Life Accidental & Health Exam
If a life insurance company used HIV testing as part of its underwriting when must an applicant be notified of the procedure?
Prior to performance of the test
Which of the following is NOT mandatory under the Uniform Provisions Law as applied to accident and health policies?
Probationary Period
The Guaranteed Insurability Rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following EXCEPT
Purchase of a new home
When comparing a Joint Life Policy to two individual life policies of the same amount on the same insureds, which condition is true?
Joint Life has a lower premium than the total of the two individual policies
Which of the following would NOT be considered a limited coverage policy?
Major medical expense insurance
A married couple purchase a life insurance policy on their newborn baby. They are concerned about what would happen to the policy if either one of them were unable to continue making the premium payments due to death or disability. Which policy rider should their agent recommend?
Payor benefit
Which of the following is a provision found in life insurance policies?
Reinstatement
If an applicant's health is poorer than that of an average applicant the policy may be issued
Substandard
If an applicant's health is poorer than that of an average applicant, the policy may be issued
Substandard
All of the following would be classified as "limited insurance coverages" EXCEPT
Supplement Social Security Coverage
Life Insurance can provide which of the following?
Survivor Protection
When term insurance is added to the main policy to enhance the policy or provide added benefit or coverage, it is called a
Term Rider
Whose responsibility is it to ensure that the application for health insurance is compete and accurate?
The Agent's
Once the initial benefit limit in Medicare Part D is reached, how is the beneficiary affected?
The beneficiary is then responsible for a portion of prescription drug costs
With Adjustable Life, the owner can change all of the following EXCPET
The insured
Who is the annuity owner?
The person who purchases the annuity
What is the purpose of a disability buy-sell agreement?
To allow the business buyout in case of the owner's disability
What is the purpose of a benefit schedule?
To state what and how much is covered in the plan
An aleatory contract is based on what kind of exchange?
Unequal exchange of values
Which of the following services will NOT be provided by an HMO?
Unlimited coverage for treatment for drug rehabilitation
Considering the principles of liquidity, how would the policyowner use today's cash values in a life insurance policy?
Use it for emergency expenses
The benefits from a business overhead expense insurance policy
Are limited to covered expenses and are taxable to the business
An individual has a 200,000 convertible term life insurance policy. If he chooses, he can
Convert to a whole life policy for the same face amount without proof of insurability
A Major Medical Expense policy would exclude coverage for all of the following treatments EXCEPT
Drug addiction
The "stop-loss" feature on a major medical policy is intended to
Establish a maximum amount of out-of-pocket expense that an insured will have to pay for medical expense in a calendar year
Which of the following is a correct statement about annuities?
Fixed annuities do not provide protection against inflation
Which federal act defines rules pertaining to protected health information?
HIPAA
An insured has individual disability income policy with a 30-day elimination period. He becomes disabled on June 1st for 15 days. When will he collect on his disability income payments.
He won't collect anything
Under which of the following conditions would life insurance proceeds be taxable by the federal government?
If there is a transfer of value
If a soliciting producer suspects that there could be misrepresentation on the part of the applicant for insurance, what must the producer do?
Inform the insurance company
In group insurance the primary purpose of the Coordination of Benefits provision is to
Prevent overinsurance
The Director my suspend, revoke, refuse to issue or renew a producer's license if the producer
Previously had his or her license revoked in another state
An insured purchased a health insurance policy with a renewability clause that states that policy is " Guaranteed Renewable." This means that as long as the required premiums are paid, the policy will continue until the insured
Reaches age 65
Which of the following types of care could be provided at a community center?
Adult day care
A whole life policy is surrendered for a reduced-paid up policy. The cash value in the new policy will
Continue to increase
Which of the following is NOT a standard exclusion in life insurance policies?
Disability
Which of the following is NOT true regarding a noncancelable policy?
Insurer can increase the premium above what is stated in the policy if claims experience greater than expected
The provision that sets forth the basic agreement between the insurer and the insured and states the insurer's promise to pay the death benefit upon the insured's death is called the
Insuring clause.
A man is an attorney when he applies for a health policy. He decides to become a professional bungee jumper. He files a claim. What should happen?
The insurance company will pay the claim according to the benefits available if the correct premium had been paid.
Which of the following is true regarding copayment and coinsurance for services provided by a physical therapist under a health benefit plan?
They must be the same as for the services of a primary care physician
Medicare is a health insurance program for all of the following individuals EXCEPT
Those with low income and low assets
An underwriter is reviewing an applicant with an extensive medial history. Which of the following would give the underwriter a better understanding of how the applicant has been treated for various illnesses?
Attending Physician's Statement
An applicant misstates his age on his application for a health insurance policy. He states that he is 39, but his actual age is 49. When he files a claim, what will most likely happen?
Benefits paid will be those that would have been purchased at the correct age.
Which of the following would be TRUE of both the fixed-period and fixed-amount settlement options?
Both guarantee that the principle and interest will be fully paid out.
In addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health?
By requiring that the insurance be incidental to the group
HMO members pay a small fee when they see their primary care physician. This fee is called a
Copay
A new homebuyer wants to purchase a life insurance policy that would protect his family against losing the home, should he die before the mortgage was paid. The most inexpensive type of policy that would accomplish this need would be
Decreasing Term
A husband and wife both incur expenses that are attributed to a single major medical insurance deductible. Which type of deductible do they have in their policy?
Family
J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did I choose?
Fixed amount
Which of the following is NOT correct concerning taxation of disability income benefits?
If paid by the individual, the premiums are not tax deductible
Under what circumstances will the contingent beneficiary receive the death benefit?
If the primary beneficiary dies before the insured.
When an insured reinstated his major medical policy, he was involved in an accident that required hospitalization. When would this accident be covered upon reinstatement of the policy?
Immediately
An insured's hospital policy states that it will pay him a flat fee of $75 per day for each day he is hospitalized. The policy pays benefits on what basis?
Indemnity
What happens to the copy of the application for health insurance once the policy is issued?
It becomes part of the entire contract
All of the following statements are true regarding an Ordinary (Straight) Life policy EXCEPT
It does not have a guaranteed death benefit
For a contract to be enforceable by law, the purpose of the contract must be
Legal and not against public policy
Agents may be found guilty of defamation if they make false statements that are intended to
Maliciously criticize another insurance company
Following a covered loss, the Time Payment of Claims Provision requires that an insurance company pay disability income benefits no less frequently than
Monthly
All life and health policies must provide a clear and conspicuous disclaimer regarding the Insurance Guaranty Association on the face page of the policy. This disclaimer must do all of the following EXCEPT
State that the insurer and its agents are protected by the Guaranty Association in case of insolvency
Who is obligated to make sure all questions are answered and all necessary signatures are collected on the application?
The agent
An insurer is attempting to determine the insurability of an applicant and decides to obtain medical information from several different sources. Which of the following must be notified of the investigation?
The applicant
All of the following are required provisions in group life insurance policies in this state EXCEPT
Warranties made by the applicants
An insured has a life insurance policy in the amount of $250,000 naming his wife as beneficiary. Upon his death his beneficiary decides not to receive the death benefit for some time. When she finally receives the death benefit check, it's in the amount of $250,530. Is any portion of the proceeds that the beneficiary receives taxable?
Yes, proceeds in the excess of face amount are taxable as interest
What does Basic Medical Expense cover?
Nonsurgical services a physician provides
Dividends received on participating life insurance policies policies are
Not taxable because they are on a return of unused premiums
If an insured is injured while committing an illegal act and his health policy contains the Illegal Occupation provision, what percentage of the claim will be paid?
Nothing
Which of the following best describes a presumptive disability?
One that is severe enough that the inured automatically qualifies for full disability benefits
Which dividend option will increase the death benefit?
Pad-up additions
An insurer must notify the consumer in writing that an investigative consumer report has been requested, within how many days of the initial request?
3 Days
An individual purchases a life insurance policy and lists his parents as the beneficiaries. He is able to change beneficiaries at any time. What type of beneficiary designation does the policy have?
Revocable
If an insurance company issues a policy even though some questions on the application were unanswered, when can the insurer get the answers to those questions?
Never, the insurer has waived right to those answers by issuing the policy
A producer has been found guilty of 5 violations on unfair methods of competition and deceptive practices. What would be the amount of fine the producer will have to pay?
$5,000
If an insured pays a health insurance premium each month how long would the grace period be under the policy?
10 Days
In a noncontributory group policy
100 % of eligible employees must participate
An insured recently discovered that the interest rate on his policy loan once again increased. Legally speaking, which of the following is the shortest amount of time that could have passed since the change in the insured's interest rate?
3 Months
Missouri law requires that producers notify the Director of any change of address within
30 Days
Y is a 66 year old male who recently bought a life insurance policy with graded death benefits. Since he is over the age of 65, the policy cannot grade the death benefit in excess of 3 years unless the policy provides at least what percent of the face amount as a first-year death benefit?
50 %
What is the maximum age that a disabled insured worker may receive Social Security disability benefits?
65
A disability income policy has waiting period of 7 days. If the insured is disabled for 15 days, how many days of benefits will the policy pay?
8 Days
According to the metal level classification of health plans, what percentage of health care costs will be covered under a gold plan?
80%
The policyowner has an option to pledge the life insurance policy as collateral for a bank load. This is called:
A collateral assignment
A viatical settlement is a transaction outside the life insurance company where the owner sells the life insurance policy for which of the following?
A percentage of the face amount of the policy
The Probationary period is
A specified period of time that a person joining a group has to wait before becoming eligible for coverage
Which of the following best defines the Probationary Period in group health policies?
A specified period of time that a person joining a group has to wait before becoming eligible for coverage
If an insured dies, and it is discovered that the injured misstated his/her age or gender, the life insurance company will
Adjust the death benefit to what the premium would have purchased at the actual age or gender.
In a variable life insurance policy, all of the following assets are held in the insurance company's general account EXCEPT
Cash surrender values
Policy delivery refers to the delivery of the
Completed insurance policy to the policowner
An applicant gives her agent a completed application and the initial premium. What can the agent issue her that acknowledges in initial premium payment?
Conditional Receipt
Decreasing Term insurance is often used to
Cover a mortgage
An insured was diagnosed two years ago with kidney cancer. She was treated with surgeries and chemotherapy, and is now ins remission. She also has a 30-year smoking history. The insured is now healthy enough to work and has just started a full-time job. Which describes the health insurance that she will most likely receive?
She would be covered under her employer's group health insurance plan, without higher premiums
Which of the following would be likely to establish SEP?
Small Employers
When an agent delivered an insurance policy to the insured, he collected the initial premium, as well as a document verifying that the insured had not had any injuries or illness since the application date. What is the document called?
Statement of Good Health
Which of the following riders pays a beneficiary a death benefit that is double or triple the face amount if the insured's death was caused by an accident as defined in the policy?
An Accidental Death Rider
All other factors being equal, which of the following premium modes would result in the lowest overall premium?
Annual
The corridor deductible applies between
Basic and major medical coverage
Cash Value guarantees in a whole life policy are called
Nonforfeiture values
With respect to the entire contract clause in health policies, who has the authority to make changes to an existing policy?
Only an executive officer of the company
When the owner of a participating whole life policy used the dividend to provide more life insurance coverage, which of the following dividend options is being used?
Paid-up additions
If an applicant submits the initial premium with the application, which action constitutes acceptance?
The underwriters approve the application.
Which of the following is consideration on the part of the insurer?
Paying a claim