LAW SUPPLEMENT PRACTICE EXAM
An agent whose license is revoked will be ineligible to reapply for any license for how many years?
1 2 3 5 B
A producer must inform the Commissioner of any change to the producer's residential address within how many days of the change?
10 20 30 60 A
An accident or health insurance policy may not be rescinded, except for fraud, after it has been in effect for
6months 1 year 2 years 4 years C
Which provision allows an individual life insurance policy to stay in force in the event the premium payment is late?
A Ownership provision B. Grace period provision C. Free-look provision D. Premium waiver provision B
How long does an insurance producer's license remain valid in Minnesota?
For as long as the 2-yearl icensing period, after which it must be renewed with another round of license testing As long as the appointing insurance company pays the appropriate fee each January 1 Continually, as long as the renewal fees are paid, and the continuing education requirements are met Until revoked by the appointing insurer C
A Medicare supplement policy is issued on May 1. Until what date must the insurer cover preexisting conditions, if it chooses to use the maximum time allowed under Minnesota law?
June1 August 1 November 1 May 1 of the following year C
A temporary license can be issued to all of the following EXCEPT
an employee o fa business entity upon the disability of the individual designated on the license an individual who has passed the producer exam and is waiting for a license to be issued the producer's spouse in order to renew insurance business sold by the deceased a businesses partner chosen by the Commissioner to perform tasks incidental to insurance business in force at the time of death B
Applicants for insurance producer licensing must meet all of the following requirements EXCEPT
beage18 be competent, trustworthy, and of good business reputation complete an approved prelicensing course of study comply with the bond requirement D
Qualified long-term care insurance policies sold in Minnesota must include a renewability provision that is at least as favorable as a provision that makes the policy
cancellable renewable at the insurer's option guaranteed renewable (premiums may be increased) noncancellable (premiums cannot be increased) C
A health maintenance organization (HMO)
is not required to disclose possible uncovered costs or expenses in marketing materials may not charge co-payments for preventive health care services must provide enrollees with a 90-day notice of any cancellation or nonrenewal must provide an annual enrollment period that extends at least 30 days B
A long-term care policy
may not exclude coverage for adultday care services B. must provide a free-look period of 20 days C. can be cancelled by the insurer if the insured's health deteriorates D. covers all nursing home and home care costs A
All the following individuals are required to become licensed in order to practice in the insurance business in Minnesota EXCEPT
nonresident producers who hold the CLU® designation a salaried employee who advises an employer about insurance matters and does not receive a commission a business entity acting as an insurance producer limited lines producers B
The Minnesota Guaranty Fund was established to protect all of the following EXCEPT
policyowners insurance companies annuitants beneficiaries B
When a Medicare supplement policyholder applies for and is entitled to Medicaid benefits, Medicare supplement policies
provide enhanced benefits must provide for a suspension of benefits and premiums for up to 24 months are automatically cancelled increase dramatically in premium cost B
When selling a health benefit plan to a small employer, insurers must make, as part of their solicitation and sales material, a reasonable disclosure of all the following EXCEPT
provisions relating to policy renewability information relating to the insurer's reserve requirements provisions relating to preexisting conditions provisions concerning the insurer's right to change premiums B
All of the following must be provided to a long- term care policy applicant at or before application EXCEPT
suitability standards outline of coverage long-term care insurance Shopper's Guide long-term care insurance Personal Worksheet A
All of the following are correct about coverage through a health maintenance organization EXCEPT
the annual open enrollment period lasts a minimum of 14 days, during which eligible individuals have the opportunity to enroll for coverage services provided by any medical provider are covered by the health maintenance organization individual policies contain a 31-day grace period during which the policy will remain in force if the premium is late enrollees may be expected to pay co-payments B
If an employer fails to notify a terminated employee of the option to continue group term life coverage
the employee loses the opportunity to continue coverage B. the employer must provide the employee with a permanent life insurance policy C. the employee has an additional 60 days to elect to continue coverage D. the employer is liable for the employee's coverage just as the insurer would be if coverage were still in effect D
All of the following illnesses, treatments, or conditions can be limited or excluded from coverage on a qualified long-term care policy EXCEPT
treatment for chemical dependency benefits covered by another long-term care policy covering the insured expenses that are reimbursable through Social Security benefits provided for Alzheimer's disease D
The free-look provision on a joint life policy begins
when the first person dies when the policy is delivered to the policyowner on the issue date of the policy on the date of the application B
What is the daily fine that may be assessed against a person who disobeys a cease and desist order of the Commissioner?
$1,000 $5,000 $10,000 $20,000 C
The Commissioner will examine the affairs and conditions of every insurer licensed in Minnesota at least once every how many years?
1 3 5 7 C
When an agent sells a life insurance policy, the agent is allowed to backdate the policy up to how many months?
1 3 6 12 C
A licensed insurance producer, limited lines producer, or temporary insurance producer who is convicted of a felony must report it to the Commissioner within how many days of the conviction?
10 21 30 45 A
An agent must retain complaint and financial records for how many years?
2 4 6 indefinitely C
How many years must an insurance company maintain documentation of an advertisement used in promoting a life insurance policy or annuity?
3 4 5 7 A
The policyowner may cancel a whole life policy within how many days of receiving it?
5 10 20 30 B
In the case of a deceased licensed insurance producer, the Commissioner may extend a temporary insurance producer license to the administrator or executor for a period not to exceed a total of how many days?
60 90 180 365 C
An agent-solicited Medicare supplement policy must contain a printed notice that the insured, if not satisfied for any reason, has how many days after delivery in which to return the policy for a refund?
7 10 14 30 D
An example of unfair discrimination is best demonstrated by which of the following situations?
A ininsurer refuses to reinstate a National Guard member's life insurance policy after coverage was nonrenewed while the person was on active duty. An insurer refuses to issue a policy to an applicant who has had 5 liability claims in the previous 3 years. An insurer assigns a premium rating to an applicant who weighs 30 pounds more than a typical person of that age and gender. An insurer refuses to issue a policy to an applicant whose credit history suggests an inability to financially support the policy for which the applicant is applying. A
Which of the following statements about nonresident agents is CORRECT?
A nonresident agent must take the Minnesota licensing examination to transact insurance in Minnesota. An individual who holds a producer license in a home state, and whose state issues nonresident licenses to Minnesota residents on the same basis may apply for a nonresident license in Minnesota. A nonresident agent must file an affidavit with the Commerce Department that appoints the Commissioner of a home state as an agent for service of process in any legal proceeding. A nonresident agent must take the same pre-licensing education that resident agents complete. B
If an enrollee and spouse divorce, a health maintenance contract that provides coverage for the enrollee's spouse will
A. terminate coverage for the former spouse but not for the dependents B. terminate upon the divorce C. incur a premium increase up to 150% of the plan cost if the former spouse continues coverage D. allow the former spouse to continue coverage D
Which statement accurately describes the required conduct of an agent?
An agent is required to deliver an insured's policy within 10 business days. Producer's are allowed to disclose their customers' names provided they do not identify the policy they have purchased. A producer may accept a loan from a customer provided the agreement is in writing andall records are kept for at least 6 years after repayment. Oral binders must be followed up in writing within 7 business days. C
Which of the following statements about group life insurance is NOT correct?
An employee's group term life policy will terminate if the employee is laid off. COBRA-like rules apply to group term life insurance. Group life insurance paid by the employer typically does not require proof of insurability. Terminated employees may elect to continue group term life coverage for themselves and their dependents. A
Under the grace period provision, how will the overdue premium be handled if the insured dies during the grace period?
Any premium due will be waived The policyowner will owe twice the amount due If any premium is owed at the time of the insured's death, the policy will be cancelled The overdue premium will be deducted from the settlement D
In Minnesota, to be an admitted company means the insurer has which of the following?
Certificate o fauthority Company appointment Surplus license Reciprocal license A
Which of the following statements concerning individual accident and health insurance policies is CORRECT?
Insurer's must cover adopted children on the same basis as other dependents. Upon a divorce, the insured's former spouse is no longer covered by the insured's individual health insurance policy. The insured must wait 90 days after proof of loss to sue the insurer. Individual health policies can be more restrictive when covering chemical dependency services. A
Which of the following is NOT included in the broad powers of the Commissioner of Commerce?
Makingrulesandregulationsasnecessaryto implement the insurance laws Conducting examinations as needed to determine whether a person or company has violated any insurance law or regulation Instituting such actions or other lawful proceedings as deemed necessary to enforce the state's insurance laws and regulations Developing and writing insurance education courses D
A Medicare supplement insurance policy application was taken on March 16. The insurer issued the policy on March 28, and it was delivered to the policyowner on April 5. Under these circumstances, when does the policy's free- look period end?
March26 April 15 April 27 May5 D
Which of the following statements about mutual insurers is NOT correct?
Mutualinsurancecompaniesaremanagedbya board of directors Mutual insurance companies return taxable dividends to policyholders Mutual insurance companies are legal reserve companies Mutual insurance companies are owned by their policyholders B
Individual health policies offered through the Minnesota Comprehensive Health Association (MCHA) provide coverage for Minnesota residents denied coverage by the private market. Which of the following statements about MCHA is NOT correct?
Pre-existing conditions for individuals insured through the plan can be excluded during the first 6 months of coverage MCHA provides coverage if benefits are payable under Medicare Premiums charged to policyholders are higher than rates on comparable policies in the private market MCHA policies offer high deductible health plans and basic Medicare supplement policies B
If the Commissioner refuses to renew a producer's license, a written notice is issued. Which of the following statements about the notice is NOT correct?
The notice will state the grounds for which the license was not renewed. The notice will state the possible criminal charges that may result from the licensee's actions. The notice will advise the producer to request a hearing within 30 days. The hearing will be held within 30 days of the producer's written request. B
Which of the following statements about continuing education requirements in Minnesota is NOT correct?
The producer must complete at least 3 credit hours in the area of ethics. Only continuing education courses offered in a classroom setting are approved for credit. All continuing education courses must be approved by the Commissioner before they can be offered to producers for credit. After being licensed, insurance producers must satisfactorily complete 24 hours of approved continuing education during each licensing period. B
Regarding company claims practices, which of the following statements is NOT correct?
When denying a claim, the insurer isr equired to reference the applicable policy language in the denial letter. A company may require an inspection at a location convenient to the insured. An insurer who responds within 7 days to an insured's voicemail has not violated a claim settlement practice. To make a correct negligence assignment, the insurer can require ancillary information in addition to the loss information. D
Under Minnesota law, all of the following are defined as unfair claims practices by insurance companies EXCEPT
failing to promptly acknowledge pertinent communications concerning claims delaying an investigation or claim payment by requiring a duplicate verification of facts compelling policyowners to go to court to recover amounts due them by offering them substantially less than the amounts recovered through litigation offering payment of approved claims after affirming liability D
When can a licensed producer sell an insurance policy without a company appointment?
iftheproducerhastheinsurer'spermission and obtains an appointment within 15 days of submitting the first application When the producer has the insurer's written permission When the producer has permission from the Commissioner The producer is not allowed to transact any insurance business without a company appointment. A
The penalties for violating the laws governing the sale of Medicare supplements in Minnesota can include
imprisonment for up to 3 years fines up to $1,000 fines up to $2,500 fines up to $5,000 D
All of the following are required provisions of an accident and health policy EXCEPT
physical exam and autopsy provision change of beneficiary provision grace period provision misstatement of age provision D
All of the following are included in the definition of advertising EXCEPT
radio and television descriptive literature cold-calling billboards C
. All of the following are true statements regarding the insurance company's right to cancel a life insurance policy EXCEPT
thepolicy must include a notice regarding the policyowner's rights to cancel the policy after receiving notice of cancellation from the insured, the insurer must refund all premiums paid within 10 days if the policyowner cancels a replacement life insurance policy 20 days after receiving it, the insurer is not required to refund any premium if a policy is sold without a notice regarding cancellation, it may be cancelled by the purchaser at any time within one year after the purchase date C