Life & Health Exam
Within how many days must a producer respond to an inquiry from the Commissioner? a. 3 days b. 10 days c. 15 days d. 30 days
d. 30 days
Under which of the following organizations are the practicing providers compensated on a fee-for-service basis? a. Open panel b. PPO c. HMO d. Blue Cross/Blue Shield
b. PPO
What is the maximum age for term-232qualifying for a catastrophic plan? a. 26 b. 30 c. 45 d. 62
b. 30
A policy with a 31-day grace period implies a. The policy is incontestable after 31 days of delivery. b. The policy benefits must be paid within 31 days after a claim is submitted. c. The policy will not lapse for 31 days if the premium is not paid when due. d. The policyholder may return the policy for a full refund within 31 days.
c. The policy will not lapse for 31 days if the premium is not paid when due.
What is the elimination period for Social Security disability benefits? a. 5 months b. 6 months c. 12 months d. 3 months
a. 5 months
In life insurance policies, cash value increases a. Grow tax deferred. b. Are income taxable immediately. c. Are taxed annually. d. Are only taxed when the owner reaches age 65.
a. Grow tax deferred.
Which type of care re-establishes functional use to natural teeth? a. Restorative b. Fillings c. Functionality d. Repair
a. Restorative
Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as a. Defamation. b. Coercion. c. Rebating. d. Misleading advertising.
b. Coercion.
The provision that states that both the printed contract and a copy of the application form the contract between the policyowner and the insurer is called the a. Master policy. b. Entire contract. c. Certificate of insurance. d. Aleatory contract.
b. Entire contract.
What document describes an insured's medical history, including diagnoses and treatments? a. Individual Medical Summary b. Comprehensive Medical History c. Attending Physician's Statement d. Physician's Review
c. Attending Physician's Statement
Which of the following provisions in annuity contracts allow the owner to surrender the annuity if interest rates drop to a specified level? a. Nonforfeiture b. Annuitization c. Bail-out d. Surrender
c. Bail-out
Which of the following best describes annually renewable term insurance? a. It requires proof of insurability at each renewal b. Neither the premium nor the death benefit is affected by the insured's death c. It provides an annually increasing death benefit d. It is level term insurance
d. It is level term insurance
A couple receives a set amount of income from their annuity. When the wife dies, the husband no longer receives annuity payments. What type of annuity did the couple buy? a. Joint and survivor b. Life with period certain c. Joint limited annuity d. Joint life
d. Joint life
Medicare Advantage is also known as a. Medicare Part D. b. Medicare Part A. c. Medicare Part B. d. Medicare Part C.
d. Medicare Part C.
Another name for substandard risk classification is a. Controlled b. Declined c. Elevated d. Rated
d. Rated
If an agent wishes to sell variable life policies, what license must the agent obtain? a. Adjuster b. Surplus Lines c. Personal Lines d. Securities
d. Securities
When employees are actively at work on the date coverage can be transferred to another insurance carrier, what happens to coinsurance and deductibles? a. They have to be reevaluated. b. Coinsurance carries over, but deductibles are generally higher. c. Deductibles carry over, but coinsurance is generally higher. d. They carry over from the old plan to the new plan.
d. They carry over from the old plan to the new plan.
A return of Premium term life policy is written as what type of term coverage? a. Decreasing b. Renewable c. Level d. Increasing
d. Increasing
Most scheduled plans provide first-dollar benefits without a. Coinsurance and deductibles. b. Premiums c. Copays. d. Exclusions and conditions.
a. Coinsurance and deductibles.
An individual has been making periodic premium payments on an annuity. The annuity income payments are scheduled to begin after 1 year since the annuity was purchased. What type of annuity is it? a. Deferred b. Fixed c. Flexible premium d. Immediate
a. Deferred
According to the nonforfeiture law, if the owner decides to surrender a deferred annuity prior to annuitization, the owner is entitled to which of the following? a. Guaranteed surrender value b. No payments c. Annuity dividends d. Full premium refund without any charges
a. Guaranteed surrender value
Which of the following is INCORRECT concerning taxation of disability income benefits? a. If paid by the individual, the premiums are tax deductible. b. If the employer paid the premiums, income benefits are taxable to the insured as ordinary income. c. If the insured paid the premiums, any disability income benefits are tax-free. d. If the benefits are for a permanent loss, the benefits paid to the employee are not taxable.
a. If paid by the individual, the premiums are tax deductible.
Which of the following is INCORRECT concerning Medicaid? a. It is solely a federally administered program. b. It provides medical assistance to low-income people who cannot otherwise provide for themselves. c. It pays for hospital care, outpatient care, and laboratory and X-ray services. d. The federal government provides about 56 cents for every Medicaid dollar spent.
a. It is solely a federally administered program.
If one takes Social Security retirement benefits at age 62, what needs to be done at age 65 to qualify for Medicare? a. Nothing b. Apply for coverage through the state c. Appear for a physical at the Social Security office d. Apply at a local Social Security office
a. Nothing
Which type of dental care services would cover the costs of the extraction of wisdom teeth? a. Oral surgery b. Restorative c. Endodontics d. Orthodontics
a. Oral surgery
An individual buys a flexible premium deferred life annuity with 20 year period certain. What would his beneficiary receive if he died 5 years after beginning the annuity phase? a. Payments for 15 years b. Payments for 20 years c. Payments for life d. Nothing
a. Payments for 15 years
What type of information is NOT included in a certificate of insurance? a. The cost the company is paying for monthly premiums b. The policy benefits and exclusions c. The procedures for filing a claim d. The length of coverage
a. The cost the company is paying for monthly premiums
Which of the following is true regarding METs? a. They allow several small employers purchase less expensive insurance together. b. They make deals with local hospitals to provide low cost coverage to the needy. c. They provide insurance for larger corporations. d. They provide insurance companies with medical information on applicants.
a. They allow several small employers purchase less expensive insurance together.
In a survivorship life policy, when does the insurer pay the death benefit? a. Upon the last death b. Upon the first death c. Half at the first death, and half at the second death d. If the insured survives to age 100
a. Upon the last death
If a telemarketer wants to make an unsolicited sales call to a potential customer, what is the earliest time the telemarketer can call the prospect's residence? a. 7 am b. 8 am c. 9 am d. Noon
b. 8 am
An individual was just caught acting as an exclusive general agent - even though he is not properly licensed. Assuming that this occurred in a single day, what is the maximum penalty he faces? a. A second-degree felony and a $10,000 fine b. A third-degree misdemeanor and a $1,000 fine c. A second-degree misdemeanor and a $1,000 fine d. A third-degree felony and a $10,000 fine
b. A third-degree misdemeanor and a $1,000 fine
If an employee terminates her employment, which of the following provisions would allow her to continue health coverage under an individual policy, if requested within 31 days? a. Renewability b. Conversion c. Replacement d. Grace period
b. Conversion
Which is true regarding HMO coverage? a. HMOs provide nationwide coverage. b. It is divided into geographic territories. c. It is divided based on the average tax bracket of a family. d. It is divided by state.
b. It is divided into geographic territories.
Variable Whole Life insurance is based on what type of premium? a. Graded b. Level fixed c. Increasing d. Flexible
b. Level fixed
The premium of a survivorship life policy compared with that of a joint life policy would be a. Half the amount b. Lower c. Higher d. As high
b. Lower
If a life insurance policy develops cash value faster than a seven-pay whole life contract, it becomes a/an a. Nonqualified annuity. b. Modified endowment contract. c. Accelerated benefit policy. d. Endowment.
b. Modified endowment contract.
A Medicare SELECT policy does all of the following EXCEPT a. Provide for continuation of coverage in the event that Medicare SELECT policies are discontinued due to the failure of the Medicare SELECT program. b. Prohibit payment for regularly covered services if provided by non-network providers. c. Make full and fair disclosure in writing of the provisions, restrictions, and limitations of the Medicare SELECT policy to each applicant. d. Provide payment for full coverage under the policy for covered services not available through network providers.
b. Prohibit payment for regularly covered services if provided by non-network providers.
Insurers may change which of the following on a guaranteed renewable health insurance policy? a. No changes are permitted. b. Rates by class c. Coverage d. Individual rates
b. Rates by class
What is necessary in order to be eligible to receive benefits from a long-term care policy? a. Age is the only requirement; upon reaching age 65, LTC benefits are available. b. The insured must be unable to perform some activities of daily living. c. The insured must meet certain economic standards. d. The insured must have been receiving disability benefits for 6 months.
b. The insured must be unable to perform some activities of daily living.
When an applicant applies for Medicare supplement insurance, whose responsibility is it to confirm whether the applicant has an accident or sickness insurance policy in force? a. The soliciting agent's b. The insurer's c. The applicant's d. A primary care physician's
b. The insurer's
What kind of policy allows withdrawals or partial surrenders? a. Variable whole life b. Universal life c. 20-pay life d. Term policy
b. Universal life
An insured is covered by a partially contributory group disability income plan that pays benefits of $4,000 a month. If the insured pays 25% of the monthly premium, how much of the monthly benefit would be taxable? a. None b. $1,000 c. $3,000 d. $4,000
c. $3,000
Who must sign the notice regarding replacement? a. Applicant only b. Agent only c. Both the applicant and agent d. Both the agent and the insurer
c. Both the applicant and agent
Which of the following is an example of prosthodontic dental care? a. Fillings b. Braces c. Bridgework d. Crowns
c. Bridgework
Which of the following is NOT a cost-saving service in a medical plan? a. Second surgical opinions b. Risk sharing c. Denial of coverage d. Preventive care
c. Denial of coverage
An agent selling variable annuities must be registered with a. The Guaranty Association. b. SEC. c. FINRA. d. Department of Insurance.
c. FINRA.
In which of the following locations would skilled care most likely be provided? a. In an outpatient setting b. At a physician's office c. In an institutional setting d. At the patient's home
c. In an institutional setting
Which of the following ultimately determines the interest rates paid to the owner of a fixed annuity? a. Investment performance of the insured b. Statewide predetermined annual interest rate c. Insurer's guaranteed minimum rate of interest d. Investment performance of the company
c. Insurer's guaranteed minimum rate of interest
The type of dental plan which is incorporated into a major medical expense plan is a/an a. Stand-alone dental plan. b. Blanket dental plan. c. Integrated dental plan. d. Supplemental dental plan.
c. Integrated dental plan.
All of the following are Nonforfeiture options EXCEPT a. Extended term b. Reduced paid-up c. Interest only d. Cash surrender
c. Interest only
All of the following long-term care coverages would allow an insured to receive care at home EXCEPT a. Respite care. b. Home health care. c. Skilled care. d. Custodial care in insured's house.
c. Skilled care.
Which of the following would help prevent a universal life policy from lapsing? a. Adjustable premium b. Corridor of insurance c. Target premium d. Face amount
c. Target premium
The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true? a. A corporation can be an annuitant as long as the beneficiary is a natural person b. The contract can be issued without an annuitant c. The annuitant must be a natural person d. A corporation can be an annuitant as long as it is also the owner
c. The annuitant must be a natural person.
If an insured continually uses the automatic premium loan option to pay the policy premium, a. The cash value will continue to increase b. The insurer will increase the premium amount c. The policy will terminate when the cash value is reduced to nothing d. The face amount of the policy will be reduced by the automatic premium loan amount
c. The policy will terminate when the cash value is reduced to nothing
Why do group health providers usually require a certain amount of participation in the plan by eligible employees? a. To ensure a higher profit for the insurer b. To ensure the employer is being fair to employees c. To guard against adverse selection and reduce cost d. To promote preventive care
c. To guard against adverse selection and reduce cost
One of the differences between group underwriting and individual underwriting is that there is little or no medical information required regarding plan participants in groups of a. 100 or more. b. 25 or more. c. Fewer than 50. d. 50 or more.
d. 50 or more.
In order to maintain coverage under COBRA, how soon from termination of employment must an employee exercise extension of benefits? a. 7 days b. 10 days c. 30 days d. 60 days
d. 60 days
Which of the following is an example of a producer's fiduciary responsibilities? a. A producer helping clients to file claims b. A producer reviewing his/her client's coverage c. A producer offering additional coverages to his client d
d. A producer promptly forwarding premiums to the insurance company
Who can make a fully deductible contribution to a traditional IRA? a. Anybody; all IRA contributions are fully deductible regardless of income level b. Someone making contributions to an educational IRA c. A person whose contributions are funded by a return on investment d. An individual not covered by an employer-sponsored plan who has earned income
d. An individual not covered by an employer-sponsored plan who has earned income
Which of the following will NOT be an appropriate use of a deferred annuity? a. Accumulating retirement funds b. Accumulating funds in an IRA c. Funding a child's college education d. Creating an estate
d. Creating an estate
What is the difference between the Medicare approved amount for a service or supply and the actual charge? a. Actual charge b. Limiting charge c. Coinsurance d. Excess charge
d. Excess charge
If a deferred annuity is surrendered prematurely, a surrender charge is imposed. How is the surrender charge determined? a. It is always 7% of the cash value. b. It is a flat fee determined by the annuity owner when the annuity is purchased. c. It will increase as the accumulation period increases. d. It is a percentage of the cash value and decreases over time.
d. It is a percentage of the cash value and decreases over time.
All of the following statements describe a MEWA EXCEPT a. MEWAs can be sponsored by insurance companies. b. MEWA employers retain full responsibility for any unpaid claims. c. MEWAs can be self-insured. d. MEWAs are groups of at least 3 employers.
d. MEWAs are groups of at least 3 employers.
Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability? a. Recurrent disability b. Partial disability c. Income replacement d. Residual disability
d. Residual disability
Which of the following statements is true concerning employer group dental plans? a. They always contain a conversion privilege. b. They are only marketed as stand-alone plans. c. They are exempt from COBRA laws. d. They seldom contain a conversion privilege.
d. They seldom contain a conversion privilege.
How long is the right to examine period for new individual annuities issued in this state? a. 10 days b. 20 days c. 45 days d. 90 days
a. 10 days
Which of the following groups would most likely be covered under a blanket accident policy? a. Students at a public school b. Office workers for a retail business c. Factory workers at the automobile assembly plant d. Independent contractors who work for a general contractor
a. Students at a public school
A client has a new individual disability income policy with a 20-day probationary period and a 30-day elimination period. Ten days later, the client breaks their leg and is off work for 45 days. How many days of disability benefits will the policy pay? a. 10 days b. 15 days c. 25 days d. 45 days
b. 15 days
A producer licensed in Pennsylvania must notify the Insurance Department of any change of address in their address within how many days? a. 20 b. 30 c. 10 d. 15
b. 30
What types of services may NOT be provided under the long-term care's assisted living care? a. Linens and personal laundry service b. Assistance with dressing and bathing c. Reminders regarding medication d. Visits by a registered nurse
d. Visits by a registered nurse
In a replacement situation, all of the following must be considered EXCEPT a. Assets. b. Benefits. c. Limitations. d. Exclusions.
a. Assets.
Most health insurance policies exclude all of the following EXCEPT a. Intentional injury. b. Injury due to war. c. Accidental injury. d. Occupational injury.
c. Accidental injury.
In the event of a divorce, which of the following would allow a divorcee to continue receiving group health coverage under an insured spouse's plan for an additional 36 months? a. Social Security b. COBRA c. MSA d. HIPAA
b. COBRA
Which type of retirement account does not require the owner to start taking distributions at age 73? a. Traditional IRA b. Roth IRA c. Nonqualified IRA d. Standard IRA
b. Roth IRA
A domestic insurer issuing variable contracts must establish one or more a. General accounts b. Separate accounts c. Liability accounts d. Annuity accounts
b. Separate accounts
In order for costs to be covered under a dental plan, what is the minimum interval that must pass between routine dental exams? a. 1 year b. 3 months c. 6 months d. 9 months
c. 6 months
Which provision states that the insurance company must pay Medical Expense claims immediately? a. Legal Actions b. Relation of Earnings to Insurance c. Time of Payment of Claims d. Payment of Claims
c. Time of Payment of Claims
Which of the following is NOT true of basic medical expense plans? a. No deductibles b. First-dollar coverage c. Low dollar limits d. Coverage for catastrophic medical expenses
d. Coverage for catastrophic medical expenses
In a group policy, who is issued a certificate of insurance? a. The health care provider b. The insurance company c. The employer d. The individual insured
d. The individual insured
What does "level" refer to in level term insurance? a. Face amount b. Premium c. Cash value d. Interest rate
a. Face amount
The automatic premium loan provision is activated at the end of the a. Elimination period b. Policy period c. Grace period d. Free-look period
c. Grace period
An insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured's age 100 is called a. Single premium whole life b. Modified Endowment Contract (MEC) c. Level term life d. Graded premium whole life
a. Single premium whole life
For what reason may a life insurance producer backdate a life insurance policy? a. To avoid an increase in premium rate for the insured b. To meet sales quotas established by the insurer c. To make a policy effective during a period when the agent't appointment was in force d. To shorten the period of contestability
a. To avoid an increase in premium rate for the insured
All of the following could own group life insurance EXCEPT a. A debtor group b. A group needing low-cost life insurance c. A group sponsored by an employer d. An alumni group
b. A group needing low-cost life insurance
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? a. Second-to-die b. Family Income Policy c. Joint Life Policy d. Survivorship Life Policy
c. Joint Life Policy
If a settlement option is not chosen by the policy owner or the beneficiary, which option will be used? a. Fixed period b. Fixed amount c. Lump sum d. Life income
c. Lump sum
This type of term insurance that provides increasing death benefits as the insured ages is called a. Interest-sensitive term b. Age-sensitive term c. Increasing term d. Flexible term
c. Increasing term
Which of the following statements about group life is correct? a. The premiums are higher than in an individual policy because there is no medical exam b. The group sponsor receives a Certificate of Insurance c. The policy can be converted to an individual term insurance policy d. The cost of coverage is based on the ratio of men and women in the group
d. The cost of coverage is based on the ratio of men and women in the group
All of the following entities regulate variable life policies EXCEPT a. The Guaranty Association b. Federal Government c. The SEC d. The Insurance Department
a. The Guaranty Association
Which of the following is INCORRECT regarding a $100,000 20-year level term policy? a. The policy will expire at the end of the 20-year period b. At the end of 20 years, the policy's cash value will equal $100,000 c. The policy premiums will remain level for 20 years d. If the insured dies before the policy expired, the beneficiary will receive $100,000
b. At the end of 20 years, the policy's cash value will equal $100,000
Which of the following types of policies will provide permanent protection? a. Term life b. Group life c. Whole life d. Credit life
c. Whole life
For variable products, underlying assets must be kept in a. A separate account b. A revenue account c. A money market account d. A general account
a. A separate account
Most agents try to collect the initial premium for submission with the application. When an agent collects the initial premium from the applicant, the agent should issue the applicant a a. Warranty b. Premium receipt c. Statement of good health d. Backdated receipt
b. Premium receipt
In an Adjustable Life policy all of the following can be changed by the policy owner EXCEPT a. The amount of the insurance b. The type of investment c. The length of the coverage d. The premium
b. The type of investment
All of the following are personal uses of life insurance EXCEPT a. Estate creation b. Cash accumulation c. Buy-sell agreement d. Survivor protection
c. Buy-sell agreement
The death protection component of Universal Life Insurance is always a. Whole life b. Adjustable life c. Decreasing term d. Annually renewable term
d. Annually Renewable term
In a case where the primary beneficiary predeceases he insured, in the event of the insured's death, the death benefit proceeds will be paid to a. The insured's spouse b. The policy owner c. The insurance company d. The contingent beneficiary
d. The contingent beneficiary
Which type of life insurance policy allows the policy owner to pay more or less than the planned premium? a. Variable whole life b. Decreasing term c. Straight whole life d. Universal life
d. Universal life
What characteristic makes whole life permanent protection? a. Living benefits b. Coverage until death or age 100 c. Guaranteed death benefit d. Guaranteed level premium
b. Coverage until death or age 100
An insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured's age 100 is called a. Modified Endowment Contract (MEC) b. Level term life c. Graded premium whole life d. Single premium whole life
d. Single premium whole life
Which of the following would help prevent a universal life policy from lapsing? a. Face amount b. Adjustable premium c. Corridor of insurance d. Target premium
d. Target premium
All of the following are characteristics of a group life insurance plan EXCEPT a. The participants receive a Certificate of Insurance as their proof of insurance b. A minimum number of participants is required in order to underwrite the plan c. The cost of the plan is determined by the average age of the group d. There is a requirement to prove insurability on the part of the participants
d. There is a requirement to prove insurability on the part of the participants
Which of the following persons is required to hold a producer license? a. A person who negotiates insurance contracts b. A person who creates insurance advertisements c. A person who takes messages related to claims d. A person who administers employee benefits
a. A person who negotiates insurance contracts
The minimum interest rate on an equity indexed annuity is often based on a. An index like Standard & Poor's 500. b. The returns from the insurance company's separate account. c. The annuitant's individual stock portfolio. d. The insurance company's general account investments.
a. An index like Standard & Poor's 500.
When the owner of a $250,000 life insurance policy died, the beneficiary decided to leave the proceeds of the policy with the insurance company and selected the Interest Settlement Option. If at the time of withdrawal the interest paid was $11,000, the beneficiary would be required to pay income tax on a. $11,000. b. None, because the beneficiary has not received the death benefit. c. $261,000. d. $239,000.
a. $11,000.
Under which nonforfeiture option does the company pay the surrender value and have no further obligations to the policy owner? a. Cash surrender b. Reduced paid-up c. Paid-up options d. Extended term
a. Cash surrender
Under what condition are group disability income benefits received by an employee NOT taxable as income? a. When the benefits received are equal or less than the employee's percentage of the contribution. b. When the employer makes all the premium payments. c. When the employee is 59 ½. d. When the amount of the benefit is equal or less than the amount of contributed by the employer.
a. When the benefits received are equal or less than the employee's percentage of the contribution.
Who is the beneficiary in a credit disability income policy? a. The Federal Government b. The lending institution c. The insurer d. The estate of the borrower
b. The lending institution
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy? a. $20,000 b. $25,000 c. $50,000 d. The face amount will be determined by the insurer
c. $50,000 (It would remain the same)
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 a. 3 years. b. 5 years. c. 10 years. d. 12 years.
c. 10 years.
Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months? a. 12 months b. 24 months c. 30 months d. 36 months
c. 30 months
Bob purchased a policy to provide coverage on himself, his wife Linda, and their two children, John and Kristen. All of them would need to prove insurability EXCEPT a. Linda. b. John and Kristen. c. Any children born to them after the inception of the contract. d. Bob.
c. Any children born to them after the inception of the contract.
An insured owes his insurer a premium payment. Since then, he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the difference. What provision allows for this? a. Proof of loss b. Payment of claims c. Unpaid premium d. Legal action
c. Unpaid premium
The main difference between immediate and deferred annuities is a. The number of insureds. b. The amount of each payment. c. When the income payments begin. d. How the annuity is purchased.
c. When the income payments begin.
All of the following are considered to be basic benefits of an HMO plan EXCEPT a. Preventive services. b. Out-of-area coverage. c. Diagnostic laboratory services. d. Prescription drugs.
d. Prescription drugs.
Before he died, an annuitant had received $12,500 in monthly benefits from his $25,000 straight life annuity. He was also the insured under a $50,000 paid-up whole life policy that named his wife as primary beneficiary. Considering both contracts, how much will the annuitant's spouse receive in benefits? a. $50,000 b. $62,500 c. $75,000 d. Nothing
a. $50,000
How long is the open-enrollment period under an employer group health insurance plan? a. 15 days b. 30 days c. 60 days d. 90 days
b. 30 days
Combination plans are comprised of two types of plan features: basic and a. Limited. b. Comprehensive. c. Scheduled. d. Expanded.
b. Comprehensive.
If a dental plan is integrated, it is combined with what type of plan? a. Supplemental b. Life c. Medical d. Secondary dental
c. Medical
All of the following coverages are usually included under a dental insurance plan EXCEPT a. Routine examinations. b. Braces and appliances. c. Teeth whitening. d. Oral surgery.
c. Teeth whitening.
Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained? a. 3 days b. 5 days c. 10 days d. 14 days
a. 3 days
Which of the following individuals will be eligible for coverage on the Health Insurance Marketplace? a. A permanent resident lawfully present in the U.S. b. Someone who has Medicare coverage c. A U.S. citizen who is incarcerated d. A U.S. citizen living abroad
a. A permanent resident lawfully present in the U.S.
Under HIPAA, which of the following is INCORRECT regarding eligibility requirements for conversion to an individual policy? a. An individual who was previously covered by group health insurance for 6 months is eligible. b. An individual who has used up COBRA continuation coverage is eligible. c. An individual who doesn't qualify for Medicare may be eligible. d. The gap of coverage for eligibility is a period of 63 or less days.
a. An individual who was previously covered by group health insurance for 6 months is eligible.
A Universal Life Insurance policy is best described as a/an a. Annually Renewable Term policy with a cash value account b. Variable Life with a cash value account c. Whole Life policy with two premiums: target and minimum d. Flexible Premium Variable Life policy
a. Annually Renewable Term policy with a cash value account
Which of the following authorities is authorized to issue a temporary insurance producer's license? a. Commissioner b. NAIC c. Federal Insurance Licensing Association d. State Insurance Board
a. Commissioner
A Health insurance policy lapses but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for accidents become effective? a. Immediately b. After 14 days c. After 21 days d. After 31 days
a. Immediately
Which of the following factors about the insured determines the amount of disability benefit that the insured will receive? a. Income b. Gender c. Marital status d. Age
a. Income
An insurance company wants to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding information included on previous insurance applications? a. Medical Information Bureau b. Insurer's Protection Guild c. Integrated Insurer's Support d. Federal Bureau of Investigation
a. Medical Information Bureau
The primary eligibility requirement for Medicaid benefits is based upon a. Need. b. Whether the claimant is insurable on the private market. c. Age. d. Number of dependents.
a. Need.
When is the annual open enrollment for state insurance exchanges? a. November 1 through January 31 b. December 1 through December 31 c. January 1 through February 28 d. December 1 through March 1
a. November 1 through January 31
Which of the following occupations would have the lowest disability insurance premiums? a. Personal Trainer b. Construction worker c. Stunt pilot d. Police officer
a. Personal Trainer
Which of the following is an example of a peril covered in an accident and health insurance policy? a. Sickness b. Alcoholism c. Smoking d. Death
a. Sickness
When a group disability insurance policy is paid entirely by the employer, benefits paid to disabled employees are a. Taxable income to the employee. b. Deductible income to the employee. c. Deductible business expense to the employer. d. Taxable income to the employer.
a. Taxable income to the employee.
If a life insurance policy has an irrevocable beneficiary designation, a. The beneficiary can only be changed with written permission of the beneficiary b. The beneficiary cannot be changed for at least 2 years c. The owner can always change the beneficiary at will d. The beneficiary cannot be changed
a. The beneficiary can only be changed with written permission of the beneficiary
How are excess funds in an employee's HSA handled? a. The funds can be carried forward to the next year. b. The funds are forfeited. c. The funds are applied toward the next years' deductible. d. The funds are not tax deductible.
a. The funds can be carried forward to the next year.
Which of the following is a key distinction between variable whole life and variable universal life products? a. Variable whole life has a guaranteed death benefit b. Variable universal life is regulated solely through FINRA c. Variable whole life allows policy loans from the cash value d. Variable universal life has a fixed premium
a. Variable whole life has a guaranteed death benefit
L has a major medical policy with a $500 deductible and 80/20 coinsurance. L is hospitalized and sustains a $2,500 loss. What is the maximum amount that L will have to pay? a. $2,500 (the entire bill) b. $900 (deductible + 20% of the bill after the deductible [20% of $2,000]) c. $500 (amount of deductible) d. $1,000 (deductible + 20% of the entire bill)
b. $900 (deductible + 20% of the bill after the deductible [20% of $2,000])
An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy? a. 7 days b. 10 days c. 31 days d. 60 days
b. 10 days
When a producer died, his surviving spouse needed to maintain the insurance agency until it could be sold. Without passing an examination, she could qualify for a temporary license for a maximum period of a. 90 days. b. 180 days. c. 1 year. d. 2 years.
b. 180 days.
Which of the following must the patient pay under Medicare Part B? a. A per benefit deductible b. 20% of covered charges above the deductible c. 80% of covered charges above the deductible d. All reasonable charges above the deductible according to Medicare standards
b. 20% of covered charges above the deductible
An insurer may provide commissions to an agent for the sale of a long-term care policy only if the first year commission is NOT greater than what percentage of the first year premium? a. 25% b. 50% c. 55% d. 15%
b. 50%
How long is an open enrollment period for Medicare supplement policies? a. 90 days b. 6 months c. 1 year d. 30 days
b. 6 months
Which of the following hospice expenses would NOT be covered in a cost-containment setting? a. Special hospital bed b. Antibiotics c. Tylenol d. Morphine
b. Antibiotics
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.
Which of the following is NOT a term for the period of time during which the annuitant or the beneficiary receives income? a. Liquidation period b. Depreciation period c. Annuitization period d. Pay-out period
b. Depreciation period
An insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice? a. Defamation b. Illegal c. A legal advertising strategy d. Unfair Discrimination
b. Illegal
Who must pay for the cost of a medical examination required in the process of underwriting? a. Department of Insurance b. Insurer c. Applicant d. Underwriters
b. Insurer
A long-term care insurance shopper's guide must be provided in the format developed by which of the following? a. Medical Information Bureau b. NAIC c. Office of Insurance Regulation d. Director
b. NAIC
What was created to keep telemarketers from calling consumers who do not wish contacted? a. Call Control Registry b. National Do Not Call Registry c. Confidential No Call Act d. Freedom of Information Act
b. National Do Not Call Registry
Under a straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive a. The remainder of the principal. b. Nothing; the payments will cease. c. Guaranteed minimum benefit. d. The amount paid into the annuity.
b. Nothing; the payments will cease.
Who is involved in completing the agent's report? a. Attending physician and the agent b. Only the agent c. The agent and the applicant d. Only the underwriter, if no agent
b. Only the agent
Which of the following is correct concerning the taxation of premiums in a key-person life insurance policy? a. Premiums are taxable to the employees b. Premiums are not tax deductible as a business expense c. Premiums are tax deductible by the key employee d. Premiums are tax deductible as a business expense
b. Premiums are not tax deductible as a business expense
Which of the following licensees is classified as a representative of the insurance company and not allowed to represent an insured or claimant? a. Public adjuster solicitor b. Producer c. Broker d. Public adjuster
b. Producer
A couple owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability? a. Medical exam and parents' medical history b. Proof of insurability is not required c. Medical exam d. Her parents' federal income tax receipts
b. Proof of insurability is not required
The Gramm-Leach-Bliley Act was passed to a. Allow insurance companies access to medical information for underwriting purposes. b. Protect private customer information filed with a financial institution. c. Define insurance as interstate commerce. d. Allow consumers access to credit and private consumer reports.
b. Protect private customer information filed with a financial institution.
All of the following are requirements for producer license renewal EXCEPT a. Record of fingerprints. b. Renewal examination. c. Up-to-date continuing education. d. Renewal fees.
b. Renewal examination.
All of the following employees may use a 403(b) plan for their retirement EXCEPT a. The vice president of a charitable organization. b. The CEO of a private corporation. c. A school bus driver. d. A part-time classroom aide.
b. The CEO of a private corporation.
How do employer contributions to a Health Savings Account affect the insured's taxes? a. The employer contributions are deducted from the individual insured's tax calculations. b. The employer contributions are not included in the individual insured's taxable income. c. The employer contributions are taxed at the same rate as the Social Security tax rate. d. The employer contributions are taxed to the individual insured as earned income.
b. The employer contributions are not included in the individual insured's taxable income.
A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim, a. Both plans will pay the full amount of the claim. b. The insurance through his company is primary. c. The insurance through his wife's company is primary. d. The insurance plans will split the coverage evenly.
b. The insurance through his company is primary.
In which of the following cases would an "any occupation" disability income policy pay the benefits? a. The insured's family has unexpected expenses due to the insured's disability. b. The insured is unable to perform any jobs in the field related to the insured's education and experience. c. The insured is unable to perform the duties of his or her specific occupation. d. The insured changes jobs and is injured as a result of a more hazardous occupation.
b. The insured is unable to perform any jobs in the field related to the insured's education and experience.
What is the duration of the free-look period for Medicare supplement policies? a. 10 days b. 15 days c. 30 days d. 60 days
c. 30 days
For how long is an insurance company allowed to defer policy loan requests? a. 30 days b. 60 days c. 6 months d. 1 year
c. 6 months
Most policies will pay the accidental death benefits as long as the death is caused by the accident and occurs within a. 30 days. b. 60 days. c. 90 days. d. 120 days.
c. 90 days.
In disability income insurance, if an insured is considered disabled because they cannot perform any job they are suited for by prior education, training or experience, the insured falls under which definition of total disability? a. Statutory b. Own occupation c. Any occupation d. Typical
c. Any occupation
What license or licenses are required to sell variable annuities? a. Only a securities license b. No license is required c. Both a life insurance license and a securities license d. Only a life insurance license
c. Both a life insurance license and a securities license
Health coverage becomes effective when the a. Medical examination has been completed and the premium paid. b. First premium has been received in the insurance company's home office. c. First premium has been paid and the application has been approved. d. Producer delivers the policy to the insured.
c. First premium has been paid and the application has been approved.
Medicaid provides all of the following benefits EXCEPT a. Eyeglasses. b. Family planning services. c. Income assistance for work-related injury. d. Home health care services.
c. Income assistance for work-related injury.
All of the following statements about Medicare Part B are correct EXCEPT a. It is financed by monthly premium b. It is financed by tax revenues. c. It is a compulsory program. d. It covers services and supplies not covered by Part A.
c. It is a compulsory program.
Medicare Part A services do NOT include which of the following? a. Hospitalization b. Hospice Care c. Outpatient Hospital Treatment d. Post hospital Skilled Nursing Facility Care
c. Outpatient Hospital Treatment
In order for an insured under Medicare Part A to receive benefits for care in a skilled nursing facility, which of the following conditions must be met? a. There is no benefit provided under Medicare Part A for skilled nursing care. b. The insured must cover daily copayments. c. The insured must have first been hospitalized for 3 consecutive days. d. The insured must have a Medicare supplement insurance policy.
c. The insured must have first been hospitalized for 3 consecutive days.
An insurer offers a policy very similar to Medicare. An agent tells an applicant that the policy is Medicare, since the policies are similar anyway. Which of the following is true? a. This is legal as long as the applicant understands all the benefits. b. This is illegal only if the policy is bought by the applicant. c. This practice is illegal. d. This is a legal practice.
c. This practice is illegal.
What is the purpose of a fixed-period settlement option? a. To provide a guaranteed income for life b. To provide a guaranteed amount of money each month c. To provide a guaranteed income for a certain amount of time d. To settle the insurance company's liability
c. To provide a guaranteed income for a certain amount of time
A noncontributory group disability income plan has a 30-day elimination period and offers benefits of $2,000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive a. $14,000, none of which is taxable. b. $14,000, all of which is taxable. c. $12,000, none of which is taxable. d. $12,000, all of which is taxable.
d. $12,000, all of which is taxable.
An insured's disability income policy includes an additional monthly benefit rider. For how many years can the insured expect to receive payment from the insurer before Social Security benefits begin? a. 5 b. 3 c. 2 d. 1
d. 1
For how many days of skilled nursing facility care will Medicare pay benefits? a. 30 b. 60 c. 90 d. 100
d. 100
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%
According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan? a. 10% b. 30% c. 40% d. 60%
d. 60%
Which of the following options best depicts how the eligibility of members for group health insurance is determined? a. Eligibility is not determined, but simply accepted b. By the physical conditions of the applicants at the time of employment c. In such a manner as to establish individual selection as to the amounts of insurance d. By conditions of employment
d. By conditions of employment
When the Commissioner suspects that a person is violating an insurance law or other regulation, what can be issued that would order the person to stop committing the act of violation? a. Stop Action Order b. Limitation of Authority Order c. Suspension of Power Order d. Cease and Desist Order
d. Cease and Desist Order
According to the Fair Credit Reporting Act, all of the following would be considered negative information about a consumer EXCEPT a. Tax delinquencies. b. Late payments. c. Failure to pay off a loan. d. Disputes regarding consumer report information.
d. Disputes regarding consumer report information.
Which of the following statements is true regarding LTC insurance? a. Every policy must offer reduced paid-up insurance to the applicant. b. LTC policies may not include any riders. c. LTC policies do not have a free-look period. d. Every policy must offer nonforfeiture benefits to the applicant.
d. Every policy must offer nonforfeiture benefits to the applicant.
In which of the following health plans are benefit payments attributed to employer contributions taxable to the employee? a. AD&D b. Disability Buy Out c. Medical Expense d. Group Disability Income
d. Group Disability Income
All of the following statements are true of a Combination Dental Plan EXCEPT a. It is basically a combination of a scheduled and nonscheduled dental plan. b. It covers diagnostic and preventive care on the usual, customary, and reasonable basis. c. It uses a fee schedule for other dental services. d. It is also known as the Superimposed Plan.
d. It is also known as the Superimposed Plan.
Which of the following would be the best option that would help the surviving spouse of the insured to put her child through daycare after the insured's death? a. State Education Waiver b. Viatical Settlement c. Estate Conservation d. Life Insurance Proceeds
d. Life Insurance Proceeds
Under an individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is a. Within 45 days. b. Weekly. c. Biweekly. d. Monthly.
d. Monthly.
The advantage of qualified plans to employers is a. Tax-free earnings. b. No lump-sum payments. c. Taxable contributions. d. Tax-deductible contributions.
d. Tax-deductible contributions.
An insurer wishes to compare the information given in an insurance application with previous insurance applications by the same applicant but for different companies. What organization can help the insurer accomplish this? a. The State Department of Insurance b. Social Security c. The National Association of Insurance Commissioners d. The Medical Information Bureau
d. The Medical Information Bureau
Which of the following is NOT true regarding the annuitant? a. The annuitant's life expectancy is taken into consideration for the annuity b. The annuitant receives the annuity benefits c. The annuitant must be a natural person d. The annuitant cannot be the same person as the annuity owner
d. The annuitant cannot be the same person as the annuity owner
If a beneficiary is NOT named for annuity benefits, to which entity will the benefit be paid? a. The next of kin b. The state government c. The insurance company d. The annuitant's estate
d. The annuitant's estate
Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean? a. The beneficiary must pay interest to the insurer b. The beneficiary will receive the lump sum, plus interest c. The primary beneficiary will receive the death benefit and the secondary beneficiaries will share the interest payments d. The beneficiary will only receive payments of the interest earned on the death benefit
d. The beneficiary will only receive payments of the interest earned on the death benefit
Which of the following is true regarding benefits paid to disabled employees? a. They are exempt from taxation if any portion of the premium was paid by the employee. b. Tax withholding is required if the employee paid the premium. c. Disability benefits are not taxed. d. They may be subject to taxation if the premium was paid by the employer.
d. They may be subject to taxation if the premium was paid by the employer.
An insured has been injured in an accident. Although he is still receiving benefits from his disability income policy, he does not have to pay premiums. This means that the policy includes a. Return of premium rider. b. Benefit of payment clause. c. Waiver of all payment. d. Waiver of premium feature.
d. Waiver of premium feature.
Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE? a. Distributions before age 59 1/2 incur a 10% penalty on policy gains. b. Policy loans are taxable distributions. c. Accumulations are tax deferred. d. Withdrawals are not taxable.
d. Withdrawals are not taxable.
Annually renewable term policies provide a level death benefit for a premium that a. Fluctuates b. Increases annually c. Decreases annually d. Remains level
b. Increases annually
The type of policy that can be changed from one that does not accumulate cash value to the one that does is a a. Convertible Term Policy b. Renewable Term Policy c. Decreasing Term Policy d. Whole Life Policy
a. Convertible Term Policy
Which component increases in the increasing term insurance? a. Death benefit b. Cash value c. Interest on the proceeds d. Premium
a. Death benefit
The death benefit in a variable universal life policy a. Depends on the performance of a separate account b. Is guaranteed to be higher than when the policy is originally issued c. Is fixed d. Always equals the face amount stated in the policy
a. Depends on the performance of a separate account
The death benefit under the Universal Life Option B a. Gradually increases each year by the amount that the cash value increases b. Decreases by the amount that the cash value increases c. Increases for the first few years of the policy, and then levels off d. Remains level
a. Gradually increases each year by the amount that the cash value increases
An employee has group life insurance through her employer. After 5 years, she decides to leave the company and work independently. How can she obtain an individual policy? a. She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan b. She will still be covered under the group plan, but will have to pay an individual policy premium c. She can only convert her coverage without proof of insurability if she has the master policy d. She must apply for a new policy, which requires her to provide proof of insurability
a. She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan
An insured purchased a 10-year level term life policy that is guaranteed renewable and convertible. What happens at the end of the 10-year term? a. The insured may renew the policy for another 10 years, but at a higher premium rate b. The insured must provide evidence of insurability to renew the policy c. The insured may only convert the policy to another term policy d. The insured may renew the policy for another 10 years at the same premium rate
a. The insured may renew the policy for another 10 years, but at a higher premium rate
Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit? a. Universal Life - Option A b. Universal Life - Option B c. Equity Indexed Universal Life d. Variable Universal Life
a. Universal Life - Option A
A Straight Life policy has what type of premium? a. A variable annual premium for the life of the insured b. A level annual premium for the life of the insured c. An increasing annual premium for the life of the insured d. A decreasing annual premium for the life of the insured
b. A level annual premium for the life of the insured1
The policy owner of an adjustable life policy wants to increase the death benefit. Which of the following statements is correct regarding this change? a. The death benefit can be increased only by exchanging the existing policy for a new one b. The death benefit can be increased by providing evidence of insurability c. The death benefit cannot be increased d. The death benefit can be increased only when the policy has developed a cash value
b. The death benefit can be increased by providing evidence of insurability
An employee quits his job on May 15 and doesn't covert his Group Life policy to an individual policy for 2 weeks. He dies in a freak accident on June 1. Which of the following statements best describes what will happen? a. The insurer will pay nothing because the employee has terminated his group insurance and hasn't started an individual one b. The insurer will pay the full death benefit from the group policy to the beneficiary c. The insurer will pay a reduced death benefit to the beneficiary d. The insurer will pay the death benefit minus one month's premium
b. The insurer will pay the full death benefit from the group policy to the beneficiary
An insured purchases a variable life insurance policy with a face amount of $50,000. Over the life of the policy, stock performance declined and the cash value fell to $10,000. If the insured dies, how much will be paid out? a. $10,000 b. $40,000 c. $50,000 d. $60,000
c. $50,000
How long must insurers maintain the evidence from the agent that a disclosure statement about a life insurance policy was delivered to the applicant? a. 3 months b. 6 months c. 1 year d. 3 years
d. 3 years
IF the owner of a whole life policy who is also the insured dies at age 80, and there are no outstanding loans on the policy, what portion of the death benefit will be paid to the beneficiary? a. A death benefit equal to the cash value of the policy b. 50% of the death benefit c. The face amount minus the premiums that would have been collected until the insured reached the age of 100 d. A full death benefit
d. A full death benefit
Partners in a business enter into a buy-sell agreement to purchase life insurance, which states that should one of them die prematurely, the other would be financially able to buy the interest of the deceased partner. What type of insurance policy may be used to fund this agreement? a. Term insurance only b. Permanent insurance only c. Universal life insurance only d. Any form of life insurance
d. Any form of life insurance
An employee quits his job and converts his group policy to an individual policy; the premium for the individual policy will be based on his a. Experience rating b. Group rate c. Insurer's scheduled rate d. Attained age
d. Attained age
When an employee terminates coverage under a group insurance policy, coverage continues in force a. Until the employee notifies the group insurance provider that coverage conversion policy is issued b. For 31 days c. For 60 days d. Until the employee can obtain coverage under a new group plan
b. For 31 days
If a life insurance policy allows the policy owner to make periodic additions to the face amount at standard rates, without proving insurability, the policy includes a a. Nonforfeiture option b. Guaranteed insurability rider c. Paid-up additions option d. Cost of living provision
b. Guaranteed insurability rider
Which of the following types of policies allows the policy owner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount? a. Variable life b. Adjustable life c. Universal life d. Flexible life
c. Universal life
After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive? a. Monthly premium waiver and monthly income b. Percentage of medical costs paid by the insurer c. Payments for life d. Yearly premium waiver and income
a. Monthly premium waiver and monthly income
Under an extended term nonforfeiture option, the policy cash value is converted to a. The same face amount as in the whole life policy b. The face amount equal to the cash value c. A lower face amount than the whole life policy d. A higher face amount than the whole life policy
a. The same face amount as in the whole life policy
A Universal Life insurance policy has two types of interest rates that are called a. Fixed and Variable b. Minimum and Target c. Guaranteed and Current d. Option A and Option B
c. Guaranteed and Current
Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member? a. Spouse rider b. Children's rider c. Additional insured rider d. Family term rider
d. Family term rider
What is the benefit of choosing extended term as a nonforfeiture option? a. It matures at age 100 b. It allows for coverage to continue beyond maturity date c. It can be converted to a fixed annuity d. It has the highest amount of insurance protection
d. It has the highest amount of insurance protection
An insured purchased a 15-year level term life insurance policy with a face amount of $100,000. The policy contained an accidental death rider, offering a double indemnity benefit. The insured was severely injured in an auto accident, and after 10 weeks of hospitalization, died from the injuries. What amount would his beneficiary receive as a settlement? a. $0 b. $100,000 c. $200,000 d. $100,000 plus the total of paid premiums
c. $200,000
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 a. Based on the issue age of the insured b. Discounted c. Adjusted to the insured's age at the time of the renewal d. Determined by the health of the insured
c. Adjusted to the insured's age at the time of the renewal
Which of the following is TRUE about a class designation? a. It is not allowed b. It determines the succession of beneficiaries c. Beneficiaries are not identified by name d. Beneficiaries must be part of the insured's immediate family
c. Beneficiaries are not identified by name
Which of the following documents must be provided to the policy owner or applicant during policy replacement? a. Buyer's Guide and Policy Summary b. Policy Illustrations c. Notice Regarding Replacement d. Disclosure Authorization Form
c. Notice Regarding Replacement
The sole beneficiary of a life insurance policy dies before the insured. If the policy owner fails to change the beneficiary before the insured's death, the proceeds of the policy will go to a. The state b. The beneficiary's estate c. The insured's estate d. Probate
c. The insured's estate
Which of the following determines the cash value of a variable life policy? a. The policy's guarantees b. The premium mode c. The performance of the policy portfolio d. The company's general account
c. The performance of the policy portfolio
Why should the producer personally deliver the policy when the first premium has already been paid? a. To find out how the family has been doing since the initial presentation b. To make sure the policy is not stolen or lost c. To help the insured understand all aspects of the contract d. To ensure the producer gets paid commission
c. To help the insured understand all aspects of the contract
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT a. Delivery receipt b. Signed waiver of premium c. Statement of good health d. Payment of premium
b. Signed waiver of premium
If an insured withdraws a portion of the face amount in the form of accelerated benefits because of a terminal illness, how will that affect the payable death benefit from the policy? a. The death benefit will be larger b. The death benefit will be smaller c. The death benefit will be fofeited d. The death benefit will be the same as the original face amount
b. The death benefit will be smaller
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective? a. As of the first of the month after the policy date b. As of the policy issue date c. As of the application date d. As of the policy delivery date
c. As of the application date
An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium? a. It will decrease for the new 5-year term since the insured is now a lesser risk to the company b. It will increase each year during the next 5 years as the face amount increases each year c. It will increase because the insured will be 5 years older than when the policy was originally purchased d. It will remain the same for the 5-year term
c. It will increase because the insured will be 5 years older than when the policy was originally purchased
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the a. Other-insured rider b. Change of insured rider c. Juvenile rider d. Payor rider
a. Other-insured rider
Which type of life insurance policy generate immediate cash value? a. Single premium b. Level term c. Decreasing term d. Continuous premium
a. Single Premium
Children's riders attached to whole life policies are usually issued as what type of insurance? a. Term b. Variable life c. Adjustable life d. Whole life
a. Term
What are the licensing requirements for someone who sells variable universal life insurance? a. Universal life and variable products b. Life insurance and securities c. Life insurance d. Securities
b. Life insurance and securities
An agent and an applicant for a life insurance policy fill out and sign the application. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. When will coverage begin? a. When the agent submits the application to the company and the company issues a conditional receipt b. When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health c. On the designated effective date d. On the application date
b. When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health
Which policy component decreases in decreasing term insurance? a. Dividend b. Premium c. Face amount d. Cash value
c. Face amount
Which of the following methods of calculating the amount of life insurance needed takes into account the insured's wages, years until retirement, and inflation? a. Blackout approach b. Lump-sum approach c. Human life value approach (HLVA) d. Needs approach
c. Human life value approach (HLVA)
What is the waiting period on a Waiver of Premium rider in life insurance policies? a. 30 days b. 3 months c. 5 months d. 6 months
d. 6 months
Which of the following applicants could the insurer charge a higher rate of premium and not violate regulations regarding unfair discrimination? a. An applicant who was born in another country b. An applicant who is legally blind c. An applicant who has been a victim of domestic abuse d. An applicant who is a smoker
d. An applicant who is a smoker
Which of the following best describes fixed-period settlement option? a. Only the principal amount will be paid out within a specified period of time b. The death benefit must be paid out in a lump sum within a certain time period c. Income is guaranteed for the life of the beneficiary d. Both the principal and interest will be liquidated over a selected period of time
d. Both the principal and interest will be liquidated over a selected period of time
Which option for Universal life allows the beneficiary to collect both the death benefit and the cash value upon the death of the insured? a. Option B b. Corridor option c. Variable option d. Option A
a. Option B
If someone wants to buy a life insurance policy that will provide lifetime protection against premature death, what type of life insurance policy should it be? a. Permanent b. An annuity c. A modified Endowment Contact d. Term
a. Permanent
If an employee wants to enter the group outside of the open enrollment period, to reduce adverse selection, the insurer may a. Increase medical requirements on existing members b. Require evidence of insurability c. Require a higher premium d. Prolong the open enrollment period
b. Require evidence of insurability
Which of the following is NOT true regarding a Variable Universal Life policy? a. The death benefit is fixed b. The policy owner can participate in some of the investment decisions c. The minimum death benefit is guaranteed d. The cash values are not guaranteed
a. The death benefit is fixed
If an applicant for a life insurance policy and person to be insured are two different people, the underwriter would be concerned about a. Which individual will pay the premium b. Whether an insurable interest exists between the individuals c. The gender of the applicant d. The type of policy requested
b. Whether an insurable interest exists between the individuals
When a life insurance policy stipulates that the beneficiary will receive payments in specified installments or for a specified number of years, what provision prevents the beneficiary from changing or borrowing from the planned installments? a. Accelerated benefit provision b. Loan provision c. Spendthrift provision d. Settlement option
c. Spendthrift provision
The insured is also the policy owner of a whole life policy. What age must the insured attain in order to receive the policy's face amount? a. 65 b. 70 1/2 c. 90 d. 100
d. 100
An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation? a. Variable life b. Universal life c. Whole life d. Decreasing term
d. Decreasing term
Concerning Juvenile Life insurance, which of the following statements is INCORRECT? a. Usually a parent or guardian is the applicant for insurance on the life of a minor b. It can be a limited premium payment policy c. Juvenile Life is classified as any life insurance written on the life of a minor d. Juvenile Life is classified as any life insurance purchased by a minor
d. Juvenile Life is classified as any life insurance purchased by a minor
An insured pays $1,200 annually for her life insurance premium. The insured applies this year's $300 worth of accumulated dividends to the next year's premium, thus reducing it to $900. What option does this describe? a. Accumulation at Interest b. Cash option c. Flexible Premium d. Reduction of Premium
d. Reduction of Premium
A policy owner of a life insurance policy who is also the insured is diagnosed with a terminal illness, so he sells the policy to a viatical company in order to pay medical bills. What term best described the policy owner's role in this transaction? a. Ceding party b. Viatical settlement purchaser c. Viatical settlement broker d. Viator
d. Viator
For a retirement plan to be qualified, it must be designed for the benefit of a. IRS. b. Employees. c. Key employee. d. Employer.
b. Employees.
In a noncontributory health insurance plan, what percentage of eligible employees must participate in the plan before the plan can become effective? a. 100% b. 75% c. 50% d. 25%
a. 100%
A person applying for a manager or exclusive general agent license must meet all of the following criteria EXCEPT a. Be responsible for at least 25% of total commissions collected by the office that he or she manages. b. Have an authority to act on the insurer's behalf. c. Be found sufficiently fit, competent and reliable by the Department of Insurance. d. Have paid all applicable fees.
a. Be responsible for at least 25% of total commissions collected by the office that he or she manages.
An individual is insured under his employer's group Disability Income policy. The insured suffered an accident while on vacation that left him unable to work for 4 months. If the disability income policy pays the benefit, which of the following would be true? a. Benefits that are attributable to employer contributions are fully taxable to the employee as income. b. The insured has to wait 2 more months to start receiving the benefits. c. For the business, payments are not considered tax deductible as an ordinary business expense. d. The insured can deduct his medical expense benefits from his income tax.
a. Benefits that are attributable to employer contributions are fully taxable to the employee as income.
A small hardware store owner is involved in a car accident that renders him totally disabled for half a year. Which type of insurance would help him pay for expenses of the company during the time of his disability? a. Business overhead expense policy b. Key person insurance c. Disability buy-sell agreement d. Business disability policy
a. Business overhead expense policy
Which of the following is an eligibility requirement for all Social Security Disability Income benefits? a. Have attained fully insured status b. Be disabled for at least 1 year c. Have permanent kidney failure d. Be at least age 50
a. Have attained fully insured status
All of the following would fall under the definition of Durable Medical Equipment EXCEPT a. Hospital blankets. b. Oxygen equipment. c. Wheel chairs. d. Hospital bed.
a. Hospital blankets.
In group insurance, what is the policy called? a. Master policy b. Entire contract c. Certificate of authority d. Certificate of insurance
a. Master policy
An insured is involved in a car accident. After the accident is determined to be her fault, the police give her a breathalyzer test to determine whether or not she had been drinking alcohol before the accident. Her blood alcohol level is over the legal limit. What type of health benefits will her health insurance policy pay for her injuries if the policy includes the narcotics and intoxicants provision? a. No benefits b. Only post-hospitalization benefits c. Full benefits d. Partial benefits
a. No benefits
Can a group that is formed for the sole purpose of obtaining group insurance qualify for group coverage? a. No, the group must be formed for a purpose other than obtaining group insurance. b. No, a group of individuals cannot apply for group coverage unless represented by an association or trust. c. Yes, any group can apply for group coverage. d. Yes, but only if the group is over 35 people.
a. No, the group must be formed for a purpose other than obtaining group insurance.
Which of the following factors would be an underwriting consideration for a small employer carrier? a. Percentage of participation b. Claims experience c. Health status d. Medical history of the employees
a. Percentage of participation
According to the PPACA metal levels classification, if a health plan is expected to cover 90% of the cost for an average population, and the participants would cover the remaining 10%, what type of plan is that? a. Platinum b. Bronze c. Silver d. Gold
a. Platinum
Rose bought three policies from the same insurer. Her benefits have exceeded the maximum allowed by the insurer. Which of the following will happen? a. Pro rata benefit reduction b. Full distribution of each policy's benefit c. Termination of two of the policies d. Termination of all of the policies
a. Pro rata benefit reduction
In respect to the consideration clause, which of the following is consideration on the part of the insurer? a. Promising to pay in accordance with the contract terms b. Offering a secondary policy to the applicant c. Offering an unconditional contract d. Explaining policy revisions to the applicant
a. Promising to pay in accordance with the contract terms
Under which provision can a physician submit claim information prior to providing treatment? a. Prospective Review b. Concurrent Review c. Anticipatory Treatment d. Suspended Treatment
a. Prospective Review
A patient is being fitted for dentures. Which type of dental treatment is this? a. Prosthodontics b. Replacement c. Restorative d. Orthodontics
a. Prosthodontics
Health insurance underwriting is best defined as a. Selection, classification, and rating of risks. b. Transacting of insurance. c. Issuance of policies. d. Reporting and rejection of risks.
a. Selection, classification, and rating of risks.
Which of the following would be a qualifying event as it relates to COBRA? a. Termination of employment due to downsizing b. Termination of employment for stealing c. Eligibility for coverage under another group plan d. Eligibility for Medicare
a. Termination of employment due to downsizing
If an insurance company offers Medicare supplement policies, it must offer which of the following plans? a. A & B b. B-N c. A-D d. A
d. A
Employer contributions made to a qualified plan a. May discriminate in favor of highly paid employees. b. Are after-tax contributions. c. Are taxed annually as salary. d. Are subject to vesting requirements.
d. Are subject to vesting requirements.
Which statement best defines a Multiple Employer Welfare Arrangement (MEWA)? a. A group health plan that covers medical expenses arising from work related injuries b. A joining together by employers to provide health benefits for employee c. A plan that provides hospice care for terminally ill employees d. A government health plan that provides health care for the unemployed
b. A joining together by employers to provide health benefits for employee
When the policy premium wasn't submitted with the application, what should the agent obtain from the insured upon policy delivery? a. A unilateral contract b. A statement of good health c. A medical report d. A conditional contract
b. A statement of good health
Which of the following Medicare supplement plans would be available to a reasonably healthy 91-year-old female? a. A-C only b. A-N c. K & L only d. A only
b. A-N
A 63-year-old man is planning to be employed until age 68. When will he be eligible for Medicare? a. Age 69 ½ if no longer employed b. Age 65, regardless of his employment status c. As soon as he retires at age 68 d. Age 70, if still employed
b. Age 65, regardless of his employment status
Long-term care insurance policies must cover which of the following? a. Injuries caused by an act of war b. Alzheimer's disease c. All mental disorders d. Treatment of alcoholism
b. Alzheimer's disease
Under which condition would an employee's group medical benefits be exempt from income taxes? a. When the premiums and other unreimbursed medical expenses exceed 10% of the employee's adjusted gross income b. An employee's group medical benefits are generally exempt from taxation as income. c. An employee's group medical benefits are never exempt from taxation as income. d. When the premiums and other unreimbursed medical expenses exceed 5% of the employee's adjusted gross income
b. An employee's group medical benefits are generally exempt from taxation as income.
In an annuity, the accumulated money is converted into a stream of income during which time period? a. Conversion period b. Annuitization period c. Payment period d. Amortization period
b. Annuitization period
Which of the following is not true of Disability Buy-Sell coverage? a. The policies provide funds for the business organization to purchase the business interest of a disabled partner. b. Benefits are considered taxable income to the business. c. It is typically written to cover partners or corporate officers of a closely held business. d. Premium payments are not deductible to the business.
b. Benefits are considered taxable income to the business.
An individual applied for a life insurance policy on Jan. 10. The policy was issued on Jan. 31; however, because the insured's agent was on vacation at that time, the policy was not delivered until Feb. 8. After reading through the policy provisions, the insured decided to return the policy to the insurer. When would the insured need to return the policy for a refund of premium? a. Anytime, because the agent did not deliver the policy promptly b. By Feb. 18, or within 10 days of policy delivery c. By Feb. 10, or within 10 days of policy issue d. Within 30 days of the application
b. By Feb. 18, or within 10 days of policy delivery
When a policy owner designates a group of individuals as the beneficiary of a life insurance death benefit without specifically naming the individuals, this is called a. Stirpes designation b. Class designation c. Revocable designation d. Irrevocable designation
b. Class designation
An applicant for an individual health policy failed to complete the application properly. Before being able to complete the application and pay the initial premium, she is confined to a hospital. This will not be covered by insurance because she has not met the conditions specified in the a. Eligibility Clause. b. Consideration Clause. c. Insuring Clause. d. Pre-existing Conditions Clause.
b. Consideration Clause.
Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts? a. Coverage limitations b. Continuation provision c. Premium provision d. Insurer's rights
b. Continuation provision
The gatekeeper of an HMO helps a. Determine which doctors can participate in an HMO plan. b. Control specialist costs. c. Determine who will be allowed to enroll in an HMO program. d. Prevent double coverage.
b. Control specialist costs.
An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement? a. Claims Saving b. Cost-containment c. Selective Coverage d. Limited Coverage
b. Cost-containment
Which of the following is NOT considered to be a basic service, under a nonscheduled plan? a. Fillings b. Dentures c. Endodontics d. Oral surgery
b. Dentures
All of the following statements concerning dividends are true EXCEPT a. Favorable investment results generate higher dividends b. Dividend amounts are guaranteed in the policy c. Lower insurance company costs generate higher dividends d. They stem from favorable underwriting experience
b. Dividend amounts are guaranteed in the policy
Concerning group Medical and Dental insurance, which of the following statements is INCORRECT? a. Employee paid premiums may be deducted if certain conditions are met. b. Employee benefits are tax deductible the year in which they were received. c. Benefits received by the employee are free from federal income tax. d. Premiums paid by the employer are deductible as a business expense.
b. Employee benefits are tax deductible the year in which they were received.
All of the following actions can be described as twisting EXCEPT a. Making an incomplete comparison between the existing and proposed policies b. Explaining to client the advantages of permanent insurance over term and suggesting changing policies c. Misrepresenting the terms and conditions of the existing policy to make the new one more attractive d. Embellishing the terms of the proposed policy in order to convince the insured to switch
b. Explaining to client the advantages of permanent insurance over term and suggesting changing policies
If an insurer changes a form that it uses to transact insurance, it must do which of the following? a. Nothing, as long as the insurer has a Certificate of Qualification. b. File the form with the Commissioner for approval c. File the form with the NAIC for approval d. Submit it to the Department of Insurance so it can be kept in the insurer's official records
b. File the form with the Commissioner for approval
The Patient Protection and Affordable Care Act includes all of the following provisions EXCEPT a. Coverage for preventive benefits. b. Individual tax deduction for premiums paid. c. Right to appeal. d. No lifetime dollar limits.
b. Individual tax deduction for premiums paid.
Which of the following statements is NOT true concerning Medicaid? a. It is intended to provide medical assistance for certain categories of people who are needy. b. It consists of 3 parts: Part A: hospitalization, Part B: doctor's services, Part C: disability income. c. It is a state program. d. It is funded by state and federal taxes.
b. It consists of 3 parts: Part A: hospitalization, Part B: doctor's services, Part C: disability income.
Which of the following is true of a children's rider added to an insured's permanent life insurance policy? a. Each child covered must show evidence of insurability b. It is term coverage that is convertible to permanent insurance at or prior to the child reaching the maximum coverage age c. It is permanent insurance d. The policy covers only the natural children of the insured
b. It is term coverage that is convertible to permanent insurance at or prior to the child reaching the maximum coverage age
Which of the following best describes the unfair trade practice of defamation? a. Refusing to deal with other insurers b. Making derogatory oral statements about another insurer's financial condition c. Assuming the name and identity of another person d. Issuing false advertising material
b. Making derogatory oral statements about another insurer's financial condition
Which type of Medicare policy requires insureds to use specific healthcare providers and hospitals (network providers), EXCEPT in emergency situations? a. Preferred b. Medicare SELECT c. Medicare Advantage d. Medicare Part A
b. Medicare SELECT
Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or become disabled? a. Waiver of Premium b. Payor Benefit c. Jumping Juvenile d. Juvenile Premium Provision
b. Payor Benefit
After the elimination period, a totally disabled insured qualified and started receiving benefits from his disability income policy that has a waiver of premium rider. What will most likely happen to the premiums paid into the policy during the elimination period? a. Premiums will be waived. b. Premiums will be refunded. c. Premiums will be retained by the company, but no further premium will be required for the duration of the disability. d. Premiums will be prorated.
b. Premiums will be refunded.
Which of the following is NOT an activity of daily living (ADL)? a. Bathing b. Talking c. Eating d. Dressing
b. Talking
All of the following would be different between qualified and nonqualified retirement plans EXCEPT a. IRS approval requirements b. Taxation on accumulation c. Taxation of withdrawals d. Taxation of contributions
b. Taxation on accumulation
Which of the following best describes what the annuity period is? a. The period of time from the effective date of the contract to the date of its termination b. The period of time during which accumulated money is converted into income payments c. The period of time from the accumulation period to the annuitization period d. The period of time during which money is accumulated in an annuity
b. The period of time during which accumulated money is converted into income payments
All of the following are general requirements of a qualified plan EXCEPT a. The plan must be permanent, written and legally binding. b. The plan must provide an offset for social security benefits. c. The plan must be communicated to all employees. d. The plan must be for the exclusive benefits of the employees and their beneficiaries.
b. The plan must provide an offset for social security benefits.
All of the following statements about Medicare supplement insurance policies are correct EXCEPT a. They are issued by private insurers. b. They cover the cost of extended nursing home care. c. They cover Medicare deductibles and copayments. d. They supplement Medicare benefits.
b. They cover the cost of extended nursing home care.
What do long-term care policies offer to policyholders to account for inflation? a. They pay a dividend that increases every 7 years. b. They offer the option of purchasing coverage that raises benefit levels accordingly. c. They do not account for inflation. d. They automatically increase premiums to account for inflation.
b. They offer the option of purchasing coverage that raises benefit levels accordingly.
An insurance company assures its new policyholders that their premium costs will not increase for a period of at least five years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next two years. What term best describes this act? a. Unfair discrimination b. Errors and omissions c. Fraud d. Defamation
c. Fraud
Under the Affordable Care Act, a special enrollment period allows an individual to enroll in a qualified health plan within how many days of a qualifying event? a. 10 days b. 30 days c. 60 days d. 90 days
c. 60 days
Individuals who itemize deductions can claim deductions for medical expenses not covered by health insurance that exceed what percent of their adjusted gross income? a. 5% b. 7% c. 7.5% d. 15%
c. 7.5%
An insured gave birth to her first child by Caesarean section. Her health insurance covered a stay of up to 96 hours in the hospital, but her doctor allowed her and the baby to leave after only 72 hours. What other coverage must the insured's health insurance now allow her? a. Her policy has no more obligation towards her or the baby b. A second hospital stay of up to 96 hours c. At least 1 home health care visit within 48 hours of discharge from the hospital d. Her policy cannot allow her to leave earlier than the prescribed time of 96 hours
c. At least 1 home health care visit within 48 hours of discharge from the hospital
A policy available to business owners that provides payment for normal business expenses in the event that the owner is disabled is called a. Partial Disability b. Recurrent Disability c. Business Overhead Expense. d. Credit Accident and Health coverage
c. Business Overhead Expense.
After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true? a. The employee can convert from group to individual insurance within 31 days of termination. b. The premium of the individual health insurance policy can be higher than the original policy. c. By law, the new, individual policy must provide the same benefits as the group insurance policy. d. Continuation of group coverage need not include dental, vision, or prescription drug benefits.
c. By law, the new, individual policy must provide the same benefits as the group insurance policy.
Which of the following children related to the insured are NOT eligible for a health insurance plan? a. Adopted children b. Newborn children c. Children of an insured's sibling d. Children of an insured's second wife
c. Children of an insured's sibling
Which of the following reports will provide the underwriter with the information about an insurance applicant's credit? a. Agent's report b. Any federal report c. Consumer report d. Inspection report
c. Consumer report
The term "fixed" in a fixed annuity refers to all of the following EXCEPT a. Equal annuity payments b. Amount and length of payments c. Death benefit d. Guaranteed rate of interest
c. Death benefit
When must an IRA be completely distributed when a beneficiary is not named? a. December 31 of the year following the year of the owner's death. b. Due date of the deceased owner's final tax return including extensions. c. December 31 of the year that contains the fifth anniversary of the owner's death. d. Due date of beneficiary's tax return including extensions.
c. December 31 of the year that contains the fifth anniversary of the owner's death.
If an insurer appoints a producer, which authority must be notified? a. State Insurance Regulation Board b. Commissioner c. Department of Insurance d. Federal Directory of Insurers
c. Department of Insurance
OBRA requires which disease to be covered by an employer for 30 months before Medicare becomes the primary mode of coverage? a. Leukemia b. End-stage heart failure c. End-stage renal failure d. Black lung
c. End-stage renal failure
All of the following violations may result in an agent's imprisonment EXCEPT a. Knowingly obtaining information about a consumer under false pretenses. b. Engaging in the business of insurance after being convicted of breach of trust. c. Failing to report to the department a criminal prosecution taken against the agent in another jurisdiction. d. Embezzling funds from the insurer.
c. Failing to report to the department a criminal prosecution taken against the agent in another jurisdiction.
An applicant is denied insurance because of information found on a consumer report. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company? a. Conditional receipt b. Disclosure rule c. Fair Credit Reporting Act d. Consumer Privacy Act
c. Fair Credit Reporting Act
Which of the following statements is CORRECT concerning the relationship between Medicare and HMOs? a. Medicare Advantage is Medicare provided by an approved HMO only. b. All HMOs and PPOs charge premiums beyond what is paid by Medicare. c. HMOs may pay for services not covered by Medicare. d. HMOs do not pay for services covered by Medicare.
c. HMOs may pay for services not covered by Medicare.
Which of the following is TRUE regarding the accumulation period of an annuity? a. It is a period of time during which the beneficiary receives income b. It is limited to 10 years c. It is a period during which the payments into the annuity grow tax deferred d. It is also referred to as the annuity period
c. It is a period during which the payments into the annuity grow tax deferred
Which of the following statements is NOT correct concerning the COBRA Act of 1985? a. It applies only to employers with 20 or more employees that maintain group health insurance plans for employees. b. COBRA stands for Consolidated Omnibus Budget Reconciliation Act. c. It requires all employers, regardless of the number or age of employees, to provide extended group health coverage. d. It covers terminated employees and/or their dependents for up to 36 months after a qualifying event.
c. It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.
The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof of loss is known as a. Payment of claims. b. Proof of loss. c. Legal actions. d. Time limit on certain defenses.
c. Legal actions.
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? a. Guaranteed insurability b. Payor benefit c. Long-term care d. Accidental death
c. Long-term care
A health insurance plan which involves financing, managing, and delivery of health care services and involves a group of providers who share in the financial risk of the plan or who have an incentive to deliver cost effective service, is called a. Limited care plan. b. Self-insurer. c. Managed care plan. d. Preferred care plan.
c. Managed care plan.
Which of the following programs expands individual public assistance programs for people with insufficient income and resources? a. Social Security b. Unemployment compensation c. Medicaid d. Medicare
c. Medicaid
An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do? a. Look at the applicant's medical history to decide what premium to charge b. Send the applicant to a doctor for a physical. Nothing can happen until they get the results. c. Offer the supplement policy on a guaranteed issue basis d. Exclude pre-existing conditions from coverage under the supplement policies
c. Offer the supplement policy on a guaranteed issue basis
Which of the following statements is INCORRECT concerning Medicare Part B coverage? a. Part B will pay 80% of covered expenses, subject to Medicare's standards for reasonable charges. b. It is a voluntary program designed to provide supplementary medical insurance to cover physician services, medical services and supplies not covered under Part A. c. Part B coverage is provided free of charge when an individual turns age 65. d. Participants under Part B are responsible for an annual deductible.
c. Part B coverage is provided free of charge when an individual turns age 65.
A medical insurance plan in which the health care provider is paid a regular fixed amount for providing care to the insured and does not receive additional amounts of compensation dependent upon the procedure performed is called a. Reimbursement plan. b. Fee-for-service plan. c. Prepaid plan. d. Indemnity plan.
c. Prepaid plan.
A producer licensed in another state wants to become a producer in Pennsylvania. The other state gives the same privileges to Pennsylvania producers wanting to be licensed in that state as it does its own agents. Pennsylvania, therefore, extends the privileges of its agents to the prospective agent of the other state. What is this called? a. Fair exchange b. Equanimity c. Reciprocity d. Equality
c. Reciprocity
Annuities can be used to fund which of the following? a. Group life insurance b. Estate creation c. Retirement plans d. Variable life insurance
c. Retirement plans
Which of the following statements about a suicide clause in a life insurance policy is TRUE? a. Suicide is covered as long as the policy is in force b. Suicide is excluded as long as the policy is in force c. Suicide is excluded for a specific period of years and covered thereafter d. Suicide is covered for a specific period of years and excluded thereafter
c. Suicide is excluded for a specific period of years and covered thereafter
Which of the following does NOT have to be disclosed in a long-term care (LTC) policy? a. Any limitations or conditions of eligibility for LTC benefits b. Any riders or endorsements c. The aggregate amount of premiums due d. The meaning of the terms "reasonable" and "customary"
c. The aggregate amount of premiums due
Which of the following is true regarding a waiver of a surrender charge on an annuity contract? a. The surrender charge will be applied to all premature surrenders. b. The surrender charge waiver only applies to immediate annuity. c. The charge may be waived if the annuitant is confined to a long-term care facility for at least 30 days. d. The charge can only be waived if the annuitant needs the funds for medical expenses.
c. The charge may be waived if the annuitant is confined to a long-term care facility for at least 30 days.
Which of the following statements concerning group health insurance is CORRECT? a. Each employee receives a policy. b. Under group insurance, the insurer may reject certain individuals from coverage. c. The employer is the policyholder. d. Only the employer receives a certificate of insurance.
c. The employer is the policyholder.
How many eligible employees must be included in a contributory plan? a. 90% b. 100% c. 50% d. 75%
d. 75%
The First Street Church plans to sponsor a summer camp for the youth of their congregation. They would like to purchase insurance that would pay benefits should one of the youth get injured while participating in the camp activities. The type of policy they would likely need is a/an a. Limited Sickness. b. Accidental Death and Dismemberment. c. Limited Accident. d. Blanket.
d. Blanket.
What process will the insurance company use to monitor the insured's hospital stay to make sure that everything is proceeding according to schedule? a. Prospective review b. Corridor deductible c. Preventive review d. Concurrent review
d. Concurrent review
A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called a. Accelerated benefit rider b. Living need rider c. Payor rider d. Cost of living rider
d. Cost of living rider
All of the following are usually provided under an employer group dental insurance plan EXCEPT a. Preventive care for up to two visits per year. b. The dental plan is typically written in conjunction with group health insurance. c. The dental plan places limits on such procedures as braces and appliances. d. Coverage for cosmetic treatment.
d. Coverage for cosmetic treatment.
Group disability income insurance premiums paid by the employer are a. Taxable to the employee. b. Tax deductible by the employee. c. Tax deferred to the employer. d. Deductible by the employer as an ordinary business expense.
d. Deductible by the employer as an ordinary business expense.
When the policy owner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option? a. Fixed period b. Life income period certain c. Extended term d. Fixed amount
d. Fixed amount
Health Savings Accounts (HSAs) are designed to a. Increase individual interest income. b. Insure against catastrophic losses. c. Provide duplicate coverage for health care expenses. d. Help individuals save for qualified health expenses.
d. Help individuals save for qualified health expenses.
What is the tax consequence of amounts received from a Traditional IRA after the money was left in the tax-deferred account by the beneficiary? a. Income tax on distributions plus 10% penalty. b. Capital gains tax on distributions and no penalty. c. Capital gains tax on distributions plus 10% penalty. d. Income tax on distributions and no penalty.
d. Income tax on distributions and no penalty.
Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by an underwriter? a. Applicant's character b. Personal habits c. General reputation d. Medical history
d. Medical history
An insured is covered under a Medicare policy that provides a list of network healthcare providers that the insured must use to receive coverage. In exchange for this limitation, the insured is offered a lower premium. Which type of Medicare policy does the insured own? a. Medicare Part A b. Medicare Supplement c. Medicare Advantage d. Medicare SELECT
d. Medicare SELECT
Under the Affordable Care Act, which classification applies to health plans based on the amount of covered costs? a. Guaranteed and nonguaranteed b. Grandfathered and nongrandfathered c. Risk classification d. Metal level classification
d. Metal level classification
A man's physician submits claim information to his insurer before she actually performs a medical procedure on him. She is doing this to see if the procedure is covered under the patient's insurance plan and for how much. This is an example of a. Concurrent review. b. Claims-delayed treatment. c. Suspended treatment. d. Prospective review.
d. Prospective review.
Which type of dental care would cover the cost of fillings? a. Endodontics b. Orthodontics c. Oral Surgery d. Restorative
d. Restorative
Which of the following entities must approve all continuing education courses in this state? a. The NAIC b. The appointing insurer c. The State Board of Education d. The Commissioner
d. The Commissioner
Which of the following is TRUE regarding variable annuities? a. The funds are invested in the company's general account. b. The company guarantees a minimum interest rate. c. A person selling variable annuities is required to have only a life agent's license. d. The annuitant assumes the risks on investment.
d. The annuitant assumes the risks on investment.
What happens if a non-member physician is utilized under the Point-Of-Service plan? a. The non-member physician will be paid a fee for service. b. The non-member physician will be paid a fee for service, but the member patient will be penalized per visit on his/her monthly premium. c. The member patient will have to pay all costs out-of-pocket. d. The attending physician will be paid a fee for service, but the member patient will have to pay a higher coinsurance amount.
d. The attending physician will be paid a fee for service, but the member patient will have to pay a higher coinsurance amount.
Which of the following factors does an insurer use the most to determine the extent of disability benefits that it will promise in a contract? a. The insured's marital status b. The insured's moral history c. The insured's hobbies d. The insured's income
d. The insured's income
All of the following are TRUE statements regarding the accumulation at interest option EXCEPT a. The annual dividend is retained by the company b. The interest is credited at a rate specified by the policy c. The policyholder has the right to withdraw the accumulations at any time d. The interest is not taxable since it remains inside the insurance policy
d. The interest is not taxable since it remains inside the insurance policy
Which of the following is true regarding elimination periods and the cost of coverage? a. The shorter the elimination period, the lower the cost of coverage b. The longer the elimination period, the higher the cost of coverage c. Elimination periods have no effect on the cost of coverage. d. The longer the elimination period, the lower the cost of coverage
d. The longer the elimination period, the lower the cost of coverage
Which of the following is true regarding optional benefits with long-term care policies? a. Only standard benefits are available with LTC policies. b. They are offered at no additional cost to the insured. c. They are included in all policies. d. They are available for an additional premium.
d. They are available for an additional premium.
How are contributions to a tax-sheltered annuity treated with regards to taxation? a. They are never taxed. b. They are taxed as income for the employee. c. They are taxed as income for the employee, but are tax free upon withdrawal. d. They are not included as income for the employee, but are taxable upon distribution.
d. They are not included as income for the employee, but are taxable upon distribution.
Which of the following is NOT true regarding Equity Indexed Annuities? a. The insurance company keeps a percentage of the returns. b. They have guaranteed minimum interest rates. c. They are less risky than variable annuities. d. They earn lower interest rates than fixed annuities.
d. They earn lower interest rates than fixed annuities.
Which of the following is true regarding Medicare supplement policies? a. They must have a 15-day free-look period. b. They must contain a minimum of Plans A and B. c. They must be available to those aged 60 and over. d. They must be guaranteed renewable.
d. They must be guaranteed renewable.
Which of the following statements about the reinstatement provision is true? a. It permits reinstatement within 10 years after a policy has lapsed b. It provides for reinstatement of a policy regardless of the insured's health c. It guarantees the reinstatement of a policy that has been surrendered for cash d. It requires the policy owner to pay all overdue premiums with interest before the policy is reinstated
d. It requires the policy owner to pay all overdue premiums with interest before the policy is reinstated
If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this? a. Limited pay whole life policy b. Modified life insurance policy c. Single premium policy d. Jumping juvenile policy
d. Jumping juvenile policy
A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this? a. Term to specified age b. Ordinary life policy c. Limited pay whole life d. Level term
d. Level term
How long will the beneficiary receive payments under the single life settlement option? a. Until the insured's death b. For a specified period of time c. Until the insured's age 100 d. Until the beneficiary's death
d. Until the beneficiary's death
