state exam #2

An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.

15

what year was the mccarran-ferguson act enacted?

1945

Every 12-months after the initial enrollment period, an HMO must hold an open enrollment period of

31 days

When an insured has the same disability within a specified time period and the insurance company provides the same benefits without a new waiting period, the second disability is covered under which of the following benefits?

Recurrent Disability

What does a 401(k) plan generally provide its participants?

Salary-deferral contributions

J has an Accidental Death and Dismemberment policy with a principal sum of $50,000. While trimming the hedges, J cuts off one of his fingers. What is the MAXIMUM J will receive from his policy?

$25,000

All of these are characteristics of a Health Reimbursement Arrangement (HRA) EXCEPT

HRA is entirely funded by the employee

Which of the following health insurance policy provisions specifies the health care services a policy will provide?

Insuring clause

B receives yearly dividends and interest from a participating life insurance policy. Which of these should B include as gross income for federal income tax purposes?

Interest only

A Disability Income policy that only the policyowner can terminate and which the rates will never go up is considered to be

Noncancellable

The type of deductible provision states that should more than one family member be involved in a common accident, or suffer the same illness, only one individual deductible amount shall be applied.

common accident deductible

Quarterly premium payments increase the annual cost of insurance because

interest to the insurer is decreased while the administrative costs are increased.

A retirement plan that sets aside part of the company's net income for distributions to qualified employees is called a:

profit-sharing plan

A major medical policy typically:

provides benefits for reasonable and necessary medical expenses, subject to policy limits

An example of rebating would be

returning a portion of a premium as inducement to purchase insurance

How long can a cash surrender value payment be deferred by the insurance company under the Nonforfeiture Law?

6 months

A "reimbursement policy" pays what amount of covered Long-Term Care expenses?

Actual covered expenses up to the daily maximum

All of the following statements regarding group health insurance is true, EXCEPT:

An individual policy is given to each member of the

T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?

Benefits are taxable to T

Which type of policy is considered to be overfunded, as stated by IRS guidelines?

Modified Endowment Contract

Which of these is NOT an element of Life insurance premiums?

Morbidity rate

A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision?

Payor provision

medicare part a and part B do NOT pay for:

dental work

S is the policyowner of a Major Medical policy. The premiums are paid monthly and due on the 1st of each month. S fails to make September's payment and is hospitalized October 15th. When S files the claim for this hospitalization, the insurer will likely:

deny the claim

The Notice of Claims provisions requires a policyowner to:

notify an insurer of a claim within a specified time

Insurance policies are offered on a "take it or leave it" basis, which make them:

Contracts of Adhesion

On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?

Collect initial premium along with a signed health statement

Which of the following would be a likely candidate for disability income insurance on a key employee?

Company executive

T is given a receipt After completing a life insurance application and paying the initial premium. Under this situation, T's coverage is

Conditional, depending on thebinsurer's underwriting guidelines

Create life insurance is typically issued with which of the following types of coverage?

Decreasing Term

How are surrender charges deducted in a life policy with a rear-end loaded provision?

Deducted when the policy is discontinued

In the event of an illness, a(n) _______ _______ policy would reimburse an insured for loss of earnings.

Disability Income

Which of the following statements does NOT accurately describe the tax treatment of premiums and benefits of individual Accident and Health insurance?

Disability income policy premiums are tax-deductible

which of these statements about a Guaranteed Insurability Option rider is NOT TRUE?

Evidence of Insurability is required when the option is exercised

An underwriter determines that an applicant's risk should be reclassified due to a health issue. This policy may be issued with a(n)

Extra premium

How does group insurance differ from individual insurance?

Premiums are lower

At what point must a life insurance applicant be informed of their rights that fall under the Fair Credit Reporting Act?

Upon competition of the application

How long does the coverage normally remain on a limited-pay life policy?

age 100

A(n)___________________ of benefits of a Health Policy transfers payments to someone other than the policyowner.

assignment

When is the face amount paid under a Joint Life and Survivor policy?

upon death of the last insured

The provision in a Group Health policy that allows the insurer to postpone coverage for a covered illness 30 days after the policy's effective date is referred to as the

waiting period

A policyowner would like to change the beneficiary on an Accidental Death and Dismemberment (AD&D) insurance policy and make the change permanent. Which type of designation would fulfill this need?

Irrevocable

A whole life insurance policyowner does not wish to continue making premium payments. Which of the following enables the policyowner to sell the policy for more than its cash value?

Life settlement contract

Life insurance companies are required to establish and maintain an anti-money laundering compliance program according to which federal regulation?

USA Patriot Act

Basic Medical Expense insurance:

has lower benefit limits has major Medical insurance

what type of life policy covers two lives and pays the face amount after the first one dies?

joint life policy