PFS Chapter 8,9, and 10

A listing of items and their details in your memory

All of the following are acceptable types of documentation for a household inventory except

Amber's insurance policy should cover any property damage claims since she was driving Bradley's car with his permission.

Amber had permission from Bradley to borrow his car to run some errands. Unfortunately, while Amber was driving, she looked down to change songs on her iPod and sideswiped a car and hit a bicyclist. Based on her experience, which of the following would be true?

Peril

Barbara left a skateboard on her front steps. A windstorm swept the skateboard up and through her window. The windstorm was a

Waiver of premium disability benefit

Bill is worried about being able to pay his premium if he is totally and permanently disabled before age 60. Which of the following rider should he consider?

Guaranteed insurability option

Bonnie is most concerned about being able to buy additional insurance undergoing medical exams. Which of the following rider should she consider?

Combining the benefits of two insurance policies issued for a married couple.

Coordination of benefits (COB) provision applies to

$175

Cynthia was charged $300 for a specialist office visit. Her indemnity policy will pay $125. What amount will she have to pay?

Automobiles

Homeowner's insurance covers all of the following except

Theft of jewelry valued at $25,000

Homeowner's insurance covers all of the following except

Accelerated benefits

Mildred was diagnosed with terminal cancer and knows that she doesn't have long to live. Which of the following riders would allow her to receive cash now?

Comprehensive physical damage coverage.

Samantha was driving on the highway during a storm and hall dented her car. This damage would be covered under her

The location of her employer

Sandra is contacting several insurance companies to compare coverage for her home. Which of the following should NOT affect her premium?

$75

Sandy went to the doctor three times, and each appointment cost $200. Her copayment was $25 per visit. How much was Sandy required to pay in total for her three visits?

Sets federal standards to ensure that workers do not lose their health insurance if the change jobs.

The Health Insurance Portability and Accountability Act of 1996

Negligence

The failure to take ordinary or reasonable care to prevent accidents from happening is called

Assigned benefits

The health insurance provision lets your insurer make direct payments to your doctor or hospital

Comprehensive major medical policy

The insurance that helps pay hospital, surgical, medical, and other bills with a low deductible is known as a(n)

Minimize personal, property, and liability risks.

The main goal when setting insurance goals to

Credit life

This life insurance is used to pay off certain debts, such as auto loans, in the event that you die before the debts are pain in full. Which of the following is not the best buy for the amount of protection offered for an individual?

Multiyear level term

This term insurance policy will guarantee that you will pay the same premium for the duration of your policy.

Point of service (POS) plan

This type of plan combines features of Health maintenance organizations and PPOs. It uses a network of participating physicians and medical professionals who have contracted to provide services for certain fees.

Employers must offer continuing coverage through COBRA for up to 24 months after you leave your job.

Under the Patient Protection and Affordable Care Act of 2010, which of the following is NOT correct?

Using the no-fault system

Various states are trying to reduce the time and cost of settling vehicle injury cases. One alternative is

Premium

What is the fee that a policyholder pays when an insurance company agrees to take on the risk?

A bad disability policy pays you if you cannot work at your regular job

What of the following is incorrect?

It is better to fully fund your IRA, Keogh, or 401(k) before buying an annuity.

When considering why to buy annuities, which of the following statements is correct?

Fixed Annuity

Which of the following allows an individual to receive a fixed amount of income over a certain period of time, or over his or her life?

Renter's insurance covers the building and other structures on the site.

Which of the following is NOT correct about renter's insurance

The cost and number of claims you have should not affect your premium

Which of the following is NOT correct?

The older you are when you enroll, the higher the annual premium.

Which of the following is TRUE about long term care insurance?

Morality and expense risk charge, Administrative fee, Fund Expense, Surrender Charge

Which of the following is a charge you will pay when you purchase a variable annuity?

An annuity is more advisable for people in poor health than for those who are likely to live longer than average

Which of the following is incorrect?

Provide a lifetime maximum level of coverage of up to $50,000

A health insurance plan should include all of the following "must haves" except

Service benefits

A health insurance policy with this provision lists coverage in terms of services, not dollar amounts.

A reimbursement plan

A policy that pays you back for actual expenses is called

Umbrella policy

A policy that supplements your bas personal liability coverage is called a(n)

Internal limit

A provision in a health policy that sets specific levels of repayment for certain services is called

cost of living protection

A young employee is buying individual life insurance and is worried about the impact inflation will have on his life insurance coverage. Which of the following riders should he consider?

Out of pocket limit

After you have reached a certain limit that you must pay for the deductible and coinsurance, the insurance company covers 100% of any additional cost. This is called

Ben

Amy bought a life insurance policy and named Ben as her beneficiary. Amy still lives with her parents who provide some of her living expenses. She has since died. Who will receive the benefits from her policy.

FSA

Anna contributes pretax dollars to an account managed by her employer for her health care expenses. If she does not spend all of her money by the end of the year, she may forfeit it. What kind of plan does she have?

Peril

Anything that may possibly cause a loss is called a

Negligence

Barbara left a skateboard on her front steps. Her neighbor tripped on the skateboard and was injured. The fact that Barbara didn't put away the skateboard is called

Hazard

Barbara left a skateboard on her front steps. Her neighbor tripped on the skateboard and was injured. The skateboard was a

He will not be eligible for any disability income because his disability ended before the elimination period ended.

Cameron age 25 sustained a debilitating hand injury and was unable to perform his job as a viola player in the local orchestra for 45 days. His employer has a disability income insurance policy that pays 70% of take home pay with an elimination period of 60 days and coverage to age 65. Given this information, which of the following is true for Cameron?

210,000

Cheyenne has a home insured for $300,000. It would cost $320,000 to rebuild her home. If she has home insurance that provides personal property coverage at 70% of value, how much of her household belongings would be covered?

Stop-loss provision

Fran is interested in purchasing a major medical policy that limits the total out of pocket amount that she will have to pay. She should consider a

Family need method

Francisco and Maria have three children and want to complete a detailed worksheet to determine the amount of life insurance they need to purchase. They will consider factors such as Social Security and liquid assets. Which method are they using to determine their life insurance needs?

Accidental death benefit

Frank, age 38 was killed in a car accident. Which of the following riders provided an additional benefit for his heirs?

Incontestability clause

Fred bought life insurance five years ago. He forgot to tell them that he had a heart condition, and, as a result of that condition, he recently died. Which of the following provisions prevents the life insurance company from refusing to pay his beneficiaries because of his original fraudulent misrepresentation?

Misstatement of age provision

Fred bought life insurance when he was 47 although he told the insurance company that he was 42. He has since died. Which of the following provisions will affect the amount of money his beneficiaries will receive?

$2,500

Georgia has a health insurance policy that includes a deductible of $500. If her total bill is $3,000, how much will her insurance pay?

$800

Georgia is considering between two health insurance policies. One includes a deductible of $600 and the other includes a coin-insurance of 20%. If a bill is $4,000, how much will she be required to pay under the policy with the coin insurance?

The grace period

Georgia was supposed to pay her premium by the 15th of the month. Which of the following provisions allows her to keep coverage id she is a couple of weeks late with paying her premium (without penalty)?

Comprehensive physical damage coverage.

Henry was driving at dusk and hit a deer running across the road. His damage would be covered under his

130,000

Holly and Matt want to use the "nonworking" spouse method to determine the amount of life insurance coverage they need. If their two children are ages 9 and 5 years old, how much fo they need?

Business property

Home insurance policies include coverage for all of the following except

40-60%, with some plans paying up to 75%

How much does a private income insurance program pay for loss of normal income from a disability?

Guaranteed renewability

If you are concerned that your disability insurer may try to cancel you coverage if your health becomes poor, you should look for a plan that offers

Risk avoidance

If you choose to avoid the risk of a traffic accident by not driving to work, you are using

Risk shifting

If you choose to insure your home or your vehicle, you are using

Risk assumption

If you choose to take responsibility for the negative results of a risk, you are using

Risk reduction

If you choose to wear your seat belt, you are using

You can convert your term policy to a permanent policy.

If you have a conversion term policy

Your premium will be the same for the duration of your policy.

If you have a multiyear level term policy

Medigap

Individuals over the age of 65 who are eligible for medicare may also be interested in purchasing more coverage called

Personal property floater

Insurance that covers valuable items, such as an expensive musical instrument, is called

Medicaid

Jack needs comprehensive medical coverage. However, his income is very low. What plan should he investigate?

HSA

Jacobi is concerned that his out of pocket health care expenses will be quite high, so he is considering adding contributions to a tax free account that he can use with his high deductible policy to cover catastrophic expenses. What kind of plan does he have?

Worker's compensation

Katrina was injured in an accident at work. The benefits she will receive to cover part of her income will come from

The legal responsibility for the financial cost of another person's losses or injuries.

Liability is defined as

Property damage liability coverage

Madeline had a severe allergy attack and crashed her car into a telephone pole while sneezing. The damage to the telephone pole would be covered under Madeline's

98,000

Marianne and Roger are in good health and have reasonably secure careers. Each earns $45,000 annually. They own a home with a $125,000 mortgage; they owe $25,000 for their car loans and have $22,000 in student loans. If one should die, they think that funeral expenses would be $12,000. What is their total insurance need using the DINK method

Social security

Mark was severely injured while on vacation and expects to be unable to work for at least 12 months. Because of his injury, he should expect to be eligible for disability income from

Anyone who is injured in your vehicle, including you.

Medical payments coverage applies to medical expenses of

Variable life

Megan wants to purchase a type of whole life insurance policy that will allow part of her premium to be invested in stock, bonds, or money market funds. Which of the following policies should she buy?

Adjustable life

Molly is thinking about buying a type of whole life insurance policy, but she is not sure about how much she will need in the next few year. She may need to change her coverage as her needs change. Which of the following policies would meet her needs?

HRA

Monica's employer offers a health insurance plan with a very high deductible. IN addition, her employer provides a fund for her to spend specifically on health care. What kind of plan does she have?

It builds cash value

Of the following, which one is the most positive feature of whole life insurance for a person who wants a more structured way to save?

Group life

Pam just started working at XYZ Widget Company and finally wants to get insurance coverage through her employer. She does not want to take a medical exam to get coverage, because she has some underlying health conditions and is concerned that she might not qualify for a policy. Which of the following life insurance policies should she apply for?

Property damage liability coverage

Patrick has an old car and wants to keep his insurance costs down, but he wants coverage in case he damages the property of others, including street sign and telephone pols. In order to minimize the financial impact of an accident he may cause, he should, at a minimum, carry which type of insurance?

Paul's uninsured motorist protection should cover the cost of injuries for Paul and his kids.

Paul was driving his kids to a piano lesson in a 2005 minivan. While driving, he was hit by an uninsured motorist. Although Paul and his kids had only minor injuries, their vehicle was totaled. Bas on this information, which of the following is correct?

Personal property items up to 55-75% of the insured value of the home.

Personal property insurance covers

196,000

Stephanie is the wage earner in a "typical family" with $40,000 gross annual income. Use the easy method to determine how much insurance she should carry.

Health maintenance organization (HMO)

Steve's employer offers a health plan that stresses preventive services and covers routine immunization and checkups, screening program, and diagnostic test. What kind of plan does his employer offer?

Proceeds left with the company

The settlement option in which the company acts as trustee and pays interest to the beneficiary is called

Limited installment payment

The settlement option that pays the life insurance proceeds in equal periodic installments for a specified number of years after your death is called

Life Income Option

The settlement option that pays the life insurance proceeds to the beneficiary for as long as she or he lives is called

Physician expense

The type of health insurance coverage that may cover routing doctor visits, X-rays, and lab tests is

Hospital expense

The type of health insurance coverage that pays for some or all of the daily costs of room and board during a hospital stay is

Immediate Annuity

Which of the following annuities is purchased with a lump sum payment and allows an individual to receive income payments beginning now?

The policy will return all premiums if you survive to the end of the policy.

Which of the following is NOT a feature of whole life insurance?

Term life

Which of the following is NOT a type of permanent insurance?

Policy reinstallment

Which of the following provisions requires the policyholder to again qualify as an acceptable risk and pay overdue premiums with interest in order to put a lapsed policy back in force?

An elderly neighbor

Who is most likely to use a home health care agency

Preferred provider organization

Yvonne's employer offers a health plat that has a group of doctors and hospitals that agree to provide specified medical services to members at prearranged fees. This health offers some flexibility since members can either visit a physician from a list or go to their own doctors. What kind of plan does her employer offer?

Comprehensive physical damage coverage

Zachary live in a neighborhood that was known for gang activity. One day, he noticed that his car had been vandalized. This damage would be covered under his