final insurance exam

ABC insurance company is replacing an existing life policy from XYZ insurance company. ABC insurance company must provide which of the following documents to XYZ insurance company?

a policy summary

a "reimbursement policy" pays what amount of covered long-term care expenses?

actual covered expenses up to the daily maximum

a term life rider offers the insured

additional life coverage

Under a Long Term Care policy, which benefit would be typically excluded or limited?

alcohol rehabilitation

When an insurance application is taken by a producer, which of these statements is true?

any changes made on the application require the applicant's initials

Any changes made on an insurance application requires the initials of whom?

applicant

what does the ownership clause in a life insurance policy state?

who the policyowner is and what rights the policyowner is entitled to

insurers may request a hearing within___ if their policy is rejected

20 days

which of the following types of organizations are prepaid group health plans, where members pay in advance for the services of participating physicians and hospitals that have agreements?

HMO

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

the commission of insurance MUST give ___ days notice before holding a hearing regarding a producer's unfair practice

10

An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.

15

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 for by the employee may be a tax deduction

a life insurance application must be signed by all of these, EXCEPT:

beneficiary

Upon delivery of a rated life insurance policy, the Producer must obtain each of the following EXCEPT

signed HIPAA disclosure

what type of life policy covers two people and pays upon the deaht of the last insured

survivorship

what is the initial source of underwriting for an insurance policy

application containing statements from the insured

a(n) ___ of benefits of a health policy transfers payments to someone other than the policyowner

assignment

a pilot applies for life insurance. The insurer approves the application with a $10 additional monthly premium modification due to the risk involved. The pilot declines the additional premium modification. The insurer will then likely issue the coverage with a(n)

aviation exclusion

P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take?

beneficiary will be paid the death benefit

all of the following are considered to be typical characteristics describing the nature of an insurance contract, EXCEPT:

bilateral

variable whole life insurance can be described as:

both an insurance and securities product

which of the following policy features allows an insured to defer current health charges to the following years deductible instead of the current years deductible

carryover provision

an example of life insurance policy replacement would be which of the following?

cash surrender an existing life policy and purchasing a new life policy

under an interest sensitive whole life policy

cash values are determined by interest rates

Which rider provides coverage for a child under a parent's life insurance policy?

child term rider

P is a Major Medical policyowner who is hospitalized as a result of injuries sustained from participating in a carjacking. How will the insurer most likely handle this claim?

claim will be denied

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

the incontestable clause allows an insurer to:

contest a claim during the contestable period

a prospective insured completes and signs an application for health insurance but intentionally conceals information about a pre-existing heart condition. The company issues the policy. Two months later, the insured suffers a heart attack and submits a claim. While processing the claim, the company discovers the pre-existing condition. In this situation, the company will:

continue coverage but exclude the heart condition

which of the following consists of an offer, acceptance, and consideration

contract

An agent takes an individual Disability Income application, collects the appropriate premium, and issues the prospective insured a conditional receipt. The next step the insurance company will take is to

determine if the applicant is an acceptable risk by completing standard underwriting procedures

T purchased a $100,000 single premium, straight life annuity 5 years ago. He has received monthly payments since the inception of the annuity. If T dies, the insurance company

does not have to make any further payments

Two partners own equal shares in a business worth a total of $1,000,000. If they both commit to the purchase of a life insurance policy that will fund a Buy-Sell Agreement, which of the following is TRUE?

each partner owns a $500,000 policy on their partner's life

which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy

entire contract

what provision in a life insurance policy states that the applicaiton is considered part of the contract

entire contract provision

S is close to retiring and would like to purchase a policy that will yield greater gains than bonds, but will still protect the principal with a minimum level or risk. Which product would S be advised to purchase?

equity index insurance

a(n)____ contained in a life insurance policy states 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

which of the following is NOT included in the policy face?

exclusions

with accidental death and dismemberment policies, what is the purpose of the grace period

gives the policyowner additional time to pay overdue premiums

what is the purpose of a policy summary

highlights the critical parts of the policy issued

which of these is NOT a reason for purchasing life insurance on the life of a minor?

if both parents were to die, it would provide death benefits to the child

which of the following actions require a policyowner to provide proof of insurability in an adjustable life policy?

increase face amount

T owns an Accident & Health policy and notifies her insurance company that she has chosen a less hazardous occupation. Under the Change of Occupation provision, which of the following actions may her insurance company take?

increase her policy's coverage amount

which of these retirement plans can be started by an employee, even if another plan is in existence

individual retirement account (IRA)

what is the initial requirement for an insured to become eligible for benefits under the waiver or premium provision

insured must be under a physicians care

the ____ clause identifies which losses resulting from an accident or sickness are insured by the policy

insuring

which of these types of coverage is best described as a short term medical policy?

interim coverage

A policyowner would like to change the beneficiary on a accidental death and dismemberment (AD&D) insurance policy and make the change permanent. Which type of designation would fulfill this need?

irrevocable

the life and health insurance guaranty association

is funded by insurance companies through assessments

On January 8, an applicant filled out an application for a life insurance policy but did not include the initial premium. The insurance company approved the application on January 14 and issued the policy January 15. The producer delivered the policy on January 26 and collected the first premium. When did the coverage become effective?

january 26

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

post-tax dollar contributions are found in:

Roth IRA investments

T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees 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

the individual health insurance policy that offers the broadest protection is a(n) ____ ____ policy

major medical

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

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 a short-term medical expense policy

nonrewnewable

whole life insurance policies are contractually guaranteed to provide each of the following, EXCEPT:

partial withdrawal features beyond a surrender charge period

Which life insurance rider typically appears on a Juvenile life insurance policy?

payor benefit rider

what is considered to be a characteristic of a conditionally renewable health insurance policy?

premiums may increase at time of renewal

what is the purpose of the time of payment of claims provision?

prevents delayed claim payments made by the insurer

a medical information report (MIB) report may disclose which of the following

prior use of marijuana

J is a producer who is recommending that an insured surrender an existing life insurance policy and purchase a new one. Which provision would this producer be subject to?

replacement

D is an architect receiving Disability Income benefits who is not able to return to work full time, but can work on a part-time basis. Which of these features would allow D to continue receiving benefits?

residual benefit clause

which provision allows a portion of any used medical benefits to be restored following a particular amount of benefit has been used, or after the policy has been in effect for a particular period of time?

restoration of used benefit

which of these terms accurately defines an underwriter's assessment of information on a life insurance application?

risk classification

which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused by a third party

subrogation

what type of life insurance are credit policies issued as

term

which of the following statements is correct regarding an employer/employee group health plan?

the employer receives a master policy and the employees receive certificates

The Consideration clause in a life insurance policy indicates that a policyowner's consideration consists of a completed application and

the initial premium

T files a claim on his Accident and Health policy after being treated for an illness. The insurance company believes that T misrepresented his actual health on the initial insurance application and is, therefore, disputing the claim's validity. The provision that limits the time period during which the company may dispute a claim's validity is called

time limit on certain defenses

Which Accident and Health policy provision addresses preexisting conditions?

time limit on certain defenses

S, age 40, is looking to buy a life insurance policy that will allow for increases or decreases in coverage as his needs change. The policy best suited for S would be

universal life

which of the following life insurance policies combine term insurance with an investment element

universal life

which policy requires an agent to register with the national association of securites dealer (NASD) before selling

variable life

the part of a life insurance policy guaranteed to be true is called a(n):

warranty

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

when is the face amount of a whole life policy paid?

when the insured dies or at the policy's maturity date, whichever happens first

Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10 year term coverage for his wife on the same policy. Which of these policies did Y purchase?

whole life policy with an other insured rider