Insurance: ALL chapters
Who issues Medigap policies?
Private insurers
How do insurers determine the cost for a group health policy?
The main variables are the ratio of men and women in the group, and the average of the group
How many members must an association have to qualify for group insurance?
100 members
noncontributory health insurance plan, what percentage of eligible employees must participate in the plan before the plan can become effective
100%
Who is considered a non resident agent?
An agent who resides and is license in another state, but who is authorized to transact in this state
If an insurer holds a Certificate of Authority, it is known as what type of insurer?
Authorized or admitted
All of the following are lines of insurance that may be transacted under a life and accident /health producer license EXCEPT
Consequential loss insurance
Which if the following best describes a misrepresentation
Issuing sales material with exaggerated statements about policy benefits
If an individual is covered by Medicare and is also covered by his employers health plan, which plan would be considered primary?
The employer plan
How many pints of blood will be paid for by Medicare supplements core benefits
The first 3 pints of blood
How does someone qualify for social security disability income benefits
The insureds must have the proper insured status, meet the definition of disability, and satisfy the waiting period
Who is responsible for the cost associated with the examination of insurers?
The insurer who is being examined
If another governmental agency takes legal action against a license, whose responsibility is it to report the action?
The licensee
According to the Coordination of Benefits provision, if both parents have coverage for a child from their employers' policies, which policy will pay first?
The order of payment will be determined by the birthday rule: the coverage of the parent whose birthday is earlier in the year will be considered the primary
What is a probationary period in group health insurance
The period of time that must lapse before an employee is eligible for group health coverage
All of the following statements about Medicare supplement insurance policies are correct EXCEPT
They cover the cost of extended nursing home care
What do long-term care policies offer to policyholders to account for inflation?
They offer the option of purchasing coverage that raises benefits levels accordingly
To whom may a certificate of authority be issued?
To an insurer authorized to transact business in this state
What is the purpose of Medicare supplement plans
To fill the gaps in Medicare coverage
What is the purpose of a cease and desist order?
To prevent a producer or insurer from further violating laws for transacting insurance
What type of misrepresentation persuades an insured, to his or her detriment, to cancel, lapse, or switch policies from one to another?
Twisting
If the insurer believes that inaccurate or misleading information was provided in the policy application it may contest a claim within how many years
2 years
Whenever the commissioner receives a demand for a hearing, a hearing shall be scheduled to be held within?
30 days
How many eligible employees must be included in a contributory plan?
75%
Individuals who itemize deductions can claim deductions for medical expenses not covered by health insurance that exceed what percent of their adjust gross income
10%
What is the required free look period for Medicare supplement policies?
30 days
Employers health plan must provide primary coverage for individuals with end stage renal disease before Medicare becomes primary for how many months?
30 months
How many parts does Medicare have?
4 (A,B,C,D)
How long does a temp producer license last
6 months
What are the most common penalties for violations of insurance statues?
A cease and desist order, a fine, and license suspension or revocation
Who is an insurance agent?
A person authorized to sell, solicit and negotiate insurance contracts
In health insurance, when would an excess plan pay benefits
After the primary plan has paid its full promised benefits, the excess plan will pay the balance
In which Medicare supplemental policies are the core benefits found?
All plans A-N
All of the following are lines of insurance that may be transacted under a life and accident /health producer license
Annuities, disability income insurance, and group health insurance
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?
Authorized and admitted
What type of licensee represents the insured?
Broker
How is Part B Medicare funded?
By monthly premiums and from the general revenues of the federal government
If the commissioner/superintendent finds a licensee engaging in an unfair method of competition or an unfair practice, what order will be issued?
Cease and desist order
What do individual insureds receive as proof of their group health coverage
Certificate of insurance
Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as
Coercion
What are producers required to do in order to renew their license?
Complete continuing education hours and pay a renewal fee
If the insureds share in the cost of health insurance premium with the employer, this would be known as what type of group health plan?
Contributory
If a producer makes maliciously critical statements about another insurer, what is this illegal practice called?
Defamation
if an instance producer is to charge to the client a fee that is in addition to the commission for the sale of an insurance policy, there producer must
Disclose the fee to the client, in writing, and be agreed upon prior to the issuance of the policy
Two individuals who are in the same risk and age class are charged different rates for their insurance policies due to an insignificant factor. what is this called?
Discrimination
What types of groups are eligible for group health insurance?
Employer sponsored and associated sponsored groups
What benefits are provided by Medicare Part C?
Expanded benefits for a fee through private insurance programs such as HMO's or PPO's.
For what reason can a temp license be issued?
For contribution of business in case the licensed producer dies or becomes disabled
In group insurance, who is issued a certificate of insurance
Individual insured
All of the following are differences between induvial and group health insurance EXCEPT
Individuals insurance does not require medical examinations, while group insurance does require medical examinations
Medicare Part A will pay for what type of services?
Inpatient hospital care, skilled nursing facility care, home health care, and hospice care
In general, who can be excluded from producers licensing and examination requirements?
Insurance company officers, directors, or any other employees who do not transact insurance and who do not receive commissions for their services (usually their responsibilities include administrative, executive or clerical)
Applicants for which type of insurance license are exempt from Alabama prelicensing education requirements
Limited license
Which type of care is not covered by Medicare
Long term care
When compared with the administrative cost found in individual coverage, the per captia administrative cost in group health insurance is
Lower
Which of the following best described the unfair trade practice of defamation
Making derogatory oral statements about another insurers finical condition
In group insurance, what is the name of the policy
Master policy
What type of Medicare policy requires insureds to use specific health care providers and hospitals has restricted network provisions
Medicare SELCECT
Can Alzheimer's disease be excluded from coverage under a long-term care policy?
No, must be covered
Does group health insurance require medical examinations?
No, the underwriter evaluates the group as a whole, rather than each induvial member
Which renewal provision must be included in a long term care policy issued to an induvial
Noncancelable and guaranteed renewable
Who may share in the commission from the sale of a life insurance policy?
Only producers properly license for the type of insurance transactions
What part of Medicare is known as hospital insurance?
Part A
Who can usually be granted a temp license?
Producer's spouse or designee in case the licenses producer dies or becomes disabled
An agent offers a client free tickets to a sporting event in exchange for the purchase of an insurance policy. What is the agent guilty of?
Rebating
which of the following is NOT specially prohibited by state law as an unfair trade practice
Reducing the premiums paid by the employers for group insurance based on loss experience
What type of license represent the insurance company
The agent
In applying for an original certificate of authority, an insurer must submit an application with the approtiate fees and the following information EXCEPT
The amount of insurance it intends to write
What is a birthday rule in a coordination of benefits provisons?
The coverage of the parent whose birthday is earlier in the year is considered primary
Who must be notified of a producers change of address?
The department of insurance (commissioner)
An insured with Medicare part D has reached the initial benefits limit and must now pay a portion of prescriptions drug cost. What is the term for this hap in coverage
The donut hole
Who are the parties in a group health contract?
The employer and the insurer
If a group health policy covers individuals that reside in more than one state, which state has jurisdiction over the group policy?
The state in which the policy was delivered
What is the purpose of COBRA?
To allow continuation of health insurance coverage for terminated employees
What is the purpose of respite care in long term care insurance
To provide relief from a major caregiver (family member)
When is the initial enrollment period for Medicare part A?
When an individual first becomes eligible for Medicare, starting 3 months before turning age 65 and ending 3 months after the 65th birthday
When can the Commissioner or Director examine insurers?
Whenever deemed necessary, but at least once every few years (5)
Which of the following determines whether disability insurance benefits are taxed
Whether the premiums were tax deductible
At what age do individuals qualify for Medicare?
age 65
A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as
critical illness
Regarding long-term care coverage, as the elimination period gets shorter, the premium
gets higher
All of the following are activites of daily living EXCEPT
speaking
if seeking repayment of Medicaid funds per the Medicaid estate recovery act would cause a hardship to survivors, states may
waive the estate recovery requirement
Following hospitalization because of an accident, Bill was confined in a skilled nursing facility. Medicare will pay full benefits in this facility for how many days?
20 days
Which of the following coverages is NOT monitored by the employee retirement income security act
Golden parachutes
What is another name for Medicare supplement plan
Medigap
Which of the following is the term used when a person, in fiduciary position, has used funds in manner for which they were not intended such as the wrongful taking or use of money belonging to another
Misappropriation of funds
On it's advertisement, a company claims that is has funds in its possession that are, in fact, not available for the payment of losses or claims. what is the company guilty of?
Misrepresentation
What illegal act does a producer commit when the producer represents a policy in a more favorable light than the policy really is?
Misrepresentation
What are the activities of daily living
Mobility, bathing, dressing, eating, toileting, and continence
When must the outline of coverage be provided to the insureds?
No later than policy delivery
The classification small employer means any person actively engaged in a business that on at least 50% of its working days during the proceeding quarter employed
No more than 50 employees
What Medicare part helps pay for inpatient hospital care, inpatient care in a skilled nursing facility, home health care and hospice care?
Part A
What Medicare part will cover lab services or diagnostic tests?
Part B
What part of Medicare is known as medical insurance?
Part B
Who is eligible for part B Medicare
Part B is optional, and is offered to everyone who enrolls in Part A
What is another name for Medicare advantage plans
Part C
What Medicare part provides a prescription drugs benefit?
Part D
Who qualifies for Medicare?
Persons 65 years or older, people with permanent kidney failure, person who has been on some social security program for at least 24 months
A long term care shopper guide must be presented at what point
Prior to the time of the application