webce insurance exam

How will a court interpret an ambiguous provision in an insurance policy?

A court will always interpret ambiguous provisions in favor of the insured.

3. As a general rule, which of the following plans requires that money not spent on medical expenses be forfeited at the end of the year under the "use it or lose it" rule?

b. FSAs

1. Which of the following benefits is likely to be provided by workers' compensation?

d. a burial allowance

5. For how long must an organization maintain a record of a person's request to be placed on a do-not-call list?

5 years

Which of the following statements regarding class actions is not true?

An injured party cannot become a member of the class without making a formal request to the court.

A minitrial is similar to arbitration in that the findings of the third party are always binding.

False

Which statement about life insurance illustrations is correct?

Illustrations must include the company's name, the date the illustration was prepared, initial death benefit, and the name, age, and gender of the proposed insured.

Jamie has a liability policy with ABC insurance. He is being sued for damages by Margie, who is also an ABC policyholder. Which statement best describes ABC's duties?

It has a higher duty to Jamie.

Which statement about the NAIC is correct?

The NAIC prepares model laws, regulations, and guidelines for adoption by the states.

4. The NAIC issued a model law on long-term care insurance. Which statement about the model law's effectiveness is correct?

The model law becomes effective in a state if approved by the state legislature.

Which statement is true about arbitration?

The submission agreement is a binding contract.

2. Laura receives disability benefits from her employer and also from a personal disability income insurance policy. Which of the following is true about the taxation of these benefits?

a. Benefits from her employer are taxable; those from her personal disability income insurance policy are not.

2. Under third-party indemnity insurance, insurers pay providers directly.

a. True

3. The Affordable Care Act expanded Medicare's list of preventive services and eliminated cost sharing for these services.

a. True

4. Disability income benefits may be provided through all of the following EXCEPT:

a. a basic medical expense policy

5. Under the ACA, all of the following are required components of an essential benefits package, EXCEPT:

a. a comprehensive set of services b. coverage of no less than 60 percent of the actuarial value of the covered services c. a limit on annual cost sharing by the insured d. stringent medical underwriting qualifications

4. What is a resource-based relative value system?

a. a managed care tool associated with Medicare Part B

2. All of the following have been cited as causes of rising health care costs EXCEPT:

a. a shortage of hospital beds

1. Felicia was hurt in a car accident. As a result, she was no longer able to work as a forklift operator, but she got a job in the same warehouse as a clerk. She was unable to collect disability benefits because she was covered under a policy that came with which definition of disability?

a. any occupation

6. Which of the following optional policy provisions does not address the problem of over-insurance?

a. cancelation

1. Which of the following must be considered in making a suitable fixed annuity recommendation to a customer?

a. the customer's financial status b. the customer's tax status c. the customer's investment objectives d. all of the above

1. Marla is covered by group health insurance maintained by her husband's employer. If her husband were to die, what is the maximum period of coverage Marla would receive under COBRA?

b. 18 months

3. Which of the following statements is true with regard to a POS plan?

b. A POS plan permits the member to choose among different plan options at the time medical service is needed.

1. The Affordable Care Act mandates that all employers, regardless of size, offer comprehensive health care coverage to their employees.

b. False

4. Kim is 72 and covered under original Medicare. If she falls and breaks her hip, which of the following components of original Medicare will pay for her surgeon's and anesthetist's fees?

b. Part B

5. Of the following, who is likely to receive workers' compensation benefits?

b. Zack, who suffered burns while at work during Henry's arson attempt

4. Connie was in the hospital for four days undergoing surgery on her hip. Her insurance company paid her $75 a day for each day, totaling $300. What type of policy does Connie probably have?

b. a hospital indemnity policy

4. An HSA is a combination of:

b. a tax-favored savings account and a high-deductible health insurance plan

1. Which of the following is applied to all expenses in a health insurance policy during a specified period?

b. all-cause deductible

2. How many ADLs must a person typically be unable to perform to qualify for LTC benefits?

b. two

3. Which of the following is true of the Blues?

c. . They provide benefits on a service basis.

5. Short-term disability plans typically pay benefits for up to how long?

c. 6 months

1. With regard to a staff-based HMO, which of the following statements is true?

c. Doctors are employees.

6. Mark has a major medical policy that requires him to pay 20 percent of the first $10,000 of medical expenses. This is known as:

c. coinsurance

2. Which of the 12 mandatory provisions of the UPPL gives the insured 90 days to submit evidence of his or her loss?

c. grace period

2. All of the following costs are covered by a Medicare supplement policy EXCEPT:

c. the first 365 days in a long-term custodial care facility

7. Eileen submits a claim under her employer-sponsored health care plan for treatment of clinical depression. She will find that benefits provided under the plan for her condition are:

c. the same as benefits provided for physical illness and injury

3. As defined by the DRA, an insured participating in a state partnership program may be eligible for an exemption to Medicaid's asset spend-down rule equal to:

c. the total lifetime benefits paid through an LTC partnership policy

3. Under ACA, what is the minimum percentage of premiums collected for an individual health insurance plan that must be spent on actual medical expenses and health care claims?

d. 80 percent

4. John suffers chest pains and is rushed to the nearest hospital emergency room. The hospital is in John's health insurance plan's network, but the on-call cardiologist is not. A month later, John is shocked to receive a bill for the difference between the cardiologist's charges and the amount paid by his health care plan. Assuming John owes no copayment or deductible, will he be responsible for paying the additional charges from the out-of-network physician?

d. No, because care was obtained at an in-network facility, balance billing is prohibited.

5. The NAIC:

d. provides model laws and regulations to be adopted and enforced by the individual states6.

Sam was involved in a car accident. The other driver told Sam that the two of them should agree on a settlement now because the longer Sam waited, the more it was going to cost him. What should Sam do?

decline because of his policy's cooperation provisions

When meeting with a prospect to discuss disability income insurance, Agent Tyler makes disparaging comments about the financial stability and reputation of a competitor to dissuade the prospect from purchasing its policies. Which unfair trade practice has Agent Tyler committed?

defamation

Which of the following is not a prohibited practice?

giving a gift of nominal value to an insurance applicant

What type of authority exists when a reasonable consumer would infer from the circumstances that the agent has authority to act on behalf of the principal?

implied authority

Which of the following is the most severe step a state insurance department can take in disciplining an insurer?

liquidation

Norman is involved in filing a claim for a loss that is large and very complex. He feels that if he handles it himself, there is a good chance he will end up with considerably less than the loss warrants. Which of the following should Norman hire to help him with the claim?

public adjuster

In addition to a damage award of $50,000, the court also awarded Fran an additional $300,000 because of the insurer's unreasonable behavior in refusing to settle the claim. What type of additional damages did the court most likely award?

punitive damages

Which of the following is not an example of an unfair claims practice?

setting a time limit for submitting proof of loss

4. What is the purpose of the Producer Database?

streamline producer licensing procedures

2. Which of the following provides general information about life insurance policies to potential buyers?

the Buyer's Guide

1. Which of the following exempted insurance companies from federal antitrust legislation?

the McCarran-Ferguson Act

3. Which of the following is the Gramm-Leach-Bliley Act primarily aimed at regulating?

the disclosure of personal financial information to third parties

Which of the following terms refers to the unethical and illegal practice of making a misleading statement about an insurance policy to induce a person to buy a policy with another insurer?

twisting