Life / Health Exam
Which of the following statements is CORRECT concerning the relationship between Medicare and HMOs?
HMOs may pay for services not covered by Medicare.
Which is TRUE about the cash surrender nonforfeiture option?
Funds exceeding the premium paid are taxable as ordinary income.
Another name for a substandard risk classification is
rated
Annuities can be used to fund which of the following?
Retirement plans
An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?
10 days
All of the following could own group life insurance EXCEPT
A group needing low-cost life insurance
According to the Replacement Rule, replacement of life insurance is defined as a process in which
A new policy is bought and an old policy is converted to a Reduced Paid-up policy.
Assuming that all of the following people are covered by a High Deductible Health Plan and are not claimed as dependents on anyone's tax returns, which would NOT be eligible for a Health Savings Account?
Amanda is 67 and is covered by a basic medical expense policy
Under which of the following circumstances would an insurer pay accelerated benefits?
An insured is diagnosed with cancer and needs help paying for her medical treatment.
Which of the following will NOT be an appropriate use of a deferred annuity?
Creating an estate
Which of the following is not true of Disability Buy-Sell coverage?
Benefits are considered taxable income to the business
Which of the following statements is NOT correct regarding Medicare?
Medicare Advantage must be provided through HMOs.
Which of the following must an insurer obtain in order to transact insurance within a given state?
Certificate of authority
Which of the following is NOT fundable by annuities?
Death benefits
Which type of insurance provides funds for a business organization to purchase the business interest of a disabled partner?
Disability Buy-Sell
An insurance company assures its new policyholders that their premium costs will not increase for a period of at least 5 years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next 2 years. What term best describes this act?
Fraud
Under a disability income policy, the insurer does not pay a monthly benefit that is equal to the insured's previous income. The reason for paying a benefit amount that is less than the insured's income is to
Prevent overutilization and malingering.
Equity indexed annuities
Seek higher returns.
Hospital indemnity/hospital confinement indemnity policy will provide payment based on
The number of days confined in hospital
All of the following statements are true regarding installments for a fixed amount EXCEPT
The payments will stop when the annuitant dies.
Which of the following best defines target premium in a universal life policy?
The recommended amount to keep the policy in force throughout its lifetime
An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?
Time of Payment of Claims
All prepaid dental plans will provide all of the following basic dental services EXCEPT
cosmetic
In the underwriting process, it was determined that the applicant for life insurance is in poor health and has some dangerous habits. Which of the following is true concerning the policy premium?
it will likely be higher because the applicant is a substandard risk
An applicant for health insurance has not had a medical claim in 5 years. He exercises daily and does not smoke or drink. What classification do you assume the applicant would receive from his insurer?
Preferred
When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy?
It is reduced to the amount of what the cash value would buy as a single premium.
Which of the following is NOT true regarding the Life with Guaranteed Minimum annuity settlement option?
It provides a higher monthly benefit than a pure life annuity.
All of the following are true regarding insurance policy loans EXCEPT
Policy loans can be made on policies that do not accumulate cash value.
It would be considered unfair discrimination to ask an insurance applicant about which of the following and then use that information as a rating factor to determine insurability?
sexual orientation
The Director has just discovered an insurer's advertisement contained false information. Before issuing an order, the Director will provide the insurer with a few days written notice. How many days?
5 days
Which of the following is a short-term annuity that limits the amounts paid to a certain fixed period or until a certain fixed amount is liquidated?
Annuity certain
Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member?
Family term rider
-uphold the financial interests of the principal (usually insurer) -be truthful in all representations of principal.
Fiduciary responsibility.
Which provision allows a person to return a Medicare supplement policy within 30 days for a full premium refund?
Free Look
After an annuity contract is delivered, a contract holder has a free-look period of
10 days.
Under a Key Person disability income policy, premium payments
Are made by the business and are not tax-deductible.
Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe?
Adhesion
What documentation grants express authority to an agent?
Agent's contract with the principal
What license or licenses are required to sell variable annuities?
Both a life insurance license and a securities license
Which policy component decreases in decreasing term insurance?
Face amount
What is the contract provision that allows the insurer to nonrenew health coverage if certain events occur?
Conditionally renewable
In insurance transactions, fiduciary responsibility means
Handling insurer funds in a trust capacity.
What are the two components of a universal policy?
Insurance and cash account
In respect to the consideration clause, which of the following is consideration on the part of the insurer?
Promising to pay in accordance with the contract terms
What type of annuity activity will cause immediate taxation of the interest earned?
Surrendering the annuity for cash
During the accumulation period in a nonqualified annuity, what are the tax consequences of a withdrawal?
Taxable interest will be withdrawn first and the 10% penalty will be imposed if under age 59 ½.
Who is the owner and who is the beneficiary on a Key Person Life Insurance policy?
The employer is the owner and beneficiary.
Which of the following is TRUE regarding variable annuities?
Variable Annuities are structured like an investment company and are regulated by the Investment Company Act of 1940.
An agent is completing an application for a long-term care policy. The agent is required to do all of the following EXCEPT
Warn the applicant of the 10 day free look period
Which authority is NOT stated in an agent's contract but is required for the agent to conduct business?
Implied
Life income joint and survivor settlement option guarantees
Income for 2 or more recipients until they die.
In an optionally renewable policy, the insurer has which of the following options?
Increase premiums
Which type of a hospital policy pays a fixed amount each day that the insured is in a hospital?
Indemnity
Who must pay for the cost of a medical examination required in the process of underwriting?
Insurer
Which of the following best describes the MIB?
Nonprofit trade organization that supplies insurability information to member companies
When an employee is still employed upon reaching age 65 and eligible for Medicare, which of the following is the employee's option?
Remain on the group health insurance plan and defer eligibility for Medicare until retirement
If an employee wants to enter the group outside of the open enrollment period, to reduce adverse selection, the insurer may
Require evidence of insurability.
Which of the following is an example of a producer's fiduciary duty?
The trust that a client places in the producer in regard to handling premiums.
Which is generally true regarding insureds who have been classified as preferred risks?
Their premiums are lower.
Which of the following is NOT true regarding Equity Indexed Annuities?
They earn lower interest rates than fixed annuities.
Which of the following is true regarding Medicare supplement policies?
They must be guaranteed renewable.
Which of the following employees insured under a group life plan would be allowed to convert to individual insurance of the same coverage once the plan is terminated?
Those who have been insured under the plan for at least 5 years
Which of the following is NOT an example of a business use of Life Insurance?
Workers Compensation
When transacting business in this state an insurer formed under the laws of another country is known as a/an
alien insurer
All of the following are requirements of eligibility for Social Security disability income benefits EXCEPT
being 65
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
Who bears all of the investment risk in a fixed annuity?
the insurer
What is the duration of the free-look period for Medicare supplement policies? Which of the following factors would be an underwriting consideration for a small employer carrier?
30 days
Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?
30 months
A contract holder is 67 years old when he applies for an annuity contract. How long will his free-look period be?
30days
Within how many days must an applicant for an annuity contract receive the disclosure document and the buyer's guide if the application was not taken in a face-to-face meeting?
5 days
In order to qualify for conversion from a group life policy that has been terminated to an individual policy of the same coverage, a person must have been insured under the group plan for how many years?
5 years
A domestic insurer has just decided to change the investment policy of a separate account. After this change is filed with the Director, how soon will it become effective?
60 days
According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan?
60%
Most policies will pay the accidental death benefits as long as the death is caused by the accident and occurs within
90 days
Which of the following is NOT an allowable 1035 exchange?
A whole life insurance policy is exchanged for a term insurance policy
When must the outline of coverage be provided to the applicant for a long-term care policy?
At the time of initial solicitation
Combination plans are comprised of two types of plan features: basic and
Comprehensivve
Which of the following provisions requires that any policy language that is in conflict with the state statutes of the state in which the insured resides is automatically amended to conform with those of the state of residence?
Conformity with State Statutes
A man is still employed at age 65 and is now eligible for Medicare. He wants to know what health insurance coverage he is eligible to receive. Which of the following options are available to him?
Continuation of group health
In a group prescription drug plan, the insured typically pays what amount of the drug cost?
Copayment
Prior to issuance of a Long-Term Care policy to an applicant age 80 or older, the insurer must obtain all of the following EXCEPT
Copies of medical records. Report of a physical examination or assessment of functional capacity. Attending physician's report.
Which of the following is used to compare the cost of one life insurance policy against another in order to guide prospective purchasers to policies that are competitively priced?
Cost comparison methods
The Medical Information Bureau (MIB) was created to protect
Insurance companies from adverse selection by high risk persons.
Which of the following statements is NOT correct concerning the COBRA Act of 1985?
It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.
All of the following statements describe a MEWA EXCEPT
MEWAs are groups of at least 3 employers.
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 correct concerning the taxation of premiums in a key-person life insurance policy?
Premiums are not tax deductible as a business expense.
An insurer wants to obtain information from investigators regarding an applicant for insurance. What must the insurer do in order to legally acquire this information?
Present the insured with a disclosure authorization notice- this notice states the insurers information collection practices and how the information will be used.
When a whole life policy lapses or is surrendered prior to maturity, the cash value can be used to
Purchase a single premium policy for a reduced face amount.
An insured owns a term policy with a guaranteed renewable option. When the end of the policy draws near, the insured answers medical questions in order to prove insurability and qualifies for a discounted premium rate. Which option best describes this scenario?
Re-entry
In terms of long-term care policies, which of the following are excluded from standard, group policy nonforfeiture benefits?
Retirement communities
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.
Which of the following is TRUE about nonforfeiture values?
They are required by state law to be included in the policy.
How many pairs of glasses in a 12-month period will a vision expense insurance plan cover?
Usually covers one pair of eyeglasses but does not cover safety glasses.
In terms of Social Security, what is the name for the time period after the youngest child of a family turns 16 and before the surviving spouse may start receiving retirement benefits?
blackout
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?
hospital for 3 consec days
An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live. The insured knows that his financial state will worsen even more with the upcoming medical expenses. What option could the insured utilize?
viatical settlement
HIPAA applies to groups of
2 or more
An insured has a long-term care policy. How often can she expect her insurer to notify her of the right to change the person she has designated to receive notice of any unintentional lapse?
2 years
What is the maximum age for qualifying for a catastrophic plan?
30
When J. applied for a life insurance policy, the agent informed him that a medical exam would be required. The exam may be completed by
A paramedic or examining physician at the insurer's expense.
What is material misrepresentation?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued?
Adjust the claim benefit to reflect the insured's true age
An insured pays a $100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. What characteristic of an insurance contract does this describe?
Aleatory
All of the following are true regarding key person disability income insurance EXCEPT
Benefits are taxable to the employer.
An insured owns a medical expense policy that he purchased for his family. The insured's employer purchased a Group Disability Income policy for the insured and all eligible employees. The insured subsequently suffered an accident on the job that left him unable to work for four months. If the insured receives benefits from his disability income policy, which of the following would be true?
Benefits received that are attributable to employer contributions are fully taxable to the employee as income.
In the executive bonus plan, who is the owner of the policy, and who pays the premium?
Executive is the owner, and the executive pays the premium.
The authority granted to an agent through the agent's contract is referred to as
Express authority.
If an applicant for a health insurance policy is found to be a substandard risk, the insurance company is most likely to
Charge an extra premium.
Which of the following would NOT be used in preventive care?
Chemotherapy
A man is injured while robbing a convenience store. How does his major medical policy handle the payment of his claim?
Claim is denied if contains illegal occupation provision
What term is used to describe when the medical caregiver provides services to only members or subscribers of a health organization, and contractually is not allowed to treat other patients?
Closed panel
A producer agent must do all of the following when delivering a new policy to the insured EXCEPT
Disclose commissions earned from the sale of the policy.
When contributions to an immediate annuity are made with before-tax dollars, which of the following is true of the distributions?
Distributions are taxable.
All of the following information about the applicant is identified in the General Information section of a life insurance application EXCEPT
Education
Which of the following statements is true regarding LTC insurance?
Every policy must offer nonforfeiture benefits to the applicant.
Which of the following statements is correct concerning taxation of long-term care insurance?
Excessive benefits may be taxable.
In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost
Is not covered.
All of the following statements are true of a Combination Dental Plan EXCEPT
It is also known as the Superimposed Plan.
A couple near retirement is planning for their golden years. They want to make sure that their retirement annuity provides monthly benefits for the rest of their lives. Should one of them die, the other would still like to continue receiving benefits. Which settlement option should they choose?
Joint and Survivor
A married couple owns a permanent policy which covers both of their lives and pays the death benefit only upon the death of the first insured. Which policy is that?
Joint life policy
If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this?
Jumping juvenile policy
The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof of loss is known as
Legal actions.
An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called
Paid-up additions. When this option is selected, the annual dividend acts as a single premium each year to buy additional amounts of insurance, based on the insured's currently attained age.
Which of the following is NOT true about a joint and survivor annuity benefit option?
Payments stop after the first death among the annuitants.
Which of the following factors would be an underwriting consideration for a small employer carrier? In individual health insurance coverage, the insurer must cover a newborn from the moment of birth, and if additional premium payment is required, how many days should be allowed for payment?
Percentage of participation. Coverage under a small employer health benefit plan is generally available only if at least 75% of eligible employees elect to be covered.
Which of the following may NOT be included in an insurance company's advertisement?
That its policies are covered by a state Guaranty Association
Nonforfeiture values guarantee which of the following for the policyowner?
That the cash value will not be lost
An insured purchased a noncancellable health insurance policy 1 year ago. Which of the following circumstances would NOT be a reason for the insurance company to cancel the policy?
The insured is in an accident and incurs a large claim
An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT?
The insured may choose to convert to term or permanent individual coverage.
An employee is insured under her employers group life plan. If she terminates her group coverage, which of the following statements is incorrect?
The insured may choose to convert to term or permanent individual coverage.
Which of the following is NOT a feature of a guaranteed renewable provision?
The insurer can increase the policy premium on an individual basis.
Which of the following is an eligibility requirement for all Social Security Disability Income benefits?
fully insured status
Which of the following would be considered an illegal inducement to purchase insurance?
Confirming future dividends in a life insurance proposal
An agent selling variable annuities must be registered with
FINRA.
A man purchased a $90,000 annuity with a single premium, and began receiving payments 2 months after that. What type of annuity is it?
Immediate
Under which of the following annuity options does the annuitant select the time period for the benefits, and the insurer determines how much each payment will be?
Installments for a fixed period
All of the following are Nonforfeiture options EXCEPT
Interest only
An insurance company wants to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding information included on previous insurance applications?
Medical Information Bureau
An insured's health claim internal appeal was denied. The insurer must do all of the following EXCEPT
Offer a payment plan.
All of the following are characteristics of group life insurance EXCEPT
Premiums are determined by the age, sex and occupation of each individual certificate holder.
If a firm has between 2 and 50 employees that are actively engaged in business during the preceding calendar year, what is its classification?
Small employer
An insured who has an Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this policy
The capital amount in a lump sum
A policy available to business owners that provides payment for normal business expenses in the event that the owner is disabled is called
business overhead expense
What characteristic makes whole life permanent protection?
Coverage until death or age 100.
S is a sole business proprietor who owns a medical expense plan. What percentage of the cost of the plan may he deduct?
100%
What is the duration of the free-look period for Medicare supplement policies?
30 days
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?
50.000
The minimum number of credits required for partially insured status for Social Security disability benefits is
6 credits
What is the waiting period on a Waiver of Premium rider in life insurance policies?
6 months
The term "uninsured small business" means a small employer that does not provide health benefits for at least
90 days prior to the effective date of coverage.
Which of the following entities is automatically qualified to enroll in health insurers mandatory, guaranteed issue policy?
All Small Employers
In reference to the standard Medicare Supplement benefits plans, what does the term standard mean?
All providers will have the same coverage options and conditions for each plan.
What is a foreign insurer?
An insurer with a home office in another state
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
An unfair trade practice.
Which of the following is NOT applied toward the deductible under a nonscheduled plan?
Annual dental exam
A Universal Life Insurance policy is best described as a
Annually Renewable Term policy with a cash value account.
When an annuity is written, whose life expectancy is taken into account?
Annuitant
Which of the following hospice expenses would NOT be covered in a cost-containment setting?
Antibiotics
Bob purchased a policy to provide coverage on himself, his wife Linda, and their two children, John and Kristen. All of them would need to prove insurability EXCEPT
Any children born to them after the inception of the contract.
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?
As of the application date
In order to qualify for group coverage in this state, associations must insure
At least 25 members.
An underwriter is reviewing the medical questions in the application and needs further information due to a medical situation the applicant had in the past. What will the underwriter require?
Attending Physician Statement
Which of the following is an example of a "gene product"?
Gene fragments
What is the time period called during which the surviving spouse of the insured does not receive Social Security income benefits?
Blackout period
A man is still employed at age 65 and is now eligible for Medicare. He wants to know what health insurance coverage he is eligible to receive. Which of the following options are available to him?
Both group health and Medicare
As it pertains to group health insurance, COBRA stipulates that
Group coverage must be extended for terminated employees up to a certain period of time at the former employee's expense.
An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement?
Cost-containment
All of the following are business uses of life insurance EXCEPT
Funding against company's general financial loss.
If a life policy allows the policyowner to make periodic additions to the face amount at standard rates, without proving insurability, the policy includes a
Guaranteed insurability rider
In which of the following cases would a credit disability policy be issued?
If an individual is in debt to a specific creditor, payments will be made for him/her until the return to work.
The policyowner wants to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain age. Which settlement option should the policyowner choose?
Interest only option
What is the purpose of a conditional receipt?
It is intended to provide coverage on a date prior to the policy issue.
An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium?
It will increase because the insured will be 5 years older than when the policy was originally purchased.
Which statement is NOT true regarding a Straight Life policy?
Its premium steadily decreases over time, in response to its growing cash value.
Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client?
Limited pay whole life
If an annuitant selects the straight life annuity settlement option, in order to receive all of the money out of the contract, it would be necessary to
Live at least to his life expectancy.
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.
Which type of Medicare policy requires insureds to use specific healthcare providers and hospitals (network providers), EXCEPT in emergency situations?
Medicare SELECT
If a life insurance policy develops cash value faster than a seven-pay whole life contract, it becomes a/an
Modified endowment contract.
If an insurer terminates a small group disability plan's coverage, it cannot issue those plans for
Next 5 years
Can a group that is formed for the sole purpose of obtaining group insurance qualify for group coverage?
No
Which renewal provision(s) must be included in a long-term care policy issued to an individual?
Noncancellable and guaranteed renewable
When an individual is covered under two health insurance policies that have duplicate benefits which could make a claim for benefits because of an injury or illness profitable, it is called
Overinsurance
Which renewal provision(s) must be included in a long-term care policy issued to an individual?
The Health Insurance Portability and Accountability Act (HIPAA) mandated that all long-term care policies must be guaranteed renewable. The insurer cannot cancel the policy and must renew coverage each year so long as the insured pays the premiums.
If a life insurance policy has an irrevocable beneficiary designation,
The beneficiary can only be changed with written permission of the beneficiary.
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then
The benefit is received tax free.
The sole beneficiary of a life insurance policy dies before the insured. If the policyowner fails to change the beneficiary before the insured's death, the proceeds of the policy will go to
The insured's estate.
A father owns a life insurance policy on his 15-year-old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disabled, what will happen to the life insurance premiums?
The insured's premiums will be waived until she is 21.
An applicant is considered to be high-risk, but not so much that the insurer wants to deny coverage. Which of the following is NOT true?
The insurer will issue a conditional coverage.
On a health insurance application, a signature is required from all of the following individuals EXCEPT
The spouse of policy owner
A premium payment is due on the Saturday before Memorial Day. What is the latest the insured can mail the payment for it to be considered on time?
Tuesday after the due date
What kind of policy allows withdrawals or partial surrenders?
Universal life
Which of the following Life Insurance policies would be considered interest sensitive?
Universal life
Which of the following describes the taxation of an annuity when money is withdrawn during the accumulation phase?
Withdrawn amounts are taxed on a last in, first out basis.
An employee quits his job and converts his group policy to an individual policy; the premium for the individual policy will be based on his
attained age
Under a typical health insurance policy, claims that result from injuries while the insured was intoxicated or under the influence of drugs are generally
excluded
Issue age policy premiums increase in response to which of the following factors?
increased benefits
During partial withdrawal from a universal life policy, which portion will be taxed?
interest earned on the withdrawn cash value
Under workers compensation, which of the following benefits are NOT included?
legal benefits
The premium of a survivorship life policy compared with that of a joint life policy would be
lower
After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive?
monthly premium waiver and monthly income
According to the PPACA metal levels classification, if a health plan is expected to cover 90% of the cost for an average population, and the participants would cover the remaining 10%, what type of plan is that?
platinum
Which clause allows both the insured and dentist to know in advance which benefits will be paid?
precertification
Under the Accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death?
principle sum
An insured carries health insurance with two different providers and is covered on an expense incurred basis. He has an appendectomy and files the claims to both insurers. Neither company is notified in advance that the insurer has other coverage. What should each insurer pay?
proprtional ammount
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
Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles?
Standard risk is representative of the majority of people.
Who is the beneficiary in a credit health policy?
lending institution
An insured is covered under 2 group health plans - under his own and his spouse's. He had suffered a loss of $2,000. After the insured paid the total of $500 in deductibles and coinsurance, the primary insurer covered $1,500 of medical expenses. What amount, if any, would be paid by the secondary insurer?
$500
According to the telemarketing sales rules, what are the permissible calling hours for telemarketing calls?
8am until 9pm
An insurance company sends frequent email advertisements and coupons to its customers. One customer does not want to receive these emails anymore and requests to be excluded from the mailing list. The emails to the customer must stop within
10 business days.
A contract holder is 67 years old when he applies for an annuity contract. How long will his free-look period be?
30 days
What is the penalty for IRA distributions that are below the required minimum for the year?
50%
All of the following are true regarding Key Employee Disability Income insurance EXCEPT
Benefits are taxable to the employer.
Which of the following is NOT an essential element of an insurance contract?
Counteroffer
What happens when a policy is surrendered for its cash value?
Coverage ends and the policy cannot be reinstated.
All of the following are usually provided under an employer group dental insurance plan EXCEPT
Coverage for cosmetic treatment.
Which of the following is NOT allowed in credit life insurance?
Creditor requiring that a debtor buys insurance from a certain insurer
An annuity owner is funding an annuity that will supplement her retirement. Because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the Standard and Poor's 500 Index. She would likely purchase
Equity Indexed Annuity.
A father purchases a life insurance policy on his teenage daughter and adds the Payor Benefit rider. In which of the following scenarios will the rider waive the payment of premium?
If the father is disabled for more than 6 months
When Y applied for insurance and paid the initial premium on August 14, he was issued a conditional receipt. During the underwriting process, the insurance company found no reason to reject the risk or classify it other than as standard. Y was killed in an automobile accident on August 22, before the policy was issued. In this case, the insurance company will
Issue the policy anyway and pay the face value to the beneficiary. The conditional receipt says that coverage will be effective either on the date of the application or the date of the medical exam, whichever occurs last, as long as the applicant is found to be insurable as a standard risk, and policy is issued exactly as applied for.
How is the amount of Social Security disability benefits calculated?
It is based upon the worker's Primary Insurance Amount (PIA), which is calculated from their Average Indexed Monthly Earnings over their highest 35 years.
All of the following are true regarding the Medical Information Bureau (MIB) EXCEPT
MIB reports are based upon information supplied by doctors and hospitals.
Which part of an insurance application would contain information regarding the cause of death of the applicant's deceased relatives?
Medical Information
When is the annual open enrollment for state insurance exchanges?
Nov 1st - Jan 31st
Which renewability provision allows an insurer to terminate a policy for any reason, and to increase the premiums for any class of insureds?
Optionally renewable
An insured has a continuous premium whole life policy. She would like to use the policy dividends to pay off her policy sooner than would have been possible otherwise. What dividend option could she use
Paid-up option
Which of the following terms is used to name the nontaxed return of unused premiums?
Premium Return - The return of unused premiums is called a dividend. Dividends are not considered to be income for tax purposes, since they are the return of unused premiums.
Which of the following do the Standard and Preferred risk categories share?
Premiums are not elevated.
Rose bought three policies from the same insurer. Her benefits have exceeded the maximum allowed by the insurer. Which of the following will happen?
Pro rata benefit reduction
A man's physician submits claim information to his insurer before she actually performs a medical procedure on him. She is doing this to see if the procedure is covered under the patient's insurance plan and for how much. This is an example of
Prospective review
Which of the following answers does NOT describe the principal goal of a Preferred Provider Organization?
Provide medical services only from physciancs in network
Which of the following is an example of liquidity in a life insurance contract?
The cash value available to the policyowner
Which of the following is true regarding health insurance underwriting for a person with HIV?
The person may not be declined for medical coverage solely based on HIV status.
Which of the following types of policies allows the policyowner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount?
Universal life
Under a credit disability policy, until what point will payments to the creditor be made for the insured?
Until the disability ends or the debt is satisfied, whichever is sooner; A credit disability policy is issued only to those in debt to a specific creditor
Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?
joint life