Practice Exam

In a noncontributory health insurance plan, what percentage of eligible employees must participate in the plan before the plan can become effective?

100%

An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would the insured be receiving benefits under an "own occupation" disability plan?

2 years

COBRA applies to employers with at least

20 employees

An employee group with which of the following number of employees would qualify for a medical savings account?

23 employees

The Medicare supplement renewal commissions paid in the third year must be as high as the commission of which year?

2nd

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?

3 days

Licensees must inform the Commissioner of a change of address within

30 days of the change.

One of the differences between group underwriting and individual underwriting is that there is little or no medical information required regarding plan participants in groups of

50 or more

The benefits for individual disability plans are based on

A flat amount

Any person or organization willfully violating any provision of rate-making provisions of the law will be punished by a fine of

A maximum of $500 for each such violation.

Which of the following individuals will be eligible for coverage on the Health Insurance Marketplace?

A permanent resident lawfully present in the U.S

Most health insurance policies exclude all of the following EXCEPT

Accidental injury.

When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she was 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision

Amounts payable under the policy will reflect the insured's correct age.

What is the maximum period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?

As long as the policy is in force

The fine for impersonation of a licensed producer is

At least $10, but no more than $100.

#61. When must the Medicare Supplement Buyer's Guide be presented?

At the time of application

Which of the following options best depicts how the eligibility of members for group health insurance is determined?

By conditions of employment

Which of the following is true regarding inpatient hospital care for HMO members?

Care can be provided outside of the service area.

In a group prescription drug plan, the insured typically pays what amount of the drug cost?

Copayment

An insurance company sells an insurance policy over the phone in response to a TV ad. Which of the following best describes this act?

Direct response marketing

The HMO Act of 1973 required employers to offer an HMO plan as an alternative to regular health plans if the company had more than 25 employees. How has this plan since changed?

Employers are no longer forced to offer HMO plans.

Which of the following is NOT true regarding a Certificate of Authority?

It is issued to group insurance participants.

In franchise insurance, premiums are usually

Lower than individual policies, but higher than group policies.

Which of the following statements is NOT correct regarding Medicare?

Medicare Advantage must be provided through HMOs.

An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do?

Offer the supplement policy on a guaranteed issue basis

Which of the following factors would be an underwriting consideration for a small employer carrier?

Percentage of participation

Which of the following describes taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable.

In respect to the consideration clause, which of the following is consideration on the part of the insurer?

Promising to pay in accordance with the contract terms

Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as

Rebating

Regarding cost containment in medical plans, what type of review process do employers and insurers use to evaluate the utilization review process and the effectiveness of the professionals involved in large insurance claims?

Retrospective review

Which of the following is a health care program funded by the federal government for the retirees and spouses of the military services?

TRICARE

Which of the following is true about the requirements regarding HIV exams?

The applicant must give prior informed written consent.

Which of the following statements concerning group health insurance is CORRECT?

The employer is the policyholder.

Who chooses a primary care physician in an HMO?

The individual member

Which of the following is true regarding benefits paid to disabled employees?

They may be subject to taxation if the premium was paid by the employer.

Premiums paid by self-employed sole proprietors or partners for medical expense insurance are

Totally tax deductible.

All of the following cases show when a Small Employer Medical plan cannot be renewable EXCEPT

When the employer chooses to renew the plan.

A nonresident producer who moves from one state to another state or a resident producer who moves from the commonwealth to another state must file a change of address and provide certification from the new resident state

Within 30 days of the change of legal residence.

A tornado that destroys property would be an example of which of the following?

a peril

Which of the following is another term for an authorized insurer?

admitted

Which of the following types of agent authority is also called "perceived authority"?

apparent

When must an insurance company present an outline of coverage to an applicant for a Medicare supplement policy?

at the time of the application

When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is

conditional

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

consideration

An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement?

cost-containment

How many pints of blood will be paid for by Medicare Supplement core benefits?

first 3

Which of the following is another name for a primary care physician in an HMO?

gatekeeper

Most LTC plans have which of the following features?

guaranteed renewability

Regarding long-term care coverage, as the elimination period gets shorter, the premium

increases

The section of a health policy that states the causes of eligible loss under which an insured is assumed to be disabled is the

insuring clause

When may an insurer require an insured to provide genetic information?

never

If one takes Social Security retirement benefits at age 62, what needs to be done at age 65 to qualify for Medicare?

nothing

Which document helps ensure that full and fair disclosure is provided to the recipient of a policy?

outline of coverage

All of the following are activities of daily living EXCEPT

speaking

Which of the following are responsible for making premium payments in an HMO plan?

subscribers

A husband and wife are insured under group health insurance plans at their own places of employment, and as dependents under their spouse's coverage. If one of them incurs hospital expenses, how will those expenses likely be paid?

the benefits will be coordinated

In a group policy, who is issued a certificate of insurance?

the individual insured

When an applicant applies for Medicare supplement insurance, whose responsibility is it to confirm whether the applicant has an accident or sickness insurance policy in force?

the insuers

Under the Physical Exam and Autopsy provision, how many times can an insurer have the insured examined, at its own expense, while a claim is pending?

unlimited

A medical expense policy that establishes the amount of benefit 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

usual, customary, reasonable