Health Insurance Sim Exam

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

An insured is covered under 2 group health plans - under his own and his spouse's. He had suffered a loss of $2,000. After the insured paid the total of $500 in deductibles and coinsurance, the primary insurer covered $1,500 of medical expenses. What amount, if any, would be paid by the secondary insurer?

500

How can a new physician be added to the PPO's approved list?

Agree to follow the PPO standards and charge the appropriate fees

in insurance, an offer is usually made when

An applicant submits an application to the insurer

Which of the following entities is responsible for paying the producer's appointment renewal fee

Appointing insurer

Which of the following is true regarding inpatient hospital care for HMO members

Care can be provided outside of the service area

a health insurance plan that covers all accidents and sicknesses that are not specifically excluded from the policy is referred to as a

Comprehensive Plan

Under which of the following employer-provided plans are the benefits taxable to an employee in proportion to the amount of premium by the employer

Disability Income

which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization

Fraternal Benefit Society

What option allows the insured to periodically increase benefit levels without providing evidence of insurability?

Guarantee of insurability

Which of the following is true regarding risk retention group

It is a liability insurance company owned by its members

Which of the following is NOT a service providers plan

Medicare -- government program

in cases where a covered employee is eligible for medicare benefits to treat end stage renal disease with dialysis or kidney transplant, which of the following is correct

Medicare is the secondary payer during the first 30 months of treatment

Which of the following statements is an accurate comparison between private and government insurers

Private insurers may be authorized to transact insurance by state insurance departments

What method do insurers use to protect themselves against catastrophic losses?

REINSURANCE

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

All of the following are requirements from the written application for a license to act as an insurance adviser EXCEPT

The application must state his professional credentials and all political affiliations for which he has received compensation or served as a member.

An insured has a Social Insurance Supplement rider in her disability income plan. Following a disability, she begins receiving benefit payments from the insurer. She then begins receiving Social Security benefits that are smaller than the SIS benefit payments. At that point, her insurer ends the SIS benefit payments. Which of the following best describes the situation?

The insured should contact the insurer to confirm her actual Social Security benefit amount. The SIS rider should pay the difference between the rider amount and the actual benefit.

a tornado that destroys a property would be an example of which of the following

a PERIL

an Insurance producer who by contact is bound to write insurance for ONLY one company is classified as

a captive agent

any person or organization willfully violating any provision of rate-making provisions of the law will be punished by a fine of

a maximum of 500 for each such violation

The Medicare supplement renewal commissions paid in the third year must be as high as the commission of which year?

a) 1st b) 2nd c) 3rd d) 4th

All of the following may be excluded from coverage in a Major Medical Expense Policy EXCEPT

a) Emergency Surgery b) Custodial Care c) Cosmetic Surgery d) Coverage provided under workers compensation

One of the differences between group underwriting and individual underwriting is the groups of

a) Fewer than 50 b) 50 or more c) 100 or more d) 25 or more

HIPAA applies to groups of

a) More than 2, fewer than 50. b) 2 or more c) At least 10 d) At least 100

If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be

a) approved b) authorized c) certified d) qualified

Pertaining to insurance, what is the definition of a fiduciary responsibility

a) helping insureds to file claims b) performing reviews of insured's coverage c) offering additional coverage to clients d) promptly forwarding premiums to the insurance company

Which of the following statements is NOT correct concerning the COBRA Act of 1985

a) it covers terminated employees and/or their dependents for up to 36 months after a qualifying event b) It applies only to employers with 20 or more employees that maintain group health insurance plans for employees c) COBRA stands for Consolidated Omnibus Budget Reconciliation Act d) It requires all employers, regardless of the number or age of employees, to provide extended group health coverage

A typical Accidental Death and Dismemberment policy covers all of the following losses EXCEPT

a) limb b) life c) income d) eyesight

The Commissioner must examine each domestic and foreign company in order to determine its financial condition, ability to fulfill its obligations, compliance with insurance laws and dealings with its policyholders

a) only as deemed necessary the commissioner b) at least once in every 3 years and whenever deemed necessary the Commissioner c) at least once every 2 years and whenever deemed necessary the Commissioner d) at least once in every 5 years and whenever deemed necessary the commissioner

What is the term for the entity that an agent represents regarding contractual agreement with third parties

a) principal

Which of the following is NOT the consideration in a policy

a) something of value exchanges between parties b) the premium amount paid at the time of application c) The promise to pay covered losses d) The application given to a prospective insured

A producer who fails to separate premium monies from his own personal funds is guilty of

a) theft b) commingling c) larceny d) embezzlement

In reference to the standard medicare supplement benefit plans, what does the term standard mean

all providers will have the same coverage options and conditions for each plan

a notice of information practices must be given to the applicants for an insurance policy at all of the following intervals except

at application

an insured is receiving hospice care. His insurer will pay for painkillers but not an operation to reduce the size of a tumor. What term best fits this arrangement

cost-containment

which of the following is NOT true of basic medical expense plans

coverage for catastrophic medical expenses

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 (provision that states coverage and when it applies)

Which of the following is true regarding benefits paid to disabled employees

they may be subject to taxation if the premium was paid by the employer