CT Life and Health State Exam Simulator

an individual who intentionally violates a Connecticut insurance law may be subject to a MAXIMUM fine of

$5,000

After conducting a hearing, the Commissioner is empowered to issue a cease and desist order. A violation of such an order is punishable by a monetary fine not to exceed

$50,000

Any administrative action taken against a producer MUST be reported to the Commissioner within____days after the final disposition?

30 days

The maximum prison sentence given under federal law for unfair and deceptive insurance practices is

15 years

To be classified as a small employer in Connecticut, an employer must employ how many eligible employees?

1 to 50

How long is individual medical expense insurance normally written for?

1 year.

The free look period provided in a life insurance policy is usually ____days

10

In Connecticut, a producer cannot use his/her license for primarily writing controlled business. In order to conform to this requirement, annual premiums collected on controlled business cannot exceed_____of total premiums.

10%

Staring in 2016, businesses with up to______employees will be defined by the ACA as a "small business"

100

John received a one-time distribution of $50,000 from his modified endowment contract (MEC). Prior to that, the contract's cash value was $150,000, the contract investment amount was $100,000, and the death benefit was $500,000. What percentage of the $50,000 distribution was taxable as ordinary income?

100 %

Under HIPPA, a medical plan late enrollees may be excluded for pre-existing conditions for a maximum of

18 months. The maximum length of a pre-existing condition exclusion period is 12 months after the enrollment date , or 18 months in the case of a "late enrollee"

In Connecticut, a temporary license may be issued for a period of not to exceed_____ days.

180 days

After a life insurance policy has been in force for more than _____ years the policy is considered incontestable.

2 Years

Nonqualified medical expense distributions from a Health Savings Account (HSA) have a tax penalty of

20%

An individual participant personally received eligible rollover funds from a profit-sharing plan. What is the income tax withholding requirements for this transaction?

20% is withheld for income taxes

A producer must complete_____credit hours of continuing education for each licensing period.

24

A licensee whose name or address changes must notify the Commissioner within_____days

30

Any administrative action taken against a producer MUST be reported to the Commissioner within_______ days

30

How many days notice does the Affordable Care Act require insurers to give before rescinding coverage?

30 days

Social security disability income requirements state that in order to become fully insured on a permanent basis, you must have worked in a covered occupation for

40 quarters

An individual in Connecticut who charges a fee for giving advice on an insurance policy must be licensed as a consultant if the advice is given to

A policyholder

What is the best way to define life insurance replacement?

A transaction in which a new life insurance policy is purchased and an existing life insurance policy is surrendered.

ALREADY KNOW

ALREADY KNOW (age 26)

Which benefit is normally payable to a life insurance policyowner when the insured's life expectancy has been severely limited?

Accelerated (living) benefit

Which of the following is NOT covered by a comprehensive long-term care policy?

Acute care

The highest mortality rate belongs to which group ?

Age 70 males

An individual who purchases a modified life insurance policy expects

An improvement in future income

A television advertisement features a health insurance product that is endorsed by a specific group. In this advertisement

Any control by the insurer over this group must be disclosed

According to HIPPA regulations, which of the following may reduce a medical plan's pre-existing conditions exclusion?

Any period of prior coverage

Julie is in need of assistance with one or two activities of daily living. She may be eligible for a(n)

Assisted living facility

What are the reasonable and customary charges for health insurance primarily based on?

Average charges within a geographic region

A policyowner pays the first annual premium for a $50,000 life insurance policy and dies one month after the policy effective date. Which of these statements is normally true?

Beneficiary receives $50,000 income-tax free

In long-term care insurance, what is the length of time for which claims will be paid?

Benefit period . The benefit period is the length of time for which claims will be paid.

Which of these statements regarding Major Medical Expense insurance is NOT true ?

Benefits are paid on a capitation basis

Pat is covered by a disability income insurance policy that covers disabilities arising from a work-related illness or injury. The amount of his disability income payments for an on-the-job injury may be reduced by

Benefits paid under workers compensation

Any agreement that unreasonably restrains the business of insurance is a violation of which Unfair or Prohibited Insurance Practice?

Boycott, coercion and intimidation

Which of the following is considered to be a prosthodontic dental procedure?

Bridgework

A life settlement____________ negotiates a life settlement between a policyowner and a life settlement provider.

Broker

For employees covered in multiple states under a group health plan, jurisdiction rules cannot alter

COBRA laws

Which of these is true regarding the exchange of consideration among parties involved in an insurance contract?

Can be unequal

Which of the following is NOT an allowable exclusion for long-term care insurance policies?

Care for incurable conditions

Which statement regarding the waiver of premium rider is accurate?

Cash payment is not directly provided to the policyowner

Medical costs in birthing centers are lowered by using

Certified nurse midwives.

What type of employee welfare plans are not subject to ERISA regulations?

Church plans

All of these are considered to be a violation of the Federal Fraud and False Statements Act EXCEPT

Claims reimbursement

A consultant derives their income from which source?

Clients

Prepaid dental plans differ from most other types of dental plans in what way?

Closed panel dentists can only be used

In Connecticut, continuing education courses must be approved by the

Commissioner

The_________________has the ability to examine the records of authorized insurers because of the powers granted through state statutes.

Commissioner

Which benefit supplement added to a life insurance policy insures an entire family?

Family term rider

The insurer's obligation to pay a claim depends on whether the insured or beneficiary has complied with all policy conditions. This makes the policy a(n)

Conditional contract

What must be given to a life insurance applicant when the agent receives an application and the initial premium

Conditional receipt

A producer MUST notify the Commissioner for

Conducting business under an assumed name

The payment of the first premium, the promise to pay a covered loss , and the agreement to abide by policy conditions are all examples of

Consideration

An accident and health insurance policy's premium requirements are set forth in which of the following provisions?

Consideration Clause

A(n)______________is a licensee who charges a fee for contracted insurance advisory services

Consultant

In regards to the Affordable Care Act (ACA), which of these is NOT a role of a health insurance exchange?

Contact the employer if an employee stops coverage under a plan offered in the exchange

Which of the following does NOT involve a life settlement transaction?

Converting term life coverage to whole life insurance

Jerry has an indemnity plan which covers dental expenses. Typically, these type of plans

Cover preventative care once every six months

What does the rehabilitation benefit cover in a disability income policy?

Covers the approved cost of the rehabilitation necessary to help a disabled insured return to work

Which of the following is NOT an intended use of an annuity?

Create new funds upon the death of a wage-earner

ABC Partnership is a business with a limited number of partners. Which disability buy-sell agreement is best suited for this business?

Cross purchase agreement

What type of doctor-ordered care assists an individual with performing basic daily activities such as bathing, dressing, and eating?

Custodial care

What effect does interest income have upon insurance premiums?

Decreases premium. The actuarial formula for a bundled insurance premium is as follows: Mortality costs (based upon age and gender) less assumed interest = Net premium. Please note that assumed interest always lowers the mortality costs and thus, lowers the total premium.

What happens to the purchasing power of benefit payments from a fixed life annuity when the cost of living goes up?

Decreases.

What kind of life policy typically offers mortgage protection?

Decreasing term . As the outstanding loan decreases, so does the amount of term coverage.

Which of the following is generally a form of group credit life insurance?

Decreasing term insurance

Which of these is typically regarded as a major treatment in an indemnity dental plan?

Dentures

Individual's covered with employer-paid group health plans will normally receive tax-free benefits under all of these plans EXCEPT

Disability income

Which statement about group life insurance is INCORRECT?

Each participant requires evidence of insurability.

When using the needs approach for life insurance planning, a lump sum may be created to provide for all of the following EXCEPT

Employee benefits

Which of the following is NOT a duty of the Commissioner ?

Enact legislation dealing with insurance

Which tax cost is normally associated with death ?

Federal estate tax

Death benefits from a life insurance policy are normally considered to be

Exempt from federal income tax

Long Term Care policies will usually pay for eligible benefits using which of the following methods ?

Expense incurred . Most long term care policies pay on a reimbursement (or expense incurred) basis , up to the policy limits.

Which of the following is considered to be a prohibited insurance practice?

Failing to submit premiums to the insurer

Which of the following would be considered a violation of Connecticut Insurance law?

Failure to remit premium in a timely manner

Which of these is NOT considered a preventative service in a dental plan?

Fillings

A producer is meeting with a client to determine whether an annuity will be suitable for purchase. Which of the following topics needs to be discussed with the client ?

Financial status of the client

A(n)__________________insurer writes business in a state other than the one in which it is domiciled

Foreign

John has a criminal record in which he was convicted of a felony that involved dishonesty. Under Federal law, how would John be able to engage in insurance transactions?

Given written consent by the state insurance regulatory agency.

According to the Affordable Care Act(ACA), insurers can no longer deny heath coverage due to pre-existing conditions unless the plan is a(n)

Grandfathered plan .

The administrator for a corporate pension plan bought an accumulation annuity contract for its 2,000 employees. All 2,000 participating employees received certificates of participation. What kind of contract is this?

Group deferred annuity

An accident and health plan that typically covers ONLY the services of approved providers is called a(n)

HMO plan

A life insurance applicant is tested for the Human Immunodeficiency Virus (HIV) . The applicant MUST be informed that the testing

Helps determine the insurability of the applicant

Which of the following is NOT subject to the promise to pay in an insuring clause

How the premium is calculated

When an individual is planning to protect his family with life insurance, one method of doing so is called needs analysis. What exactly does needs analysis involve?

Identifies the needs of an individual and the individual's dependents.

According to the Affordable Care Act , coverage may be rescinded

If intentionally false statements were offered

Which of the following is NOT classified as an "employee" under a group employer insurance plan?

Independent contractors

Which statement regarding whole life insurance is accurate?

Insurance coverage can continue for life

When compared to a fixed annuity , a variable annuity has what distinguishing feature?

Investment risk is assumed by the purchaser

Which of these would NOT be a valid reason to add the waiver of premium rider to a life insurance policy?

It allows a policy loan to cover premium payments if the policyowner becomes totally disabled.

Which of the following regarding hospital pre-admission authorization is NOT true?

It encourages weekend admission

The initial premium for a life insurance policy is typically paid in what way?

It is typically obtained by the producer and forwarded to the insurer

What type of life insurance policy covers two or more persons and pays the face amount upon the death of the first insured?

Joint Life

A life insurance beneficiary died after receiving only six payments under the policy's life income settlement option. What happens with the remaining balance of the death proceeds?

Kept by the insurance company

Which of the following is NOT information needed to determine the suitability of an annuity

Level of education

Laura added a children's rider to her life insurance policy. What type of coverage was added?

Level term

Which of the following financial products creates an instant estate, no matter when the date of death?

Life Insurance

Someone who is licensed to negotiate a life settlement contract is called a (n)

Life settlement broker

Inpatient psychiatric care is covered under Part A Medicare Insurance for 190 days per

Lifetime

How can a group dental insurer discourage adverse selection?

Limit the duration of coverage.

An insurance policy may be issued with a preferred insurance premium in all of these situations EXCEPT

Living in a rural area

The Commissioner is empowered to perform each of the following acts EXCEPT

Make rules that are consistent with those of neighboring states.

Misrepresentation on the application is

Material

Which of the following statements accurately describes the financial impact of total disability?

May be worse than the financial impact of death

Karen is considering replacing her individual accident and health insurance policy with another individual policy. She has had issues in the past with her gall bladder that would be considered a pre-existing condition. How will a pre-existing conditions exclusion affect Karen's new insurance contract?

May reduce her benefits

According to the Affordable Care Act (ACA), the proportion of premium revenues spent on clinical services and quality improvements is called the

Medical loss ratio

A producer's failure to provide title and true nature of a policy upon solicitation is an example of

Misrepresentation

Which of the following is considered to be an unfair claims settlement practice ?

Misrepresenting pertinent policy provisions relating to coverage after a loss.

In Connecticut, the Human Immunodeficiency Virus (HIV) consent form

Must disclose who will be receiving a copy of the test results

James the producer has sold a life insurance contract to a client without using an illustration, even though his insurer offers one. For this particular transaction, the applicant

Must sign a statement that no illustration was provided

How would preventative care be encouraged in a dental plan?

No deductible on routine examinations

Medicare Supplement insurance requires an individual to be at least how old for open enrollment?

No minimum age

Tim is covered by an accident and health insurance policy that may not be changed in any way by the insurer up to a stated age, as long as the premiums are paid. What type of policy is this?

Noncancelable

Jerome is covered by a disability income policy that does NOT provide benefits for losses occurring as the result of his employment. What kind of coverage is this?

Nonoccupational coverage

A(n) _______________ producer lives in another state and transacts insurance from Connecticut.

Nonresident

Which statement is true regarding hospital preadmission certification for emergency situations ?

Notification is required to be given after insured is admitted to the hospital.

Which of these is NOT an Unfair Claims Settlement Practice ?

Offering to settle a claim by arbitration. Refusing to pay persons bringing false or fraudulent claims .

Most prepaid dental plans cover

Oral examinations

Which of the following is a requirement for an individual to receive an insurance license in Connecticut?

Passing the appropriate examination.

Twisting means

Persuading an insured, to the insured's detriment, to switch policies

Which of the following guidelines does NOT apply under the pregnancy provision of the Civil Rights Act?

Post-termination extensions of medical benefits must apply equally to pregnancy.

In most dental plans, a deductible typically is NOT applied to

Preventative and diagnostic services

Karen is a health maintenance organization (HMO) subscriber. Who provides all of her preventative and routine care?

Primary care physician

A pre-existing condition exclusion in an accident and health insurance policy pertains to

Prior health matters

Which of these is NOT a standard provision in qualified long-term care policies sold in Connecticut?

Prior hospitalization

A life insurance producer is required to give a disclosure notice about information practices to an applicant or proposed insured

Prior to or at the time of signing the application

At what point must a producer give notification to the Commissioner about using an assumed name ?

Prior to using the assumed name

When a producer submits an application that discloses personal information regarding the applicant, who supplies the privacy notice?

Producer

Under Federal Law, which of the following actions may result in a producer becoming imprisoned?

Producer embezzling funds from an insurer

A producer has indicated to a potential client that the proposed life insurance is covered by the Connecticut Life and Health Insurance Guaranty Association. This action taken by the producer is

Prohibited by Law

A handicapped child is covered under an individual health policy. If continuation is needed beyond the policy's age limit, which of the following is required?

Proof of incapacity and dependency upon reaching the age limit.

The dental specialty which deals with the replacement of missing teeth is called

Prosthodontics . They use bridgework and or dentures

The main role of accident and health and disability insurance is to

Protect against medical care costs and the loss of earning power

Replacement regulations exist in order to

Protect policyowners from misrepresentations and loss of benefits

The automatic premium loan provision can be accurately described as a

Provision that provides a policy loan to pay any premiums by the end of the grace period

What type of risk involves the potential for loss with no possibility for gain?

Pure risk

Insurance producer Kelly offers insured a $500 shopping card if they purchase an insurance product through her. What is this an example of?

Rebating, which is an unfair trade practice.

Which of the following is NOT a dividend option for a life insurance policy?

Receiving the entire policy cash value

A life insurance policyowner would like a dividend option that results in a limited current outlay of funds. Which dividend option would be chosen?

Reduction of premium payment

Which of the following would prevent a person from obtaining a Connecticut resident producer license?

Residing in a state outside of connecticut

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

Salary-deferral option.

A life insurance producer's underwriting duties may include

Seeking additional information

Which of these situations would NOT potentially involve a prison sentence under Federal law?

Selling insurance with a nonresident license

What is a life insurance producer authorized to do?

Solicit, receive and forward applications to the insurer

Kelly purchases a health insurance policy issued on a conditionally renewable basis. The insurance company has a right to refuse renewal of the policy for

Specific reasons stated in the contract.

Which entity is responsible for regulating claims settlement practices of insurers?

State insurance departments

Contributions made by an employee to a qualified retirement plan are required to be

Subject to a vesting schedule

Jonas is covered with disability insurance through his employer. The employer pays 75% of the premium, while Jonas pays the other 25%. What is Jonas' tax liability for any benefits paid from the disability plan?

Taxes must be paid on 75% of the benefits received

Which group is the Do Not Call Registry designed to protect against?

Telemarketers

To secure authority for soliciting insurance products in the State of Connecticut, an insurance company must secure a certificate of authority from

The Connecticut Insurance Commissioner

Which of the following is NOT a valid cause for termination of an employees group health coverage?

The coinsurance limit has been exceeded

If one producer provides a referral to another producer which results in the sale of an insurance contract,who will likely be paid a commission?

The commission will likely be shared between the two producers.

Which of the following is the BEST candidate for a temporary insurance license?

The executor of the estate of a deceased licensed producer

What would be considered an advantage of purchasing term life insurance?

The initial premium is lower compared to an equivalent amount of whole life coverage

Who may terminate coverage under a cancelable health insurance policy?

The insurer or the insured

James is covered with health insurance by two different insurers. The "insurance with other insurers" provision in an individual health insurance policy allows an insurer to pay benefits to the insured on a pro-rata basis when

The insurer was not notified prior to the claim that the insured has other health coverage

Which of the following must clearly be illustrated in ALL sales material for market value adjusted annuities?

The market value adjustment can be either upward or downward.

Under an adjustable life insurance policy, which of the following may NOT be changed without further underwriting?

The person insured.

An advantage of owning a flexible premium life insurance policy would be

The policyowner can make policy changes without difficulty

How is a community rating used for underwriting purposes?

The same rates are changed for individual and group plans in the same geographical area. regardless of their health status

Darrell has a group long-term disability income policy paid by his employer. Which of these statements is true?

The specified benefit amount is a percentage of his wages.

Why were Exchanges implemented by the Affordable Care Act (ACA)?

To create a one-stop market for standardized health insurance plans

Why does Connecticut require insurers to maintain a minimum level of assets?

To demonstrate insurer solvency

Typically, states will permit the grouping of two or more small employers in the same industry for obtaining group health insurance at a favorable rate. This grouping of employers is known as a multiple employer

Trust

Insurance crimes which affect interstate commerce are prosecuted by the

US attorney general

When an individual buys insurance under a threat made by a producer , a violation has occurred under the

Unfair Trade Practice Act

Charging different premiums to policyholders in the same risk classification is referred to as

Unfair discrimination

Laura has an employer-based preventative health care plan that focuses on an enrollee's problems, such as drug abuse or stress. These plans are called

Wellness Programs

When would evidence of insurability be required for a person already covered with a variable universal life policy?

When the death benefit is increased.

When does the producer give a premium receipt for a life insurance application?

When the initial premium has been paid with the application.

An agent's authority to bind an insurer to an insurance contract may be granted in the

agent's contract and the insurance company's appointment.

According to federal fraud and false statements regulation, what is required for a prohibited person to transact insurance business in this state ?

Written consent from the state insurance regulatory agency

Emergency health care coverage for Medicare enrollees traveling abroad is

a Medicare Supplement additional benefit

Before soliciting insurance applications for an insurer , a producer must secure a(n)

appointment

In a qualified retirement plan, the yearly contributions to an employee's account?

are restricted to maximum limits set by the IRS

An order issued by the Commissioner that prohibits a specific practice listed in the order is called a(n)

cease and desist order

A prospective client was intimidated by a producer to purchase an insurance contract. The producer could be found guilty of

coercion

The policy provision that permits an employee to change from group life coverage to an individual life policy is called the

conversion provision

Life settlement proceeds may be subject to the claims of

creditors

A(n)______________insurer is incorporated and formed in Connecticut

domestic

An annuity contract may be returned for a full refund during the

free look period

Insurable interest in one's own life is legally considered as

generally unlimited

With life insurance, the needs approach is used primarily in determining

how much life insurance a client should apply for

The_________is responsible for reporting to the Commissioner any name or address change of the licensee.

licensee

Respite Care coverage is typically found in a(n)

long term care policy

If the Commissioner requests access to a producer's business records, the producer

must provide access to the records upon request

Typically, working individuals age 65 or over must be

offered the same Health benefits as younger employees

A life annuity feature which provides benefit payments for a minimum number of years, no matter when the annuitant dies, is called

period certain

Patrick purchased a long-term care policy. He has a health condition for which medical treatment was recommended by a physician within 6 months prior to the policy's effective date. This condition is called a(n)

pre-existing condition

The law of large numbers enables an insurer to

predict losses

After joining a health maintenance organization (HMO), a subscriber will typically select a(n)

primary care physician

A Keogh plan is a (n)

qualified retirement plan for the self employed

During an annuity's liquidation phase, the annuitant normally

receives benefit payments at regular intervals.

The interest credited to the cash values of personally-owned non-qualified annuities is considered

tax-deferred

The interest paid during an annuity's payout period is considered

taxable as ordinary income

When testing for the Human Immunodeficiency Virus (HIV), Connecticut law requires a consent form

that discloses who may receive a copy of the results

Purchasing insurance is an example of risk

transference

Mentally or physically handicapped dependent children MUST be covered under an individual health insurance policy

until they become self-supporting