Exam FX 150 Questions
#47 According to the Medical Loss Ratio (MLR), what is the minimum percentage of health coverage premium that must be applied to actual medical care in a large group health plan?
85%
#144 Who is included in the definition of an agent?
A producer who owns his own field office
#97 When is the earliest a policy may go into effect?
When the application is signed and a check is given to the agent
#110 When is insurability conditional receipt given?
When the premium is paid at the time of application
#64 If the Superintendent finds a licensee in violation of an unfair method or unfair practice he or she will issue a ?
Cease desist order
#52 What is the clause that describes the method of paying the death benefit in the event that the insured and beneficiary are both killed in the same accident?
Common Disaster Clause
#73 During partial withdrawal from a universal life policy, which portion will be taxed?
Interest
#60 The Superintendent may refuse to issue a license in all of the following situations EXCEPT if the proposed licensee
Is from another state
#22 Which of the following is correct about group health insurance policy issued in New York?
It cannot exclude newborn children from coverage
#37 When is the annual open enrollment for state insurance exchanges?
November 1 through January 31
#35 An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do?
Offer the supplement policy on a guaranteed issue basis
#100 When calculating the amount a policyowner may borrow from a variable life policy, what must be subtracted from the policy cash value?
Outstanding loans and interest
#30 Prior to purchasing a Medigap policy, a person must be enrolled in which of the following?
Parts A and B Medicare
#85 Under which provisions can a physicians submit claim information prior to providing treatment?
Prospective Review
#51 In a life settlement contract, who does the life settlement broker represent?
The owner
#129 Under the Affordable Care Act, what percentage of preventive care must be covered without cost sharing?
100%
#12 The Superintendent may refuse to renew a license if a licensee is receiving more than 10% of the aggregate commissions from controlled business in how many months?
12
#78 Every small employer carrier must actively offer to small employers at least how many health benefits plans?
2 Plans
#101 What is the period of coverage for events such as death or divorce under COBRA?
36 months
#40 The law states that an insurer is allowed to pay the entire Death Benefit to the insured if they qualify to use the Accelerated Death Benefits Rider, however most insurers limit the amount of the Death Benefit paid to
50%
# 5 At what age dose individuals qualify for Medicare?
65
#139 All of the following are essential benefits required to be included in all health plans purchased in the Marketplace EXCEPT
Adult dental care
#93 How can a new physician be added to the PPO's approved list?
Agree to follow the PPO standards and charge the appropriate fees
#96 Which of the following individuals is eligible for a Health Savings Account?
Allison is insured by a High Deductible Health Plan (HDHP)
#36 Which of the following would NOT be considered an insurance producer?
An insurer's officer
#69 A Universal Life Insurance policy is best described as a/an
Annually Renewable Term Policy with a cash value account
#10 Which of the following is a short-term annuity that limits the amount paid to a certain fixed period or until a certain fixed amount is liquidated?
Annuity Certain
#20 Employer contributions made to a qualified plan
Are subject to vesting requirements
#16 In which of the following scenarios will repayment of funds take place per the Medicaid Estate Recovery Act?
Before her death, a 23-year-old was living in a long-term nursing facility paid for with Medicaid funds.
#25 Which of the following is NOT true regarding Workers Compensation?
Benefits are offered by the insurer
#111 A man bought an individual health insurance policy for himself. Which of the following roles does he now legally have?
Both subscriber and insured
#68 When the partners of a business develop an arrangement whereby should one of them die or become permanently disabled, the other partners would purchase the interest of the deceased or disabled partner at a predetermined price, this is called a/an
Business continuation plan
#116 As deductible amounts increase, premium amounts change in what way?
Decrease
#77 Which of the following terms is used to name the nontaxed return of unused premiums?
Dividend
#143 Who can provide skilled nursing care?
Doctor
#106 A policy which covers medical costs related to a specific conditions is called a?
Dread Disease Policy
#82 Items stipulated in the contract that the insurer will not provide coverage for are found in the
Exclusions clause
#102 The requirement the agents must account for all insurance funds collected and are not permitted to commingle those funds with their own funds without the express consent of the insurance company is know as ?
Fiduciary Responsibility
#8 With of the following best describes the MIB?
It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.
#57 Which of the following is INCORRECT concerning Medicaid?
It is solely a federally administered program
#3 Which of the following statements is True concerning the Accidental Death Rider ?
It will pay double or triple the face amount
#141 Which of the following is NOT true regarding the accumulation period of an annuity?
It would not occur in a deferred annuity
#80 Which statements is NOT true regarding's a Straight Life policy?
Its a premium decreases over time, in response to its growing cash value.
#11 What type of health insurance policy provides an employer with funds to train a replacement if a valued employee become disabled?
Key Person Disability
#32 For the reported losses of an inured group to become more likely to equal the statistics probability of loss for that particular class, the insured group must become
Larger
#62 A policyowner is reading a statement on the first page of his health insurance policy, which says "this is limited policy" What is the name of this statement?
Limited Policy Notice
#56 A participating insurance policy may do which of the following?
Pay dividends to the policyowner
#127 An insured pays her Major Medical Insurance premium annually on March1. Last March she forgot to mail her premium to the company. On March 19, she had an accident and broke her leg. The insurance company would
Pay the claim
#55 Which of the following must be present in all Medicare
Plan A
#72 An insured purchased a 10-year level term life policy that is guaranteed renewable and convertible. What happens at the end of the 10-year term?
The insured may renew the policy for another 10 years, but at a higher premium rate
#38 (come back to write it)
The insured should contact the insurer to confirm her actual Social Security befit amount. The SIS rider should pay the difference between the rider amount and the actual benefit
#133 An insured has a heart attack 40 days after his new health insurance policy goes into effect. He has a quadruple bypass surgery and a long hospital stay. As a result, the insurer cancels the policy with a written notice 80 days after the effective policy date. Which of the following is TRUE?
The insurer is cancelling the insured's policy on illegal grounds.
#123 Which of the following is NOT required on an illustration used in the sale of a life insurance policy?
The name of the primary and secondary beneficares
#58 Which of the following best describes what the annuity period is?
The period of time during which accumulated money is converted into income payments
#128 Regarding long-term care coverage , as the elimination period get shorter, the premium ?
Gets higher
#67 According to the entire contract provision, what document must be made part of the insurance policy?
A Copy of the original application
#33 How is emergency care covered for a member of an HMO?
A member of an HMO can receive care in or out of the HMO service area, but care is preferred in the service area.
#113 An insured carries health insurance with two different provides and is covered on an expense incurred basis. He has an appendectomy and files the claims to both insurers. Neither company is notified in advance that the insurer has coverage. What should each insurer pay?
A proportionate amount
#104 All of the following are correct about the required provisions of a health insurance policy EXCEPT
A reinstated policy provides immediate coverage for an illness
#46 A small hardware store owner is involved in a car accident that renders him totally disabled for half a year. Which type of insurance would help him pay for expenses of the company during the time of his disability?
Business overhead expense policy
#121 A man purchased a $90,000 annuity with a single premium, and began receiving payments 2 months after that. What type of annuity is it?
Immediate
#63 In which of the following locations would skilled care most likely be provided?
In an institutional setting
#29 Which of the following factors about the insured determines the amount of disability benefit that the insured will receive?
Income
#65 Medicaid provides all of the following benefits EXCEPT
Income assistance for work-related injury
#147 Life income joint nd survivor settlement option guarantees
Income for 2 or more recipients until they die
#132 Issue age policy premiums increase in response to which of the following factors?
Increased benefits
#42 The continuing education (CE) requirement in this state.
Consists of completing 15 hours of counting education each biennium
#115 After a year of receiving disability income benefits, the insured notices that her monthly benefit has increased slightly. What rider does the policy most likely have that would cause this?
Cost of Living Adjustment Rider (COLA)
#75 Which of the following is TRUE about credit life insurance?
Creditor is the policyowner
#124 What provisions in an insurance policy extends coverage beyond the premium due date?
Grace Period
#7 According to the Nonforfeiture law, if the owner decides to surrender a deferred annuity prior to annualization, the owner is entailed to witch of the following ?
Guaranteed Surrender value
#118 The Patient Protection and Affordable Care Act includes all of the following provisions Except
Individual tax deduction for premiums paid
#39 Which of the following entities has the authority to make changes to an insurance policy?
Insurer's executive officer
#6 Which of the following is NOT true regarding the Life with Guaranteed Minimum Annuity settlement option?
It does NOT guarantee that the entire principle will be paid out
#34 In cases where a covered employee is eligible for Medicare benefits to treat end-stage renal disease (ESRD) with dialysis or kidney transplant, which of the following is correct?
Medicare is the secondary payer during the first 30 months of treatment
#14 Attempting to determine how much insurance a family would require based upon their financial objectives is know as ?
Needs Approach
#135 Which of the following is NOT true regarding the needs approach method of determining the value of an individuals life?
Needs is predicted using the number of years until the insured's retirement
#17 According to the Insurance Frauds Privation Act, will the person who suspects a fraudulent transaction be penalized for reporting it to the Superintendent?
No, as long as the act is reported in good faith
#74 Which option is being utilized when the insurer accumulates dividends at interest and then use them, in addition to interest and then uses them, in addition to interest and the policy cash value, to pay the policy earlier than planned. This is different from paid-up additions, in which the dividends are used to buy additional polices that increase the face amount of the original policy.
Paid-up option
#119 If the policyowner, the insured, and the beneficiary under a life insurance policy are three different people, who has the ownership rights?
Policyowner
#50 Which of the following is an entity that can be hired by an employer to handle all its employee management tasks?
Professional Employer Organization
#89 Pertaining to insurance, what is the definition of a fiduciary responsibility?
Promptly forwarding premiums to the insurance company
#45 Which of the following factors is NOT considered by an underwriter when determining the premium rates for an individual seeking insurance?
Race
#81 The Federal Fair Credit Reporting Act
Regulates consumer reports
#92 Which of the following is NOT provided by an HMO?
Reimbursement
#76 Which type of retirement account does not require the owner to start taking distributions at age 72?
Roth IRA
#88 To sell variable life insurance polices, an agent must receive all of the following EXCEPT
SEC registration
#87 What part of the Internal Revenue Code allows an owner of a life insurance policy or annuity to exchange or replace their current contract with another contract without creating adverse tax consequences?
Section 1035 Policy Exchange
#83 Upon policy delivery the producer may be required to obtain any of the following EXCEPT
Signed waiver of premium
#53 According to the Coordination of Benefits (COB) provisions in health insurance in this state. If insurer overpaid on a claim, the insurer may recover the excess from all of the following EXCEPT
The Insurance Guaranty Association
#15 Which of the following is NOT covered under Plan A in Medicap insurance?
The Medicare Part A deductible
#54 Which of the following does NOT have to be disclosed in a long term care (LTC) policy?
The aggregate amount of premiums due
#28 An insurer offers a policy very similar to Medicare, although it differs slightly. An agent tells an applicant that the policy is Medicare, since the polices are so similar anyway. Which of the following is true?
The practice is illegal
#112 How must a replacing producer respond to an applicant wishing to replace existing life insurance?
The producer must provide the applicant with a Notice Regarding Replacement
# 4 On a disability income policy that contains the "Own Occupation" definition of total disability, the insured will be entailed to benefits if they cannot perform?
Their regular job
#41 All of the following are characteristics of a group life insurance plan EXCEPT
There is a requirement to prove insurability on the part of the participants
#1 What is another name for an Administrative-Services Only Arrangement
Third-Party Administrator
#21 Which of the following Life Insurance polices would be considered interest sensitive?
Universal Life
#126 All of the following are TRUE regarding the convertibility option under a term life insurance policy EXCEPT
Upon conversation, the death benefit of the permanent policy will be reduced by 50%