PSI life, accident, and health

In noncontributory plans, which percentage of eligible members must participate? A. 0% B. 50% C. 75% D. 100%

100%

Upon the issuance of a conditional receipt for a renewal when the premium is paid AFTER the time granted by the insurer, what is the maximum amount of time for reinstatement of the policy? A. 10 days B. 30 days C. 45 days D. 60 days

45 days

For an individual long-term care policy there is an annual dollar limit for tax deductions that is based on which of the following? A. Age B. Cost of care C. Policy value D. Premium cost

Age

Which is the major reason why long-term care insurance is becoming increasingly important? A. It is easy to make a profit from investing in long term care B. As life expectancy increases, the chances of needing long term care also increase C. Nursing homes only accept Medicare as a secondary insurance source. D. Many younger people are developing life-threatening conditions and require hospice care.

As life expectancy increases, the chances of needing long term care also increase

All of the following are nonforfeiture options EXCEPT A. Cash surrender value B. Extended term insurance C. Reduced paid-up insurance D. Cash dividend option

Cash dividend option

Why are insurance policies considered conditional contracts? A. Certain conditions need to be met to make the contract legally enforceable. B. The policy is conditional upon approval from the underwriting process. C. There are conditions included that can make the policy invalid. D. They can be deemed invalid at a future date if misrepresentations were made.

Certain conditions need to be met to make the contract legally enforceable.

Which of the following is TRUE of the limited pay whole life policy? A. Coverage ends when the policy is paid-up. B. Coverage continues after the policy is paid-up. C. Premium payments increase as the insured ages. D. Premium payments are lower than continuous premium whole life.

Coverage continues after the policy is paid-up.

Which of the following coverage types pays a monthly cash benefit following the elimination period for total disability due to accident or sickness? A. Disability income insurance B. Credit disability insurance C. Recurrent disability insurance D. Workers compensation disability insurance

Disability income insurance

What specific new procedures does the USA Patriot Act require of insurance companies? A. Establish an anti-money laundering program B. Investigate applicants for potential terrorist links C. Report large transactions by charitable organizations D. To take action against employees for failure to implement the Act.

Establish an anti-money laundering program

Obtaining consumer information reports under false pretenses is prosecutable by which of the following? A. USA Patriot Act B. Fair Credit Reporting Act C. State laws where the applicant resides D. Securities and Exchange Commission

Fair Credit Reporting Act

Which of the following is TRUE of an equity-indexed annuity? A. It is a variable annuity. B. It may decrease in value. C. It requires a securities license to sell. D. It has a guaranteed minimum interest rate.

It has a guaranteed minimum interest rate

Which of the following is defined as the dollar amount beyond which the insured no longer participates in payment of medical expenses? A. Deductible B. Stop Loss Limit C. Maximum Benefit D. Coinsurance

Stop Loss Limit

Which of the following amends the Social Security Act to make Medicare secondary to group health plans? A. ADEA B. ERISA C. OBRA D. TEFRA

TEFRA

In a case where an individual's health is insured by both their own policy and their spouse's policy, which policy pays in the event of an illness? A. Only the individual's policy pays. B. Both policies pay the full amount. C. The individual's policy pays first, the spouse's policy pays the remaining up to coverage amount. D. The policy that was purchased first pays first, the second policy pays the remaining up to coverage amount.

The individual's policy pays first, the spouse's policy pays the remaining up to coverage amount.

Which of the following policy types is considered double indemnity? A. accidental death B. key employee C. term life D. whole life

accidental death

Which type of receipt makes the insurer liable for the risk from the date of application, regardless of the applicant's insurability? A. binding receipt B. conditional receipt C. inspection receipt D. temporary receipt

binding receipt

All of the following are characteristics of COBRA EXCEPT A. qualifying events. B. notification statements. C. continuation of coverage. D. change in medical privacy procedures.

change in medical privacy procedures.

A consumer report used to determine eligibility for insurance may include all of the following EXCEPT A. character. B. reputation. C. credit information. D. medical underwriting exam.

medical underwriting exam.

How long after being entitled to disability benefits will an individual be eligible to receive Medicare benefits? A. immediately B. 1 year C. 2 years D. At age 65

2 years

Which of the following is TRUE of a point of service plan (POS)? A. Patients must submit claim forms for all services received. B. The difference in cost between in-network and out-of-network is relatively small. C. A patient's care is coordinated by an in-network primary care physician. D. A patient may see any provider for any condition for the same cost and does not need to consult a primary care physician.

A patient's care is coordinated by an in-network primary care physician.

Which of the following is the most common method to supplement Medicare coverage? A. Medicaid B. Group health insurance C. Employer Health Insurance D. Coverage offered by private insurers

Coverage offered by private insurers

What is the waiver of premium provision? A. In a long term care contract, the premium is waived after the insured has been confined for a specific period of time. B. In a life insurance policy, the insured may request a waiver of premium during times of financial hardship. C. In a disability policy, the premium is waived after the insurance benefit period has been passed D. In a health insurance policy, the premium is waived after the maximum out of pocket has been paid by the insured.

In a long term care contract, the premium is waived after the insured has been confined for a specific period of time.

What does it mean if a health policy is conditionally renewable? A. Insurer may elect NOT to renew based on the health of the insured. B. Insurer may elect NOT to renew for any reason only on the policy anniversary or premium due date. C. Insurer may elect NOT to renew only under conditions specified in the policy. D. Insurer may elect NOT to review if the insured exceeds the maximum number of claims.

Insurer may elect NOT to renew only under conditions specified in the policy.

Why is relying solely on employer group life insurance generally considered inadequate for most individual's needs? A. It is financially insufficient to cover end of life expenses. B. It is meant to cover funeral expenses only. C. It does not pay off the insured's mortgage. D. It is based on salary amounts that are too low.

It is financially insufficient to cover end of life expenses.

Why is the accidental death benefit referred to as double indemnity? A. It provides for both the actual death as well as other losses from the accident B. It provides twice the face value in the policy for death due to accident. C. The beneficiaries have twice the amount of time to provide proof of loss. D. The beneficiaries must provide proof of death due to multiple causes.

It provides twice the face value in the policy for death due to accident.

Which type of annuity covers two or more annuitants and provides monthly income only until the first annuitant dies? A. Joint life annuity B. Life annuity C. Survivorship life annuity D. Temporary annuity

Joint life annuity

Which insurance plans are commonly offered through the worksite (employer sponsored) EXCEPT? A. Medicare B. Dental Insurance C. Long Term Care Insurance D. Supplemental Disability Insurance

Medicare

Which of the following refers to how often a premium is paid? A. Level B. Mode C. Net D. Ratio

Mode

Which of the following was specifically designed to address STOLI and IOLI practices? A. NOIL Act B. Fair Credit Reporting Act C. State Insurance Statutes D. HIPAA

NOIL Act

Short term disability insurance generally only covers injuries due to which of the following? A. Occupational injuries B. Non-occupational injuries C. injuries covered during the enrollment period D. injuries not covered by other insurance

Non-occupational injuries

Which type of life policy can be continued year after year without a required medical examination but rates are dependent on the insured's current age? A. Whole life B. Variable life C. Flexible term D. Renewable term

Renewable term

All of the following are tax qualified retirement plans EXCEPT A. 401(k) B. 403(b) C. Section 529 plan D. SIMPLE IRA

Section 529 plan

What procedure is used by an insurer to protect itself in the event a dispute arises and the applicant and the agent do not recall the changes that were made in a completed application? A. The applicant and possibly the agent initial any changes made. B. The applicant and the agent sign a document that outlines changes made. C. An arbitration agreement is signed at the time of the signing of the application. D. All changes must be approved by the underwriter prior to the submission of the application.

The applicant and possibly the agent initial any changes made.

Which of the following is true about a decreasing term life policy? A. The cash value of the policy decreases over time. B. The face amount reaches zero at policy expiration. C. Premiums decrease over time but the amount of coverage remains constant. D. Commonly sold as a rider to another type of policy to provide an additional death benefit.

The face amount reaches zero at policy expiration.

What does coinsurance mean? A. The insurer and the insured share ALL expenses. B. The insurer and the insured share expenses over the deductible. C. A policy covers the insured and any additional named persons. D. The policyowner holds multiple policies through the same insurer.

The insurer and the insured share expenses over the deductible.

All of the following are required signatures on a life insurance application EXCEPT A. The agent B. The applicant C. The minor in a juvenile policy D. The proposed insured

The minor in a juvenile policy

The right to change the beneficiary or dispose of the policy or its benefits in any manner one chooses is reserved to the policyowner UNLESS which of the following is true? A. The policyowner has named an irrevocable beneficiary. B. The policyowner has named a revocable beneficiary. C. The policyowner deems the beneficiary unfit. D. The insurer prohibits changes to beneficiaries.

The policyowner has named an irrevocable beneficiary.

How does the per capita rule apply to proceeds from a life insurance policy? A. The proceeds are divided equally among living primary beneficiaries. B. The secondary beneficiary receives the proceeds if the primary beneficiary is no longer living. C. The proceeds go to the policyholder's estate when no beneficiary is living. D. The proceeds go to the descendants of the primary beneficiaries

The proceeds are divided equally among living primary beneficiaries.

Which of the following is TRUE for a flexible premium annuity? A. The actual amount of the annuity benefit is determined in advance. B. A single set amount premium is paid by the annuitant on an annual basis. C. The company promises to pay the annuitant an amount each period beginning after a single lump sum payment. D. The purchaser has the option to vary the amount of each premium payment falling between a minimum and maximum amount.

The purchaser has the option to vary the amount of each premium payment falling between a minimum and maximum amount.

Which is the primary purpose of Health Reimbursement Accounts (HRAs)? A. To assist covered employees with the payment of medical expenses on a high deductible plan funded through pre-tax contributions. B. To assist covered employees on standard group health insurance plans by using post tax contributions to fund an account to pay medical expenses. C. To assist employees who work for small companies to pay medical expenses on high coinsurance policies. D. To reimburse employees who choose not to participate in the group health coverage provided by their employer.

To assist covered employees with the payment of medical expenses on a high deductible plan funded through pre-tax contributions.

Under which situation must insurable interest exist between the applicant and insured at the time of application? A. When a third-party applicant names themselves beneficiary. B. When the applicant and the insured are the same person. C. When the beneficiary is a member of the applicant's immediate family D. When a third-party applicant names the insured's company as beneficiary.

When a third-party applicant names themselves beneficiary.

When will a policy pay on a UCR (Usual, Customary, Reasonable) basis? A. When particular benefits are not listed on a payment schedule B. When a surgical procedure is not pre-approved by the insurer C. When the provider charges a different amount than is listed on the payment schedule D. When the treatment is received in a different geographic area than where the insured lives

When particular benefits are not listed on a payment schedule

When a policy or certificate containing an accelerated benefit provision is applied for or delivered, the producer is responsible for providing the applicant a summary of coverage that includes all of the following EXCEPT A. a detailed and comprehensive summary of the accelerated benefit B. definitions of the conditions or occurrences triggering payment of the benefit C. an explanation of any effects an accelerated benefit on the cash value, death benefit, premium payments, and loans. D. a statement that benefit payments may adversely affect eligibility for Medicaid

a detailed and comprehensive summary of the accelerated benefit

A group conversion option may be used in all the following instances EXCEPT A. the termination of the master policy. B. loss of coverage due to loss of employment. C. loss of eligibility on the part of a class of insureds. D. a life-changing event, such as marriage, divorce, or childbirth.

a life-changing event, such as marriage, divorce, or childbirth.

How do warranties differ from representations? A. a warranty is guaranteed to be true, a representation is believed to be true to the best of one's knowledge. B. a representation is guaranteed to be true, a warranty is believed to be true to the best of one's knowledge. C. a warranty is issued by the insurer, a representation is a statement provided by the applicant. D. an incorrect representation automatically voids a contract, whereas an incorrect warranty must be proven.

a warranty is guaranteed to be true, a representation is believed to be true to the best of one's knowledge.

What is the return of premium rider? A. an increasing amount of term insurance that always equals the total of premiums paid up to the current point B. a provision that allows the insured to cancel the policy in the first two years and have premiums refunded C. an increasing amount of term insurance that equals the cash value of the policy at any point in time D. a provision that states the insurer must return any premiums paid during the free-look period

an increasing amount of term insurance that always equals the total of premiums paid up to the current point

Which of the following is an example of a premium payment mode? A. annual premium payment B. payment by check C. automatic deduction of premium D. $200 per policy year

annual premium payment

In a home healthcare benefit, all of the following are eligible expenses EXCEPT A. intermittent part-time nursing care; B. physical, occupational, or speech therapy; C. blood transfusions D. medical social services;

blood transfusions

All of the following are common exclusions from loss found in disability income policies EXCEPT for that incurred while A. serving in the military B. living overseas C. committing a misdemeanor D. piloting a personal aircraft

committing a misdemeanor

The group conversion option is allowed for all of the following EXCEPT A. termination of the master policy. B. loss of group coverage due to termination of employment. C. upon the loss of eligibility on the part of a class of insureds. D. during the annual benefits enrollment period.

during the annual benefits enrollment period.

Which of the following is exempted from the incontestability provision in insurance policies? A. fraudulent misstatements B. pre-existing conditions C. change in health D. changes in the insurance code

fraudulent misstatements

Which of the following is covered by a dread disease policy? A. mental health and related psychiatric illnesses B. hospital stays that extend beyond the usual and customary time frame C. illnesses that do not occur frequently but incur significant costs when they do occur D. a newly acquired illness that is contracted by a person with a pre-existing condition

illnesses that do not occur frequently but incur significant costs when they do occur

What is the primary advantage for obtaining a reinstatement of a policy rather than obtaining a new one? A. No proof of insurability is required B. insured original issue age is used C. No application is required D. outstanding loans are cancelled

insured original issue age is used

Current assumption whole life policies are sensitive to which of the following? A. interest rates B. age of the insured C. health of the insured D. current cash value of the policy

interest rates

Why is rehabilitation considered worthy of federal help under workers' compensation? A. it reduces insurance losses and helps regain the worker's dignity B. the costs to states are prohibitive so federal funding is required C. states do not have the means to provide rehabilitative services D. because under the Americans with Disabilities Act it is required

it reduces insurance losses and helps regain the worker's dignity

What type of insurance should a company purchase if it wants to insure the life of its CEO? A. key person insurance B. BOE insurance C. group life policy D. industrial life insurance

key person insurance

Which type of rider reimburses health and social service expenses incurred in a convalescent or nursing home facility? A. accelerated benefits rider B. assisted living rider C. terminal illness rider D. long term care rider

long term care rider

Which problem was universal life insurance designed to address? A. low interest rates during periods of high inflation B. high interest rates during periods of low inflation C. increased risk of death due to aging D. lack of a fixed death benefit

low interest rates during periods of high inflation

Compared to basic hospital, medical and surgical policies, which type of insurance provides broader coverage, fewer gaps, higher individual benefits, and higher policy maximums? A. medicaid insurance B. major medical insurance C. supplemental medical insurance D. long term care insurance

major medical insurance

All of the following are classifications of risk EXCEPT A. substandard B. preferred C. declined D. non-nicotine

non-nicotine

Which of the following must be given to the insurer within 20 days after occurrence or commencement of any loss covered by the policy, or as soon thereafter as is reasonably possible? A. evidence of insurability B. notice of claim C. proof of loss D. supporting evidence for the claim

notice of claim

Which of the following is characteristic of a non-qualified plan? A. defined vesting schedule B. plan established by the employer C. plan does not meet federal guidelines for tax benefits D. employer contributions are deductible business expenses

plan does not meet federal guidelines for tax benefits

Which of the following is a characteristic of Preferred Provider Organizations (PPOs)? A. prearranged costs for services rendered B. providers receive a flat monthly amount for each user C. ability to receive care at the same cost from any provider D. emergency treatment is restricted to pre-selected hospitals

prearranged costs for services rendered

During which period of a Disability Income Policy is coverage effective but during which no benefits will be paid under the policy? A. benefit period B. elimination period C. grace period D. probationary period

probationary period

A basic vision care package includes all of the following EXCEPT A. safety glasses. B. the annual eye exam. C. lenses and frames. D. contact lenses.

safety glasses.

All of the following are TRUE regarding incomplete applications EXCEPT A. the underwriting department will return the application to the agent. B. the applicant will have to wait additional time before coverage begins. C. there will be a delay in the underwriting process. D. the incomplete application can be accepted with the missing information added later.

the incomplete application can be accepted with the missing information added later.

Which one of the following represents an advantage of obtaining a policy loan versus a withdrawal? A. the loan is subtracted from the death benefit and does not require payments B. the loan is not taxed while a withdrawal is taxed for amounts above the contract cost basis C. the loan originates from the insurance company, whereas the withdrawal comes from the policy D. the interest on the loan does not have to be paid if the insured dies before the loan is paid in full.

the loan is not taxed while a withdrawal is taxed for amounts above the contract cost basis

What is the purpose of Stranger-originated life insurance (STOLI)? A. the policy is originated primarily or solely for the purpose of resale B. the policy is written so as to avoid proof of insurable interest C. it is a method of insuring a person who has been previously declined. D. it is a fraudulent policy meant for financial gain of someone unknown to the insured.

the policy is originated primarily or solely for the purpose of resale

If the insurer wishes to share an applicant's HIV status, the applicant must be given full notice of all of the following EXCEPT A. insurer's practices with respect to the treatment of this information. B. the applicant's rights to maintain privacy. C. an opportunity to refuse the dissemination of the information. D. the treatment procedures that are covered by the policy.

the treatment procedures that are covered by the policy.

Which of the following occurs immediately after the application is submitted and the initial premium paid? A. the underwriting process begins B. the applicant's references are checked C. the beneficiaries are selected D. the insurance goes into effect

the underwriting process begins

All of the following are characteristics of variable whole life EXCEPT A. the premium is level B. there is no guaranteed cash value C. there is no guaranteed minimum death benefit. D. the agent must be licensed in both insurance and securities.

there is no guaranteed minimum death benefit.

Managed care plans increase efficiency by all of the following means EXCEPT A. increasing beneficiary cost sharing. B. controlling inpatient admissions and length of stay. C. selectively contracting with health care providers. D. transferring the management of costs to the insureds.

transferring the management of costs to the insureds.

All of the following are requirements to qualify for Social Security disability benefits EXCEPT when A. credited with the appropriate number of quarters of coverage. B. total and permanent disabled for at least 5 months. C. disability expected to last for 12 months or end in death. D. unable to work in occupation in which the worker was trained or educated.

unable to work in occupation in which the worker was trained or educated.

When does insurable interest come into play in a life insurance policy? A. when the applicant for the policy is not the insured B. when a charity is named beneficiary of the policy C. when a beneficiary is irrevocable D. when the free look period ends

when the applicant for the policy is not the insured

When can the premiums of an individually owned health insurance policy be deducted from the individual's income tax? A. when the taxpayer's medical expenses exceed 5.0% of adjusted gross income during a taxable year B. when the taxpayer's medical expenses exceed 7.5% of adjusted gross income during a taxable year C. any taxpayer who itemizes deductions may deduct their health insurance premiums D. never because only group owned health insurance premiums may be deducted.

when the taxpayer's medical expenses exceed 7.5% of adjusted gross income during a taxable year