Exam Simulator FL-LH - FL Health and Life and Annuity
XYZ Company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is:
100%
What is the maximum Social Security Disability benefit amount an insured can receive?
100% of the insured's Primary Insurance Amount (PIA)
An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.
15
The minimum age at which a person can sign a life insurance application is
15 years
A 15-year mortgage is best protected by what kind of lice policy?
15-year decreasing term
Qualified Long-Term Care policies may take into consideration an applicant's pre-existing conditions for a maximum of not more than __ month(s) prior to the effective date of coverage.
6
Three law partners form a Cross-Purchase Buy and Sell agreement. This agreement is funded with individual life insurance. How many total life policies are needed for this agreement?
6
The waiting period for a pre-existing condition under a Medicare Supplement policy may NOT go beyond
6 months
"A producer does not have the authority to change a policy or waive any of its provisions". The health provision that best describes this statement is called the
Entire contract
When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called the:
Entire contract provision
Which of the following is NOT a consequence for placing business with an unauthorized insurer?
First degree misdemeanor
After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms?
File written proof of loss
The purpose of the _________ Period clause is to avoid an unintentional lapse of a life insurance policy.
Grace
Which of the following is a standard provision of the conversion privileges in a Group Life policy?
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
A sole proprietor may use this plan ONLY if the employees of this business are included.
Individual Retirement Account (IRA)
Which of these actions should a producer take when submitting an insurance application to an insurer?
Inform insurer of relevant information not included on the application
A Multiple Employer Welfare Arrangement (MEWA) provides what type of benefits?
Insurance
Multiple Employer Welfare Association (MEWA) provides what type of benefits?
Insurance
Which of the following situations are NOT subject to Florida life insurance laws?
Insurance companies' day-to-day operations
Who has the option to renew a Renewable Term policy?
Insured
What is the initial requirement for an insured to become eligible for benefits under the Waiver of premium provision?
Insured must be under a physician's care
Which of these needs is satisfied by Adjustable Life Insurance
Insured's need for flexible premiums
T was treated for an ailment 2 months prior to applying for health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards. How will the insurer likely consider this condition?
Insurer will likely treat as pre-existing condition which may not be covered for one year.
The ______________ clause indentifies which losses resulting from an accident or sickness are insured by the policy.
Insuring
Which of the following health insurance policy provisions specifies the health care services a policy will provide?
Insuring clause
Which of the following claims are typically excluded from Medical expense policies?
Intentionally self-inflicted injuries
Which of these arrangements allows one to bypass insurable interest laws?
Investor-Originated Life Insurance
A life insurance arrangement which circumvents insurable interest statues is called:
Investor-originated Life Insurance
A policyowner would like to change the beneficiary on a Life insurance policy and make the change permanent. Which type of designation would fulfill this need?
Irrevocable
What kind of Accidental Death and Dismemberment (AD&D) insurance beneficiary requires his/her consent when a change of beneficiary is made?
Irrevocable beneficiary
Which type of life insurance beneficiary requires his/her consent when a change of beneficiary is attempted by the policyowner?
Irrevocable beneficiary
Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for a Disability income policy?
Issue the policy with an altered Time of Payment of Claims provision
In Major Medical Expense policies, what is the objective of a Stop Loss provision?
Limits an insured's out-of-pocket medical expenses.
When a life insurance policy exceeds certain IRS table values, the result would create which of the following?
Modified Endowment Contract (MEC)
K buys a policy where the premium stays fixed for the first 5 years. The premium then increases in year 6 and stays level thereafter, all the while the death benefit remains the same. What kind of policy is this?
Modified Whole Life
which of these life products is NOT considered interest-sensitive?
Modified whole life
Which of the following characteristics is associated with a large group disability income policy?
No medical underwriting
According to Florida law, when must an agent deliver the outline of Coverage to a Medicare Supplement applicant?
At the time of application
At what time must a policyowner have insurable interest on the insured in order for the life policy to be valid?
At the time of application
P is a new employee and will be obtaining non- contributory group Major Medical insurance from her employer. Which of the following actions must she take during the open enrollment period?
Sign an enrollment card
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers (and their families) whose employment has been terminated the right to
continue group health benefits
What type of group insurance plan involves employees sharing the cost?
contributory plan
When a policyowner exchanged a term policy for a whole life policy without providing proof of good health, which of these apply?
conversion provision
Which of the following BEST defines usual, customary, and reasonable (UCR) charges?
The maximum amount considered eligible for reimbursement by an insurance company under a health plan
Medicare is intended for all of the following groups, EXCEPT:
Those enrolled as a full-time student
What is the elimination period of an individual disability policy?
Time period a disabled person must wait before benefits are paid
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privilege gives T the right to convert
To an individual policy upon employment termination
Why is an applicant's signature required on a life insurance application
To attest that the statements on the application are accurate to the best of the applicant's knowledge
Which policy requires an agent to register with the National Association of Securities Dealers (NASD)
Variable Life
A(n) ______________ _____________ Life policy combines investment choices with a form of Term coverage
Variable Universal
A life policy that contains a monthly mortality charge as well as self-directed investment choices is called a(n)
Variable Universal Life policy
A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as:
Variable life
Life insurance immediately creates an estate upon the death of an insured. Which of the following policies is characterized by a guaranteed minimum death benefit?
Variable life
When a misrepresentation on a life insurance policy application is discovered, what action may an insurance company take?
Void the policy only if it is discovered during the Contestable period and proven to be material
The provision in a Group Health policy allows the insurer to postpone coverage for a covered illness 30 days after the policy's effective date is referred to as the:
Waiting period
A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached?
Waiver of Premium
What type of rider would be added to an Accident and Health policy if the policyowner wants to ensure the policy will continue if he/she ever becomes totally disabled?
Waiver of premium rider
Which parts of a life insurance policy are guaranteed to be true?
Warranty
At what point does an informal contract become binding?
When one party makes an offer and the other party accepts that offer
A $20,000 life insurance policy application is completed, however the producer does not collect the initial premium. At what point does the coverage go into effect?
When the applicant receives the policy and pays the initial premium
What action will an insurer take if an interest payment on a policy loan is not made on time?
automatically add the amount of interest due to the loan balance
The coordination of benefits (COB) provision exists in order to
avoid duplication of benefit payments
What is considered to be a characteristic of an immediate annuity?
benefit payments start within one payment period of purchase
All of following are considered to be typical characteristics describing the nature of an insurance contract, EXCEPT:
bilateral
What is the initial source of underwriting for an insurance policy?
Application containing statements from the insured
When is a Group Health policy required to provide coverage for a newborn child?
At the moment of birth
P is self-employed and owns an Individual Disability Income policy. He becomes totally disabled on June 1 and receives $2,000 a month for the next 10 months. How much of this income is subject to federal income tax?
$0
T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?
$0
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?
$20,000 death benefit
An insured covered by a group Major Medical plan is hospitalized after sustaining injuries that resulted from an automobile accident. Assuming the plan had a $1,000 deductible and 80/20 Coinsurance clause, how much will the INSURED be responsible to pay with $11,000 in covered medical expenses?
$3,000
P purchases a $50,000 whole life insurance policy in 2005. One of the questions on the application asks if P engages in scuba diving, to which P answers "No". The policy is then issued with no scuba exclusions. in 2010, P takes up scuba diving and dies in a scuba-related accident in 2011. What will the insurer pay to P's beneficiary?
$50,000 minus any outstanding policy loans
what is the required minimum percentage of employee participation for a noncontributory group health insurance plan according to Florida Law?
0%
Which of the following types of Term Life policies most likely contains a Renewability feature?
10 Year Convertible Term
in Florida, monthly-premium health insurance policies must provide a grace period of at least
10 days
in Florida, monthly-premium insurance policies must provide a grace period of at least
10 days
Premature IRA distributions are assessed a penalty tax of
10%
Premature IRA distributions are assessed a penalty tax of:
10%
a life policy loan in Florida cannot charge a fixed rate of interest higher than
10%
Under the USA Patriot Act, insurers are required to report receipt of cash payments in excess of:
10,000
A non-contributory plan requires _________ participation of all eligible employees
100%
What percentage of eligible persons must a policy cover in a noncontributory group?
100%
M has a Major Medical insurance policy with a $200 flat deductible and an 80% Coinsurance clause. If M incurs a $2,200 claim for an eligible medical expense, how much will M receive in payment for this claim?
1600
An insurance company can contest a life insurance contract due to application fraud within
2 years
Employers with less than __ employees are affected by Florida's Health Insurance Coverage Continuation Act (Mini COBRA).
20
insurers may request a hearing within _____________ if their policy is rejected
20 Days
An individual participant personally received eligible rollover funds from a profit-sharing plan. What is the income tax withholding requirements for this transaction?
20% is withheld for income taxes
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?
20-Pay Life accumulates cash value faster than Straight Life
Eligibility for coverage under the Florida Healthy Kids Corporation requires a family to be within ________ of the federal poverty level.
200%
The USA Patriot Act was enacted in:
2001
in what year was The Florida Office of Financial Regulation (OFR) created?
2003
How many hours of continuing education must a newly licensed agent complete every two years ?
24
A life insurance policy's grace period entitles the insured a period of no less than __ days to make the premium payment
30
Within how many days after policy delivery can a Medicare Supplement policy be returned for a 100% premium refund?
30
within how many days after policy delivery can a Medicare Supplement policy be returned for a 100% premium refund
30
N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?
30 Pay Life
How long is the typical free look period for Long Term care insurance policies?
30 days
According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid?
31 days
S is employed by a large corporation that provides group health coverage for its employees and their dependents. If S dies, the company must allow his surviving spouse and dependents to continue their group health coverage for a maximum of how many months under COBRA regulations?
36 months
A __ day notice to the policyholder is required for any health insurer that wishes to cancel a health insurance policy
45
A licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?
48 months
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of aw and ethics every two years
5
One becomes eligible for Social Security disability benefits after having been disabled for
5 months
In Florida, what is the maximum percentage of controlled business an agent may produce?
50%
How long does an individual have to "rollover" fund from an IRA or qualified plan?
60 days
According to Florida law, an additional lapse notice must be issued after the standard grace period has expired for policyowner age
64 or older older
Which of these is an element of a Variable Life policy?
A fixed, level premium
Which statement is TRUE regarding a Variable Whole Life policy?
A minimum guaranteed Death benefit is provided
Which of the following statements about noncontributory employee group life insurance is FALSE?
A minimum number of employees is required to participate
What do families pay that are covered by the Florida Healthy Kids Corporation?
A portion of the premium
P received Disability income benefits for 3 months then returns to work. She is able to work one month before her condition returns, leaving her disabled once again. What would the insurance company most likely regard this second period of disability as?
A recurrent disability
What do Dread Disease policies cover?
A specific disease or illness
What is Florida's definition of Life insurance replacement?
A transaction in which new policy is bought and an old policy is terminated
All are true statements regarding the underwriting process, EXCEPT:
AIDS and HIV virus exams can be conducted in a discriminatory fashion
P is blinded in an industrial accident. Which provision of his life insurance policy will pay a stated benefit amount?
Accidental Death and Dismemberment clause (AD&D)
A "reimbursement policy" pays what amount of covered Long-Term care expenses?
Actual covered expenses up to the daily maximum
Which of the following types o care is typically not covered in a Long-Term Care policy?
Acupuncture
Common exclusions to continuation of group coverage include:
All of the above
J owns a business and has a group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
All of the employees must be notified of the cancellation either by the insurance company or through J
Which of the following statements is CORRECT regarding the tax treatment of a lump-sum payment paid to a life insurance policy's primary beneficiary?
All proceeds are income tax free in the year they are received
The Consideration clause in a life insurance contract contains what pertinent information?
Amount of premium payments and when they are due
P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?
An immediate annuity
Which of the following statements BEST describes what the Legal Actions provision of an Accident and Health policy requires?
An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed
An example of false advertising would be
An insurer exaggerating its dividends in a magazine advertisement
What does the insuring agreement in a Life insurance contract establish?
An insurer's basic promise
Which premium schedule results in the lowest cost to the policyowner?
Annual
Which product would best serve a retired individual looking to invest a lump-sum of money through an insurance company?
Annuity
When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n)
Anti-Money Laundering violation
Which of the following is the best description of 'insurer'?
Any person, corporation, association, or society that writes insurance contracts
When can a policyowner change a revocable beneficiary?
Anytime
Any changed made on an insurance application requires the initials of whom?
Applicant
Which of the following medical expenses does Cancer insurance NOT cover?
Arthritis
Which of the following acts is an agent NOT authorized to do on behalf of an insurer?
Authorize claim payments
All of the following are Nonforfeiture Options EXCEPT
Automatic Premium Loan Option
T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?
Benefits are taxable to T
The difference between group insurance and blanket health policies are:
Blanket health policies do not issue certificates
Which type of policy would pay an employee's salary if the employer was injured in a bicycle accident
Business Overhead Expense
Many small business owner worry how their business would survive financially if the owner becomes disabled. The policy which BEST addresses this concern is:
Business Overhead Expense
Which of these is NOT considered to be a cost connected with an individual's death?
Business expenses
Which of these circumstances is a business Disability Buy-sell policy designed to help in the sale of a busness?
Business owner becoming disabled
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product?
Buyer's guide
A policy loan is made possible by which of these life insurance policy features?
Cash value provision
A company that owns a life insurance policy on one of its key employees may do all of the following EXCEPT
Change the policy's interest rate
The Bureau of Unclaimed Property is overseen by the
Chief Financial Officer
Whose life is covered on a life insurance policy that contains a payor benefit clause?
Child
S is covered by a whole life policy. Which insurance product can cover his children?
Child term rider
Which rider provides coverage for a child under a parent's life insurance policy?
Child term rider
What type of employee welfare plans are not subject to ERISA regulations
Church plans
A Disability income policyowner recently submitted a claim for a chronic neck problem that has now resulted in total disability. The original neck injury occurred before the application was taken 5 years prior. The neck injury was never disclosed to the insurer at the time of application. How will the insurer handle this claim?
Claim will be paid and coverage will remain in force
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
Coercion
A Major Medical policy typically contains a provision that requires the insurer to pay only part of a loss, while the balance is paid by the insured. This provision is called.
Coinsurance
on August 6, D submitted and application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer take?
Collect initial premium along with a signed health statement
Which of the following areas of state regulation is NOT protected by the saving clause in ERISA?
Commerce
Which of the following organizations would make reimbursement payments directly to the insured individual for covered medical expenditures?
Commercial insurer
This type of deductible provision states that should more than one family member be involved in a common accident, or suffer the same illness, only one individual deductible amount shall be applied.
Common accident deductible
Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?
Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company
An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?
Consideration clause
Which of these require an offer, acceptance, and consideration?
Contract
All of the following are eligibility requirements for an association group EXCEPT:
Contributory plans require minimum of 25 participants
What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability?
Conversion
K has a life insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an automobile accident, where would the death proceeds be directed?
Daughter
K has an Accidental Death and Dismemberment (AD&D) insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an automobile accident, where would the death proceeds be directed?
Daughter
Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?
Decreasing Term
What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?
Decreasing term
F needs life insurance that provides coverage for only a limited amount of time with a death benefit that changes regularly to a schedule. What kind of policy is needed?
Decreasing term policy
P, age 50, purchased an annuity that P will fund with $500/ month for 15 years. The annuity will then pay P retirement payments after the 15 years. Which type of annuity did P purchase?
Deffered
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission
in the event of an illness, a(n) _________________ ___________ policy would reimburse an insured for loss of earnings.
Disability Income
A characteristic of preferred provider organizations (PPOS) would be:
Discounted fees for the patient
Which of the following does Social Security NOT provide benefits for?
Dismemberment
How are Roth IRA distributions normally taxed?
Distributions are received tax-free
M becomes disabled and is unable to work for six months. M dies soon after from complications arising from this disability. M has a Disability income policy that pays $2,000 a month. Which of the following statements BEST describes what is owed to her state?
Earned, but unpaid benefits
What provision in a life insurance policy states that the application is considered part of the contract?
Entire Contract provision
Under a trustee group life policy, who would be eligible for a certificate of coverage?
Employee
P owns a $25,000 Life Policy that pays the face amount to him if he lives to age 70, or to his beneficiary if he dies before age 70. What kind of policy does P own?
Endowment at Age 70
Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?
Entire Contract
N is a student pilot with a large life insurance policy. Which of these features would limit the insurer's obligation in the event N was killed while flying as a student pilot?
Exclusion
Term insurance has which of the following characteristics?
Expires at the end of the policy period
D owns a Whole Life policy that was purchased 10 years ago. If the premium payments suddenly stop and D takes no additional action, which Nonforfeiture Option will the insurer likely proceed with?
Extended term
From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?
Fair Credit Reporting Act
What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?
Family Maintenance Policy
What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pay a lump sum benefit of that 30 years?
Family Maintenance Policy
P is looking to purchase a life insurance policy that will pay a stated monthly income to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end of that 20 year period. What type of policy should P purchase?
Family Maintenance policy
This type of deductible provision waives the deductible for all family members after some of them have satisfied individual deductibles within the same year:
Family maximum deductible
N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?
Fixed deferred
The payments on Q's annuity are no less than $250 quarterly. Which of the following annuities does Q own?
Flexible installment Deferred
S, while in the process of converting her group life insurance to an individual policy, dies. What happens to the claim her beneficiary submits?
Full benefits are payable under the Master contract
Which of the following employees may NOT be excluded from a group life plan?
Full-time employees after the probationary period
A life insurance application may be rejected on the basis of all of these factor EXCEPT
Gender
With Accidental Death and Dismemberment policies, what is the purpose of the Grace Period?
Gives policyowner additional time to pay overdue premiums
A medical care provider which typically delivers health services at its own local medical facility is known as:
Health Maintenance Organization
J is a subscriber to a plan which contracts with doctors and hospitals to provide medical benefits at a predetermined price. What type of plan does J belong to?
Health Maintenance Organization
Which of these retirement plans can be started by an employee, even if another plan is in existence?
IRA
Tom has a qualified retirement plan with his employer that is currently considered to be 80% "vested". How can this be interpreted?
If Tom's employment is terminated, 20% of the funds would be forfeited
In regards to representations or warranties, which of these statements is TRUE?
If material to the risk, false representations will void a policy
Which of the following statements about Health Reimbursement (HRA) is CORRECT?
If the employee paid for qualified medical expenses, the reimbursements may be tax-free
Which of the following statements about Health Reimbursement Arrangements (HRA) is CORRECT?
If the employee paid for qualified medical expenses, the reimbursements may be tax-free
How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy?
If the primary beneficiary dies before the insured
W is a 39-year old female who just purchased an annuity to provide income for life starting at age 60. All of these would be acceptable annuity choices EXCEPT a(n)
Immediate annuity
When must insurable interest exist for a life insurance contract to be valid?
Inception of the contract
When determining the monthly benefit amount for a Disability Income policy, the factor that limits the amount a prospective insured may purchase is:
Income
All of the following statements regarding a Tax Sheltered Annuity (TSA) are true EXCEPT:
Income derived from the TSA is received income tax-free
At the age of 45, an individual withdraws $50,000 from his Qualified Profit-Sharing Plan and then deposits this amount into a personal savings account. This action would result in:
Income tax and a %10 penalty assessed upon funds withdrawn from the Qualified Plan
A 55 year old recently received a $30,000 distribution from a previous employer's 401k plan. minus $6,000 withholding. Which federal taxed apply if none of the funds were rolled over?
Income taxes plus a 10% penalty tax on $30,000
T, age 70, withdraws cash from a profit-sharing plan and purchases a Straight life Annuity. What will this transaction provide?
Income that cannot be outlived by the owner
Who is a mutual insurance company owned by?
Its policyholders
What type of life policy cover 2 lives and pays the face amount after the first one dies?
Joint Life Policy
What type of life policy covers 2 lives and pays the face amount after the first one dies?
Joint life Policy
K, age 45, and his wife, age 43, have three children. They purchase a Family Policy that covers K's wife to age 65. All of these situations will pay a death benefit EXCEPT
K'S wife dies at age 66
Life insurance that covers an insured's whole life with level premiums paid over a limited time is called:
Limited Pay Life
A sole proprietor may use this plan ONLY if the employees of this business are included
Keogh Pension Plan
An architecture firm would stand to lose a lot of money in the vent of the death of its project manager. Which type of policy should be firm purchase on its project manager?
Key person insurance
Which of the following BEST describes how a policy that uses the "accidental bodily injury" definition of an accident differs from one that uses the "accidental means" definition?
Less restrictive
T has an annuity that guarantees an income payment for the rest of his life. The contract also guaranteed that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this?
Life Annuity with Period Certain
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?
Life Income
If an agent would like to sell Variable annuities, which state examination must the agent pass?
Life and Variable contracts
Under Florida law, which of the following provisions is NOT required in a Medicare Supplement policy?
Limitation on pre-existing condition for up to 12 months
Which of these is NOT relevant when determining the amount of personal life insurance needed>
Local unemployment rates
An Insured's inability to perform two or more activities of daily living may trigger which type of life policy rider?
Long term care
An insured's inability to perform two or more activities of daily living may trigger which type of life policy rider?
Long term care
What is the main reason for regulating the insurance industry?
Maintain the solvency of insurance companies
A catastrophic illness would be best covered by which of the following health insurance plans?
Major Medical
Which of the following types of health coverage frequently uses a deductible?
Major Medical policy
According to Florida law, which of the following does NOT need to be obtained by an agent recommending annuity purchase?
Marital status
Asset protection can be provided by a long-term care partnership policy if the policyholder qualifies for
Medicaid
If a retiree on Medicare required five hospital stays in one year, which policy would provide the best insurance for excess hospital expenses?
Medicare supplement
Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?
Misrepresentation
According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?
Monthly
According to the Time Payment of Claims provision, the insurer must pay Disability income benefits no less frequently than which of the following options?
Monthly
Under an individual Disability policy in Florida, what is the minimum schedule of time in which claims must be made to an insured?
Monthly
what are adjustable rates for life policy loans in Florida based on?
Moody's corporate bond index
Which of the following BEST describes how a Preferred Provider Organization (PPO) is less restrictive than a Health Maintenance Organization (HMO)
More physicians to choose from
In Florida, which of the following practitioners normally do NOT receive payment from health insurance policies?
Naturopaths
A Disability Income policy that only the policyowner can terminate and which the rates will never go up is considered to be
Noncancellable
When funds are shifted straight from one IRA to another IRA, what percentage of the tax is withheld?
None
Which of these statements concerning an individual Disability Income policy is TRUE?
Normally includes an Elimination period
Which of these statements concerning an individual Disability income policy is TRUE?
Normally includes an Elimination period
which statement is true regarding a minor beneficiary?
Normally, a guardian is required to be appointed in the beneficiary clause of the contract
Which statement is true regarding a minor beneficiary ?
Normally, a guarding is required to be appointed in the Beneficiary clause of the contract
Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy?
Notice to existing and replacing insurers of intention to replace
S filed a written proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning:
November 1 ( 60 days )
Which entity approves the insurance policy forms used in Florida?
Office of insurance Regulation (OIR)
In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy?
Owner's right
P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to
P Only
P is the insured on a participating life policy. Which statement is true if P's premiums are waived due to a disability?
P will still receive declared dividends
Which of these statements is INCORRECT regarding a Preferred Provider Organization (PPO)?
PPO'S are NOT type of managed care systems
K owns a Whole Life policy. If K wants an increasing Death Benefit to protect against inflation, which Dividend option should she chose?
Paid-Up Additional insurance
K is an agent who made an improper sale of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay monetary restitution to the client
Which life insurance rider typically appears on a Juvenile life insurance policy?
Payor benefit rider
A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision?
Payor provision
Which of the following best describes a contingent beneficiary?
Person designated by the insured to receive policy proceeds in the event that the primary beneficiary dies before the insured
When an employee is terminated, which statement about a group term life conversion is true?
Policy proceeds will be paid if the employee dies during the conversion period
Which of the following information is NOT requires to be included in a Whole Life policy?
Policy's guaranteed dividend table
On a life insurance policy, who is qualified to change the beneficiary designation?
Policyowner
On an Accidental Death an Dismemberment (AD&D) insurance policy, who is qualified to change the beneficiary designation
Policyowner
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees?
Portion of the premiums paid by the employer may be a tax deduction
A policyowner is able to choose the frequency of premium payments through what policy feature?
Premium Mode
Which statement is correct regarding the premium payment schedule for whole life policies?
Premiums are payable throughout the insured's lifetime/coverage lasts until death of the insured
Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy?
Premiums are waived after the insured has been totally disabled for a specified time period
What benefit does the payor clause on a Juvenile Life policy provide?
Premiums are waived if the payor becomes disabled
Which of the following actions is NOT possible with a Universal Life policy?
Premiums may be applied as credit against income tax
What is the purpose of the Time of Payment of Claims provision?
Prevents delayed claim payments made by the insurer
What determines the full amount of Social security retirement benefits a qualified individual is entitled to receive?
Primary Insurance Amount (PIA)
A Medical Information Report (MIB) report may disclose which of the following:
Prior use of marijuana
An insured covered by Accidental Death and Dismemberment (AD&D) insurance has just died. What will happen if the primary beneficiary had already before the insured and contingent beneficiary?
Proceeds will go to contingent beneficiary
Which of the following is NOT requires in the outline of Coverage for a health insurance policy?
Projection of the policy's future costs
What is the consideration given by an insurer in the Consideration clause of a life policy?
Promise to pay death benefit to a named beneficiary
When an insured has the same disability within a specified time period and the insurance company provides the same benefits without a new waiting period, the second disability is covered under which of the following benefits?
Recurrent Disability
Which of these Nonforfeiture Options continue a build-up of cash value?
Reduced Paid-Up
K failed to pay a renewal premium within the time granted by the insurer. K then sends in a payment which the insurer subsequently accepts. Which policy provision specifies that coverage may be restored in this situation?
Reinstatement
R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?
Residual Disability
When a person returns to work after a period of total disability but cannot earn as much as he or she did before the disability, this situation is called which of the following?
Residual disability
S buys a $10,000 Whole Life policy in 2003 and pays an annual premium of $100. S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. What kind of rider did S include on the policy?
Return of premium rider
A(n) ____________ beneficiary may be changed by the policyowner WITHOUT the consent of the beneficiary.
Revocable
J would like to maintain the right to change beneficiaries. Which beneficiary designation should be used?
Revocable
M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son?
Revocable
Which of these terms accurately defines an underwriter's assessment of information on a life insurance application?
Risk classification
Which factors are taken into consideration when an insurance company determines the premium rate for a Whole Life policy on an applicant?
Risk of classification
Which of the following are Equity indexed annuities typically invested in?
S&P 500
A prepaid application for individual Disability income insurance was recently submitted to an insurer. When the insurer received the Medical Information Bureau (MIB) report, the report showed that the applicant had suffered a stroke 18 months ago, something that was not disclosed on the application. Which of the following actions would the insurance company NOT take?
Send a notice to the MIB that the applicant was declined
Which of the following statements BEST describes dental care indemnity coverage?
Services are reimbursed after insurer receives the invoice
Which of the following provisions is NOT required in HMO contracts/certificated?
Seven-day grace period
Which mode of payment is NOT used by health insurance policies?
Single premium
What is required in the Florida Employee Health Care Access Act?
Small group benefits plans are to be issued on a "guarantee-issue" basis
The annuity that represents the largest possible monthly payment to an individual annuitant is a(n)
Straight Life anuity
K is shopping for a permanent life insurance policy that will offer her the MOST protection per dollar of annual premium. Which of these policies best fits her need?
Straight life
Which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused by a third party?
Subrogation
An agent selling Medicare Supplement policies must provide every applicant with a(n)
Suitability form
An agent selling Medicare supplement policies must provide every applicant with a(n)
Suitability form
Which of the following statements about accumulated interest earned on dividends from an insurance policy is TRUE?
Taxed as ordinary income
T would like to be assured $10,000 is available in 10 years to replace a roof on his house. What kind of $10,000 policy should T purchase?
Ten-Year-Endowment
What type of life insurance are credit policies issued as?
Term
What type of life insurance gives the greatest amount of coverage for a limited period time?
Term life
Which of these life insurance riders allows the applicant to have excess coverage?
Term rider
Which of the following factors is NOT considered when the Department of Financial Services determines if an agent's home is an insurance agency?
The amount of premium collected at this location
Which statement regarding a Key Employee Life policy is NOT true?
The beneficiary is named by the key employee
Whole Life insurance is sometimes referred to as "Straight Life". What does the word "Straight" indicate when using this phrase?
The duration of premium payments
What is the underlying concept regarding level premiums?
The early years are charged more than what is needed
Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?
The employee
D was actively serving in the Marines when he was killed in an automobile accident while on leave. His $100,000 Whole life policy contains a War exclusion clause. How much will D's beneficiary's receive?
The full face amount
Upon policy delivery, a signed good health statement is requested from the applicant. Why would this be necessary?
The initial premium was NOT submitted with the application
A policy of adhesion can only be modified by whom?
The insurance company
J, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J's age, as stated on the application five years ago, was found to be understated by ten years. Which of the following actions will the insurance company take?
The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age
W gave W's age as 50 when W purchased a Life policy. At the time of W's death seven years later, the company discovered W's true age at issue had been 59. What would the normal procedure be under the misstatement of age provision in regard to the payment of the death claim?
The proceeds would be reduced based on whatever the premium would have been if purchased at age 59
In order for a domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?
The state where they are conducting business
Which of the following statements is true about most Blue Cross/Blue Shield organizations?
They are nonprofit organizations
The Common Disaster clause provides that if both the insured and the sole named beneficiary were to die in a common accident, which of the following is true?
This clause provides the payment of proceeds to the insured's estate
A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as
a representation
A person insured under a health policy is required to give the insurance company a Notice of Claim within how many days after a covered loss?
Twenty
J is an agent who has induced an insured though misrepresentation to surrender an existing insurance policy. What is J guilty of?
Twisting
Which of the following is considered an accurate statement of an unfair trade practice?
Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that they can purchase a new life insurance policy with another company
R becomes disabled and owns an individual Disability Income policy. When is R eligible to receive disability benefits?
Upon satisfying the elimination period requirement
Which of the following BEST describes how pre-admission certification is used?
Used to prevent nonessential medical costs
A Business overhead Expense policy would cover which of the following if a business owner becomes disabled?
Utilities and office rent
A(n) _________ Life policy offers the owner investment in products such as money-market funds, long-term bonds and equities
Variable
What type of annuity has a cash value that is based upon the performance of it's underlying investment funds?
Variable
At what point does a Whole Life Insurance policy endow?
When the cash value equals the death benefit
If an individual is covered under an Accidental Death Policy and dies, an autopsy can be performed in all these situations, EXCEPT:
When the state prohibits this by law
Q would like to purchase $100,000 of permanent protection on his wife and $50,000 of Term coverage on himself under the same policy. What kind of policy should Q purchase?
Whole life policy with other insured rider
In Florida, deceptive advertising is considered to be
a form of misrepresentation
All of the following will result in the suspension of an agent's license EXCEPT
acting with fiduciary responsibility
B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of
additional Whole Life coverage at specified times
a Cost of Living rider gives the insured
additional death benefits
Which premium schedule results in the lowest cost to the policyowner
annual
Group life insurance policies are generally written as:
annually renewable term
An applicant's medical information received from a Medical Information Bureau (MIB) may be furnished to the
applicant's physician
In Florida, the underwriting and issuance of a master group health policy requires all employees
are eligible to participate, regardless of their individual health history
Under a graded Premium policy, the premiums
are lower during the policy's early years
in a qualifies retirement plan, the yearly contributions to an employee's account:
are restricted to maximum levels set by the IRS
An individual covered under a group life insurance policy is considered to be a (n)
certificate holder
K is insured under a Group life insurance policy. K is considered to be a(n)
certificate holder
A Whole Life insurance policyowner does NOT have the right to
change the grace period
One definition of replacement is "the act of replacing an existing insurance policy with another". Replacement
closely regulated and requires full disclosure
The policy summary contains specific information on all of the following, EXCEPT:
commission
Omitting information that affects the issuance or the rate of an insurance contract is called:
concealment
A Universal Life policy is sometimes referred to as an unbundled Life Policy because the owner can see the interest earned, expenses charges, and the
cost of insurance
a Business Overhead Expense policy:
covers business expenses such as rent and utilities
Florida's 14-day free-look period for life insurance policies begins at the
date of delivery
A(n) _______________ term life policy is normally used when covering an insured's mortgage balance.
decreasing
Additional coverage can be added to a whole Life policy by adding a(n):
decreasing term rider
Medicare Part A and Part B do NOT pay for:
dental work
Health insurance benefits NOT covered due to an act of war are:
excluded by the insurer in the contract provisions
A(n) ____________ contained in a life insurance policy stated that the policy will NOT cover certain risks
exclusion
When an insurer issues a policy that refuses to cover certain risks, this is referred to as a(n) :
exclusion
What kind of premium does a Whole Life policy have?
level
The act of an insurance company publishing misleading information about its policy's provisions is called
false advertising
The reason for a business having a Business Overhead Expense Disability Plan is to cover
fixed business expenses
The Financial Services commission may hold hearings
for any reason deemed necessary
The insurance Guaranty Fund Association is
funded by admitted insurance companies through assessments
With Disability Income insurance, an insurance company may limit the monthly benefit amount a prospective policy holder may obtain because of the insured's
gross income at the time of purchase
The Florida Employee Health Care Access Act was established to make
group health insurance available to employers with up to 50 employees
K has a health policy that must be renewed by the insurer and the premiums can only be increased if applied to the entire class of insureds. This type of policy is considered:
guaranteed renewable
Insurers/agents must, in Florida, offer and issue a small employer health plans on a ___________ basis:
guaranteed-issue
Insurers/agents must, in Florida, offer and issue all small employer health plans on a ________________
guaranteed-issue
Variable Life products require a producer to
hold a life Insurance license and Securities license
Which of the following will a Long Term Care plan typically provide benefits for?
home health care
which of the following actions require a policyowner to provide proof of insurability in an Adjustable Life policy?
increase face amount
A life insurance policy would be considered a wagering contract WITHOUT
insurable interest
An insurance company normally has 2 years to contest information provided on an accident and health application. This 2 year period begins on the date that the:
insurer dated the policy
Quarterly premium payments increase the annual cost of insurance because
interest to the insurer is increased while administrative costs are decreased
A foreign insurance company doing business in Florida
is a company that was formed under the laws of another state
Credit Life insurance is:
issued in an amount not to exceed the amount of the loan
In Florida, an element of an insurance transaction would be
issuing an insurance contract
Who owns a stock company
its stockholders
K is looking to purchase Renewable Term insurance. Which of these types of Term insurance may be renewable?
level
An employer that offers a qualified retirement plan to its employees is eligible to
make tax-deductible contributions to the plan
Defamation occurs when an agent makes a false statement intended to
malign another insurer
Rick recently died and left an individual IRA account in his name. His widow was forwarded to the balance of the IRA. The widow qualifies for the:
marital deduction
Periodic health claim payments MUST be made at least:
monthly
With a medical discount plan, how often would a person generally pay a fee to get discounts on specific services?
monthly
According to Florida law, a Group Life insurance policy requires a minimum of how many insureds?
no minimum
If an insurance company issues a Disability income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best describes this policy is called:
noncancellable
Which of the following BEST describes short-term medical expense policy?
nonrenewable
K made a fraudulent statement on her health insurance policy application. In the event of a claim on this policy, the insurance company is required to pay
nothing
The Notice of Claims provision requires a policyowner to:
notify an insurer of a claim within a specified time
An accident policy will most likely pay a benefit for a(n):
off-the-job accident
in Florida, agents are allowed to engage in rebating if
offered to all insureds in the same actuarial class
An example of rebating would be
offering a client something of value not stated in the contract in exchange for their business
An example of unfair discrimination would be
offering different premiums for individuals of the same risk classification
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract
once each year
Upon reaching the limiting age, a handicapped child can extend their health insurance coverage as a dependent
only if the child is incapable of employment and chiefly dependent on the policyowner
Under a life insurance policy the __________ has the authority to name the beneficiary.
owner
Whole Life insurance policies are contractually guaranteed to provide each of the following, EXCEPT:
partial withdrawal features beyond a surrender charge period
The __________ has the right to change a life insurance policy's beneficiary.
policyowner
Who benefits in Investor-Life Insurance (IOLI) when the insured dies?
policyowner
If a policyowner does not pay the premium by the due date, the
policyowner can make the premium payment during the grace period
The fundamental reason for regulation of insurance is to:
protect consumers
A long-term care lapse notice must be delivered to both the applicant and
secondary addressee
A life insurance application must be signed by all of these, EXCEPT:
the beneficiary
The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is
the cost
A noncontributory group term life plan is characterized by:
the entire cost of the plan is paid for by the employer
In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and
the initial premium
During the application process, the agent's primary responsibility is to
the insurance company
The amount of coverage on a group credit life policy is limited to:
the insured's total loan value
According to Florida's life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary Statement when it's requested by
the policyowner
When replacing or exchanging an annuity, the agent must disclose to the annuitant
the possible tax ramification as a result of the transaction
An individual who purchases a Life annuity is given protection against:
the risk of living longer than expected
Association Plans that are designed to provide health benefits to their members are regulated by the state because
they are insured by an authorized insurer
Stranger-Owned Life insurance (STOLI) is when a person purchases life insurance only to sell to a(n)
third-party with no insurable interest
A disability elimination period is best described as a:
time deductible
Group Life policies in Florida are required to contain a conversion privilege that allows for conversion
to an individual policy for a stated period of time
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privileges gives T the right to convert
to an individual policy upon employment termination
An example of an unfair claims settlement practice is
turning down a claim without providing the basis of denial
When is the face amount paid under a Joint Life and survivor policy?
upon death of the last insured
Which of the following phrases refers to the fees charged by a healthcare professional?
usual, customary, and reasonable expenses
Term Life Policies that have the ability to be converted to permanent coverage may do so during a specific time period. This conversion period
varies according to the contract
The provision in a Group Health policy that allows the insurer to postpone coverage for a covered illness 30 days after the policy's date is referred to as the.
waiting period
What must an insurer obtain to conduct an HIV test?
written consent