PRIMERICA PART 5

293. What is the difference between a conditional premium reciept and a binding premium reciept? a. The applicant must be insurable in order to have coversge only under the binding reciept b. Only a conditional reciept always provides insurance that is effective from the date the reciept is given c. Only a binding reciept always peovides insurance that is effective from the daye the reciept is given d. Premiums must be paid to recieve knky a conditional reciept

C. Only a binding reciept always provides insurance that is effective from the daye the reciept is given.

309. In which of the following qualified pension plans are benefits link to the employees years of service and/or amount of compensation? a. Defined benefit plan b. Keogh plan c. Defined contribution plan d. Tax-sheltered account

a. Defined benefit plan

Which to our activities of daily living? a. Eating and Dressing b.Speaking and incontinence c. sleeping and walking d. bathing and hearing

a. Eating and dressing

334. A waiting period between the onset of disability and the time when benefits begin is the: a. Elimination Period b. Incontestable Period c. Probationary Period d. Grace Period

a. Elimination period

313. An ESOP invests in: a. Employer Stock b. Mutual funds c. Corporate bonds d. Employers investments

a. Employer stock

319. In order to qualify for Social Security retirement benefits the worker must be: a. Fully insured b. Disability insured c. Currently insured d. Partially insured

a. Fully insured

279. Which of the following is not an option for the use of the policy dividends? a. Fund the addition of monthly income payments b. Purchase a one year term addition c. Purchase paid-up additions d. Reduce the current premium

a. Fund the addition of monthly income payments

280. Who are owners/members of the Medical Information Bureau? a. Life insurance companies b. Physicians c. Hospitals d. Health Insurance companies

a. Life insurance companies

312. Life insurance illustrations showing premiums, values, credits or charges that are not determined at issue demonstrate: a. Non-guaranteed elements b. Guaranteed elements c. Minimum assumed expenses d. Supplemental illustrations

a. Non-guaranteed elements

307. Every ensure offering individual life insurance policies or annuities to senior citizens that use non-guaranteed elements in illustrations must provide a statement to the effect. Which of the following is correct regarding this statement? a. Non-guaranteed elements must be in bold print b. Guaranteed a non-guaranteed element must be in bold print, at the discretion of the agent c. Guarantee elements must be in bold print and non-guaranteed element must be in plain type d. All statements must be in plain type

a. Non-guaranteed elements must be in bold print

324. If an insured knowingly allows one of its agents to mislead a member of the public in order to induce the person to change their existing insurance, the commissioner may: a. Suspend the insurer's certificate of authority for the class of business involved b. Impose a $1,500 fine

a. Suspend the insurer's certificate of authority for the class of business involved

294. After a life insurance policy has been in effect for two years, what prevents it from being rescinded by the insurer? a. The incontestability clause b. The reinstatemmet clause c. The grace period provision d. The right to return provision

a. The incontestability clause

311. The Social Security age of retirement is dependent upon: a. The individuals date of birth b. The amount of compensation earned prior to retirement c. The number of quarters earned

a. The individuals date of birth

342. Which of the following is the definition of morbity? a. The likelihood of illness or injury b. The assumption of wellness or ailment. c. The probability of death or disablement

a. The likelihood of illness or injury

291. What rule is used to determine the importance of a representation? a. The materiality of concealment b. That of alratory contracts c. The insurable interest standard d. The law of adhesion

a. The materiality of concealment

306. What does the phrase "life insurance creates an immediate estate" mean? a. The total death benefit will be paid to a beneficiary on the death of the insured b. The death benefit will always be paid to the estate of the insured c. The total premium must be paid to the insurer d. The policy creates cash value

a. The total death benefit will be paid to a beneficiary on the death of the insured

288. What do we call the process whereby insurers decide which customers to ensure, and what coverage to offer? a. Underwriting b. Rate marketing c. Marketing d. Adverse selection

a. Underwriting

276. Which life insurance classification carries the highest premium? a. Substandard b. Standard c. Endowed d. Preferred

a.) Substandard

301. If an insurer inadvertently is found guilty of unfair trade practices while issuing, renewing and servicing a policy, the insured could be prosecuted for how many violations? a. 4 b. 3 c. 1 d. a

b. 3

327. If a dependent child covered by a group life plan is in capable of self support, coverage under the plan may continue up to age: a. 24 b. Any age c. 21 d. 19

b. Any age

285. When must insurance records for insurance agents and insurance brokers be made available to the Insurance Commisioner? a. One month agyer policy issuance b. At all times c. Within 30 days of a written request by the Commisioner d. Annually, and submitted with the proper paperwork

b. At all times

340. In a physician is paid through a Preferred Provider Organizations (PPO), the normal way of paying him/her is: a. Through a system called "capitation" b. By payment directly for each service c. By reimbursement d. A flat amount per subscriber on a monthly basis.

b. By payment directly for each service

302. And ensure owned by a parent company that provides insurance to cover the parent company is loss exposure is a: a. Reciprical insurer b. Captive insurer c. Mutual insurer d. Stock insurer

b. Captive insurer

305. Which of the following could be used to pay off the mortgage on a home, provide a death benefit that equals the amount of outstanding debt on the home, no more and no less? a. Home service insurance b. Decreasing term insurance c. Home warranty

b. Decreasig term insurance

320. All the following are covered by the CLHIGA, EXCEPT: a. Individual annuities b. Employer self-funded plans c. Group term insurance d. Disability income

b. Employer self-funded plans

297. In relation to the frequency of premium payments paid by the insured, which of the following statements is true concerning the total of premium paid by the end of the year: a. Assumes the premium will be paid at the end of the year, if paid earlier a discount will result b. Is greater if paid semi-annually rather than annually c. Is less is paid quarterly rather than semi-annually d. Is the same regardless of the frequency of payments

b. Is greater if paid semi-annually rather than annually

289. Which of the following is the best definition of premium? a. The amount the insured pays per unit of coverage b. Money the insured pays the insurer to obtain the benefits in the policy c. Money the insurer oays the insired to obtain the benefits in the policy?

b. Money the insured pays the insurer to ontain the benifits in the policy

317. Eligibility for Social Security retirement benefits is based on: a. The workers age at retirement b. The number of quarters earned c. The workers date of birth

b. Number of quarters earned

298. Every admitted insured in the state of California is required to maintain a unit or division to investigate which of the following? a. Possible non-justifiable discrimination b. Possible non-compliance with CA rate laws c. Possibke fraudulent claims made by insurers d. Possible arson claims

b. Possible non-compliance with CA rate laws

322. In a group life policy with the death benefit of more than $50,000: a. Premium cost is not taxable b. Premium cost for insurance about $50,000 is taxable as income to the insured

b. Premium cost for insurance above $50,000 is taxable as income to the insured

335. A parent who lives at home is being cared for by an adult daughter on a full time basis. Which of the following would provide care in the daughter needs a period of separation. a. Adult day care b. Respite care c. Home Care d. Grace Period

b. Respite care

341. In a Worker's Compensation contract, Part One provides payments for which of the following? a. Sums the employer is legally required to pay according to the Master Servant doctrine b.Sums the employer is legally required to pay under State workers compensation laws c. Sums the insured is legally required to pay in order to upgrade working conditions and safetu requirements at the insures location d. Sums the insured is legally required to pay under State Common Laws resulting from work related injuries

b. Sums the employer is legally required to pay under State workers compensation laws

278. Whose benefits are affected by the blackout period? a. The survivig children b. The surviving spouse c. The disabled worker d. The fully insured

b. The survivig spouse

283. Whats it called when an insurer uses higher rate based solely on religion, race, or erhnic group? a. Categorizing b. Unfair discrimination c. Social injustice d. Redlining

b. Unfair descrimination

314. When an insurer presents an illustration for life insurance, all the following are prohibited, EXCEPT: a. Stating that the amount of non-guarantee elements is guaranteed b. Using the insurers "discipline current scale" in the illustration c. Including a description of a "vanishing premium" d. Providing the applicant with an incomplete illustration

b. Using the insurers "discipline current scale" in the illustration

304. The MINIMUM number of employees in group life insurance in California is: a. 10 b. 50 c. 2 d. 100

c. 2

295. The blackoutperiod starts when the youngest child reaches the age of: a. 25 b. 30 c. 21 d. 16

c. 21

315. In a group life plan, unmarried children may be covered as dependents until age: a. 19 b. 20 c. 21 d. 22

c. 21

328. In a group life plan, a dependent child attending an educational institution may be covered until age: a. 21 b. 19 c. 24 d. 20

c. 24

318. All of the following apply to an insurance broker (not an insurance agent), EXCEPT a. A broker represents the insured b. A broker can charge a fee to the insured c. A broker is appointed by an insurer to transact insurance d. A broker acts on behalf of an insurer

c. A broker is appointed by an insurer to transact insurance

333. The insured's policy has a deductible that is applied between the exhaustion of basic plan limits and the commencement of excess coverage. This is called a: a. Family Deductible b. Per Cause Deductible c. Corridor Deductible d. Stop-loss limit

c. Corridor deductible

339. Medicare PART B does/is not: a. Mandate a premium payment from the participant b. Optional for those who are enrolled in PART A c. Cover the expense of virtually all drugs prescribed by a doctor d. Cover the expense of a doctor's service

c. Cover the expense of virtually all drugs prescribed by a doctor

277. A group insurance plan is contributory when the: a. 3rd party administrator collects part of the premium b. Employer pays all the premium c. Employee pays part of the premium d. Service provider collects part of the premium

c. Employee pays part of the premium

321. Which of the following is NOT covered by the CLHIGA? a. Direct group life insurance b. Individual (non-group) health insurance c. Group stop loss plans d. Individual term life

c. Group stop loss plans

308. The usual amount of death benefit in industrial life insurance policy is: a. $10,000 to $25,000 b. $50,000 to $100,000 c. Less than $2,000 d. $100,000

c. Less than $2,000

287. Which type of insurance policy provides a death benefit that matches the projected outstanding debt of an individuals home? a. Family protection b. Level term c. Mortgage protection d. Joint life

c. Mortgage protection

326. If an insured indicates that an illustration will be used, they must do which of the following? a. Send the form to the commissioner for approval b. Update and revise the policy annually c. Send a summary status report to the policy owner annually d. A, B and C are correct

c. Send a summary status report to the policy owner annually

299. For more serious offenses and convictions, an application for a license can be denied without a hearing. Which of the following circumstances would allow for an application to be denied for an insurance license, without a hearing? a. The applicant for the license has never been licensed to sell insurance and therefore has no experience in the industry b. The applicant for the license has failed the required pre-licensing exam four times before passing c. The application for the license has had a previous license denied for cause within the previous five years d. The applicant for the license speaks English as a second language

c. The application for the license has had a previous license denied for cause within the previous five years

284. A policy owner has the right to change all of the following except: a. The beneficary b. The payment mode c. The dicidend schedule d. The dividend option

c. The dividend schedule

290. If insurance pays an insured $25,000 in lost wages, $45,000 for physicians visits and hospital cost, and $15,000 for physical therapy treatments, and later discovered that the claim was fraudulent, the insured maybe find as much as: a. $25,000 b. $60,000 c. $85,000 d. $170,000

d. $170,000

Medicare part a, begins automatically at age: a. 55 b. 60 c. 62 d. 65

d. 65

325. All the following are required to be included in life insurance illustrations, EXCEPT: a. The name of the insured b. The page number showing its relationship to the total number of pages in the illustration c. The page number d. A statement that the benefits in the illustration are guaranteed

d. A statement that the benefits in the illustration are guaranteed

303. Which if the following is NOT excluded in group life? a. War b. Military service c. Aviation d. Accidental injury

d. Accidental injury

336. The federal law known as COBRA does which of the following? a. Allowing insurers to require evidence of insurability for insureds who wish to join a group health insurance plan once the period of enrolment has passed b. Allowing employers to terminate group health insurance coverage when an employee terminates employment c. Requiring employers to pay the same percentage of the premium for terminated employee for up to 18 months after termination as they would havepaid peior termination. d. Allowing for, and providing protection of ex-employees, as well as their dependents by providing them the same conversion and extension benefits for group health insurance benefuts as those given to existing employees.

d. Allowing for, and providing protection of ex-employees, as well as their dependence by providing them the same conversion and extension benefits for group health insurance benefits as those given to existing employees.

300. The rules regarding life insurance policy illustrations are intended to ensure all the following, EXCEPT: a. Ensure that illustrations are understandable by prescribing standard format to be followed when illustrations are used b. Ensure that illustrations do not miss lead purchasers of life insurance and annuities c. Are you sure that the disclosures that are required in connection to illustrations are specified d. Ensure that the illustration specifies that both guaranteed a non-guaranteed elements will continue unchanged for all years shown

d. Ensure that the illustration specifies that both guaranteed a non-guaranteed elements will continue unchanged for all your shown

282. Which of the following functions is best defined as an insurance company's identifying and selling to potential customers? a. Rate marking b. Underwriting c. Claims handling d. Marketing

d. Marekting

310. Which of the following allows employees to share in the financial success of the company? a. Tax-sheltered account b. Simplified employee pension plan c. Keogh plan d. Profit-sharing plan

d. Profit sharing plan

316. And insurance company which is owned by individual to purchase shares of stock in the company, sharing profits in proportion to shares owned, and vote for a board of directors is known as what type of insurer? a. Lloyd's of London b. Fraternal insurer c. Mutual insurer d. Stock insurer

d. Stock insurer

323. When a corporation ceases to exist entirely, their insurance license: a. Is suspended temporarily b. Becomes inactive c. Terminate unless the corporation files an application to continue to transact within 30 days d. Terminates

d. Terminates

338. What does a stop-loss provision in a medical expense insurance plan sey a maximum for? a. Premium increases for specific insureds. All insureds must be subjectto the same increases. b. The total of all payments from an insurer over the life of the policy. c. The limit of payments per year by an insurer for the expenses incurred by an individual insured. d. The limit of out-of-pocket expense payments covered each year under a policy.

d. The limit of out-of-pocket expense payments cover each year under a policy

343. Which of the following is not true regarding Managing General Agents? a. They can be a license life agent b. They have the power to appoint, supervise, and terminate the appointment of local agents. c. They have the power to accept and decline risks. d. They do not collect premium money from producing broker-agents

d. They do not collect premium money from producing broker-agents

286. In a reinsurance agreement, the insurance comapny that transfers its loss exposure to another insurer is called: a. Primary insurer b. Reinsurer c. Captive insurer d. Secondary insurer

A. Primary insurer

329. Any ensure that provides claim forms must include which of the following statements? a. "For your protection California law requires the following to appear on this form: Any person who knowingly presents false or fraudulent claims for the payment of a loss is guilty of a crime and may be subject to fines and confinement in state prison" b. "This is an illustration only. And illustration is not intended to predict actual performance. Interest rates, dividends, or values that are set forth in the illustration or not guaranteed, except for those items clearly labeled as guaranteed." c. " are you thinking about buying a new life insurance policy or annuity in discontinuing or changing an existing one? If you are, your decision could be a good one or a mistake. You will not know for sure unless you make it careful comparison of your existing benefits and the proposed benefits."

a. " For your protection California law requires the following to appear on this form: any person who knowingly present false or fraudulent claim for the payment of a loss is guilty of a crime it may be subject to fines and confinement in state prison".

281. After the deductible, whats portion does a patient pay for covered expenses under Medicare Part B? a. 20% b. 50% c. 80% d. 100%

a. 20%

292. An agent must submit all the following to the insurer, except: a. A copy of all printed communications used for the presentation b. A copy of the signed replacement notice, if replacement is involved c. A statement aigned by the applicant as to whether replacment of exsisting life insurance is involved in the transaction d. Premiums must be paid to receive only a conditional reciept

a. A copy of all printed communications used for the presentation

296. A person responsible for collecting premium payments in addition to paying claims as which of the following? a. An Administrator b. An Adjuster c. An Analyst d. An Agent

a. An Administrator

A disability income policy covers injuries suffered by an insured on or off the job is called? a. An Occupational Policy b. a non-occupational Policy c. A wraparound policy d. Twenty-four hour policy

a. An occupational policy

337. Which of the following conditions would NOT be included among the chronic illness triggers of a LTC policy. a. Deafness b. Alzheimer's c. Incontinence d. Dementia

a. Deafness