insurance license review
by examining an insurer's records, the head of the department of insurance assesses the insurer's a. compliance with state laws b. workforce morale c. profitability d. adherence to NAIC regulations
A
a part of medicare that pays for inpatient hospital care, skilled nursing care, home health care, and hospice care is a. part a b. part b c. part d d. part c
A
acts requiring a person to be licensed as a producer include all of the following EXCEPT a. advertising insurance policies b. negotiating insurance sales c. soliciting insurance sales d. selling insurance policies
A
all of the following statements about a modified endowment contract (MEC) are true EXCEPT a. an MEC is not considered to be life insurance b. an MEC offers tax-free death benefits c. once an MEC, always an MEC d. an MEC offers tax-deferred cash value accumulation
A
all of the following statements about the annuitization period are correct EXCEPT a. when the annuitization period starts, additional premium payments can be made b. when the annuitization period starts, the owner can't change the contract c. when the annuitization period starts, no withdrawals can be taken d. when the annuitization period starts, the annuity cannot be surrendered
A
allison has a major medical expense plan with a $1,000 deductible. she fell and broke her arm, and the cost of medical treatment was $2,000. how much will allison have to pay out of pocket for this injury? a. $1,000 b. $0 c. $500 d. $2,000
A
charles and suzanna both agree to pay premiums on their policies for the next 20 years. after that, they will no longer have to pay premiums, but their insurance coverage will continue until they die. charles and suzanna have... a. limited payment whole life policies b. single premium whole life policies c. continuous premium whole life policies d. ordinary life policies
A
covered expenses in a major medical insurance plan include all of the following EXCEPT a. self-inflicted injuries b. outpatient services c. anesthesia d. hospital inpatient room and board
A
if a beneficiary chooses the lump sum option at the death of the annuity owner, what amount of money is taxable? a. the gain b. the amount of premiums paid in c. the cost basis d. the total value
A
jill is terminally ill with cancer. she is at a point with her illness that she will need respite care, counseling, pain relief, and symptom management. which of the following services will jill most likely use? a. hospice care b. custodial care c. home health care d. skilled nursing care
A
medigap is another name for a. medicare supplement insurance b. medicare part b c. medicare part d d. medicare part a
A
the affordable care act eliminated pre-existing conditions exclusions for which of the following policies? a. medical expense policies b. long-term care insurance c. limited benefit policies d. medicare supplements
A
the chief officer of the state insurance department is NOT responsible for a. enacting insurance laws b. licensing and supervising agents and brokers c. issuing rules and regulations d. overseeing insurance companies' marketing practices
A
the period during which annuity benefits are received is called a. the annuitization period b. the accumulation period c. phase 2 d. the credit period
A
the premiums paid by a company for group health for its employees are a. tax deductible by the company and not taxable to the employees b. not tax deductible to either the employer or the employee c. tax deductible to the employees and the company d. tax deductible by the company and considered taxable income to the employees
A
to increase sales activity as a new agent, norm offers two nights' stay at a nice downtown hotel to the first 10 clients who purchase a homeowners, auto, and life insurance policy with his agency. norm is guilty of a. rebating b. misrepresentation c. false advertising d. coercion
A
when lenders extend credit for a large purchase, they often require the insurer to purchase a. credit disability insurance b. hospital income insurance c. blanket coverage d. accident-only insurance
A
which of the following annuities requires that the producer have a securities license? a. variable annuities b. market value-adjusted annuities c. equity-indexed annuities d. fixed annuities
A
which of the following annuity payout options pays the highest monthly income? a. life-only option b. joint-life option c. life with period certain option d. life with refund option
A
which of the following covers medical and nonmedical expenses for individuals with chronic illness, cognitive impairment, and difficulty performing activities of daily living? a. long-term care insurance b. disability income insurance c. major medical expense coverage d. dental expense insurance
A
which of the following features of term insurance allows the policy to be renewed at the end of a specified period without evidence of insurability? a. renewability b. decreasing premium c. increasing premium d. return of premium
A
which of the following is NOT excluded under medicare part b? a. flu shots b. private-duty nursing c. routine foot, vision, dental, or hearing care d. outpatient prescription drugs
A
which of the following is designed to protect a person from running out of money from "living too long"? a. annuities b. permanent insurance c. death benefits d. term insurance
A
which of the following is designed to remain in force for the entire life of the insured? a. whole life insurance b. increasing term insurance c. convertible term insurance d. term insurance
A
which of the following medicare advantage plans has a network of providers, but no gatekeeper, and enrollees pay more if their costs go outside of the plan's network? a. medicare preferred provider organization (PPO) plans b. medicare managed care plans c. medicare specialty plans d. medicare private fee-for-service (PFFS) plans
A
which of the following perils describes a need for medical care due to a cause other than an accident? a. sickness b. pre-existing condition c. accident d. injury
A
which of the following plans offers lower premiums and requires the insured to pay a high deductible when the plan is used? a. high-deductible health plan b. health reimbursement arrangement c. flexible spending account d. health savings account
A
which of the following services would NOT be covered under medicare part B? a. amy is 30 and had a mammogram b. richard is 55 and had a screening test for diabetes c. jim is 55 and had his annual prostate cancer screening d. susan is 30 and had a flu shot
A
which of the following situations in a group life insurance policy is tax deductible? a. premiums paid by an employer in a contributory group insurance plan b. premiums paid for a key person life insurance policy c. death benefits to a named beneficiary d. premiums paid by the employee of a contributory plan
A
which of the following specialized policies pays the death benefit when the last insured dies? a. survivorship life policy b. first-to-die policy c. joint life policy d. juvenile policy
A
which of the following statements about variable policies is NOT true? a. variable policies have a guaranteed rate of return b. variable policies have potential to keep pace with inflation because of the tax deferred feature c. variable policies have potential of higher returns than the guaranteed rates paid on traditional life insurance products d. variable policies allow the policyowner to participate in various types of options while not being taxed on earnings until the policy is surrendered
A
which of the following term policies has a level premium throughout the policy and a decreasing death benefit? a. decreasing term b. return of premium term c. level term d. increasing term
A
the grace period for an annual, semiannual, or quarterly premium policy is a. 10 days b. 31 days c. 30 days d. 7 days
B
ABC printing has a business disability insurance plan in which the company can deduct the premium from their gross income. which of the following plans does ABC printing most likely have? a. buy-sell b. business overhead expense c. key person d. health savings
B
a producer's license may be revoked for all of the following activities EXCEPT a. general incompetence b. soliciting controlled business (e.g., close family members) c. misrepresenting insurance policy provisions d. a fraudulent application for license
B
all of the following are optional provisions in an insurance policy EXCEPT a. unpaid premium b. physical examination and autopsy c. change of occupation d. insurance with other insurers
B
all of the following are required to be a part of the entire contract EXCEPT a. the riders b. the premium payment c. the application d. the insurance policy
B
all of the following statements about enrollment in medicare part b are correct EXCEPT a. the part b monthly premium is deducted from the individual's social security monthly benefit check b. part b is mandatory, and requires a monthly premium c. individuals who enroll in part a are automatically enrolled in part b unless they request otherwise d. the part b monthly premium is tied to an individual's income
B
all of the following statements about interest-sensitive whole life are correct EXCEPT a. the interest-sensitive policy is also known as current assumption whole life b. the interest-sensitive policy has an adjustable death benefit c. the interest-sensitive policy has a fixed premium schedule d. the interest-sensitive policy has a fixed, level death benefit
B
all of the following statements about policy loans are correct EXCEPT a. loans are not taxable to the policyowner b. loans are not repayable c. the interest paid on policy loans is not tax deductible d. policy loans reduce the cash value of the policy
B
all of the following statements about the convertibility feature in a term policy are correct EXCEPT a. the conversion can occur without evidence of insurability b. the conversion must be made after the policy expires c. the conversion an occur without having to submit an application d. the conversion must be made before the policy expires
B
amy received her father's $100,000 death benefit in a lump sum. how will amy be taxed on the lump sum? a. amy with only be taxed on interest earned on the proceeds b. amy will not be taxed c. amy will be taxed on any premiums paid into the policy d. amy will be taxed on the entire benefit
B
cindy has a plan that covers losses that arise only from one peril or one type of peril, or a loss that occurs from one particular situation. which of the following plans does cindy have? a. TRICARE b. a limited plan c. medicare d. a comprehensive plan
B
exclusive agents do NOT have the responsibility for a. collecting premiums b. licensing producers c. delivering policies d. soliciting applications for insurance
B
health maintenance organizations provide service on a. a fee-for-service basis b. a prepaid basis c. a scheduled basis d. a customary basis
B
how many days' notice must an insurer give the insured if the policy is going to be cancelled? a. 10 days b. 5 days c. 30 days d. 3 days
B
in most jurisdictions, all of the following would constitute unlawful acts of rebating EXCEPT a. sharing a sales commission with a policyowner b. paying a bonus to a licensed employee for referring the policyowner to the producer c. sending a new policyowner on an expense-paid trip to florida d. reducing the initial premium payable on an insurance policy
B
in order to sell insurance for an insurer, the producer must first a. apply for a temporary license b. be appointed by that insurer c. be appointed by the commissioner d. take a training course sponsored by the insurer
B
julie has a life insurance policy with a $20,000 cost basis. she makes a withdrawal for $25,000. how much of her withdrawal is considered excess and taxable? a. $25,000 b. $5,000 c. $20,000 d. $10,000
B
most government insurance programs are partially or entirely paid for by a. employers b. tax dollars c. the insured d. the state
B
the head of the department of insurance can suspend a producer's license for all of the following reasons EXCEPT a. forging a name on an insurance application b. making conservation efforts regarding the replacement of policies c. misappropriating money belonging to policyowners d. making a false statement on a licensing application
B
the period between the purchase of an annuity and when the benefits begin is called a. the annuitization period b. the accumulation period c. the distribution period d. phase 1
B
traditional fee-for-service plans refer to their customers as a. patients b. insureds c. participants d. subscribers
B
which of the following health insurance policies pays a stated amount of income to the insured when an accident or sickness leaves him unable to work for an extended period? a. major medical expense coverage b. disability income insurance c. long-term care insurance d. dental expense insurance
B
which of the following is NOT a mandatory provision in every insurance contract? a. proof of loss b. misstatement of age c. grace period d. incontestability clause
B
which of the following statements about reinstatement is NOT true? a. if the insurer requires a reinstatement application, a conditional receipt will be issued to the applicant b. once a policy is reinstated, there is a 10 day waiting period for accident coverage c. coverage is automatically reinstated 45 days after the application is submitted if the insurer has not notified the applicant d. once a policy is reinstated, there is a 10 day waiting period for sickness coverage
B
which of the following types of life insurance requires a producer to have an insurance and securities license? a. whole life b. variable life c. flexible life d. universal life
B
with a deferred annuity, the amount paid as the death benefit is the greater of the accumulated value of the annuity or... a. the total premiums left to pay in the annuity b. the total premiums paid, minus any withdrawals c. the total premium paid, plus any withdrawals d. 75% of the total premiums paid
B
written notice of a claim must be given to the insurer within how many days of the occurrence? a. 3 days b. 20 days c. 31 days d. 15 days
B
all of the following are characteristics of annuities EXCEPT a. they are often called upside down life insurance b. they use a lump sum of accumulated money to guarantee income payments while living c. they can be used to create an estate d. they protect against living too long
C
all of the following are characteristics of individual health insurance EXCEPT a. each person's health is required b. anyone can apply for coverage c. each person gets a certificate of coverage d. each person has a unique policy
C
all of the following are considered to be unfair and deceptive trade practices EXCEPT a. circulating a statement claiming that another insurer is in danger of going bankrupt b. rebating premiums c. issuing checks in full settlement of a claim that contain language releasing the insurer from liability d. inflating the dividend amount when discussing the policy's advantages with potential policyholders
C
all of the following are limited policies EXCEPT a. specified (dread) disease policies b. hospital income (indemnity insurance) policies c. long-term care policies d. accident-only policies
C
all of the following are required provisions in a medigap policy EXCEPT a. medigap policies must not duplicate benefits provided by medicare b. medigap policies must have a 30 day free-look period c. medigap policies must have a 31 day free look period d. medigap policies must be guaranteed renewable
C
all of the following statements about optional provisions are correct EXCEPT a. if an insured is older than stated on his application, the benefits will be reduced b. insurers will not be liable for loss sustained by the insured while under the influence of alcohol c. if an insured is younger than stated on his application, the benefits will be decreased d. if premium is due at the time a claim is made, the premium amount will be deducted from the benefit payable under the claim
C
all of the following statements regarding income tax treatments of life insurance and annuities are correct EXCEPT a. partial surrenders are taxable to the extend of any gain b. premiums paid for individual life insurance are not taxable c. premiums paid for individual life insurance are taxable d. full surrenders are taxable to the extend of any gain
C
an individual's enrollment in medicare is automatic on a. the last day of the month that she reaches age 72 b. the last day of the month that she reaches 65 c. the first day of the month that she reaches 65 d. the first day of the month that she reaches age 60
C
benefits that are available when the insured is still alive are known in the insurance world as... a. retirement accounts b. savings accounts c. living benefits d. investments
C
if a withdrawal of an annuity is taken before age 59.5, there is... a. no additional penalty on taxable earnings b. an additional 5% penalty on taxable earnings c. an additional 10% penalty on taxable earnings d. an additional 15% penalty on taxable earnings
C
jason is self-employed and runs an advertising agency. what percentage of his health insurance premium can he deduct from his gross income? a. 50% b. 25% c. 100% d. 75%
C
regarding the insurance business, which of the following is an example of a self-regulatory body? a. state department of insurance b. state senate c. national association of insurance commissioners d. us court of appeals
C
sarah purchases a universal life policy with an increasing death benefit equal to the face value of the policy plus the cash account. which of the following death benefit options did sarah choose? a. option 1 b. option C c. option B d. option A
C
sofia has an insurance plan that provides the highest maximum coverage and has very few gaps. which of the following plans does sofia have? a. basic hospital, medical, and surgical insurance b. medical and surgical insurance c. major medical insurance d. basic medical expense
C
susan and tim are married, and they chose an annuity option that would pay one of them for the rest of their life if the other one died. which of the following is the option that they choose? a. life-only option b. life with period certain option c. joint life and survivor option d. joint life option
C
the death benefit of a whole life policy is a. decreasing b. adjustable c. fixed and level d. flexible
C
the dollar limit beyond which the insured no longer has to pay for her medical expenses is known as a. the deductible b. the maximum benefit c. the stop-loss limit d. the coinsurance
C
which of the following annuities has a value that will never be less than the amount paid into the contract? a. market value-adjusted annuities b. variable annuities c. fixed annuities d. equity-indexed annuities
C
which of the following insurance policies allow for partial surrenders from the cash value? a. convertible term b. whole life c. universal life d. single premium whole life
C
which of the following is also known as a cafeteria plan? a. high-deductible health plan (HDHP) b. health savings account (HSA) c. flexible spending account (FSA) d. health reimbursement arrangement (HRA)
C
which of the following is not excluded from coverage, but is subject to coverage limitations in a medical expense plan? a. experimental procedures b. custodial care c. home health care services d. injury resulting from war
C
which of the following statements about a deferred annuity is NOT true? a. deferred annuities do not start an income stream immediately b. with deferred annuities, the annuity owner can choose the amount and frequency of the premium c. the deferred annuity owner must annuitize the contract d. deferred annuities are a vehicle to accumulate money for future needs
C
which of the following states the insurer's promise to pay under the conditions described in the policy? a. the consideration clause b. the renewability clause c. the insuring clause d. the right to examine
C
which of the following is considered to be a return of the portion of premium paid for the policy? a. policy loans b. surrenders c. death benefits d. dividends
D
accelerated death benefits advance the payment of death benefits to a person if she has been diagnosed with a qualifying event that will lead to her death within a. 6 months b. 12 months c. 48 months d. 24 months
D
all of the following are advantages of whole life insurance EXCEPT a. cash values accumulate tax deferred b. whole life insurance has guaranteed level premiums and does not expire c. whole life insurance is permanent coverage d. premiums are lower than other types of life insurance policies
D
all of the following are common health insurance exclusions EXCEPT a. workers' compensation b. elective cosmetic surgery c. intentional self-inflicted injuries d. dread disease
D
all of the following are duties of insurance licensees EXCEPT a. notify the department of insurance of a change of address b. comply with continuing education requirements c. file any fictitious name the licensee uses for business purposes d. file the list of agency appointments with the department of insurance
D
all of the following are examples of business disability insurance EXCEPT a. buy-sell b. key person c. business overhead expense (BOE) d. business income expense (BIE)
D
all of the following statements about a health savings account are true EXCEPT a. HSA distributions are tax free when used to pay for qualified medical expenses b. contributions to an HSA are tax deductible c. earnings in an HSA grow tax deferred d. individuals need IRS authorization to set up an HSA
D
all of the following statements about estate tax treatment are correct EXCEPT a. if the owner of the estate died during the annuity period, the present value of future payments is included in the estate b. if the owner of the estate died during the accumulation period, the entire value of the annuity is included in the estate c. estate taxes are owed if an estate's value exceeds a certain value at the time of the individual's death d. life insurance death benefits are not counted as value in a deceased insured's estate if they are payable to the estate
D
all of the following statements about medicare and employer group health coverage are correct EXCEPT a. if the employer has more than 20 employees, the group health plan is primary for employees b. if the employer has more than 20 employees, medicare is primary for retirees c. if the employer has less than 20 employees, medicare is primary employees and retirees d. regardless of the number of employees, medicare is primary for retirees and employees
D
if randy's company pays the entire premium for his group disability income coverage, how much of his benefits would be subject to tax? a. 0% b. 75% c. 50% d. 100%
D
in order to do business in a state, an insurer must have a certificate of a. agency b. admittance c. approval d. authority
D
mary has an insurance policy that cannot be canceled for any reason except for nonpayment of the premium, and premiums may increase on the renewal date. which of the following type of renewability provision did mary purchase? a. conditionally renewable b. noncancelable c. optionally renewable d. guaranteed renewable
D
samantha is 40 years old and wants to withdraw some of the interest earned on her annuity. what is the additional penalty that samantha will have to pay above the regular tax due on amount received? a. no penalty b. 5% penalty on interest c. 25% penalty on interest d. 10% penalty on interest
D
the earliest that a single premium immediate annuity can be paid is... a. 1 year b. 5 years c. 10 years d. 1 month
D
the life-only annuity option is also referred to all of the following EXCEPT a. life-no refund b. straight life c. pure life d. life with refund
D
tim has decided to quit his desk job and become a professional skydiver. due to his change of occupation, the insurer will a. increase his benefits b. increase his premium c. reduce his premium d. reduce his benefits
D
which of the following have a panel of physicians and hospitals under contract to provide health care services and generally cover 80%-100% of the cost? a. health maintenance organization (HMO) b. fee-for-service plan c. comprehensive medical expense plan d. preferred provider organization (PPO)
D
which of the following inpatient hospital services is NOT covered by medicare part a? a. meals b. medical services c. a semiprivate room d. private-duty nursing
D
which of the following movements of cash value under a section 1035 has tax consequences? a. life insurance to annuity b. life insurance to life insurance c. annuity to annuity d. annuity to life insurance
D
which of the following statements regarding the payment of commissions is NOT correct? a. a producer may not charge additional fees not included in his commissions for soliciting and procuring insurance or servicing existing policyholders b. a producer may not share commissions with unlicensed persons c. a producer may share commissions with another licensed producer d. a producer may not share commissions with a licensed nonresident producer
D
all of the following statements about medicare are correct EXCEPT a. medicare is federally funded b. to be covered by medicare, an individual must be "fully insured" c. medicare pays a large portion of the health care bill for persons age 65 and over d. the initial enrollment for medicare is a 30 day period
D (it is a 7 month period)
