Practice exam #6

In order to collect Social Security disability benefits, the claimant must be able to demonstrate that the disability will last at least

12 months

Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by an underwriter?

medical history

Another name for a substandard risk classification is

rated

Which of the following insurance options would be considered a risk-sharing arrangement?

reciprocal

Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of

twisting

What process will the insurance company use to monitor the insured's hospital stay to make sure that everything is proceeding according to schedule?

Concurrent review

Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts?

Continuation provision

A policyowner who is also the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of ownership. The policyowner should have her husband named as the

Revocable beneficiary

Which of the following policies would be classified as a traditional level premium contract?

Straight life

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

The date of medical exam

The minimum interest rate on an equity indexed annuity is often based on

The insurance company's general account investments.

A Return of Premium term life policy is written as what type of term coverage?

increasing

According to OBRA, what is the minimum number of employees required to constitute a large group?

100

Following hospitalization because of an accident, Bill was confined in a skilled nursing facility. Medicare will pay full benefits in this facility for how many days?

20

Terminally ill patients are expected to survive how many months or less?

24 months

Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?

30 months

What documentation grants express authority to an agent?

Agent's contract with the principal

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

Under a Key Person disability income policy, premium payments

Are made by the business and are not tax-deductible.

A person applying for a manager or exclusive general agent license must meet all of the following criteria EXCEPT

Be responsible for at least 25% of total commissions collected by the office that he or she manages.

Which of the following are NOT fundable by annuities?

Death benefits

All of the following are dividend options EXCEPT

Fixed period installments

Which of the following does a producer NOT have the authority to do?

Issue policies

A couple receives a set amount of income from their annuity. When the wife dies, the husband no longer receives annuity payments. What type of annuity did the couple buy

Joint Life

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

A long-term care insurance shopper's guide must be provided in the format developed by which of the following?

NAIC

Which of the following are the main factors taken into account when calculating residual disability benefits?

Present earnings and earnings prior to disability

A long-term care shopper's guide must be presented at what point?

Prior to the time of application

Which of the following statements regarding conditional receipts is true?

Temporary insuring agreement

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

Under an extended term nonforfeiture option, the policy cash value is converted to

The same face amount as in the whole life policy

What is the purpose of coinsurance provisions?

To help the insurance company to prevent overutilization of the policy

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

Universal Life - Option A

Who effectuates viatical settlement contracts?

Viatical settlement providers

A tax-sheltered annuity is a special tax-favored retirement plan available to

certain groups of employees only

If a beneficiary wants a guarantee that benefits paid from principal and interest would be paid for a period of 10 years before being exhausted, what settlement option should the beneficiary select?

fixed period