PRACTICE LAH EXAM
A new homebuyer wants to purchase a life insurance policy that would protect his family against losing the home, should he die before the mortgage was paid. The most inexpensive type of policy that would accomplish this need would be 1. level term 2. decreasing term 3. increasing term 4. flexible term
decreasing term
what is the primary difference between medigap and medicare select policies 1. medigap policy premiums are lower 2. medicare select policies cover the first 3 pints of blood 3. medigap policies provide coverage for core benefits 4. medicare select policies contain restricted network provisions
medicare select policies contain restricted network provisions
in health insurance, the length of the grace period varies according to the 1. length of the benfit period 2. age of the insured 3. mode of the premium payment 4. length of the waiting period
mode of the premium payment
in the event an annuitant dies during accumulation period, and there is a beneficiary named in the annuity, annuity benefits woulf be paid to the 1. named beneficiary 2. annuitants estate 3. next of kin 4. insurance company
named beneficiary
Medicare Part A services do NOT include which of the following? 1. post hospital skilled nursing facility care 2. hospitalization 3. hospice care 4. private duty nursing
private duty nursing
all of the following are true regarding the waiver of cost of insurance rider EXCEPT 1. rider cannot waive the cost of premiums that accumulate cash value 2. the rider expires when the insured reaches age 60 3. rider waives insurance costs in the event the insured becomes diabled 4. the rider is only applicable to universal life policies
the rider expires when the insured reaches age 60
if an applicant submits the initial premium with the application, which action constitutes acceptance> 1. the underwriter approves the application 2. applicant submits a statement of good health 3. producer delivers the policy 4. insurance company receives the application and initial premium
the underwriter approves the application
What is the purpose of the surrender charge in a deferred annuity? 1. to compensate the company for loss of inv value 2. to punish tge annuitant for breach of contract 3.to prevent the over funding of the annuity 4. to provide additional revenue for the insurance company
to compensate the company for loss of investment value
considering the principles of liquidity, how would the policyowner use today's cash value in a life insurance policy 1. fund a retirement 2. use it for emergency expenses 3. secure a car loan next year 4. make a down payment on a home in 5 years
use it for emergency expenses
an insured has a new home built and insisted on having smoke detectors installed in multiple places in the house. what method of handling risk is the insured doing 1.retention 2.avoidance 3.sharing 4.reduction
reduction
An insured had a heart attack while jogging, but is expected to return to work in approximately 6 weeks. The insured's Disability Income policy will 1. not pay 2. pay a lump sum benefit 3. replace a % of his lost income 4. cover inquiries only
replace % of his lost income
the elimination period in a disability income policy is better known as 1. the period of time an insured must wait after the onset of an illness or injury before benefits begin 2. probationary period 3.corridor deductible 4. period of time the insured has to review the policy and return it
the period of time an insured must wait after the onset of an illness or injury before benefits begin
Medicare is a health insurance program for all of the following individuals EXCEPT 1. those who have been on SSD for 2 years 2. those with low income and low assets 3. those 65 or over 4. those with permanent kidney failure
those with low income and low assets
insurance provides a means to 1. eliminate a loss 2. transfer a loss 3.retain a loss 4. avoid a loss
transfer a loss
what is the purpose of the gatekeeper in an HMO 1. making sure patients do not go to physicians outside of the HMO's region 2. estalishing strong preventive care 3. making sure that services are properly prepaid 4. controlling costs
controlling costs
an insured decides to surrender his while life insurance policy. cash value at surrender is high than the premium paid into the policy, due to interest. what part of the surrender value would be income taxable? 1. entire cash value 2. difference between the premiums paid and cash value 3. nothing 4. amount equal to the premiums paid
difference between the premiums paid and cash value
all of the following are "covered" under the California Insurance Guarantee Assication EXCEPT 1. states in which the persos reside have associations similar to the association created by the article 2. insurers within last 10 yrs held a license in the states in which the persons resides 2. residents of the states 4. insurer that issued the policies that is domiciled in this state
insurers within last 10 yrs held a license in the states in which the persons resides
Which of the following is provided by skilled medical personnel to those who need occasional assistance or rehabilitation care? 1. skilled 2. intermediate 3. custodial care 4. home health care
intermediate care
an insured submitted a claim and received $40,000 for doctors and hospital fees, $15,000 for rehabilitation expenses, and $25,000 in income payments. The insurance company later determined that the claim was fraudulent. What is the max fine the insured will have to pay 1. $40,000 2. $80,000 3. $150,000 4. $160,000
$160,000
What is the max penalty for releasing personal nonpublic info of multiple consumers without their consent? 1. $2500 2. $4800 3. $160,000 4. $500,000
$2500
Elaine's Basic Hospital Expense policy has $500 per day limit for room and board in a hospital for a max of 5 days. Elaine got sick and had to spend 3 days in the hospital at $650 a day. How much will Elaine have to pay to cover the rest of her room and board charges? 1. $0 2. 150 3. $350 4.$450
$450
what is the tax penalty for withdrawing money from an annuity prior to age 59 1/2 1. 5% 2. 10% 3. 12% 4. 20%
10%
unless the commissioner disapproves a rate-change application, it will be assumed to be approved after 1. 30 days 2. 60 days 3. 90 days 4. 180 days
180 days
Core benefits are included in all Medicare supplemental policies. What percentage of Part B coinsurance is required? 1. 20% 2. 35% 3. 10% 4. 15%
20%
in a group life insurance plan, children of the employee may be covered as eligible dependents until they reach the age of 1. 20 2. 21 3. 25 4. 26
26
how long does the removal coverage remain in efect under the standard fire policy? 1. 30 days 2. 5 days 3. 10 days 4. 15 days
5 days
there is a 10% penalty on the taxable portion of a deferred annuity when it is surrendered prior to what age? 1. 65 2. 59 1/2 3. 55 1/2 4. 40
59 1/2
how long is the grace period for an individual life insurance policy in California 1. 3 months 2. 60 days 3. 1 month 4. 7 to 10 business days
60 days
An annuity has accumulated the cash value of $70,000, of which $30,000 is from premium payments. The annuitant dies during the accumulation phase. The beneficiary will receive 1. 30,000 2. 70,000 3. 100,000 4. a survivor benefit is determined
70,000
according to the metal level classification of health plans, what % of health care costs will be covered under a gold plan? 1. 50% 2.60% 3. 80% 4. 100%
80%
which is FLASE statement about the California Insurance Comissioner? 1. Commissioner is a representative of the national association of insrance commissioners NAIC 1. Commissioners is capable of becoming the conservator of a financially impaired or insolvent insurer 2. Commissioner is elected by the people of CA every 4 years 4. Commissioner is selected by the Governor as an appointee
Commissioner is selected by the Governor as an appointee
What is the name of an org that collects and complies info from members concerning insurance claims in order to prevent insurance claims fraud? 1. Insurance Claims Analysis Bureau 2. Fraud Division 3. Fair Claims Reporting Agency 4. Insurance Guarantee Association
Insurance Claims Analysis Bureau
which of the following time periods is the general enrollment period for Medicare Part B? 1. Jan 1 to March 31 each year 2. March 1 to May 31 each year 3. Jan 1 - Jan 31 each year 4. March 1 - March 31 each year
Jan 1 to March 31 each year
Which of the following would be a proper choice of policy for a company that transports good that are irreplaceable in nature? 1. Lloyds policy 2. Valued policy 3. excess liabilities floater 4. replacement of cost rider
Lloyds policy
A core Medicare supplement policy (Plan A) will cover all of the following expenses EXCEPT 1. the first 3 pints of blood 2. 20% of Part B coinsurance amounts for Medicare-approved services 3. Part A coinsurance 4. Part A deductible
Part A deductible
J purchased a "core policy" (Plan A) to supplement her Medicare coverage. Following a stay in the hospital, J fouhnd that her supplemental coverage paid for all of the following EXCEPT: 1. first three pints of blood 2. 20% of Part B coinsurance 3. Part A coinsuance amount 4. Part A deductible
Part A deductible
Ed is covered under a health plan provided by his employer. He was told that his insurance would pay the majority of the covered expenses if he would choose to see a provider in his plan's list. If Ed chose to be treated by a provider who was not on the list, his portion of the bill would be greater. Ed is covered under a/an 1. limited health plan 2. Preferred Provider Plan 3. Coordinated Plan 4. HMO group plan
Preferred Provider Plan
all of the following are consideration in an insurance policy EXCEPT 1. premium paid at time of application 2. promise to pay covered losses 3. cash value in the policy 4. statements on the application
cash value in the policy
Concerning the "Family Protection Policy" all of the following statements are true, except: 1. convertible term riders cover both the spouse and all the children 2. additional children born after the policy is issued are covered automatically at no extra cost 3. children, upon reaching age of majority, are permitted to cover to an individual policy with proof of insurability 4. this type of policy consists of whole life on the base insured and riders on the others
children, upon reaching age of majority, are permitted to cover to an individual policy with proof of insurability
Which of the following losses would likely be covered under the Accidental Death rider? 1. suicide 2. mountian-clumbing accident 3. death resulting from a long-term disability 4. death caused by a head-on collision
death caused by a head-on collision
An applicant for an insurance license has had a previous application for a professional license denied for cause within 5 years. the insurance commissioner may 1. deny the application 2. accept as other licenses have no bearing 3. accept the application for a 2 yr provisional license 4. accept or deny the application after an exploratory hearing
deny the application
when life insurance proceeds are used to pay inheritance taxes and federal estate taxes, it is known as 1. liquidity 2. life settlement 3. estate conservation 4. estate creation
estate conservation
J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did J choose? 1. fixed period 2. interest only 3. joint and survivor 4. fixed amount
fixed amount
An insurer incorporated under the laws of another state but doing business in this state is considered 1. alien 2. domestic 3. foreign 4. multi-national
foreign
all of the following are features of catastrophic plans EXCEPT 1. essential benefits 2. high premiums 3. out of posket costs 4. high deductiles
high premiums
If a loan request is for payment of due premiums on the policy, how soon must the insurer issue a loan? 1. immediately 2. wihtin 10 days 3. witin 30 days 4. within 90 days
immediately
the provision that sets forth the basic agreement between the insurer and the insured and estates the insurer's promise to pay the death benefit upon the insured's death is called 1. insuring clause 2. payment of claims 3. declarations 4. consideration
insuring clause
an insurance company that is owned by the policyholders is called a 1. mutual insurer 2. fraternal insurers 3. stock insurer 4. reciprocal insurer
mutual insurer
which of the following is not a function of the HICAP? 1. giving consumers advice 2. offering to sell to customers more suitable medicare plans 3. providing free counseling 4. organizing education presentations
offering to sell to customers more suitable medicare plans
which statement best describes agreement as it relates to insurance contracts? 1. all parties must be capable of entering into a contract 2. each party must offer something of value 3. one party accepts the exact terms of the other party's offers 4. the intent of the contract must be legally acceptable to both parties
one party accepts the exact terms of the other party's offers
Under what type of policy would the value of an insured object not be defined until a loss occurs? 1. valued 2. flexible 3. appraised 4. open
open
key person insurance can provide protection for all of the following economic losses to a business EXCEPT 1. fund the cost of training to a current employee to perform the duties of a deceased employee 2. pay the death benefit to the estate of the insured 3. provide deferred compensation retirement if key employee is disabled 4.fund the expense of finding replacement following the death of an employee
pay the death benefit to the estate of the insured
Policies written on a third-party ownership basis are usually written to cover: 1. policyowners who are not insured 2. insured's estate 3. policyowner's estate 4. policy owner's minor children or business associates
policy owner's minor children or business associates
who can request changes in premium payments, face value, loans, and policy plans? 1. producer 2. policyowner 3. beneficiary 4. contingent beneficiary
policyowner
an applicant for a disability insurance policy has a heart condition of which they are unaware and therefore they answer no to the question pertaining to heart problems on their application. Their answer is considered to be 1. fraudulent answer 2. representation 3. warranty 4. concealment
representation
Any intentional and fraudulent omission on the part of one insured entitles the insurer to 1. charge a higher premium on anniversary date 2. apple for reconsideration 3. re-underwrite the policy 4. rescind the policy
rescind the policy
Which of the following is a daily nursing and rehabilitation care than can only be provided by medical personnel, under the direction of a physician? 1. skilled 2. intermediate 3. custodial 4. assisted living
skilled
wagering on a sporting event is an example of what type of risk 1. speculative 2. calculated 3. simple 4. pure
speculative
in contrasting stock insurers with mutual insurers, which statement is true? 1. nonparticipating policies can pay out dividends to the policyholders 2. mutual insurers are owned by the shareholders and issue participating policies 3. stock insurers are owned by the shareholders and issue nonparticipating policies 4. stock dividends are tax free while dividends are taxable
stock insurers are owned by the shareholders and issue nonparticipating policies
a warranty may relate to which of the following 1. only the past and present conditions 2. the past, present, and future 3. the past experience only 4. only the time of application
the past, present, and future
Who is the annuity owner? 1. the person who receives the benefits 2. person on whose life the annuity is written 3. the insurer 4. the person who purchases the annuity
the person who purchases the annuity
what is the purpose of a benefit schedule 1. to include avg charges for procedures 2. to provide the dates for the payment of benefits 3. to list the insured's copay and deductible 4. to states what and how much is covered in the plan
to states what and how much is covered in the plan
an aleatory contract is based on what kind of exchange? 1. unequal exchange of values 2. equal amounts for pay in and pay out 3. balanced benefits 4. exchange of equal obligations
unequal exchange of values
The renewable provision allows the policy-owner to renew the coverage at the expiration date 1. only with evidence of insurability 2. with evidence of insurability if the insurer requires it 3. with evidence if insured risk has increased 4. without evidence of insurability
without evidence of insurability
If an insured pays a health insurance premium each month, how long would the grace period be under the policy? 1. 7 2. 10 3. 14 4. 25
10 days
A policyholder returns the policy to the insurer a week after its delivered. How much of the premium will be returned to the applicant? 1. 80% 2. 50% 3. none 4. 100%
100%
how many tiers must be included in each treatment category of a medicare prescription drug plan formulary? 1. 1 2. 2 3. 3 4. 4
2
Core benefits are included in all Medicare supplemental policies. What percentage of Part B coinsurance is required? 1. 20% 2. 35% 3. 10% 4. 15%
20%
The ACA mandates that insurers provide coverage for adult children of the insured up to the age of 1. 21 2.26 3. 28 4. 30
26
A Medicare supplement policy must have a free-look period of at least 1. 10 2. 15 3. 30 4. 45
30 days
to be acceptable to insurance companies, what % of all eligible employees must be enrolled under a contributory group health insurance plan? 1. 65% 2. 75% 3. 100% 4. 50%
75%
The presumptive disability provision assumes that the insured is totally disabled upon loss of all the following EXCEPT 1. hearing 2. Two limbs 3. Feeling 4. Sight
Feeling
slippery floors, reckless driving, or providing false info are examples of 1. hazards 2. perils 3. pure risks 4. causes of loss
Hazards
Medicare Part B covers all of the following EXCEPT 1. outpatient hospital service 2. LTC services 3. doctors services 4. home health visits
LTC services
Which of following indicates how much of the health coverage premium must go toward actual medical care 1. metal tiers 2. Medical Loss Ratio MLR 3. Minimum Value calculator 4. modified adjusted gross income MAGI
MLR medical loss ratio
which of the following is used to be called Medicare + Choice Plans? 1. Medicare Supplement Plans 2. Original Medicare Plans 3. Medicare Advantage Plans 4. Medical Insurance
Medicare Advantage Plans
new individual members of an HMO must choose a 1. specialty physician 2.surgeon 3.primary care physician 4.referral physician
PCP
in addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health? 1. by obtaining MIB reports on each enrollee 2. by imposing case management provisions 3. by requiring that the insurance be incidental to the group 4. by having each enrollee undergo a paramedical examination
by requiring that the insurance be incidental to the group
which of the following describes the relationship between the principal sum and a capital sum? 1. cap sum is a % of the principal sum 2. prinicpal sum varies, while cap sum doesn't 3. the cap sum varies, while prin doest 4. prinicpal sum is a % of cap sum
cap sum is a % of the principal sum
Conrad receives $50000 from a $100000 AD&D policy as a result of the loss of his left arm in an accident, Conrad has received the 1. principal amount 2. capital amount 3. contributory amount 4. primary amount
capital amount
all of the following are ways to handle risk EXCEPT 1. reduction 2. transfer 3. elimination 4. avoidance
elimination
how will life insurance proceeds that are paid as a lump sum received by the beneficiary 1. taxed as ordinary income 2. taxed as inv income 3. tax-deductible income 4. free of fed income taxation
free of federal income taxation
in order for an alumni association to be eligible to purchase group health insurance, all of these must be trust EXCEPT when the association 1. has a constitution, by-laws, and must hold at least annual meetings 2. is organized for reasons other than having insurance 3. has at least 100 members 4. has been active for 5 years min
has been active for 5 years min
Restoring an insured financially after a claim is known as 1. reasonable expectations 2. indemnity 3. adhesion 4. restoration
indemnity
to purchase insurance, the policyowner must face the possibility of losing money or something of value. what's this concept called? 1. insurable interest 2. indemnity 3. exposure 4. pure loss
insurable interest
Which of the follwing best depicts the law of large number? 1. the larger the pool of risks under study, the more accurate the predictions will be 2. larger groups produce healthier applicants 3. large groups offer less opportunity for loss 4. the larger the group is, the more likely it will be to get a good choice
larger the pool. more accurate
which of the following riders provides for the payment of part of the policy death benefit if the insured is diagnosed with a terminal illness that will result in death within 2 years 1. living needs rider 2. LTC rider 3. cost of living rider 4. accidental death rider
living needs rider
What does Basic Medical Expense cover 1. x-ray charges 2. all office visits, under any circumstances 3. surgery 4. nonsurgical service a physician provides
nonsurgical service a physician provides
which of the following is NOT a component of an insurance policy premium 1. insurer expenses 2. investment return 3. number of benificiaries 4. mortality cost
number of beneficiaries
which of the following best describes a presumptive disability? 1. one that is severe enough that the insured automatically qualifies for full disability benefits 2. one that requires the insured to submit to physical exams periodically 3. one that a doctor predicts may recover in the future 4. one that the insured will fully recover from in the future
one that is severe enough that the insured automatically qualifies for full disability benefits
In reinsurance, the insurance company that transfers its loss exposure to another insurer is the 1. primary insurer 2. secondary insurer 3. reciprocal insurer 4. reinsurer
primary insurer
an applicant completes an application for a disability policy and pays the initial premium. the producer gives the applicant a conditional receipt. insurance coverage for the applicant will become effective when 1.the insurance company accepts the risk 2.insurance company requesdts a medical exam 3. applicant signs the conditional receipt 4. producer delivers the policy
the insurance company accepts the risk
which of the following is NOT true regarding term health coverage? 1. policy is issued for a specified period of time only 1. the policy expires at the end of the term 3. the policy could be written as a accident only policy 4. the owner may renew the policy for a specified term
the owner may renew the policy for a specified term
How does insurance distribute the financial consequences of individual losses? 1. it transfers the risk to associates of the insureds 2. transfers the risk to a small number of persons insured 3. transfers the risk to all persons insured 4. it retains the financial consequences
transfers the risk to all persons insured
which of the following services will NOT be provided by an HMO? 1.emergency care 2.inpatient hospital care outside the service area 3. unlimited coverage for treatment for drug rehabilitation 4. treatment of mental disorders
unlimited coverage for treatment for drug rehabilitation
a graded permium life insurance policy is a modified form of 1.level term 2.deferred annuity 3.universal life 4. whole life
whole life
which of the following is the best definition of "indemnification"? 1. contract whereby one undertakes to indemnify another against loss, damage, or liability arising from a contingent or unknown event 2. act of one person who agrees to restore an injured person to the condition she enjoyed prior to the loss 3. legal entity which acts on behalf of itself, accepting legal and civil responsibility for the actions it performs nd making contracts in its own name 4. contract whereby the 2 parties involved agree to what things of value will be exchanged b the parties to the contract
act one 1 person who agrees to restore an injured person to the condition she enjoyed prior to the loss
which of the following would be true of both the fixed-period and fixed-amount settlement options? 1.both guarantee that the principal and interest will be fully paid out 2.the amount of payments is based on the recipient's life expectancy 3. size of installments decreases after certain period of time 4. both guarantee payments for the life of the beneficiary
both guarantee that the principal and interest will be fully paid out
The policyowner has an option to pledge the life insurance policy as collateral for a bank loan. This is called 1. collateral assignment 2. insurance pledge 3. unilateral contract 4. an absolute assignment
collateral assignment
what is the written document called in which the insurance coverage is set forth? 1. certificate of authority 2. the contract 3. california insurance code 4. the covenant of insurance
the contract
which of the following meets the insureds personal needs, and is provided by nonmedical personnel? 1. custodial care 2. skilled care 3. assisted living 4. intermediate care
custodial care
which of the following statements is incorrect 1. medicare and medicaid supplements does not cover skilled nursing care 2. medicaid does not pay for nursing home care in any case 3. medicare and medigap policies do not provide coverage for long-term custodial or nursing home care 4. medicare and medigap policies provide coverage for long term custodial or nursing care
medicare and medigap policies provide coverage for long term custodial or nursing care
under the ACA, when would pregnancy be considered a pre-existing condtion? 1. always 2. never 3. only if excluded by insurer 4. if it begins before the coverage takes effecrt
never
In health insurance, what is coinsurance 1. amount of the insurance company pays for the insureds treatment 2. % of the cost of service that the insured and the insurer share 3. portion of the deductible the insured must pay for treatment 4. amount an insured pays for treatment
a % of the cost of service that the insured and the insurer share
group members that are covered by group life insurance policies will be issued which of the following? 1. a certificate of insurance 2. an estimate of the sponsors authority 3. certificate of authority 4. master policy
a certificate of insurance
Compulsory automobile finanical responsibility laws may be satisifed in all of the following ways EXCEPT 1. posting a bond with the motor vehicle dep 2. the purchase of insurance from an insurance company 3. a certificate of insurance 4. a certificate pf passing a safe-drivers education course
a certificate of passing a safe-drivers education course
an individual is approaching retirement age and is concerned about having proper coverage should he have to be placed in a LTC facility. His agent told him that LTC policies would provide necessary coverage at all of the following levels EXCEPT 1. skilled 2. acute 3. custodial 4. intermediate
acute
an insurer who trasacts insurance in this state but whose articles of incorportions are registered in Canada is considered what type of insurer 1. unauthorized 2. surplus lines 3. foreign 4. alien
alien
which action by an insurer or its representatives is NOT considered an unfair claims violation? 1. the claims dep fails to affirms or deny coverage within a responsible period of time after proof of loss has been submitted 2. an agent advises a claimant to obtain the services of an attorney 3. a claims adjustor misrepresents pertinent policy provisions to dissuade an insured from making a claim 3. an agent does not respond to a clamaints communication concerning a claim where a response is required
an agent advises a claimant to obtain the services of an attorney
what is it called when a doctor accepts the Medicare approved amount 1. consent 2. verification 3. acceptance 4. assignment
assignment
a loss resulting from which of the following would qualify for the accidental death rider coverage? 1. a disability 2. hazardous hobby 3. automobile accident 4. health condition
automobile accident
a comprehensive medical expense insurance policy combines which of the following in a single contract 1. major medical and AD&D 2. basic hospital and surgical coverage wit major medical 3. diability income and accidental death 4. disability income with basic hospital and surgical coverage
basic hospital and surgical coverage wit major medical
what specific kind of insurance is often written in conjunction with hospital expense policies and includes surgeons and anesthesiologists fees? 1. practicioners insurance 2. basic surgical expense insurance 3. basic medical insurance 4. personnel insurance
basic surgical expense insurance
which of the following is NOT a typical type of LTC coverage 1. home health care 2. child day care 3. skilled nursing 4. residential care
child day care
An insured intentionally did not disclose a material fact on an application for insurance. This would be considered 1. concealment 2. coercion 3. avoidance 4. misrepresentation
concealment
which of the following could reduce the amount of the death benefit? 1. adding a family term rider 2. making premium payments within the grace period 3. choosing a paid-up addition dividend options 4. failure to repay a policy loan
failure to repay a policy loan
a husband and wife both incur expenses that are attributed to a single major medical insurance deductible. which type of deductibles do they have in their policy 1. per occurence 2. family 3. flat 4. annual
family
a married couple wants to include the entire family in their whole life policy under one rider. which of the following will help them 1. other-insured term 2. inclusive term 3. children's term 4. family term
family term
An insurer that operates for one or more social, educational, charitable, benevolent, or religious purposes for the benefit of its members is known as a 1. mutual insurer 2. recriprocal insurer 3. stock insurer 4. fraternal insurer
fraternal insurer
under HIPAA portability, which of the following are NOT protected under required benefits? 1. preg women 2. mentally ill 3. groups of one or more 4. self-employed
groups of one or more
A representation in an insurance contract qualifies as an 1. implied warranty 2. express warranty 3. policy provision 4. opinion
implied warranty
hazards are conditions or situations that 1. determine the likelihood of a loss occuring 2. guarantee that a loss will occur 3. increase the likelihood of a loss occurring 4. decrease the likelihood of a loss occurring
increase the likelihood of a loss occurring
An insured's hospital policy states that it will pay him a flat fee of $75 per day for each day he is hospitalized. The policy pays benefits on what basis? 1.indemnity 2.reimbursement 3.expense 4. service
indemnity
which of the following statements is NOT true regarding HICAP? 1. provides consumer counseling 2. works in conjunction with local area agencies on aging 3. it exists to assist seniors who are not qualified to receive SS or Medicare 4. it is overseen by the The State Dep of Aging
it is overseen by the The State Dep of Aging
all of the following are characterisitics of group health insurance plans EXCEPT 1. employers may require the employees to contribute to premium payments 2. benefits under a group plan are more extensive than those under indv plans 3. parties that hold a group heallth insurance contract are the employees and employer 4. cost of insuring an indv is less than what would be charged for comparable benefits under an idv plan
parties that hold a group health insurance contract are the employees and employer
J's Retirement plan meets all federal requirements and entitles him to certain tax benefits as the owner of the plan. What term best describes j's retirement plan? 1. unqualified 2.variable 3.deffered 4. qualified
qualified
which of the following actions does NOT constitute false advertising? 1. using names that diguise the true nature of a policy 2. stating that dividends are not guaranteed 3. misrepresenting the terms of a policy 4. representing n insurance policy as a share of stock
stating that dividends are not guaranteed
Because of an injury, an insured has been unable to work for 7 months. He wasn't able to pay his life insurance policy premium, yet the policy remained in force. The policy includes 1. nonforfeiture options 2. waiver of premium rider 3. guaranteed insurability benefits 4. facility of payment clause
waiver of premium rider
an employee that become ineligible for group coverage because of termination of employment or change in statues, must exercise extension of benefits under COBRA 1. within 10 days 2. within 60 days 3. within 30 days 4. before termination is complete
within 60 days
What two components compromise 24-hour coverage 1. whole life and emergency medical 2. workers comp and medical insurance 3. whole life and medical 4. emergency medical and workers comp
workers comp and medical insurance
the human life value approach to determining life insurance needs is based upon which of the following ideas 1. replacement of assets 2. specific needs for college education 3. retirement needs 4. loss of the breadwinners income
loss of the breadwinners income
which method of dealing with risk is applied when insurance is purchased? 1. reduction 2. transfer 3. sharing 4. avoidance
transfer
Under the ACA, maternity, pregnancy, and preventive care service are considered 1. essential 2. elective 3. limited 4. optional
essential
The owner of a deferred annuity pays $100 in premium one month, and $130 the next month. Which of the following terms best describes this premium payment arrangement ? 1. single premium 2. l;evel premium 3. flexible premium 4. lump sum
flexible premium
in a group policy, all of the following can be the policyowner EXCEPT 1. an association 2. insurance company 3. union 4. the employer
insurance company
Which of the following defines "own occupation disability" with respect to disability income insurance? 1. disability tht results in the insured being unable to work at their regular job even though they may be able to perform the duties of another occupation 2. any disability that requires home confinement 3. disability cause by infectious disease 4. disability resulting from an accident while on the jon
disability tht results in the insured being unable to work at their regular job even though they may be able to perform the duties of another occupation
Benefits for a disability income policy are based on which of the follwing? 1. minimum wages 2. typical wage for similar professions 3. earnings of the insured 4. avg US wages
earnings of the insured
all of the following are statement about agents are true except 1. exclusive agents work for themselves 2. producers can be natural persons or corporations 3. independent agents can be appointment by multple insurers 4. managing general agents are responsible for hiring, training, and suprervising other agents
exclusive agents work for themselves
which of the following would not be considered a peril? 1. driving too fast for conditions 2. playing gold in a thunderstorm 3. fire 4. smoking
fire
An insured has purchased a variable annuity. He has not waived his rights during the free-loook period. Where wll the premiums be initially during free-look period 1. stock portfolio chosen by the insured 2. insurers gen account for preservation of fund value 3. policy's sep account 4. a fixed income or money market account
a fixed income or money market account
Which of the following statements about a resident-life only agent is INCORRECT 1.loss of a previous license could result in automatic denial of the application 2. a plea of nolo contendere is considered a conviction and may adversely affect attempts to obtain a license 3. a licensee has 30 days to update a change in address 4. licensees are required to have an in-state residential address
a licensee has 30 days to update a change in address
Which of the following Medicare parts provides prescription drugs benefit? 1. Part D 2. Part A 2. Part B 4. Part C
Part D
which of the following best describes a rebate 1. a producer returning part of her commission to her client, as an inducement to buy 2. a producer misrepresenting policy provisions or coverages at issue 3. a producer requiring an insured to buy insurance from her as a condition to a loan 4. a producer selling insurance primarily to himself, his family and his friends
a producer returning part of her commission to her client, as an inducement to buy
which of the following terms is used to define the period of time during which an annuitant makes payments into an annuity? 1. loading period 2. accumulation period 3. premium building period 4. annuity period
accumulation period
all of the following could qualify as a group for the purpose of purchasing group health insurance EXCEPT: 1. multple employer trust 2. single employer with 14 employees 4. an association of 35 people 4. labor union
an association of 35 people
Which statement is FALSE concerning insurance company regulations? 1. Commissioner may begin conservation proceedings against companies who cannot meet solvency regulations 2. insurer may be liquidated if conservation proves to be ineffective 2. insurers may not advertise their membership in the Guarantee Association 4. an insurer suffering from an impairment of their minimum require paid-in capital is labeled solvent
an insurer suffering from an impairment of their minimum require paid-in capital is labeled solvent
which of the following indicates the person upon whose life the annuity income is determined? 1. owner 2. insured 3. annuitant 4. beneficiary
annuitant
the CA Insurance Commissioner may deny an application for license for all of the fllowing reasons EXCEPT 1. applicant does not have CA business address 2. applicant does not have a good business rep 2. applicant transacted insurance prior to issue of the license 4. applicant is not properly qualified to perform the duties
applicant does not have a good business rep
HMO members pay a small fee when they see their primary care physician. This fee is called a 1. stop-loss 2. copay 3. coinsurance 4. deductible
copay
decreasing term insurance is often used to 1. cover a mortgage 2. liquidate an estate 3. build up cash value for retirement 4. pay estate taxes
cover a mortgage
which of the following statements describes one of the reasons individuals purchase life insurance? 1. helps liquidate an estate thru death proceeds 2. always accumulates cash value 3. provides income an insured cannot outlive 4. creates an immediate estate
creates an immediate estate
During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, and makes it sounds worse than it is. This is an example of an unfair trade practice of 1. defamation 2. twisting 3. false advertising 4. misrepresentation
defamation
the notice about policy cancellation delivered to senior consumers must include all of the following except 1. explanation of where the premiums have been invested 2. time limit for cancellation 3. to whom to return the policy 4. possible surrender charges
explanation of where the premiums have been invested
the annual open enrollment period for state insurance exchanges runs from november through 1. january 2. feb 3. march 4. dec
january
if a business wants to make sure it will be able to cover losses due to the disability of its top emploee, the business should get which insurance 1. group health insurance policy 2. health savings account 3. business overhead expense 4. key person disability income
key person disability income
a policyowner no longer needs a life insurance policy and agrees to sell it to a third party for more than its cash value. this type of transaction is call an 1. 1035 exchange 2. investor-originated life insurance 3. viatical settlemt 4. life settlement
life settlement
when assessing needs for life insurance, an indicidual may use retention, which means 1. maintaining assets at death 2. keeping life insurance policy until death 3. raising capital 4. purchasing life insurance
maintaining assets at death
in group insurance, the primary purpose of the Coordination of Benefits provision is to 1. encourage hospitals to keep their charges reasonable 2. prevent overinsurance 3. prevent lawsuits 4. ensure the payment of claims by all policies that are in effect as the time of the claim
prevent overinsurance
statistical probabilities of loss for a particular class of insureds is best predicted when the insured group is 1. larger 2. diverse 3. older 4. smaller
larger
an isured was seriouslly injured in a skiing accident that required him to be hospitalized for 5 weeks. his medical expense policy covered all of the following EXCEPT 1. loss of income while hospitalized 2. necessary medicine and medical suppplies 3.surgical expense 4. hospital room and board
loss of income while hospitalized
for which of the following could an insurer terminate a LTC insurance policy? 1. deterioration in mental health of the insured 2. nonpayment of premium 3. advanced age of the insured 4. deterioration in physical health of the insured
nonpayment of premium
which of the following elements of an insurance contract requires payment of premiums 1. competent patries 2. offer and acceptance 3. consideration 4. legal purposes
consideration
which source of underwriting info includes info on an applicant's character, gen rep, personal habits, and mode of living? 1. MIB 2. agent's report 3. physicians statement 4. investigative consumer report
investigative consumer report
if a basic medical insurance plan's benefits are exhausted, what type of plan will then begin covering those losses? 1. social secuirty 2. supplemental major medical 3. supplementary basic medical 4. none
supplement major medical
upon surrender of a life insurance policy, any cash accumulated in excess of the premium payments is 1. not taxed 2. taxed as income on 50% of the excess 3. assessed a fine of 10% of the excess 4. taxed as ordinary income
taxed as ordinary income
What is the exclusion ratio used to determine 1. the premium amounts to be included in taxes 2.the interest base and the payout base 3. the benefit amounts to be paid to the annuitant 4, the annuity benefit to be excluded from taxes
the annuity benefit to be excluded from taxes
Once the initial benefit limit in Medicare D is reached, how is beneficiary affected? 1. the beneficiary is no longer responsible for perscription drug costs 2. medicare part a will cover all costs 3. the beneficiary is the responsible for a portion of prescription drug costs 4. the beneficiary is then responsible for 75% of prescription drug costs
the beneficiary is the responsible for a portion of prescription drug costs
When LTC insurance covers care in a person's home or in a skilled or residential facility, the policy may be labeled 1. home care 2. standard 3. comprehansive 4. facility care
comprehensive
a limited health insurance policy that will pay a lump sum to an insured diagnosed with a heart attack, stroke, or renal failure is known as 1. accidental death and dismemberment 2. hospital confinement 3. dread disease insurance 4. critical illness insurance
critical illness insurance
the owner of a whole life policy with an accidental death rider intentionally kills himself after having the policy for 18 months. what is the insurance company's course of action 1. pay twice the face amount 2. deny any payment of death benefit 3. deny only payment of ace amount but pay the rider since suicide is an accident 4. pay the face amount because suicide is not an accident
deny any payment of death benefit
which of the following statements is INCORRECT regarding the def of total disability 1. can be the inability to perform any occupation for which a person is reasonably suited for 2. is the inability to perform partial duties of any occupation for which a person is suited by reason of education, training, or experience 3. disability is defined differently inability to perform the duties of one's own occupation
is the inability to perform partial duties of any occupation for which a person is suited by reason of education, training, or experience
which of the following is TRUE of level term insurance? 1. premium will increase or decrease based on the current interest rates 2. policy endows at age 100 3. the policy offer a nonforfeiture values 4. it is temporary protection
it is temporary protection
an individual is applying for health insurance. his health insurance is nearly perfect; he has a health weight, and doesn't smoke. what risk classification would this applicant most likely receive? 1. preferred 2. superior 3. excellent 4. standard
preferred
which of the following is TRUE regarding premium in a 10 year level premium policy 1. premium will remain the same at the renewal 2. the premium will decrease at the end of the term 3. the premium will be level for the first few yrs then increase by 10th 4.premium will remain level for 10 years
premium will remain level for 10 years
which of the following statements is TRUE regarding an Agent's report during the policy application process 1. becomes part of the entire contract after the policy is issued 2. is is a required element of the contract 3. provides the agent's personal observations concerning the proposed insured 4. it is only used when the initial premium is not paid with the application
provides the agent's personal observations concerning the proposed insured
an insured purchased a health insurance policy with a renewability clause that states the policy is "guaranteed renewable" this means that as long as the required premiums are paid, the policy will continue until the insured 1. reaches age 100 2. becomes diabled 3. reaches age 65 4. dies
reaches age 65
if an insured purchases an insurance policy with a large deductible, what risk management technique is the insured exercising 1. avoidance 2. sharing 3. retention 4. transfer only
retention
When acting as a field underwriter, a producer is 1. seeking credible info about an applicant for health insurance 2. visiting a prospective policyholder in the client's home rather than in the producer's office 3. obligated to turn over all premiums to the insurer in a timely fashion 4. obtaining all necessary signatures on the application
seeking credible info about an applicant for health insurance
which of the following best defines the probationary period in a group health policies 1. specified period of time that person joining a group has to wait before becoming eligible for coverage 2. the number of days the insured has to determine if they will accept the policy as received 3. stated amount of time when benefits may be reduced under certain conditions 4. number of days that must expire after the onset of an illness before benefits will be earned
specified period of time that person joining a group has to wait before becoming eligible for coverage
