WA Life and Health Insurance
What is the maximum age for qualifying for a catastrophic plan?
30 Years of age.
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 Days.
What is the elimination period for Social Security Disability benefits?
5 Months.
A producer just completed a continuing education (CE) course. When would the producer be allowed to repeat the same course as part of her CE requirement?
After 3 years.
Under what condition would an employee's group medical benefits be exempt from income taxes?
An employee's group medical benefits are generally exempt from taxation as income.
Can Alzheimer's disease be excluded from coverage under a long-term care policy?
No, organic cognitive disorders must be covered.
What term best describes an individual who is domiciled and licensed as a resident producer in a state other than Washington?
Nonresident producer.
What Medicare part will cover lab services or diagnostic tests?
Part B.
Who qualifies for Medicaid?
Persons with insufficient income.
What are the three types of hazards?
Physical, moral, morale
What services does Medicare Part B pay for?
Physician services, diagnostic tests, and physical therapy.
Regarding the taxation of business overhead policies, what is true?
Premiums are deductible and benefits are taxed.
What do the standard and preferred risk categories share?
Premiums are not elevated.
If an insurer needs to obtain information about the applicant from investigations, what is the insurer required to do?
Provide the applicant a Disclosure Authorization Notice.
The commissioner may permit an agent to enter into reasonable arrangements with prospective insureds to charge a reduced fee in situations where services that are charged for are?
Provided beyond the scope of customary services in connection with the solicitation and procurement of insurance.
What type of risk is insurance?
Pure Risk.
The Fair Credit Reporting Act does what?
Regulates consumer reports.
What is not provided by an HMO?
Reimbursement
An insured wants to name her husband as the beneficiary of her health policy. She also wishes to retain all of the rights of ownership. The insured should have her husband named as what type of beneficiary?
Revocable.
What is the dental insurance category in which filling cavities would be covered?
Routine and major restorative care
What is an example of peril covered in an accident and health insurance policy?
Sickness or accident.
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?
Stop-loss.
If an insurer intends to rely on an applicant's answers to health questions in an application to determine eligibility for coverage, then:
Such questions must be clear and precise.
An insurer wishes to compare the information given in an insurance application with previous insurance applications by the same applicant but for different companies.What organization can help the insurer accomplish this?
The Medical Information Bureau.
How is a Major Medical policy premium NOT determined?
The average age of the group.
In insurance, an offer is usually made when?
The completed application is submitted.
How many pints of blood will be paid for by Medicare Supplement core benefits?
The first 3 pints.
In a disability policy, the elimination period (or waiting) period refers to the period between?
The first day of a disability and the day the insured starts receiving benefits.
How does someone qualify for Social Security Disability Income benefits?
The insured must have the proper insured status (such as fully insured), meet the definition of disability, and satisfy the waiting period.
An individual applies for a life policy. Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. He has also been hospitalized for drug abuse, but does not remember this when applying for insurance. The insurer issues the policy and learns of his history one year later. How will this affect his policy?
The policy will NOT be affected. In this particular instance there was no intent to commit fraud.
If a producer has procured insurance coverage for a policyowner through an unauthorized insurer, what could happen?
The producer may be held personally liable for policy claims
What information regarding an insured is NOT included in an investigative consumer report, which is requested by an underwriter?
Medical history.
Under an individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is?
Monthly.
A producer has established a separate account for premiums collected on life insurance policies sold by the producer. Who is entitled to the interest earned on the deposits in the separate account?
The producer.
On a disability income policy that contains the "own occupation" definition of total disability, the insured will be entitled to benefits if they cannot perform?
Their regular job.
What are activities of daily living?
There are 6: Mobility, Bathing, Dressing, Eating, Toileting, and Continence.
When employees are actively at work on the date coverage can be transferred to another insurance carrier, what happens to coinsurance and deductibles?
They carry over from the old plan to the new plan.
If a producer has been found guilty of any violations of the provisions of the insurance code, the commissioner may levy a fine upon the licensee, up to?
$1000 per offense.
An employee insured under a group plan has been paying a $25 monthly premium for his coverage. The employer has been contributing $75, for a total of $100. If the employee leaves, what is his MAXIMUM monthly premium for COBRA coverage?
$102 (rate of 102% to cover administration costs)
An insured is covered under 2 group health plans- under their own or their spouse's. They had suffered a loss of $2000. After the insured paid the total of $500 in deductibles and coinsurance, the primary insurer covered $1500 of medical expenses. What amount, if any, would be paid by the secondary insurer?
$500
According to the state regulations pertaining to claims settlements, after receiving a notification of claim from an individual policyowner, the insurer must acknowledge that notice within?
10 Working days.
Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to?
10 Years and possibly fined.
Every order by the commissioner suspending any insurance license must specify the period during which the suspension will be effective and may not last longer than?
12 Months.
Every licensed person in this state must reply to an inquiry by the commissioner regarding the business of insurance within what time period?
15 Business days.
For eligible producers, once a producer's appointment is filed, within how many days will the commissioner verify the appointment?
15 Days.
To attain currently insured status under Social Security, a worker must have earned at least how many credits during the last 13 quarters?
6 Credits.
How long is the open enrollment period Medicare Supplement policies?
6 Months.
Once an individual is licensed as an insurance producer for life or accident and health insurance, how many hours of training must the producer initially complete to sell long-term care insurance?
8 Hours.
How long does any person receiving written notification of the commissioner's order have to respond and request a hearing?
90 Days.
What does the insuring clause NOT specify?
A list of doctors.
What condition is LEAST likely to be required in order to qualify for benefits under a disability income policy?
A specified income status prior to the disability.
When risks with a higher probability of loss are seeking insurance more often than other risks, this is known as what?
Adverse selection.
In which Medicare supplemental policies are the core benefits found?
All plans.
In disability income insurance, an insured is considered disabled if they cannot perform any job they are suited for by prior education, training, or experience, they fall under which definition of total disability?
Any occupation.
Vocab: The appearance (or assumption) of authority based on the actions, words or deeds of the principal or because of circumstances the principal created.
Apparent authority.
What document describes an insured's medical history, including diagnoses and treatments?
Attending physician's statement.
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report must what?
Be informed of the source of the report.
What is NOT a requirement for Social Security disability income benefits?
Being age 65.
What is NOT true in regards to business overhead expense policies?
Benefits are usually limited to six months.
When an insurer offers services like preadmission testing, second opinions regarding surgery, and preventative care, what term describes that?
Case management provision.
What document is required for an insurance company to transact insurance?
Certificate of Authority.
The provision that provides for the sharing of expenses between the insured and the insurance company is?
Coinsurance.
On a disability income policy that pays a lump sum if the insured suffers a heart attack or stroke is known as?
Critical illness.
Two individuals are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant factor. What is this called?
Discrimination.
What is considered a qualifying event under COBRA?
Divorce, voluntary termination, change from full to part-time, and death of employee.
The general powers and duties of the Insurance Department do NOT include?
Enacting statutes to regulate the insurance industry.
What are the three types of agent authority?
Express, implied, and apparent.
True or False: A substandard risk would qualify for a discounted premium.
False.
True or False: Basic medical expense plans provide coverage for catastrophic medical expenses.
False.
True or False: Partial disability is a form of insurance that covers part-time workers.
False.
True or false: Concerning taxation of disability income benefits, if paid by the individual, the premiums are tax deductible.
False.
How many parts does Medicare have?
Four: Parts A-D
An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits?
Full benefits.
An insurer who covers a child under a noncustodial parent's health-care plan must?
Give the custodial parent information about obtaining benefits through that coverage.
What is incorrect concerning taxation of disability income benefits?
If paid by the individual, the premiums are deductible.
What rider would not increase the premium for a policyowner?
Impairment rider.
What two elements are necessary for a life insurance contract to have legal purpose?
Insurable interest and consent.
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.
What law is the foundation of the statistical prediction of loss upon which rates for insurance are calculated?
Law of large numbers.
What type of care is NOT covered by Medicare?
Long-term care.
After the elimination period, a totally disabled insured qualified for and received benefits from his policy that has a premium waiver rider, what happens to the premiums?
Premiums will be refunded.
What is NOT considered to be a supplemental benefit under an HMO?
Preventative services.
Who issues Medigap policies?
Private insurers.
What is the initial period of time specified in a disability income policy that must pass, after the policy is in force, before a loss can be covered?
Probationary period.
What is NOT the principal goal of a preferred provider network?
Provide medical services only from physicians in the network.
What is NOT a goal of risk retention?
To minimize the insured's level of liability in the even of loss.
True or False: Medicare supplement insurance policies do NOT cover the cost of extended nursing home care.
True.
For the purpose of insurance, what is risk?
Uncertainty of loss.
What provision is NOT mandatory for health insurance policies in Washington?
Unpaid premiums.
In forming an insurance contract, when does acceptance usually occur?
When an insurer's underwritter approves coverage.
What is another name for Medicare Supplement plans?
Medigap.
A client has a new individual disability policy with a 20-day probationary period and a 30-day elimination period. Ten days later, the client breaks their leg and is off work for 45 days. How many days of disability benefits will the policy pay?
15 Days.
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 she be receiving benefits under the "own occupation" disability plan?
2 Years.
COBRA applies to employers with at least how many employees?
20 Employees
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.
What is the required free-look period for Medicare Supplement policies?
30 Days
Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?
30 Months.
An insured is involved in a car accident. After the accident is determined to be her fault, the police give her a breathalyzer test to determine whether or not she had been drinking alcohol before the accident. Her B.A.C. is over the legal limit. What type of health benefits will her health insurance policy pay her for her injuries if the policy includes the narcotics and intoxicants provision?
No benefits.
An insured is involved in a car accident. In addition to general, less serious injuries, he permanently loses the use of his left leg and is rendered completely blind. The blindness improves a month later. To what extent will he receive Presumptive Disability benefits?
No benefits.
Who is Eligible for Part B Medicare?
Part B is optional, and is offered to everyone who enrolls in part A.
