Guarantee ExamFX

Open enrollment period for MCR supplement policies

6 months

What are the two types of Flexible Spending Accounts?

Health Care and Dependent Care

A return of premium life policy is written as what type of term coverage?

Increasing

IRS required corridor or gap =

Universal Life - Option A

All are consideration in an insurance policy EXCEPT a. cash value in policy b. promise to pay c. premium paid d. statements on application

a. cash value in policy

Decreasing term insurance is often used to a. cover a mortgage b. liquidate an estate c. build up for retirement d. pay estate taxes

a. cover a mortgage

During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, making it worse than it seems. This is an example of what unfair trade practice? a. defamation b. misrepresentation c. twisting d. false advertising

a. defamation

All of the following statements concerning dividends are true EXCEPT a)Dividend amounts are guaranteed in the policy. b)Lower insurance company costs generate higher dividends. c)They stem from favorable underwriting experience. d)Favorable investment results generate higher dividends.

a. dividends amounts are guaranteed in the policy

The Patient Protection and Affordable Care Act includes all of the following provisions EXCEPT a)Individual tax deduction for premiums paid. b)Right to appeal. c)No lifetime dollar limits. d)Coverage for preventive benefits.

a. individual tax deduction for premiums paid

Which of the following is the primary source of information that an insurer uses to evaluate the insured's risks? a. insurance application b. agent's report c. risk analysis d. law of large numbers

a. insurance application

A married couple purchase a life insurance policy on their new born baby. They are concerned about what would happen to the policy if either one of them were unable to continue making the premium payments due to death or diability. Which policy rider should the agent reccommend? a. payor benefit b. guaranteed insurability c. automatic premium loan d. waiver of premium

a. payor benefit

Which of the following is considered the principle? a. the insurer issuing a policy b. producer or agent solicitating the policy c. head of Dept. of Insurance

a. the insurer issuing a policy

To attain currently insured status under Social Security, a worker must have earned at least how many credits during the last 13 quarters? a)4 credits b)6 credits c)10 credits d)40 credits

b) 6 credits

In a relative value system of determining coverage for a given procedure, what term describes the total amount payable per point? a)Practical value b)Conversion factor c)Relative value d)Translation factor

b) Conversion factor

Once the person meets the stringent requirements for disability benefits under Social Security, how long is the waiting period before any benefits will be paid? a)90 days b)5 months c)12 months d)Benefits will be paid immediately.

b. 5 months

Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured?a)Option A b)Option B c)Corridor option d)Variable option

b. Option B

Under a Key Person disability income policy, premium payments a)Are made by the business and are tax-deductible. b)Are made by the business and are not tax-deductible. c)Are made by the employee and are not tax-deductible. d)Are made by the employee and are tax-free.

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

What specific kind of insurance is often written in conjuction with hospital expense policies and includes surgeon's fees? a. basic medical expense b. basic surgical expense c. personnel d. practicioner's

b. basic surgical expense

An insured is involved in a car accident. In addition to general, less serious injuries, he permanently loses the use of his leg and is rendered completely blind. The blindness improves a month later. To what extent will he receive Presumptive Disability benefits? a)Full benefits until the blindness lifts b)No benefits c)Full benefits d)Partial benefits

b. no benefits

All of the following are true of Annually Renewable term insurance EXCEPT a. death benefit remains level b. proof of insurability must be provided at time of each renewal c. policy must be renewed no matter what happens d. premium increases each year

b. proof of insurability must be provided at time of each renewal

Which risk classification is representative of the majority in certain age groups and have similar lifestyles? a. substandard b. standard c. preferred d. decline

b. standard

A life insurance policy does not have a war clause. If the insured is killed during a time of war, what will the beneficiary receive from the policy? a)Nothing, since the insured was killed as a result of a war b)The full death benefit c)The policy's cash value d)A refund of premiums

b. the full death benefit

To sell variable life insurance policies, an agent must receive all of the following EXCEPT a. securities b. license c. SEC d. FINRA

c. SEC

An adjustable life policy can assume the form of a. neither term or permanent insurance b. term insurance c. either term or permanent insurance d. permanent insurance

c. either term or permanent insurance

When may HIV test results be provided to the MIB? a. given authorization by patient b. when results are negative c. if individual is not identified

c. if individual is not identified

If an applicant makes a false statement on his/her producer's license application, what is he/she guilty of? a)Misrepresentation b)False advertising c)Perjury d)Defamation

c. perjury

An annuity would normally be purchased by an individual who wants to a. create an estate b. provide death benefits to surviving family c. provide income for retirement d. earn a higher rate of interest

c. provide income for retirement

The Guaranteed Insurability Rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following EXCEPT a. birth of a child b. marriage c. purchase of a new home d. approximately every 3 years between the ages of 25 and 40

c. purchase of a new home

What is true of taxation of accelerate benefits paid under a life insurance policy? a. considered taxable income b. taxable to insured's estate c. received tax free d. tax deductible

c. received tax free

Under the Affordable Care Act, what percentage of preventive care must be covered without cost sharing? a)25% b)50% c)80% d)100%

d. 100%

The relation of earnings to insurance provision allows the insurance company to limit the insured's benefits to his/her average income over the last a)6 months. b)12 months. c)18 months. d)24 months.

d. 24 months

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply? a)7 days b)10 days c)3 days d)5 days

d. 5 days

When a policy is being replaced, it should be known that the policy is, or is likely to be a. lapsed b. assigned as collateral for a loan c. reissued with reduction amount d. all of the above

d. all of the above

Which agreement specifies how a business will transfer hands when one of the owners dies or becomes disabled? a)Proprietary Transfer b)Absolute assignment c)Transfer of Ownership d)Disability Buy-Sell

d. disability buy-sell

Taxation of LTC insurance...

excessive benefits may be taxable

A man is an attorney when he applies for benefits. He decides to become a professional bunjee jumper. He files a claim. What should happen?

insurance company will pay the claim according to the benefits available if the correct premium had been paid

Nonforfeiture values guarantee...

that the cash value will not be lost

Bethany studies in England for a semester. While she is there, she is involved in a train accident that leaves her disabled. If Bethany owns a general disability policy, what will be the extent of benefits that she receives? a)Full b)50% c)25% d)None

d. none

An equity indexed annuity will grow based upon a. performance in separate accounts b. current interest rates c. rate of interest d. performance of a recognized index

d. performance f a recognized index

Todd has been informed that he has a hernia which requires repair. When Todd researches the cost, he learns that his insurance plan will cover 200 points worth of surgical expenses. Each point represents $10, which means that $2000 of his surgery will be covered by his insurance plan. What system is Todd's insurance company using? a)Basic Surgical b)Point-based medical c)Conversion factor d)Relative value

d. relative value

Which of the following describes the tax advantage of a qualified retirement plan? a)Distributions prior to age 59½ are tax deductible. b)Employer contributions are deductible as a business expense when the employee receives benefits. c)Employer contributions are not taxed when paid out to the employee. d)The earnings in the plan accumulate tax deferred.

d. the earnings in the plan accumulate tax deferred

Which of the following policy components contains the company's promise to pay? a)Insuring clause b)Premium mode c)Owner's rights d)Entire contract provision

a. insuring clause

Which of the following would not be eligible for coverage under key person? a. owner of a shop b. pharamacist in drug store c. manager of small store d. executive officer

a. owner of a shop

Which of the following is another term for the accumulation period of an annuity? a)Pay-in period b)Premium period c)Liquidation period d)Annuity period

a. pay-in period

Which method of dealing with risk is applied when insurance is purchased? a. transfer b. sharing c. avoidance d.reduction

a. transfer

If a policy includes a free-look period of at least 10 days, the Buyer's Guide may be delivered to the applicant a)With the policy. b)Upon issuance of the policy. c)Within 30 days after the first premium payment was collected. d)Prior to filling out an application for insurance.

a. with the policy

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT a)An offer to share in commissions generated by the sale. b)Dividends from a mutual insurer. c)An offer of employment. d)Stocks, securities, or bonds.

b. dividends from a mutual insurer

When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option? a. reduced paid-up b. extended term c. paid-up additions d. cash surreder value

b. extended term

Which of the following is not a Medicaid qualifier? a. age b. insurability c. residency d. income level

b. insurability

What is the purpose of a conditional receipt? a)It is given only to applicants who fully prepay the premium .b)It is intended to provide coverage on a date prior to the policy issue. c)It guarantees that a policy will be issued in the amount applied for. d)It serves as proof that the applicant has been determined insurable

b. it is intended to provide coverage on a date prior to the policy issue

Which of the following is NOT a requirement in order to be a nonresident licensee? a)Submit a copy of his/her application for the resident license b)Maintain a physical address in each state the licensee transacts insurance c)Be in good standing in the resident license state d)Submit the proper application fee

b. maintain a physical address in each state the licensee transacts insurance

Under an extended term nonforfeiture option, the policy cash value is converted to a)A higher face amount than the whole life policy. b)The same face amount as in the whole life policy. c)The face amount equal to the cash value. d)A lower face amount than the whole life policy.

b. the same face amount as in the whole life policy

Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of a)Rebating. b)Twisting. c)Defamation. d)Misrepresentation.

b. twisting

When an insured terminates membership, the insured can convert to a. term without proof of insurability b. whole life without proof of insurability c. whole life with proof of insurability d. term with proof of insurability

b. whole life without proof of insurability

An insured makes regular contributions to his Health Savings Account. How are those contributions treated in regards to taxation? a)They are not deductible. b)They are taxed as income. c)They are tax deductible. d)They are considered after-tax contributions.

c) They are tax deductible

An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT? a)The insured may choose to convert to term or permanent individual coverage. b)The insured would not need to prove insurability for a conversion policy. c)The insured may convert coverage to an individual policy within 31 days. d)The premium for individual coverage will be based upon the insured's attained age.

a. the insured may choose to convert to term or permanent individual coverage

Which of the following is NOT covered under Plan A in Medigap insurance? a)The Medicare Part A deductible b)Approved hospital costs for 365 additional days after Medicare benefits end c)The 20% Part B coinsurance amounts for Medicare approved services d)The first three pints of blood each year

a. the medicare Part A deductible

With Adjustable Life, the owner can change all of the following EXCEPT a. the premium b. length of time coverage will last c. the insured d. the death benefit

c. the insured

All of the following are TRUE statements regarding the accumulation at interest option EXCEPT a)The interest is credited at a rate specified by the policy. b)The policyholder has the right to withdraw the accumulations at any time. c)The interest is not taxable since it remains inside the insurance policy. d)The annual dividend is retained by the company.

c. the interest is not taxable since it remains inside the insurance policy

The Uniform Provision Law that prevents an insurance company from altering its agreement with a PO by referring to documents or other items not contained in a policy is a. legal action provision b. grace period provision c. reinstatement provision d. entire contract provision

d. entire contract provision

All of the following are general requirements of a qualified plan EXCEPT a)The plan must be communicated to all employees. b)The plan must be for the exclusive benefits of the employees and their beneficiaries. c)The plan must be permanent, written and legally binding. d)The plan must provide an offset for social security benefits.

d. the plan must provide an offset for social security benefits

Which of the following is NOT true of life settlements? a)They could be used for a key person coverage. b)They could be sold for an amount greater than the current cash value. c)They involve insurance policies with large face amounts. d)The seller must be terminally ill.

d. the seller must be terminally ill

How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?a)As soon as possible b)Within 20 days c)Within 60 days d)Within 90 days or as soon as reasonably possible, but not to exceed 1 year

d. within 90 days or as soon as reasonably possible, but not to exceed 1 year