Life and health
Carla owns $100,000 life policy with a $50,000 ADND rider. She is hit by a train while jogging and her foot is severed. While she's in the hospital, she contracts and affection and dies five weeks later. The insurer will pay
$125,000
Carl owns $250,000 life policy with a triple idemnity rider. While running a marathon he suffers a fatal heart attack. How much will the insurer pay?
$250,000
Gemma owns a $250,000 life policy with a $50,000 ADAND rider. Well mountain climbing, Jim had an accident which caused him to lose control. He fell and died. What is the total death benefit
$250,000
In a noncontributory plan, what percentage of eligible employees will be covered under a group health plan?
100%
The maximum SS pays for disability income is
100% of the primary insurance amount
Under the common disaster provision both the insured and the beneficiary are presumed to have died at the same time as the beneficiary dies within what time after the insurance death?
60 days
In a contributory plan, at least what percentage of eligible employees must participate in the group plan
75%
With group insurance, the insured receives
A certificate of insurance
Who established the MIB
A group of insurance companies
And insured wishes to name her daughters as beneficiary for her life insurance policy, but does not want to give up any ownership rights. Your insured should name her daughter as?
A revocable beneficiary
John and carol are married and in their early 20's. John worked at the local factory for 3 years. It's his first job. He's killed in a tragic accident. Carol is eligible for what
A single lump sum survivor benefit of $255
An applicant submits a premium with the application. The purpose of having the producer deliver the policy to the applicant is to
Accept an offer
The inability of an insured to negotiate any changes in the policy language related to the concept of
Adhesion
Intentional or unintentional misstatement of age allows the insurer to
Adjust the claim
Who sells insurance to a client and owes a fiduciary duty to an insurance company
Agent
The section of the application providing the producers evaluation of the applicant
Agents report
Offer plus acceptance equals
Agreement
Under an insurance policy, either the insurer or the insured may receive disproportionate payment under the concept of
Aleatory
Fair Credit Reporting Act
Allows consumers to insert a correct of statement in a consumer report
If only 5% of a company's employees choose insurance coverage, this presents what type of issue?
An adverse selection issue
Who can alter an insurance policy
An executive officer at a company
The federal fair credit reporting act requires the insurer to warn the insured in advance that
An inspection report will be obtained
An applicant submits an application without first payment this is
An invitation
Ms L applies for life insurance but doesn't make an initial premium payment. Her actions constitute
An invitation to negotiate for the purchase of life insurance
Which premium mode results in the least dollar outlay over the life of a policy
Annual
To protect the applicants privacy and confidentiality, some information is given to the underwriter and not to the producer. Which of the following is the only item that the producer would have access to in the normal insurance transaction?
Application
When must insurance interest exist for life and health insurance
At the inception of the policy
The simultaneous death at applies to the simultaneous death of the insured and the
Beneficiary
Who helps place a client with an insurance company and owes a fiduciary duty to the client
Broker
Which of the following losses is least likely to be insurable
Catastrophic
Exchanging something of. value
Consideration
Creation of a contract requires
Consideration and offer and acceptance, agreement( and legally competent parties
The producer tells the insured that the premium is due each year on July 1. The insured may confirm by reading this where
Consideration clause
To determine the applicants financial standing, and underwriter would most likely use
Credit report
If an application is not offered a policy after underwriting process he or she is referred to as
Declined risk
What document triggers the 10-day free look period
Delivery receipt
In group policy situation, who receives the policy certificate?
Employee
T/F dividends play a factor in calculating gross premium
False
T/F retirement benefits will be reduced if the worker has retirement income from a company sponsored retirement plan
False
T/f insurance involves the insured paying a premium to transfer all risk to the insurance company
False
T/f the agent represents the client
False
Premium mode refers to
Frequency of payment
What policies do not contain a free look clause
Group
Which of the following actions is an agent likely to take when a conditional receipt is not used
Have the client sign a statement of continued good health at the time of the policy delivery
Which of the following beneficiary choices restricts the policy owners flexibility
Irrevocable
Which of the following statements regarding an a D in D policy is correct
It provides a death benefit, so the insured should name a beneficiary
The creation of a contract requires
Legal purpose, agreement, and consideration
What helps underwriters predict likelihood of death
Mortality table
Consenting to be insured by a third party owner
Must be given in writing and normally consists of the insured signing the application
Which type of insurance company is owned by it's policyholders
Mutual company
A policy that covers losses due to employment is known as "occupational coverage." A policy that does not cover losses due to employment is known as
Non occupational
In a noncontributory plan, what will eligible group members need to do to enroll other than complete the application
Nothing, enrollment it automatic
An applicant is rejected for life insurance due to a prior medical condition. The producer may do each of the following except
Notify the MIB that the applicant was rejected
The fair credit reporting act prevents the insurer from
Obtaining a consumer investigative report without notifying the applicant
Factors for denying a policy
Occupation, health, and age
Under the fair credit reporting act, the producer must inform the client of the rights regarding consumer investigative reports at the time
Of application
An applicant submits an application with the first premium payment. The company delivers the policy. This constitutes a/an?
Offer
A company may provide group insurance for
Officers, directors, and employees who are members of a labor union
A hospital identity policy's elimination period is applied
Once per each hospital stay
A hospital indemnity policy
Pays even if other insurance has already paid for the hospital stay
If a physical exam reveals Has serious medical condition such as HIV the information maybe reported to the applicants
Physician
Underwriting involves what
Predicting future losses, reviewing applicant information, and placing applicant in appropriate rate group
The time period one must be employed before becoming eligible for group disability income or health insurance is known as
Probationary period
A single employer group plan for a new business
Proof of insurability will not be required and the insurer will use "community" rating
The purpose of the life insurance replacement regulations is to
Protect the insured against loss of benefits
The purpose of the fair credit reporting act is to
Provide fair and accurate consumer credit reporting
An application was denied insurance based on information contained in his or her credit report. The applicant may
Receive the name and address of the consumer reporting agency from the insurer
Under the fair credit reporting act the insured has no right to
Require that the insure provide a copy of the report to the insured
SS provides
Retirement benefits, disability benefits, and survivor benefits
A conditional receipt accomplished
Retroactive coverage in some situations
The premium formula is
Risk + expenses - interest
A conditional receipt accomplishes
Temporary coverage while the application is being processed, allows retroactive coverage in some situations, and provides coverage from the date of the application or the date of the medical exam
The primary source of insurability information is
The application
The fair credit reporting act entitled the applicant to review information obtained by
The consumer reporting agency
The 10 day free look provision is initiated by
The delivery receipt
Association buying group insurance
The group cannot be formed for the purpose of buying insurance
The primary source of moral character is
The inspection report
Which policy section specified the policy's coverage limits?
The insuring clause
noncontributory plans
The plan may use a probationary period, the employer pays for the coverage, and all eligible employees are automatically covered
Assume no conditional receipt is used. If the premium has been paid and the medical exam taken, a policy's coverage becomes effective when?
The policy is physically delivered to the applicant
If a conditional receipt is used
The policy may become effective prior to delivery
Nancy is the beneficiary on Jack's like policy and their daughter Cassie is the contingent beneficiary. Nancy and Jaker are involved in a serious car accident, which kills Jack instantly. Nancy is on life-support for two weeks and then dies. What will happen under the common disaster clause
The policy proceeds will be paid to Cassie
Nancy is a beneficiary on Jack's life policy and daughter Cassie is a contingent beneficiary. Nancy and Jack are involved in a serious car accident, which kills Jack instantly. Nancy is on life-support for two weeks and then dies. What will happen under the simultaneous death act
The policy proceeds will be paid to Nancy's estate
Under in a D & D policy, which pays the most, the capital sum or the principal sum
The principal sum
Which document is signed to initiate coverage if no conditional receipt is used?
The statement of good health
What is required for a worker to be Eligible for disability benefits under SS
The worker must have fully insured status
A business insured it's key executive. This is an example of
Third party ownership
The main principle of insurance is
Transfer of risk
Medical information is supplied to MIB by the member insurance companies
True
T/F a charity to which the insured consistently donates money does not have insurable interest
True
T/F if a conditional receipt is used the policy may become effective prior to delivery
True
The process of selecting and classifying risk is called
Underwriting
Mr Z submits an application with premium to his life insurance producer. The producer gives him a conditional receipt. Prior to the time he takes the medical examinationXx he's considered to be
Uninsured
If an insurer issued a rated policy, when will it become effective
When delivered to the applicant and the applicant pays the additional premium
Under which of the following circumstances with an AD&D policy pay a benefit
When the insured is blinded in a tragic grilling accident
The policy's coverage becomes effextive
When the policy is physically delivered to the applicant assuming the premium has been paid
To qualify for Old Age and Survivors disability insurance one must
have been employed for at least 40 quarters
The purpose of a life annuity is to guarantee against:
living too long
The law of large numbers allows insurers to
predict claims more accurately.
Molly is injured in a work-related accident. Molly is considering filing a negligence lawsuit against her employer.
work comp is mollys sole remedy she cannot win a lawsuit against the employer