Simulation Exam

An individual purchased a $100,00 Joint Life policy on himself and his wife. Eight years later he died in an automobile accident. How much will his wife receive from the policy?

$100,000

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

Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to

10 years

What is the minimum age for someone to purchase property insurance in this state (OK)

18

HIPAA applies to groups of

2 or more

Within how many months must a person be expected to die from a sickness in order to be classified as terminally ill?

24 months

An insured has Medicare Part D coverage. Upon reaching the initial benefit limit what percentage of the prescription drug is the insured responsible for paying?

25%

Credit life accident and sickness insurance must be evidenced by an individual or a group certificate delivered to the debtor no later than how many days after the insurance term begins?

30 days

The commissioner has just issued an order regarding a recent hearing. How many days does the producer who was subject to the hearing to appeal to Commissioner's action?

30 days

In the event a policy lapses due to nonpayment of premium within how many days would the policy be automatically reinstated once the outstanding premium is paid?

45 days

The commissioner has a duty to examine each domestic insurer admitted to transact insurance in Oklahoma at least once every

5 years

In the event of the death disablement of a licensee, or other specific events, the Commissioner may issue temporary license to another person to continue their business of insurance. A temporary license is issued for a period not to exceed

6 months

An individual who has been honorably discharged from military service may reinstate prior individual health insurance policy within how many days?

90

Most policies will pay the accident death benefits as long as the death is caused by the accident and occurs within

90 days

Which is NOT a characteristic of group health insurance?

A policy is issued to each insured individual

Which of the following documents delivered to the policyowner includes information about premium amounts cash value surrender values and death benefits for specific policy year?

A policy summary

The term "illustration" in a life insurance policy refers to

A presentation of nonguaranteed elements of a policy

For variable products, underlying assets must be kept in

A separate account

Level term insurance provides a level death benefit and a level premium during the policy term. If the policy renews at the end of a specified period of time, the policy premium will be

Adjusted to the insured's age at the time of renewal

Any life insurance policy that accumulates cash values must include a provision for policy loans after a certain period of time. In the state of Oklahoma, that period of time is

After three full years of premium payments

Which of the following would NOT be a violation of state insurance regulations?

Agent C uses her license to write only business other than controlled

Under what circumstances may a licensed agent hold a consultant's license?

Agents may not hold a consultant's license

How can a new physician be added to the PPO's approved list?

Agree to follow the PPO standards and charge the appropriate fees

In an annuity, the accumulated money is converted into a stream of income during which phase?

Annuitization period

Which of the following is another term for the accumulation period of an annuity?

Annuity period

What is the clause that describes the method of paying the death benefit in the event that the insured and beneficiary are both killed in the same accident?

Common Disaster Clause

If more than one family member covered the under the same major medical policy is injured in the same accident the family only has to pay one deductible. This is due to the

Common accident provision

An insured pays an annual premium to his insurer. In return the insurer promises to pay benefits in accordance with the terms of the contract. This is called

Consideration

After a year of receiving disability income benefits, the insured notices that her monthly benefit has increased slightly. What rider does the policy most likely have that would cause this?

Cost of Living Adjustment Rider (COLA)

Underwriting a group health insurance plan that is paid for by the employer requires all of the following

Coverage for plan participants is uniform The plan is based on other than individual selection All eligible employees must be covered

What characteristics makes whole life permanent protection?

Coverage until death or age 100

The type of insurance sold to a debtor and designed to pay the amount due on a loan if the debtor dies before the loan is repaid is called

Credit life insurance

All of the following are categories of a limited insurance license

Crop Insurance Credit Life Insurance Travel Insurance

In increasing and decreasing term policies which policy component fluctuates during the policy term?

Death benefit

Which of the following is NOT a term for the period of time during which the annuitant of the beneficiary receives income?

Depreciation period

When the insured selects the extended term nonforfeiture option, the cash value will be used to purchase term insurance with what face amount?

Equal to the original policy for as long as the cash values will purchase

Items stipulated in the contract that the insurer will not provide coverage for are found in the

Exclusion clause

An agent selling variable annuities must be registered with

FINRA (Financial Industry Regulatory Authority)

Which of the following criminal activities would be sufficient violation to warrant rejection revocation or suspension of an insurance agent's license?

Forgery

Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated organization or religious organization

Fraternal benefit society

Which of the following policies is characterized by a provision where the premiums are lower in the early years of the policy and increase over time to a point where they become level for the remainder of the policy?

Graded premium whole life

Life income joint and survivor settlement guarantees

Income for 2 or more recipients until they die

Which of the following are enrollment periods for Medicare Part A applicants?

Initial enrollment Special enrollment General enrollment

Which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the insured and to whom the benefits will be paid?

Insuring clause

During partial withdrawal from a universal life policy which portion will be taxed?

Interest

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

Which two terms are associated directly with the premium?

Level or flexible

In a replacement situation all of the following must be considered

Limitations Exclusions Benefits

Which of the following riders added to a life insurance policy can pay part of the death benefit to the insured to cover expenses incurred in a nursing or convalescent home?

Long-term care

An applicant who receives a preferred risk classification qualifies for

Lower premiums than a person who receives a standard risk

All of the following actions can be described as twisting

Making an incomplete comparison between the existing and proposed policies Misrepresenting the terms and conditions of the existing policy to make the new one more attractive Embellishing the terms of the proposed policy in order to convince the insured to switch

During replacement of life insurance, a replacing insurer must do which of the following?

Obtain a list of au life insurance policies that will be replaced

Which of the following is NOT correct regarding false statements by a person engaged in the business of insurance?

Only written statements can be considered fraud

Prior to purchasing a Medigap policy, a person must be enrolled in which of the following?

Parts A and B of Medicare

An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?

Pay the full death benefit

Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner?

Payment of claims

Which of the following has the right to convert the existing term coverage to permanent insurance?

Policyowner

When healthcare insurers negotiate contracts with healthcare providers or physicians to provide health care services for subscribers at a favorable cost it is called

Preferred Provider Organization (PPO)

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 question ions in order to provide insurability and qualified for a discounted premium rate. Which option best describes this scenario?

Re-entry

All of the following are required prostate cancer screening coverages

Screening must consist of a prostate-specific antigen blood test and digital rectal exam Actual cost of screening can no exceed the maximum of $65 per screening Screening must be performed by a qualified medical professional

Which of the following best details the underwriting process for life insurance?

Selection, classification, and rating of risks

The Ownership provision entitles the policy owner to all of the following

Set premium rates Assign the policy Designate a beneficiary

Which of the following are metal levels of coverage offered under the Patient Protection and Affordable Care Act?

Silver, Bronze, Gold

Which of the following are types of whole life insurance?

Single premium Straight life Limited Payment

An employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?

The PPO will pay reduced benefits

Which is NOT true about beneificare designation

The beneficiary must have insurable interest in the insured

Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean?

The beneficiary will only receive payments of the interest earned on the death benefit

Insured Z's health insurance policy year begins in January. His policy contains a carry-over provision. In November, he has a small claim which is less than his deductible. Which of the following is true?

The insured may carry over the amount of this year's expenses to next year which will help satisfy next year's deductible

An insured has a Social Insurance Supplement rider in her disability income plan. Following a disability, she begins receiving benefit payments from the insurer. She then begins receiving Social Security benefits that are smaller than the SIS benefit payments. At that point her insurer ends the SIS benefit payments. Which of the following best describes the situation?

The insured should contact the insurer to confirm her actual social security benefit amount. The SIS rider should pay the difference between the rider amount and the actual benefit amount

Which of the following best describes the "first-dollar coverage" principle in basic medical insurance?

The insurer is not required to pay a deductible

Which of the following will vary the length of the grace period in health insurance policies?

The mode of the premium payment

An agent is in the process of replacing the insured's current health insurance policy with a new one. What of the following would be proper action?

The old policy should stay in force until the new policy is issued

If a policy has an automatic loan provision what happens if the insured dies before the loan is paid back?

The policy beneficiary takes over the loan payments

The policyowner of a Universal Life policy may skip paying the premium and the policy will not lapse as long as

The policy contains sufficient cash value to cover the cost of insurance

An insurer would like to add a provision to its individual health insurance policies. This particular provision would be consistent with uniform provisions. Which of the following is true?

The provision would be allowed as long as it is approved by the state

All of the following are statements about Medicare supplement insurance policies

They are covered by private insurers They cover medicare deductibles and copayments They supplement Medicare benefits

Which of the following is NOT true regarding Equity Indexed Annuities

They earn lower interest rates than fixed annuities

All of the following are true regarding the guaranteed insurability rider

This rider is available to all insured with no additional premium The insured may purchase additional coverage at the attained age The insured may purchase additional insurance up to the amount specified in the base policy

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.

What is the purpose of the buyer's guide

To allow the consumer to compare the costs of different policies

What is the purpose of establishing a target premium for a universal life policy?

To keep the policy in force

What is the purpose of a suicide provision within a life insurance policy?

To protect the insurer from persons who purchase life insurance with the intention of committing suicide

If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?

Unilateral

What kind of policy allows withdrawals or partial surrenders?

Universal life

A policyowner has a health insurance policy with his wife listed as the primary beneficiary. He would like to change the primary beneficiary to his sister. Which of the following is true?

Unless the policy designated the current beneficiary as irrevocable the policyowner can make the change at any time

What is the name for the owner of a life insurance policy who enters into a viatical settlement contract

Viatical settlement provider

Under what condition are group disability income benefits received by an employee NOT taxable as income?

When the benefits received are equal or less than the employee's percentage of the contribution

The main difference between immediate and deferred annuities is

When the income payments begin

Which of the following includes information regarding a person's character reputation, and habits

consumer report

An insurance producer just sold an insurance policy to his sister. What kind of business is this called?

controlled

The commissioner may examine any company or person engaged in the insurance business as often it is deemed appropriate but is required to examine each foreign insurer at least

every 2 years

Which of the following is NOT true regarding the annuitant

the annuitant cannot be the same person as the annuity owner

Graded-Premium Whole Life policy premiums are typically lower initially but gradually increase for a period of 5 to 10 years. After the period of increase the premiums will

Be level thereafter

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

Consideration

Which of the following are essential elements of an insurance contract?

Legal Purpose, Consideration, Agreement

What does level refer to in level term insurance?

Premium

A policy with a 31-day grace period implied

The policy holder may return the policy for a full refund within 31 days

Every licensed agent must notify the Commissioner of an change of the address shown on the license

within 30 days after the change

How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?

within 60 days