Missed
On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the
In Accidental Death and Dismemberment coverage, the principal sum is paid for accidental death
Which of the following is true regarding pure life annuity settlement option?
It provides the highest monthly benefit. The pure life annuity pays the most since it only guarantees to pay for the rest of one's life without a minimum guarantee.
Who would be the insured in business disability insurance?
Key Employees. A business purchases business disability insurance on its key employees to protect it from loss when the employee becomes disabled
The dividend option in which the policyowner uses dividends to purchase a term policy for one year is referred to as the
One-year term option.
In order to reinstate a life insurance policy the insured must do all of the following EXCEPT
Pay next year's premium in advance
An insured and his spouse recently had a child. Which of the following riders would allow the couple to insure the child for a limited period of time at a specified amount?
The children's term rider allows children to be added to coverage for a limited period of time for a specified amount
Which of the following would NOT be eligible for coverage under key person?
The owner of a shop. The owner is the principal, not a key person.
The entire contract includes all of the following EXCEPT
Buyers Guide. The entire contract includes (1) the policy, (2) a copy of the application and (3) any riders or amendments.
Which of the following is NOT true regarding a noncancellable policy?
Insurer can increase the premium above what is stated in the policy if claims experience is greater than expected. The insurance company cannot cancel a noncancellable policy, nor can the premium be increased beyond what is stated in the policy. The insured has the unilateral right to renew the policy for the life of the contract, but, in effect, may cancel the policy at any time by discontinuing premium payments.
Life insurance creates an immediate estate. Which of the following best explains this statement?
Unlike a traditional estate where the value of personal wealth is usually built up over time, a life insurance policy's face value is available immediately in one lump-sum upon the death of the insured
Contributions to Roth IRAs are
Contributions to Roth IRAs are not tax deductible, and excess contributions are subject to a 6% tax penalty.
How often must an insurance agency notify the Director of the appointment of a producer?
Each insurer authorized to transact business in Nebraska must notify the Director of each producer it intends to list as a company representative to the public. This appointment process is accomplished by application and payment of a fee. This process must be repeated annually for the duration of the time a producer represents the company.
Reciprocal insurers
Sharing is a method of dealing with risk for a group of individual persons or businesses with the same or similar exposure to loss to share the losses that occur within that group. A formal risk-sharing arrangement. When insurance is obtained through a reciprocal insurer, the insureds are sharing the risk of loss with other subscribers of that reciprocal.
All of the following are characteristics of group health insurance plans EXCEPT
The contract for coverage is between the employer and the insurance company. Only one policy is issued (master policy) to the employer; covered employees receive a certificate of insurance.
Which of the following advises people (for a fee) regarding the provisions of their insurance policies?
A consultant counsels or advises people, for a fee regarding the advantages and disadvantages, insurable risks, benefits, coverage, or provisions of any insurance policy that could be issued in the state
An annuity has accumulated the cash value of $70,000, of which $30,000 is from premium payments. The annuitant dies during the accumulation phase. The beneficiary will receive
If the annuitant's death occurs during the accumulation period, the beneficiary will receive the amount of premiums paid into the plan or the cash value, whichever is greater. In this case, the beneficiary will receive $70,000.
To qualify for disability income benefits under Social Security, an individual's disability must be expected to result in death or last for at least
Individuals will qualify for Social Security disability income benefits are hard if they are unable to perform any job and the disability is expected to last at least 12 months, or result in death.
What is the purpose of the surrender charge in a deferred annuity?
Insurance companies apply surrender charges to deferred annuities that are surrendered prematurely. The surrender charge discourages surrender of the annuity and compensates the company for loss of the investment value.
What is the main difference between franchise and group insurance?
Franchise insurance provides health coverage for small groups that do not qualify for true group coverage. In franchise insurance individual policies are issued for each participant; individual underwriting is done for each person, and each participant submits his or her own application and medical history.
Which of the following does NOT need to be included on the first page of a Medicare supplement policy?
Medicare supplement policies must include a renewal or continuation provision that is appropriately captioned and on the first page of the policy. It must include any reservation by the insurance company of the right to change premiums and any automatic renewal premium increases based on the policyholder's age (attained age policies).
Which of the following is not true of Long-term care for employer group health insurance?
Premiums paid by the employer are deductible as a business expense, but if not used, the funds are not for personal use by the employee
Which two terms are associated directly with the way an annuity is funded?
Annuities are characterized by how they can be paid for: either a single payment (lump sum) or through periodic payments in which the premiums are paid in installments over a period of time. Periodic payment annuities can be either level, in which the annuitant/owner pays a fixed installment, or the payments can be flexible, in which the amount and frequency of each installment varies.
Which of the following is NOT one of the independent rating services that publishes guides to insurance companies' financial integrity
The various independent rating services are AM Best, Fitch, Standard and Poor's, Moody's, and Weiss. NAIC is a regulatory organization composed of insurance commissioners.
An applicant misstates his age on his application for a health insurance policy. He states that he is 39, but his actual age is 49. When he files a claim, what will most likely happen?
Benefits paid will be those that would have been purchased at the correct age. If the insured misstated his or her age at the time of the application, the benefits paid will be those that the premium would have purchased at the correct age. This provision is similar to the one found in life insurance policies.
With Adjustable Life, the owner can change all of the following EXCEPT
The mortality charge is determined by the actuary in the home office. The owner of the policy has no control over this mortality cost.
All of the following are true of a nonqualified deferred compensation plan EXCEPT
Contributions are tax deductible. Nonqualified deferred compensation plans may be discretionary and therefore do not require IRS approval. These plans are contractual agreements between employees and employers for the deferral of constructive receipt of a portion of their earnings are not tax deductible.
Utilization management consists of an evaluation of the appropriateness, necessity and quality of health care, and may include
Utilization management consists of an evaluation of the appropriateness, necessity and quality of health care, and may include prospective review and concurrent review.
According to the "Common Disaster" clause, if the insured and primary beneficiary are killed in the same accident and it cannot be determined who died first, which of the following will be assumed?
According to the "Common Disaster" clause, if it cannot be determined who died first, the insured or the primary beneficiary, it will be assumed the primary beneficiary died first, so the proceeds go to the contingent beneficiary. Proceeds will go the insured's estate only if there is no contingent beneficiary.
Which of the following would be considered a nonmedical insurance application?
An application on which the medical information is completed by the applicant and the agent only. An application on which all of the questions, including medical history questions, do not need to be completed by medical professionals, and may be completed by the applicant and the agent.
Which of the following would be considered a nonmedical insurance application?
An application on which all of the questions, including medical history questions, do not need to be completed by medical professionals, and may be completed by the applicant and the agent.
What is the purpose of a benefit schedule?
Some medical expense insurance plans contain a benefit schedule, which very specifically states exactly what is covered in the plan and for how much.
A self-employed mechanic operates his own shop. He is considering purchasing health insurance that would protect him financially in the event of a serious sickness or accident. He feels that he can handle any small health care expenses. What type of policy would likely meet this person's needs?
Major Medical has high maximum limits, copayments, blanket coverage and a deductible.
Medicaid is sponsored by what kind of sources?
Medicaid is sponsored at both the state and federal levels. Most other standard health insurance programs are provided by private insurance companies.
Which of the following statements is INCORRECT?
Medicare and Medigap policies do not provide coverage for long-term custodial or nursing home care. Medicare will cover nursing home care if it is part of the treatment for a covered injury or illness. Medicare and Medicare supplements pay for skilled nursing care, but the coverage is limited. Medicaid does pay for nursing home care, but it provides coverage only for those that qualify with low income and low assets.
Flexible premium
Periodic payment annuities can be either level (the annuitant/owner pays a fixed installment), or flexible (the amount and frequency of each installment varies).
An employee is covered under COBRA. His previous premium payment was $100 per month. His employer now collects $102 each month. Why does the employer collect an extra $2?
The employer is permitted to collect a premium from the terminated employee at a rate of no more than 102% of the individual's group premium rate. The 2% charge is to cover the employer's administrative costs.
Which of the following is NOT true regarding term health coverage?
The owner may renew in a specified amount of time. Term health policies are written for a specified period of time and are nonrenewable. When it expires, the insured must purchase another policy.
The Director is
e Director is appointed by the Governor and holds the office until a successor is appointed and qualified. It is the Director's duty to administer and enforce the Nebraska Code of Insurance and the law and regulations related to insuran
Simplified Employee Pension (SEP)
is a type of qualified plan suited for the small employer. In a SEP, an employee establishes and maintains an individual retirement account to which the employer contributes. Employer contributions are not included in the employee's gross income.
Which of the following statements is correct concerning taxation of long-term care insurance?
regardless of whether or not the insured can deduct individual long-term care premiums, the benefits are received income tax free by the individual. Excessive benefits as determined by statute are taxable as ordinary income.
A disability income policy has a waiting period of 7 days. If the insured is disabled for 15 days, how many days of benefits will the policy pay?
8 days.The waiting or elimination period is the time an insured must wait between the onset of an accident or illness and when benefits start being paid. An insured with a 7-day waiting period who was off work for 15 days would only have 8 days of coverage.
Because of the imposed blackout period, the surviving spouse will not receive social security benefits until
He or she qualifies for retirement benefits. Blackout period begins when the youngest child reaches the age of 16, and ends when the surviving spouse qualifies for retirement benefits, as early as age 60.
Some deferred annuities include an adjustment that subjects the owner of the annuity to share in all loss or gain due to a premature liquidation of bonds. This feature is found in
Market Value Adjusted annuities subject the owner to share in the loss or gain when bonds must be prematurely surrendered.
What is the difference between a straight life policy and a 20-pay whole life policy?
Premium payment period A limited-pay whole life policy, just like straight life, endows for the face amount if the insured lives to age 100. The premium is, however, completely paid off in 20 years.
In order for a business partner to be eligible for a Keogh plan, he/she must work full-time and own at least how much of the business?
To be covered under a Keogh retirement plan, the person must be self-employed or a partner working part or full-time who owns at least 10% of the business
If a dental plan is integrated, it is combined with what type of plan?
Integrated plans allow for dental plans to be included in a medical plan, providing coverage for both under a single contract. Sometimes the deductibles are merged, but this does not have to be the case
Which of the following best describes life annuity with period certain option?
Life with Period Certain annuity benefit option guarantees the payments for the life of the annuitant. There is also a specified period that is guaranteed. The guaranteed period could be 10 or 20 years, or to age 65 - whatever time period meets the needs of the annuitant.
An individual was denied coverage under Social Security because his disability did not meet the strict definition of total disability used by Social Security. Which of the following would provide disability income coverage?
Social Insurance Supplement (SIS) riders are used to supplement or replace benefits that might be payable under Social Security Disability. If the insured has been denied coverage under Social Security, a Social Insurance Supplement or social security rider would be applicable.
Which of the following individuals would be a likely candidate to purchase a deferred annuity?
Someone who wants to grow retirement funds tax Deferred annuities are often used to accumulate retirement funds that grow tax deferred. Income payments, however, begin sometime after one year from the date of the annuity purchase.
