers can also increase premiums on these dates/
An individual is purchasing permanent life insurance with a face value of $25,000. While this is all the insurance that he can afford, he wants to make sure that additional coverage will be available in the future. Which option should be included in his policy? A: dividend option B: guaranteed renewable option C: nonforfeiture options D: Guaranteed insurability option
D. The guaranteed insurability option allows the insured to purchase specific amounts of additional coverage at specific times without any proof.
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 A:Policy Application B: Buyer's Guide C: Certificate of coverage D: Notice regarding replacement
D. The notice regarding replacement must inform the applicant of the 30-day free look provision of the replacing policy
What is the advantage of reinstating a policy instead of applying for a new one A: Proof of insurability is no longer required B: The face amount can be increased C: The cash values have gained interest while the policy was lapsed D: The original age is used for the premium
D. The reinstatement provision allows the policy owner to reinstate a previous policy so long as they can pay any existing balances and prove insurability
Which of the following is true regarding METs A:they make deals with local hospitals B: the provide insurance for larger corporations/ C: They provide insurance companies with medical information on applicants D: They allow several small employers purchase less expensive insurance together
D. Those small employers who cannot qualify for group health insurance, must band together and buy METs.
An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefits. The dividend option that the insured has chosen is called. A: One-Year term purchase B: Accumulation at interest C: Reduction of Premiums D: Paid-Up-Premiums
D. When this option is selected, the annual dividend acts as a single premium each year to buy additional amounts of insurance, based on the insured's currently attained age.
How can LTC Benefits be received tax free by an individual? A: if the amount of premiums paid exceeds 4% of the individuals income B: Only if the individual itemizes the premiums C: Only if the individual does not itemize the premiums D: In any case, benefits are received tax free.
D: Regardless of whether or not the insured can deduct individual long-term care insurance premiums, the benefits are received income tax free by the individual?
What is the minimum number of employees that a small employer can have? A:10 B:25 C:1 D:2
D:The term "Small employer applies to any person or entity that employs at least 2, but not more than 50 people on business days during the calendar year.
In order to collect social security disability, the claimant must prove that the disability will last for A: until 65 B: For life C: 12 months D: 24 months
Social Security disability is paid to someone who is expected to have it for at least 12 months or lead to death
After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive? A:Percentage of medical costs B: payments for life C: yearly premium waiver and income D:monthly premium waiver and monthly income
The Disability Income Benefit rider waives the policy premiums, just like the Waiver of Premium rider. Unlike the Waiver of Premium rider, it also allows the insured to receive a weekly or monthly income during the disability period.
Which provision concerns the insured's duty to provide the insurer with reasonable notice in the event of a loss? A: Notice of a claim B: loss notification C: claims initiation D: consideration
The notice of claim provision spells out the insurerd's duty to the insurer in the event of a loss with reasonable notice