Insurance Practice Exam
According to the provisions of the Patient Protection and Affordable Care Act, all of the following are require preventative care services EXCEPT
Cervical cancer exams for all woman starting at age 40
Which of the following is NOT covered by Health Maintenance Organizations (HMOs)?
Elective Services
In replacement transactions, what is the term used for the insurer of the original policy that is being replaced?
Existing insurer
Health Savings Accounts (HSA) are designed to
Help individuals save for qualified health expenses
The National Conference of Insurance Legislators was created to
Help legislators make informed decisions on insurance issues
Medicaid provides all of the following benefits EXCEPT
Income assistance for work-related injury
When is the open enrollment period through Maryland Health Connection?
November 1 through January 31
Which document helps ensure that full and fair disclosure is provided to the recipient of a policy?
Outline of Coverage
which of the following riders would NOT cause the Death Benefit to increase?
Payor Benefit Rider
A patient has severe gingivitis and is seeking treatment from his dentist. Which type of dental treatment is this?
Periodontics
An applicant buys a nonqualified annuity, but dies before the starting date. For which of the following beneficiaries would the interest accumulated in the annuity NOT be taxable?
Spouse
when an annuity is written, whose life expectancy is taken into account?
annuitant
According to the reinstatement provision, if a policy is reinstated, which of these benefits would be covered immediately upon reinstatement?
Accidental injury
All of the following are true about group disability Income Insurance EXCEPT
Coverage applies both on and off the job
Which of the following is NOT true of basic medical expense plans?
Coverage for catastrophic medical expenses
The primary eligibility requirement for Medicaid benefits is based upon
Need
If someone wants to buy a life insurance policy that will provide lifetime protection against premature death, what type of life insurance policy should that person buy?
Permanent
which of the following is the most common time for errors and omissions to occur on the part of an insured?
Policy delivery
Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability?
Residual disability
which type of care re-establishes functional use to natural teeth?
Restorative
In major medical insurance polices, 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
What characteristic must an annuity have if it is used to accumulate funds in an IRA?
Tax-qualified
What type of insurance can be obtained through SGLI by members of the armed forces?
Term Group Life Insurance
an employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?
The PPO will pay reduced benefits.
What type of information is NOT included in a certificate of insurance?
The cost the company is paying for monthly premiums
in order for an insured under Medicare Part A to receive benefits for care in a skilled nursing facility, which of the following conditions must be met?
The insured must have been first hospitalized for 3 consecutive days
All of the following statements concerning the use of life insurance as an Executive Bonus are correct EXCEPT
The policy is owned by the company
An association could buy group insurance for its members if it meets all of the following requirements EXCEPT
has at least 50 members
which of the following is correct regarding credit life insurance?
it insures the life of the debtor
In an Adjustable Life policy all of the following can be changed by the policy owner EXCEPT
the type of investment
An employee quits her job where she has a balance of $10,000 in her qualified plan. The balance was paid out directly to the employee in order for her to move the funds to a new account. If she decides to rollover her plan to a Traditional IRA, how much will she receive from the plan administrator and how long does she have to complete the tax-free rollover?
$10,000, no tax consequence
An applicant for an insurance license has failed his written examination. How many days must he wait before we can take another examination?
4 days
Existing insurers must provide policyowners with a policy summary for the existing life insurance how soon after a request?
5 days
One of the differences between group underwritting and individual underwritting is that there is little or no medical information required regarding plan participants in groups of
50 or more
One of the differences between group underwritting and individual underwritting is that there is littler or no medical information required regarding plan participants in groups of
50 or more
At what age may an individual make withdrawals from an HSA used for nonhealth purposes without being penalized?
65
Who can make a fully deductible contribution to a traditional IRA?
An individual not covered by an employer-sponsored plan who has earned income
what is a risk retention group?
An insurance organization that most often addresses a commercial casualty concern
In disability income insurance, if an insured is considered disabled if they cannot perform any job they are suited for by prior education, training or experience, they fall under which definition of total disability?
Any occupation
An insured has a life insurance policy with a face amount of $500. He pays a premium each week to the agent who sold him the policy. What kind of policy does the insured have?
Industrial life
Who is required to keep and maintain a register of appointed producers?
Insurers
Which of the following programs expands individual public assistance programs for people with insufficient income and resources
Medicaid
Who is a person, other than a viator, that enters into a viatical settlement contract?
Provider
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
If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a
Settlement option
Which type of life insurance policy generates immediate cash value?
Single Premium
All of the following long-term care coverages would allow an insured to receive care at home EXCEPT
Skilled care
In the event of a producer's license being terminated, which of the following would be true?
The producer's appointments must also be terminated
the termination of marital property rights may be reversed for all of the following reasons EXCEPT
The spouse named as beneficiary has obtained or consented to a final decree or judgment of an annulment, divorce or separation
What is the name for the owner of a life insurance policy who enters into a viatical settlement contract?
Viator
An employee insured under a group health plan has been paying $25 monthly premium for his group health coverage. The employer has been contributing $75, for the total monthly cost of $100. If the employee leaves the company, what would be his maximum monthly premium for COBRA coverage?
$102
To be eligible under HIPAA regulations, for how long should an individual converting to an individual health plan have been covered under the previous gap plan?
18 months
What is the license renewal period in this state?
2 years
what is the maximum age for qualifying for a catastrophic plan?
30
A broker requests a hearing with the Commissioner. Within how many days of the request must the hearing be held?
30 days
Which concept is associated with "exclusion ratio"?
Annuity payments
Partners in a business enter into a buy-sell agreement to purchase life insurance, which states that should one of them die prematurely, the other would be financially able to buy the interest of the deceased partner. What type of insurance policy may be used to fund this agreement?
Any form of life insurance
Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?
Apparent
When must an IRA be completely distributed when a beneficiary is not named?
December 31 of the year that contains the fifth anniversary of the owner's death
Which of the following types of insurance would be most suitable for mortgage protection?
Decreasing term
Which of the following is NOT a cost-saving service in a medical plan?
Denial of coverage
How often must a viatical settlement broker register with the commissioner?
Every other year
Which of the following is NOT a rating for Medicare Supplement Insurance Policies?
Experience
which policy component decreases in decreasing term insurance?
Face amount
Health coverage becomes effective when the
First premium has been paid and the application has been aproved
In a direct rollover, how is the money transferred from one plan to the new one?
From trustee to trustee
What insurance concept is associated with the names Weiss and Fitch?
Guides describing company financial integrity
which of the following statements is CORRECT concerning the relationship between Medicare and HMOs?
HMOs may pay for sercives not covered by Medicare
The premium is guaranteed for an initial period and then the insurer can charge up to a maximum premium charge in what type of policy?
Indeterminate Premium
Which of the following is TRUE of a qualified plan?
It has a tax benefit for both employer and employee
What type of group rating uses the actual experience of the group, in part, determines the rates charged by the insurer.
It may pay dividends to the policyowners
If a business owner becomes totally disabled, a Business Overhead Expense policy will pay all of the following EXCEPT
Loss of the owner's income
The premium of a survivorship life policy compared with that of a joint life policy would be
Lower
An individual purchased a Medicare supplement policy in March and decided to replace it 2 months later. His history of coronary artery disease is considered a pre-existing condition. Which of the following is true?
The pre-existing condition waiting period fulfilled in the old policy will be transferred to the new policy, the new one picking up where the old one left off.
Annuity contracts grow tax deferred. That means that
There is no current income taxation upon the growth in the annuity
What kind of policy allows withdrawals or partial surrenders?
Universal Life
most policies will pay the accidental death benefits as long as the death is caused by the accident and occurs within
90 days
Employers can reduce health plan cost by coupling a Health Reimbursement Account (HRA) with
A high deductible health plan
How is the Commissioner selected for the office?
Appointment by the Governor
The sole proprietor of a business makes a total salary of $50,000 a year. This year, his medical expenses have reached a total of $75,000. What amount may the sole proprietor deduct in regards to his medical expenses?
$50,000
A policy that does not pay dividends to policyholders is a
Nonparticipating policy
Who might receive dividends from a mutual insurer?
Policyholders
Which of the following is NOT required to be appointed by an insurer?
Broker
Which of the following is TRUE about class designation?
Beneficiaries are not identified by name
Which of the following is excluded in a dental insurance plan?
Lost dentures
For Maryland residents insured under a long-term care policy, the one-time long-term care insurance tax credit pays what amount?
The lesser of the premiums paid or $500
What is the purpose of the Maryland Health Insurance Plan?
To provide health insurance to individuals who have been denied coverage
Hospital indemnity/hospital confinement indemnity policy will provide payment based on
the number of days confined in a hospital
What type of information is NOT included in a certificate of insurance?
the procedures for filing a claim
Which of the following statements regarding Business Overhead Expense policies is NOT true?
Benefits are usually limited to six months
Which benefits would a disability plan most likely pay?
Income lost by the insured's inability to work
All of the following are true of an annuity owner EXCEPT
The owner must be the party to receive benefits
An insured receives a monthly summary for his life insurance policy. He notices that the cash value of the policy is significantly lower this month than it was last month. What type of policy does the insured have?
Variable
Which of the following life insurance policies allows a policyowner to take out a loan from the policy's cash value?
Variable universal life
an individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?
the date of medical exam
If $100,000 of life insurance proceeds were used in a settlement option, which paid $13,000 per year for 10 years, which of the following would be taxable annually?
$3,000
to attain currently insured status under Social Security, a worker must have earned at least how many credits during the last 13 quarters?
6 credits
How long is an open enrollment period for Medicare supplement policies?
6 months
The LEAST expensive first-year premium is found in which of the following policies?
Annually Renewable Term
What is the maximum period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?
As long as the policy is in force
If an applicant for a health insurance policy is found to be substandard risk, the insurance company is most likely to
Charge an extra premium
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
Because an insurance policy is a legal contract, it must confrom to the state laws governing contracts which require all of the following elements EXCEPT
Conditions
In a group prescription drug plan, the insured typically pays what amount of the drug cost?
Copyament
The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true?
The annuitant must be a natural person
The limits of a health reimbursement account are set by
The employer
Social Security was created to provide all of the following benefits EXCEPT
Unemployment income