Quiz: Licensee Responsibilities in Selling Life Insurance

Which of the following is a correct statement about HIV testing by health insurers? A. Applicants must give their informed written consent before they can be tested for HIV. B. Insurers may not deny coverage on the basis of test results. C. Insurers cannot ask an applicant to submit to an HIV test. D. HIV test results are not confidential.

A. Applicants must give their informed written consent before they can be tested for HIV. Testing for HIV may be done only with the informed consent of the applicant.

How long are replacing insurers required to keep an applicant's Notice Regarding Replacement? A. two years B. three years C. six years D. five years

D. five years Replacing insurers must be able to produce copies of the Notice Regarding Replacement for at least five years or until the next regular examination by the Insurance Department of a company's state of domicile, whichever is later.

Which of the following is not considered unfair discrimination in the availability of insurance? A. previous rejection by another insurer B. previous cancelation by another insurer C. previous nonrenewal by another insurer D. previous acceptance by another insurer

D. previous acceptance by another insurer An insurer decision on the availability of insurance for an individual, other than life or health insurance, that is based on previous rejection, cancelation, or nonrenewal of insurance by another insurer is unfair discrimination.

In which of the following transactions is a replacement notice required? A. Mary is selling a replacement life insurance policy. B. Sherry is selling group life insurance. C. Terry is selling a replacement policy, and the existing and replacing insurer are the same. D. Larry is selling a life insurance policy.

A. Mary is selling a replacement life insurance policy. Replacement rules do not apply to group life insurance or to transactions where life insurance is replaced by the same insurer. Larry is not necessarily selling a replacement policy.

A consent form for HIV testing signed by an applicant is valid for how long? A. 1 year B. 6 months C. 1 month D. 30 days

B. 6 months A consent form for HIV testing signed by an applicant is valid for six months.

Insurers must notify existing insurers affected by a proposed replacement within how many days of receiving a completed application indicating replacement? A. five business days B. three business days C. seven business days D. ten business days

A. five business days Insurers must notify any other existing insurer affected by the proposed replacement within five business days of receiving a completed application indicating replacement or when the replacement is identified if not indicated on the application.

How long must insurers maintain sales materials relating to replacement life insurance policies? A. five years B. four years C. three years D. one year

A. five years Insurers must have the ability to produce copies of sales materials, the basic illustration, any supplemental illustrations related to the specific policy or contract purchased, and the producer's and applicant's signed statements with respect to financing and replacement for at least five years after the termination or expiration of the proposed policy.

Department rules regarding replacement of insurance apply to which of the following? A. group life insurance B. changes to an insurance contract C. reduction in a policy's benefits or term D. credit life insurance

C. reduction in a policy's benefits or term Replacement rules apply primarily to transactions in which an existing contract will be lapsed, forfeited, or surrendered; reduced in value, benefits, or term; reissued with any reduction in cash value; or used in a financed purchase.