review 3-16 simulator test
Q: What is a benefit of a POS plan?
A: 1.It allows the employee to use an HMO provided doctor. 2.It allows the employee to use a doctor not covered under the HMO. 3.With the Point-Of-Service plan the employees do not have to make a decision between the HMO or PPO plans that lock them in.
Q: An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?
A: 10 days
Q: Every small employer carrier must actively offer to small employers at least how many health benefit plans?
A: 2 plans
Q: If an insurer cancels a universal life insurance policy due to the nonpayment of required premiums, how much prior notice must be given to the policyowner?
A: 30 days
Q: Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?
A: 30 months
Q: The Omnibus Budget Reconciliation Act of 1990 (OBRA) requires that large group health plans must provide primary coverage for disabled individuals under
A: Age 65 who are not retired.
Q: Who can make a fully deductible contribution to a traditional IRA?
A: An individual not covered by an employer-sponsored plan who has earned income
Q: In an annuity, the accumulated money is converted into a stream of income during which time period?
A: Annuitization period (annuity period)
Q: Which concept is associated with "exclusion ratio"?
A: Annuity payments
Q: A group policy used to provide accident and health coverage on a group of persons being transported by a common carrier, without naming the insured persons individually is called
A: Blanket policy A single policy covering several certificate holders without naming the insureds individually is a blanket policy.
Q: Which of the following is a generic consumer publication that explains life insurance in general terms in order to assist the applicant in the decision-making process?
A: Buyer's Guide
Q: What is the purpose of a conditional receipt?
A: It is intended to provide coverage on a date prior to the policy issue.
Q: Which provision stipulates that misstatements made in a health insurance application may not be used to deny a claim after the policy has been in force for 3 years?
A: Time Limit on Certain Defenses. The Time Limit on Certain Defenses provision states that misstatements made in the application at the time of issue cannot be used to deny a claim after the policy has been in force for 3 years, unless the misstatement is fraudulent.
Q: According to the Time Limit on Certain Defenses provision, non-fraudulent misstatements made on the health insurance application may not be used to deny a claim after the policy has been in force ford
A:3 years. In Michigan, the time limit for certain defenses is 3 years.
Q: Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?
A: A warranty
Q: Which of the following long-term care benefits would provide coverage for care for functionally impaired adults on a less than 24-hour basis?
A: Adult day care
Q: Which term describes a situation in which people who are the most likely to have claims are also the most likely to seek insurance?
A: Adverse selection
Q: An applicant knowingly fails to communicate information that would help an underwriter make a sound decision regarding coverage. This is an example of
A: Concealment.
Q: Which of the following terms describes a specific dollar amount of the cost of care that must be paid by the member?
A: Copayment A copayment is a specific dollar amount of the cost of care that must be paid by the member.
Q: terms is used to name the nontaxed return of unused premiums?
A: Dividend
Q: What type of group rating uses the actual experience of the group as a factor in developing the rates to be charged?
A: Experience rating
Q: An insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice?
A: Illegal It is illegal to participate in any boycott, coercion, or intimidation that is intended to restrict fair trade or create a monopoly.
Q: A Health insurance policy lapses but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for accidents become effective?
A: Immediately Coverage for accidents is immediate when reinstatement occurs, but coverage for sickness may have a waiting period of about 10 days.
Q: Guarantee of insurability option in long-term care policies allows the insured to
A: Increase benefit levels without providing proof of insurability Guarantee of insurability option allows the insured to periodically increase benefit levels without providing evidence of insurability.
Q: Which of the following best describes a misrepresentation?
A: Issuing sales material with exaggerated statements about policy benefits
Q: What is the benefit of choosing extended term as a nonforfeiture option?
A: It has the highest amount of insurance protection.
Q: If a retirement plan or annuity is "qualified," this means
A: It is approved by the IRS. A qualified retirement plan is approved by the IRS, which then gives both the employer and employee benefits such as deductible contributions and tax-deferred growth.
Q: A policyowner is reading a statement on the first page of his health insurance policy, which says "this is a limited policy." What is the name of this statement?
A: Limited Policy Notice
Q: Which of the following is considered a presumptive disability under a disability income policy?.
A: Loss of two limbs. Presumptive disability is a provision that is found in most disability income policies that specifies conditions that will automatically qualify the insured for full disability benefits, such as the loss of two limbs
Q: If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a
A: Settlement option.
Q: In major medical insurance policies, when the insured's share of coinsurance reaches a certain amount, the insured is no longer obligated to pay it. This feature is known as
A: Stop-loss. The stop-loss amount is the maximum amount that the insured pays out of pocket during the year. When the insured's out-of-pocket expenses reach the stop-loss, the insurance company then provides coverage at 100% of eligible expenses for the remainder of the year.
Q: An employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?
A: The PPO will pay reduced benefits.
Q: what is type of enrollment period for Medicare Part A applicants?
A: There are 3 types of enrollment periods for Medicare Part A: initial enrollment period, general enrollment period and special enrollment period.
Q: Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?
A: Universal Life - Option A
Q: An insured owes his insurer a premium payment. Since then, he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the difference. What provision allows for this?
A: Unpaid premium
Q: An insurance company receives an application with some information missing and issues the policy anyway. What is this called?
A: Waiver
Q: An insured has been injured in an accident. Although he is still receiving benefits from his disability income policy, he does not have to pay premiums. This means that the policy includes
A: Waiver of premium feature.
