Life & Health
J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?
20-pay Life
In the event of employment termination, a person covered by a group policy also has the right to convert such coverage to an individual policy within ___ days without proving insurability.
31
An IRA owner can start making withdrawals and NOT be subjected to a tax penalty beginning at what age?
59 1/2
Any changes made on an insurance application requires the initials of whom?
Applicant
When does a Probationary Period provision become effective in a health insurance contract?
At the policy's inception
All of the following statements regarding a Tax Sheltered Annuity (TSA) are true EXCEPT
Income derived from the TSA is received income tax-free
Which of these retirement plans can be started by an employee, even if another plan is in existence?
Individual Retirement Account (IRA)
Variable annuities may invest premiums in each of the following, EXCEPT:
Insurer's corporate business account
Which of the following is TRUE if the owner of an IRA names their spouse as beneficiary, but then dies before any distributions are made?
The account can be rolled into the surviving spouse's IRA
Which of the following statements is true about most Blue Cross/Blue Shield organizations
They are nonprofit organizations
An individual covered under a Group Life insurance policy is considered to be a(n)
certificate holder
Who elects the governing body of a mutual insurance company?
policyholders
In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and
the initial premium
Indiana's Long Term Care Partnership Program requires a Producer to have:
15 hours of additional education after they receive their license
If a new life insurance policy is replacing an existing one, the insured is given the right to return for a full refund at least ____ days after policy delivery.
20
A potential client, age 40, would like to purchase a Whole Life policy that with accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?
20-Pay Life accumulates cash value faster than Straight Life
In Indiana, what is the maximum percentage of controlled business a producer may produce over a twelve-month period?
25%
A producer must notify the Insurance Commissioner within ___ days of an address change?
30
In the event of employment termination, a person covered by a group policy also has the right to convert such coverage to an individual policy within ____ days without proving insurability
31
Three law partners form a Cross-Purchase Buy and Sell agreement. This agreement is funded with individual life insurance. How many total life policies are needed for this agreement?
6
The individual most likely to buy a Medicare Supplement policy would be a(n)
68-year old male covered by Medicare
A life policy loan in Indiana cannot charge a fixed rate of interest higher than
8%
Eligible employees must be added to group health coverage NO LATER than ___ days after their first day of employment?
90
All students attending a large university could be covered by
A blanket policy
Which of the following is considered to be misrepresentation?
A producer guaranteeing a policy's dividends
Which of the following is NOT included in an annuity contract?
Accidental Death & Dismemberment (AD&D) rider
Which of the following statements is CORRECT regarding the tax treatment of a lump-sum payment paid to a life insurance policy's primary beneficiary?
All proceeds are income tax free in the year they are received
Which type of contract liquidates an estate through recurrent payments?
Annuity
Which of these is NOT considered to be a cost connected with an individual's death?
Business expenses
Company XYZ offers a group Term Life insurance plan to its employees. What does each employee covered under this plan receive?
Certificate of Insurance
Whose life is covered on a life insurance policy that contains a payor benefit clause?
Child
Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy?
Reimbursement
R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?
Residual Disability
Post-tax dollar contributions are found in
Roth IRA investments
What does a 401(k) plan generally provide its participants?
Salary-deferral contributions
Which of these factors does NOT influence an applicant's needs for life insurance?
Self-maintenance expenses
P is a new employee and will be obtaining non-contributory group Major Medical insurance from her employer. Which of the following actions must she take during the open enrollment period?
Sign an enrollmet card
S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation?
Single Premium
Which mode of payment is NOT used by health insurance policies?
Single premium
What type of life insurance are credit policies issued as?
Term
The Common Disaster clause provides that if both the insured and sole named beneficiary were to die in a common accident, which of the following is true?
This clause provides the payment of proceeds to the insured's estate
Why would the commissioner examine the records of an insurance company?
To determine the solvency of the company
J is a producer who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of?
Twisting
In an insurance contract, the insurer is the only party who makes a legally enforceable promise. What kind of contract is this?
Unilateral
The cash value in a(n) ____ Life policy may fluctuate to reflect changing assumptions regarding mortality cost, interest, and expense factors.
Universal
B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of
additional Whole Life coverage at specified times
Group life insurance policies are generally written as
annually renewable term
A(n)___ of benefits of a Health Policy transfers payments to someone other than the policyowner
assignment
The situation in which a group of physicians are salaried employees and conduct business in an HMO facility is called a
closed panel
When is the face amount paid under a Joint Life and Survivor policy?
upon death of the last insured
Term Life Policies that have the ability to be converted to permanent coverage may do so during a specific time period. This conversion period
varies according to the contract
All of the following statements regarding group health insurance is true, EXCEPT:
An individual policy is given to each member
A Disability Income policyowner recently submitted a claim for a chronic neck problems that has now resulted in total disability. The original neck injury occurred before the application was taken 5 years prior. The neck injury was never disclosed to thee insurer at the time of application. How will the insurer handle this claim?
Claim will be paid and coverage will remain in force
S is a life insurance policyowner and enters into a written agreement to receive immediate cash in exchange for the sale and transfer of her life insurance policy. This agreement is referred to as a(n)
Viatical Settlement
A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached?
Waiver of Premium
The provision in a health insurance policy that suspends premiums being paid to the insurer while the insured is disabled is called the:
Waiver of Premium
An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?
When the conditions of the receipt are met
What type of insurance offers permanent life coverage with premiums that are payable for life?
Whole Life
Health insurance benefits NOT covered due to an act of war are:
excluded by the insurer in the contract provisions
In Indiana, an insurer licensed to conduct business in Indiana, but domiciled in Texas, is called a(n)
foreign company
Which of these is considered a true statement regarding medicaid?
funded by both state and federal governments
Which of these is NOT relevant when determining the amount of personal life insurance needed?
local unemployment rate
A disability elimination period is best described as a
time deductible
A producer's license may be denied, suspended, or revoked if the licensee:
is found guilty of misrepresentation in obtaining the license
Q is hospitalized for 3 days and receives a bill for $10,100. Q has a Major Medical policy with a $100 deductible and 80/20 coinsurance. How much will Q be responsible for paying on this claim?
$2,100 $10,000 x 20% coinsurance + $100 deductible = $2,100
S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider. S dies 1 year later of natural causes. How much will the insurer pay the beneficiary?
$50,000
XYZ Company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is
100%
A key employee policy is taken out by Company X on its vice president. Ten years later, this employee leaves Company X and begins working for Company Y. If this individual were to die and the policy is still in force and unchanged, where would the death proceeds be directed?
Company X
Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?
Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company
If its employees share in the cost of insurance, what type of group life insurance plan would a corporation have?
Contributory
When an employee is required to pay a portion of the premium for an employer/employee group health plan, the employee is covered under which of the following plans?
Contributory
K has a life insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an automobile accident, where would the death proceeds be directed?
Daughter
What is the purpose of the Indiana Life and Health Insurance Guaranty Association?
Ensures that claims filed against insolvent insurance companies will be paid
Long Term Care policies will usually pay for eligible benefits using which of the following methods?
Expense incurred
A 66 year-old is covered under a group health plan while employed with a business that has 40 employees. If she injures herself while walking in the park, what coverage would be considered primary?
Her group health plan
For which of the following expenses does a Basic Hospital policy pay?
Hospital room and board
Which of the following statements about Health Reimbursement Arrangements (HRA) is CORRECT?
If the employee paid for qualified medical expenses, he reimbursements may be tax-free
The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the
Insuring clause
All of these statements are true regarding a child qualifying for coverage under the Indiana Children's Health Insurance Program, EXCEPT:
Must have been born in the United States to qualify
When funds are shifted straight from one IRA to another IRA, what percentage of the tax is withheld?
NONE
Which of the following BEST describes a short-term medical expense policy?
Nonrenewable
which statement is true regarding a minor beneficiary?
Normally, a guardian is required to be appointed in the Beneficiary clause of the contract
In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy?
Owner's Rights
Which of the following provisions guarantees that premiums will be waived if a Juvenile Life policyowner becomes disabled
Payor clause
When an employee is terminated, which statement about a group term life conversion is true?
Policy proceeds will be paid if the employee dies during the conversion period
Which of the following statements about a Guaranteed Renewable Health Insurance policy is CORRECT?
Premiums normally increase at the time of renewal
A Medical Information Report (MIB) report may disclose which of th following?
Prior use of marijuana
Which of the following is NOT a reason for the Commissioner to revoke a producer's license?
Producer is insolvent
Which of the following actions by a producer would NOT result in a license suspension or revocation?
Producer represents a foreign insurance company
K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?
conditional
common exclusions to the continuation of group coverage includes:
dental care, vision care, other prescription drugs
T purchased a $100,000 single premium, Straight Life annuity 5 years ago. He has received monthly payments since the inception of the annuity. If T dies, the insurance company
does NOT have to make any further payments
A hearing must be held before a producer's license can be suspended or revoked. Prior to the hearing, the Commissioner of Insurance is required to
give written notice to the producer
A Nonforfeiture clause gives the policyowner
guaranteed values even if the policy has lapsed
T applied for a Disability Income policy and has a history of back injuries. The insurer issued the policy with a statement that excludes coverage for back injuries. This statement is called a(n)
impairment rider
If a new Medicare Supplement policy involves the replacement of existing coverage, it must be verified on a question located:
on the application
In order to terminate a producer's appointment, the insurer MUST
send notice of the termination to the commissioner
C is trying to determine whether to convert her convertible term life policy to whole life insurance using her original age or attained age. What factor would affect her decision the most?
the cost
Life insurance replacement regulation protects the interests of:
the policyowner
