XCEL Life and Health Insurance Final Exam

P only

P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accident Death benefits will be paid to:

Determind by the term of the policy

M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for?

dental work

Medicare Part A and Part B do NOT pay for:

inpatient hospital services

Medicare Part B does NOT cover:

Fixed deferred

N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?

10%

Premature IRA distributions are assessed a penalty tax of:

Entire Contract Provision

Which provision prevents an insurer from changing the terms of the contract with the policyowner by referring to documents not found within the policy itself?

Irrevovable beneficiary

Which type of life insurance beneficiary requires his/her consent when a change of beneficiary is attempted by the policyowner?

Reimbursement

Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy?

To determine the solvency of the company

Why would the Insurance Commissioner examine the records of an insurance company?

Guaranteed Renewable

X is insured with a Disability Income policy that provides coverage until age 65. This policy allows the insurer to change the premium rate for the overall risk class assigned. Which of these renewability features does this policy contain?

50%

______ of continuing education MUST be completed in the classroom or classroom equivalent.

Nonpayment of coverage

Which of the following is a valid reason for an enrollee to be canceled by a Health Maintenance ORganization (HMO) plan?

Payor Clause

Which of the following provisions guarantees that premiums will be waived if a Juvenile Life Policyowner becomes disabled?

Commercial insurers

Which of the following reimburses its insured for covered medical expenses?

Company executive

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

Federal Government

Which of these is NOT a source of funding for Social Security benefits?

Disability Income

A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type of policy will pay a monthly benefit to the personal assisstant?

premium payments limited to a specified number of years

A Limited-Pay Life policy has:

The premium has not been paid by the insured

A Medicare Supplement policy may be cancelled for which of the following reasons?

authority

A certification of _____ permits an insurance company to transact business in Texas.

is incorporated and formed in Texas

A domestic insurance company in Texas is considered a company that?

beneficiary

A life insurance application must be signed by all of these, EXCEPT:

Waiver of Premium

A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached?

24

A new general property and casualty licensee must complete at LEAST _____ hours of continuing education with 24 months of initial licensure.

Any legal resident (except those incarcerated)

A plan through the Marketplace may be purchased by

The insurance company

A policy of adhesion can only be modified by whom?

Proceeds will go to the contingent beneficiary

A primary beneficiary has died before the insured in a life insurance policy. A contingent beneficiary is also named in the policy. Which of the following will occur when the insured dies?

a representation

A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as:

90

A temporary agent's license issued by the Commissioner of Insurance is valid for up to _____ days.

Revocable

A(n) ______ beneficiary may be changed by the policyowner WITHOUT the consent of the beneficiary.

unfair mehtods of competition

ABC Insurance Company is actively engaging in boycott, coercion, intimidation that results in the unreasonable restraint of trade. ABC is committing a prohibited act under Texas insurance laws covering

31 days

According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid?

File written proof of loss

After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms?

Return to the customer, collect a new check made out to the insurance company, and send the new check out ot the insurance company

Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance compnay. What action should J take?

An individual policy is given to each member

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

Commisioner

An Evidence of Coverage form may be issued by a Health Maintance Organization (HMO) after being approved by the

Medicare Supplement policy

An applicant MUST recive an Outline of Coverage when an application is taken for a(n)

An insurer exaggerating its dividends in a magazine advertisement

An ecample of false advertising would be

$25,000

An employee is covered under a company group life plan with a $50,000 death benefit. What is the MAXIMUM amount a spouse may be insured for under this program?

returning a portion of a premium as inducement to purchase insurance

An example of rebating would be

$7,000

An individual has a Major Medical policy with a $5,000 deductible and an 80/20 Coinsurance clause. How much will the INSURED have to pay if a total of $15,000 in covered medical expenses are incurred?

other agents

An insurance agent has a fiduciary reponsibility to all of the folliwng EXCEPT

20

An insured must notify an insuer of a medical claim within ____ days after an accident.

an insured

An insurer is NOT required to provide information on fraudulent claims if requested by

15

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

Basic Hospital

B's policy provides coverage on an in-hospital basis only and contrains a limited daily room and board benefit. Which of these policies does B have?

has lower benefit limits that Major Medical insurance

Basic Medical Expense insurance:

Guaranteed insurability rider

Bryce purchases a disability income policy with a rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this?

Morbidity rate

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

$720

C was injured while deep sea diving and requires a hospital stay. C has a Major Medical policy with a 80/20 coinsurance clause and a $400 deductible. What is the MAXIMUM C will pay if the covered expenses are $2000?

correct the information and have the prospect initial the change

D the agent met with a prospect and ended up selling an insurance policy. When filling out the insurance application, D makes a mistake. In this situatuion, D MUST

31 days

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

Through mutual funds, stocks, bonds

How does a typical Variable Life Policy investment account grow?

6 months

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

If the primary beneficiary dies before the insured

How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&A) policy?

an amount that the premiums paid would have purchased at the current age

If an insured's age was misstated on a life insurance contract, the Misstatement of Age provision requires that any death benefit payable would be

An insurer may not use suicide as a defense against payment after the second year

In Texas, which of these statements regarding the Suicide clause is TRUE?

internal limit

J was reviewing her Health Insurance policy and noticed the phrase "this policy will only pay for a semi-private room". This phrase is considered to be a(n)

Modified Whole Life

K buys a policy where the premium stays fixed for the first 5 years. The premium then increases in year 6 and stays level thereafter, all the while the death benefit remains the same. What kind of policy is this?

the date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured

K is an agent what takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?

Proceeds will be paid to P's estate

K is the insured and P is the sole beneficiary of an Accidental Death and Dismemberment (AD&D) insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true?

adjust the death benefit to a reduced amount

L takes out a life inurance policy and dies 10 years later. Durimg the claim process, the insuer discovers the L had understated her age on the application. Under the Misstatement of Age provision, the insurer will:

Residual Disability

R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not at full capacity?

November 1

S filled a written Proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take a legal action against the insurer beginning:

Waiver of Premium

The provisions in a health insurance policy that suspends premiums being paid to the insurer while the insured is disabled is called the:

impairment rider

T applied for a Disability Income policy and has a history of back injuries. The insurer issued the procedure with a statement that excludes coverage for back injuries. This statement is called a(n)

Benefit's are taxable to T

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

conditional, depending on the insurer's underwriting guidlines

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

Insurer will likely treat as a pre-existing condition which may not be covered for one year

T was treated for an ailment 2 months prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards. How will the insurer likely consider the condition?

Fiduciary responsibility

Taking recipt of premiums and holding them for the insurance comoany is an example of:

This clause provides the payment of proceeds to the insured's estate

The Common Disaster clause provides that if both the insured and the sole named beneficiary were to die in a common accident, which of the following is true?

prevents an insured covered by two health plans from making a profit on a covered loss

The Coordination of Benefits provision:

notify an insurer of a claim within a specified time

The Notice of Claims provision requires a policyowner to:

Insuring

The ______ clause identifies which losses resulting from an accident or sickness are insured by the policy.

policyowner

The ______ has the right to change a life insurance policy's beneficiary.

Insuring agreement

The agreement in a life insurance contract that states a specific sum of money will be paid to a designated person upon an insured's death is called a(n):

Decreasing

The combination of Whole Life and ________ Term insurance is referred to as a Family Income Policy.

buy additional coverage at a later date

The guarantee of insurability option provides and long-term care policyowner the ability to:

Waiting Period

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

6

Three law partners form a Cross-Purchase Buy and Sell agreement. This agreement is funded with individual life insurance. How many total life policies are needed for this agreement?

may cancel the policy for nonpayment only

Under a Guaranteed Renewable health insurance policy, the insurer

Universal Life

Which of the following Life insurance policies combine term insurance with an investment element?

Transportation to and from a treatment facility

Which of the following benefits is NOT required under a group health plan for drug and alcohol treatment?

Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company

Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?

individuals who are blood related

Which of the following groups may NOT be insured by a group life insurance policy?

from the date that the policy was issued

Under an individual Health Insurance policy, the Time Limit of Certain Defenses provision states that nonfraudulent misstatements first become incontestable two years

Signed HIPPA disclosure

Upon delivery of a rated life insurance policy, the Producer must obtain each of the following, EXCEPT:

Fraternal Benefit Society

What is an organization that solicits insurance only to its members?

Wait at least 5 years before applying for a new license

What is required for an agent whose license has been revoked?

12 months

What is the MINIMUM benefit period that must be offered by a Long-Term Care policy?

Promise to pay a death benefit to a named beneficiary

What is the consideration given by an insurer in the Consideration clause of a life policy?

100% of the insured's Primary Insurance Amount (PIA)

What is the maximum Social Security Disability benefit amount an insured can receive?

Term rider

What kind of life insurance product covers children under their parent's policy?

Dread disease insurance

What type of policy would only provide coverage for specific types of illness (cancer, stroke, etc)?

Anti-Money Laundering violation

When a policyowner cash surrenders a Universal Life Insurance policy in it's early years, this may be considered a red flag for a(n):

Any changes made on the application require the applicant's initials

When an insurance application is taken by a producer, which of these statements is true?

Fair Credit Reporting Act

Which Federal law allows an insurer to obtain an inspection report on a potential insured?

Insuring

Which health policy clause specifies the amount of benefits to be paid?

Entire Contract

Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?