RI Pre-Licensing Life & Health Insurance

Which of the following statements is a producer not allowed to say?

"If my company fails to pay a claim, the Guarantee Association will pay"

Which of the following statements is a producer not permitted to say

"If my company fails to pay a claim, the Guarantee Association will pay"

In the course of making a sales presentation, a producer may not say which of the following?

"The Rhode Island Guaranty Association will protect you"

An individual working part time has an annual income of $25,000. If this individual has an IRA what is the maximum deductible IRA contribution allowed?

$2,500

K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?

$20,000 death benefit

An employee with $25,000 group term life coverage was recently fired. This employee's group coverage may be converted to a

$25,000 individual whole life policy

S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider. S dies 1 year later of natural causes. How much will the insurer pay the beneficiary?

$50,000

In RI the min. rate increase and/or decrease that an insurer may adjust for policy loan interest rates per annum is

.50%

The Director must give how many days notice prior to holding a hearing regarding a producer's unfair or deceptive practices?

10

The Director must give how many days notice prior to holding a hearing regarding a producer's unfair or deceptive practice?

10 days

What is the maximum Social Security Disability benefit amount an insured can receive

100% of the insured's Primary Insurance amount

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

15

Insurers may request a hearing within _______ if their policy is rejected

20 days

What is the "free look" period in RI

20 days

How many hours of continued education must a newly licensed agent complete every 2 years?

24

How many hours of continuing education must a newly licensed agent complete by 2 years?

24 hours

RI requires that an insurance producer must complete _______ hours of continuing education on the subject of ethics every 2 years

3 hours

Within how many days after policy delivery can a Medicare supplement policy be returned for 100% premium refund

30

N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?

30 Pay life

An individual whose producer license request has been denied may appeal the Department's decision within

30 days

An individual whose producer license request has been denied may appeal the department's decision within

30 days

How long is the typical free look period for Long Term care insurance policies

30 days

If an application for a producer license is denied, the applicant may make a written request for a hearing to appeal this decision within

30 days

If an application for producer license is denied, the applicant may make a written request for a hearing to appeal this decision within

30 days

Long Term Care insurance applicants are provided the right to return their policy for a full refund of premium within how many days of its delivery?

30 days

One becomes eligible for Social Security disability benefits after having been disabled for

5 months

A small employer in RI is defined as an employer that is composed of _____ employees

50

Three law partners form a Cross-Purchase Buy Sell Agreement. This agreement is funded with individual life insurance. How many total life policies are needed for this agreement?

6

In RI, Long Term Care policies may exclude insuring pre-existing conditions for a maximum of _______ after the effective date of coverage?

6 months

The waiting period for a pre-existing condition under a Medicare Supplement policy may NOT go beyond

6 months

What is the earliest age a non disabled individual becomes eligible for Medicare Supplement policy?

65 years old

According to RI's rules on disclosure a life insurance applicant is expected to be provided with

A Buyer's Guide and Policy Summary

All students attending a large university could be covered by

A blanket policy

Which statement is TRUE regarding a Variable Whole Life policy?

A minimum guaranteed death benefit is provided

What is RI's definition of Life insurance replacement?

A transaction in which a new policy is bought and an old policy is terminated

What is RI's definition of Life Insurance Replacement?

A transaction in which a new policy is bought and another is terminated

When is the face amount of a Whole Life policy paid?

When the insured dies or the maturity date, whichever comes first

A life insurance policy that provides a policy owner with cash value along with a level face amount is called:

Whole life

A return premium life insurance policy is

Whole life and Increasing term

In a 10 year term life policy contains a renewability provision the policy will renew

Without evidence of insurability

Which of the following activities will NOT result in the suspension of a producer's license

Working for a foreign insurer

A qualified profit sharing plan is designed to

Allow employees to participate in the profits of the company

The amount of monthly disability benefits payable under Social Security is affected by which of the following factors?

Amount of the benefits available from other sources

In Rhode Island, replacement forms are required to be obtained for the replacement of which of the following

Annual Renewable Term (ART) Insurance

Which of the following does the RI Life and Health Insurance Guaranty Association Act apply to?

Annuity Contracts

When a policy owner cash surrenders a Universal Life policy in it's early years this may be considered a red flag for a(n)

Anti-Money laundering violation

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

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

An applicant's medical information received from the Medical Information Bureau (MIB) may be furnished to the

Applicant's physician

Before a life insurance policy is issued, which of these components of the contract is required?

Applicant's signature on the application

What is the initial source of underwriting for an insurance policy?

Application containing statements from the insured

In RI who is authorized to transact insurance sales for an insurance company?

Appointed producers

Traditional individual retirement annuity (IRA) distributions must start by

April 1st of the year following the year the participant attains age 70.5

Under a Graded Premium policy, the premiums

Are lower during the policy's early years

One major function of RI Guaranty Association is to:

Assess member fees upon all admitted insurers in RI

One major function of the RI guaranty association is to

Assess member fees upon all admitted insurers in RI

What action can a policy owner take if an application for a bank loan requires collateral

Assign policy ownership to the bank

In RI all Accident and Health insurance plans are required to provide coverage for the services of properly licensed midwives in accordance with each of the following requirements EXCEPT:

At home birthing services are covered

Signed disclosure Der the Fair Credit Reporting Act must be obtained

At the time of sale

Signed disclosures under the Fair Credit Reporting Act must be obtained

At the time of sale

According to RI law when must a producer deliver the outline of coverage to a Medicare supplement applicant

At the time of the application

What action will an insurer take if an interest payment on a policy loan is not made on time?

Automatically add the amount of interest due to the loan balance

Medicare Part C is

Available to those who are enrolled in Medicare part A and B

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

Aviation exclusion

An applicant for a non residential producer license MUST:

Be a producer in good standing in their home state

What is one of the requirements for being an insurance producer in RI?

Be at least 18 y/o

T is the policy owner for a Life Insurance policy with an irrevocable beneficiary designation. If T wishes to change the beneficiary, T must obtain permission from the

Beneficiary

What is considered to be a characteristic of an immediate annuity?

Benefit payments start within one payment period of purchase

T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?

Benefits are taxable to T

Accidental Death coverage is provided to commercial airline passengers in which of the following types of policies

Blanket Accident policy

Defamation may be described as which of the following

Brochures the malign the financial standing of the admitted insurer

This is NOT considered a cost connected to an individual's death

Business expenses

The guarantee of insurability option provides a long term care policy owner the ability to:

Buy additional coverage at a later date

A Health Reimbursement Arrangement MUST be established:

By the employer

When a policy owner exchanges a term policy for a Whole Life policy without providing proof of good health, which of these apply?

Conversion Provision

According to the Affordable Care Act, which of the following coverages is not required?

Coverage for cosmetic surgery

In the event that an insured's premium is not paid by the due date, the result will be...

Coverage will continue for not more than a maximum of 31 days, beyond which time the policy will lapse

Viatical Settlement death benefit proceeds are payable to the

Current beneficiary

At what point does an insurer begin to owe interest on death proceeds payable to a life insurance beneficiary

Date of death

The combination of Whole Life policy and __________ Term insurance is referred to as a family income policy

Decreasing

Credit life insurance is typically issued with which of the following types of coverage?

Decreasing Term

F needs life insurance that provides coverage for only a limited amount of time with a death benefit that changes regularly according to a schedule. What kind of policy is needed?

Decreasing Term Policy

What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?

Decreasing term

Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?

Decreasing term

How are surrender charges deducted in a life policy with a rear-end loaded provision?

Deducted when the policy is discounted

Medicare Part A & Part B do NOT pay for

Dental work

What is the purpose of the USA patriot act

Detect and deter terrorism

Which of the following statements does NOT accurately describe the tax treatment of premiums and benefits of individual Accident and Health insurance

Disability income policy premiums are tax-deductible

This BEST describes the intent of a Coinsurance clause in a Major Medical policy

Discourages over-utilization of the insurance coverage

Social Security does not provide benefits for:

Dismemberment

How are Roth IRA distributions normally taxed?

Distributions are received tax-free

An insurance company incorporated under the laws of the state in which its home office is located is called a(n)__________ company

Domestic

P owns a $25,000 Life Policy that pays the face amount to him if he lives to age 70, or to his beneficiary if he dies before age 70. What kind of policy does P own?

Endowment in age 70

"A producer does not have the authority to change a policy or waive any of its provisions" The Health provision that best describes this statement is called the:

Entire Contract

When an individual is planning to protect his family with whole life insurance, one method of doing so is called needs analysis. What exactly does needs analysis involve?

Establishes the needs of the individual and their dependents

How often must an insurance producer license be renewed?

Every 2 years

Which of these statements about a Guaranteed Insurability Option Rider is NOT TRUE

Evidence of insurability is required when the option is exercised

N is a student pilot with a large life insurance policy. Which of these features would limit the insurer's obligation in the event N was killed while flying as a student pilot?

Exclusion

An underwriter determines that an applicant's risk should be recategorized due to a health issue. This policy may be issued with a(n)

Exclusion for the medical condition

A Universal Life policy is sometimes referred to as an unbundled life policy because the owner can see the interest earned, cost of insurance and the

Expense charges

Term insurance has which of the following characteristics?

Expires at the end of the policy period

D owns a whole life policy that was purchased 10 years ago. If the premium payments suddenly stop and D takes no additional action which Nonforfeiture Option will the insurer likely proceed with:

Extended term

This is not a characteristic of an Adjustable Life policy

Face amount can be adjusted using policy dividends

An example of an unfair claims practice would be

Failing to effectuate prompt, fair, and equitable settlements of a claim

From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?

Fair Credit Reporting Act

What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?

Family Maintenance Policy

Which of these is NOT a source of funding for Social Security benefits?

Federal Government

T is a producer, and when hired, is reminded that he has a responsibility to handle client's funds in an honest and ethical manner. This responsibility is referred as:

Fiduciary Responsibility

Taking receipt of premiums and holding them for the company is an example of:

Fiduciary Responsibility

N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?

Fixed deferred

The payments on Q's annuity are no less than $250 quarterly. Which of the following annuities does Q own?

Flexible Installment Deferred

In RI in an insurer licensed to conduct business in RI but domiciled in NJ is called a(n)

Foreign Company

In RI an insurer licensed to conduct business in RI, but domiciled in NJ, is called a(n)

Foreign company

What action should a producer take if the initial premium is NOT submitted with the application?

Forward the applicant to the insurer without the initial premium

A producer knowingly assists a client in withholding material facts while taking an Accident and Health insurance application. His action may be considered:

Fraud

A producer knowingly assists client in withholding material facts while taking in an Accident and Health insurance application. His action may be considered which of the following:

Fraud

Under an Individual Health insurance policy, the Time Limit of Certain Defenses provision states that non fraudulent misstatements first become incontestable two years ago

From the date the policy was issued

S, while in the process of converting her group life insurance to an individual policy, dies. What happens to the claim her beneficiary submits?

Full benefits are payable under the Master contract

What is considered a valid reason for small businesses to insure the lives of its major shareholders?

Fund for buy-sell agreement

The Life and Health Insurance Guaranty Association is

Funded by admitted insurance companies through assessments

A life insurance application may be rejected on the basis of all of these factors EXCEPT

Gender

Which requirement must be met for an association to be eligible for a group life plan?

Group was formed for a purpose other than selling insurance

Bryce purchased a disability income policy with a rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this?

Guaranteed Insurability rider

A Long-Term policy sold in RI MUST be

Guaranteed renewable

This is NOT. characteristic of a Health Reimbursement Arrangement (HRA)

HRA is entirely funded by the employee

The Director may issue a Temporary license in order to

Help a deceased producer's family member by allowing time for the sale of business

Variable life products require a producer to

Hold a Life insurance license and securities license

Under a Basic Medical Expense policy, what does the hospitalization expense portion cover?

Hospital room and board

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

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

In regards to representations or warranties, this statement is TRUE

If material to the risk, false representations will void a policy

This statement of Health Reimbursement Arrangements (HRA) is CORRECT

If the employee paid for qualified medical expenses, the reimbursements may be tax free

How would a continent beneficiary receive the policy proceeds in an Accidental death and dismemberment (AD&D) policy

If the primary beneficiary dies before the insured

The type of annuity that can be purchased with one monetary deposit is called a(n)

Immediate annuity

W is a 39-year old female who just purchased an annuity to provide income for life starting at age 60. All of these would be acceptable annuity choices EXCEPT a(n)

Immediate annuity

Upon finding a producer guilty of misappropriating premium funds, which of the following actions may the Dept. of Business Regulations take?

Impose a $50,000 penalty

Upon finding a producer guilty or misappropriating funds which of the following actions must the Department of Business Regulations take?

Impose a $50,000 penalty

A long-term care rider in a life insurance policy pays a daily benefit in the event of

Inability of the insured to perform more than 2 Activities of Daily Living (ADL)

Which of the following actions require a policy owner to provide proof of insurability in an Adjustable Life policy?

Increase face amount

Which of these retirement plans an be started by an employee even if another plan is in existence?

Individual Retirement Account (IRA)

K is an annuitant currently receiving payments. If she were to die before receiving payments equal to the correct value, a beneficiary will continue receiving payments until an amount equal to the contract value has been paid. This is called a(n)

Installment refund annuity

A life insurance policy would be considered a wagering contract WITHOUT:

Insurable Interest

When third-party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have

Insurable interest in the proposed insured

When third-party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have:

Insurable interest in the proposed insured

Who makes the legally enforceable promises in a unilateral contract?

Insurance company

If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of?

Insured

In a Key Employee Life Insurance policy the third party owner CANNOT be

Insured

Who has the option to renew a Renewable Term Policy

Insured

What is the initial requirement for an insured to become eligible for benefits under the Waiver of Premium provision?

Insured myst be under a physician's care

If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?

Insured's continent beneficiary

In RI which of the following actions by an insurer is NOT allowed in regards to group life insurance conversion privelages?

Insurer requires evidence of insurability

T was treated for an ailment 2 months prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards.How will the insurer likely consider this condition?

Insurer will likely treat as a pre-existing condition which may not be covered for one year

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

Insuring

The agreement in a life insurance contract that states a specific sum of money will be paid to a designated person upon an insured's death is called a(n)

Insuring agreement

Which of the following health insurance policy provisions specifies the health care services a policy will provide

Insuring clause

Interest on death benefit proceeds is payable as which of the following?

Interest is assessed at the rate of 9% from the date of the death of the insured and added to the death benefit proceeds

How are policy owner dividends treated in regards to income tax

Interest on accumulations is taxed

Which of these types of coverage is best described as short term medical policy

Interim coverage

A life insurance arrangement which circumvents insurable interest statuses is called:

Investor originated life insurance

A policy owner would like to change the beneficiary on a Life insurance policy and make the change permanent. Which type of designation would fulfill this need?

Irrevocable

A policy owner's rights are limited under which beneficiary designation

Irrevocable

Dividends paid from a life insurance policy are

Issued by the insurer

Which statement regarding third party ownership of a life insurance policy is true?

It is used extensively in estate-planning as well as business circumstances

Who owns a stock company?

Its stockholders

What type of policy covers 2 lives and pays the face amount after the first one dies?

Joint life policy

A sole proprietorship may use this plan ONLY if the employees of this business are included

Keogh pension plan

Stranger Originated Life Insurance (STOLI) has been found to be in violation of:

Legal purpose (insurable interest)

Which of these would be considered a Limited Pay Life policy?

Life paid up to age 70

Every HMO conducting business in the state of RI must provide all the following disclosures to newly enrolled subscribers EXCEPT

List of current shareholders of the organization

An insured's inability to perform two or more activities of daily living may trigger which type of policy rider?

Long term care

In the state of RI all individual and group Medical Expense plans must provide Mandated Benefits coverage for which of the following conditions?

Lyme's disease

In the state of RI all individual and group Medical expense plans must provide Mandated Benefits coverage for which of the following conditions?

Lyme's disease

Comprehensive Major Medical policies usually combine:

Major Medical with Basic Hospital/surgical coverage

Pre-hospitalization authorization is considered an example of

Managed care

A trustee-to-trustee transfer of rollover funds in a qualified plan allows a participant to avoid

Mandatory income tax withholding on the transfer amount

According to RI law which of the following information does NOT need to be obtained by a producer recommending an annuity purchase?

Marital Status

The Health Insurance program which is administered by each state and funded by both federal and state governments is called:

Medicaid

An unemployed Medicare enrollee suffers 3 hospital admissions in the course of a year. Which of the following health plans provides the BEST method of coverage for excess hospital charges?

Medicare Supplement

A long term policy may exclude coverage for which of the following conditions

Mental or Nervous disorders

A Long Term care policy may exclude coverage for which of the following conditions

Mental or nervous disorders

A producer making an unfair comparison of two insurance policies is considered to be engaging in

Misrepresentation

Advising a proposed insured that the required premium is lower than it actually would be, given the correct rate classification, is an example of

Misrepresentation

Advising a proposed insured that the required premium is lower than it actually would be, given the current rate classification is an example of

Misrepresentation

Convincing a prospective insured to buy an insurance policy based on exaggerations is called

Misrepresentation

When soliciting an Accident and Health insurance plan, a producer advises the applicant that smoker a non smoker rates are the same. The producer's advice is an act of:

Misrepresentation

When a life insurance policy exceeds certain IRS table values, the result would create which of the following?

Modified Endowment Contract (MEC)

This is not an insurance products requirement of an agent to have proper FINRA Securities registration in order to sell them

Modified whole life

Periodic health claim payments MUST be made at least

Monthly

Which of these is NOT an element of Life Insurance premiums

Morbidity Rate

This best describes how a PPO is less restrictive than a HMO

More physicians to choose from

Which type of insurance company allows their policy owners to elect a governing body?

Mutual

Under RI law, a producer may NOT state which of the following?

Mutual insurers pay dividends just as though you held stock in the company

Under Rhode Island law, a producer may NOT state which of the following

Mutual insurers pay dividends just as though you held stock in the company

Which of these statements concerning an individual straight life annuity is accurate?

Payments are made to annuitant for life

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

Payor Benefit rider

Which of the following provisions guarantees that premiums will be waived if a Juvenile Life policy owner becomes disabled?

Payor Clause

Which of the following correctly describes a certificate of authority?

Permits an insurance company to transact business in RI

This does NOT constitute policy delivery

Policy issued with a rating

The underwriting process does NOT involve this

Policy loan

The _____________ is authorized to assign a life insurance policy as collateral for a loan

Policy owner

Who has the right to change a revocable beneficiary?

Policy owner

With Accidental Death and Dismemberment policies, what is the purpose of the Grace Period?

Policy owner additional time to pay overdue premiums

Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?

Policy was returned within the free look period, premium will be fully returned

Which of the following information is not required to be included in a whole life policy?

Policy's guaranteed dividend table

This characteristic is consistent with a Straight life policy

Premiums are payable for as long as there is insurance coverage in force

Which statement is correct regarding the premium payment schedule for Whole Life policies

Premiums are payable to throughout the insured's lifetime/coverage lasts until death of the insured

This statement BEST describes the Waiver of Premium provision in an Accident and Health policy

Premiums are waived after the insured has been totally disabled for a specified time period

Which of the following actions is NOT possible with a Universal Life policy

Premiums may be applied as a credit against income tax

The Coordination of Benefits provision:

Prevents an insured covered by two health plans from making a profit on a covered loss

What is NOT a type of agent authority

Principal

In a life insurance transaction when must the producer disclose the name of the insurer?

Prior to the sales presentation

In a life insurance transaction, when must the producer disclose the name of the insurer?

Prior to the sales presentation

K is the insured an P is the sole beneficiary on a life insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true

Proceeds will be payable to K's estate if P dies at the same exact time

RI insurance law requires that a Policy Summary which is a statement of benefit information and policy cost must be disclosed to the insured. According to RI regulations all of the following information must be included with the exception of

Producer Commission Scales

A retirement plan that sets aside part of the company's net income for distributions to qualified employees is called a

Profit sharing plan

What is the consideration given by an insurer in the Consideration clause of a life policy

Promise to pay a death benefit a named beneficiary

A major medical policy typically:

Provides benefits for reasonable and necessary medical expenses, subject to policy limits

All of these are considered sources of underwriting information about an applicant EXCEPT

Rating Services

The provision that can be used to put an insurance policy back in force after it has lapsed due to nonpayment is called

Reinstatement

T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?

Request of the change will be refused

In the state of RI Prepaid Legal Services insurance plans

Require that the attorney be licensed in the state of RI or any other state where the attorney provides basic legal services

In order to renew a producer's license in Rhode Island, continuing education credits are required for each of the following EXCEPT:

Residents holding a license for 25 consecutive years and are under the age of 55 at time of renewal

With Optionally Renewable Health policies, the insurer may

Review the policy annually and determine whether or not to renew it

J would like to maintain the right to change beneficiaries. Which beneficiary designation should be used?

Revocable

A mutual insurance company and a stock ins. company have one main difference between them. What is it?

Stock company is owned by shareholders . Mutual company is owned by policyholders

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

Subrogation

What would the Medical Information Bureau (MIB) identify?

Testing positive for marijuana use from a previous screening

In the course of making a sales presentation, a producer may not say ...

The Rhode Island Guaranty Association will protect you

This statement is CORRECT about an agent who is taking an insurance application?

The agent should have the applicant initial any changes made on an application

Which statement regarding a Key Employee Life Policy is NOT true

The beneficiary is named by the kay employee

The Common Disaster clause provides that if both the insured and sole named beneficiary were to die in a common accident which of the following is true

The clause provides the payment of proceeds to the insured's estate

In state of RI commissions may be paid to a non licensed individual if

The commissions were earned on a renewal premium and the individual held the proper license at the time of the original sale

In the state of RI commissioners may be paid to a non licensed individual if

The commissions were earned on a renewal premium and the individual held the proper license at the time of the original sasle

Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?

The employee

This is TRUE regarding a group accident and health policy issued to an employer

The employer receives the policy and each employee is issued a certificate

J chooses a monthly premium payment mode on his Whole Life insurance policy. Which of these statements is correct?

The gross premium is higher on a monthly payment mode as compared to being paid annually

In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and

The initial premium

A policy adhesion can only be modified by whom?

The insurance company

A policy of adhesion can only be modified by whom?

The insurance company

A Medicare Supplement Policy may be cancelled for which of the following reasons?

The insured fails to pay the premium

A Medicare Supplement policy may be cancelled for which of the following reasons?

The insured fails to pay the premium

The amount of coverage on a group credit life policy is limited to

The insured's total loan value

This statement BEST defines usual, customary, reasonable (UCR) charges

The maximum amount considered eligible for reimbursement by an insurance company under a health plan

Health policies sold in RI are REQUIRED to begin medical coverage of a newborn beginning at

The moment of birth

A life insurance policy owner may sell their policy to a(n) ___________ in order to receive a percentage of the policy's face value

Viatical Settlement Provider

The Dept. of Business Regulations may revoke a producer's license for each of the following offenses EXCEPT:

Violating an insurer's internal control requirements

When a misrepresentation on a life insurance policy application is discovered, what action may an insurance company take

Void the policy only if it is discovered during the Contestable period and proven to be material

What is the primary factor that determines the benefits paid under a disability income policy

Wages

The provision in a Group Health Insurance policy that allows the insurer to postpone coverage for a covered illness 30 days after the policy's effective date is referred to as:

Waiting Period

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

Warranty

Insurers using stop loss insurance policies in RI must comply with which of the following?

When advertised the elements of coverage including the amount of stop loss insurance must be disclosed

Insurers issuing Stop-Loss insurance policies in the state of RI must comply with which of the following?

When advertised the elements of coverage including the amount of stop-loss insurance must be disclosed

At what point does an informal contract become binding?

When one party makes an offer and the other party accepts that offer

When must insurable interest be present in order for a life insurance policy to be valid?

When the application is made

An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?

When the conditions of the receipt are met

When is the face amount of a Whole Life Policy paid?

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

A level premium indicates

the premium is fixed for the entire duration of the contract

Insurance policies are offered on a "take it or leave it" basis which makes them:

Contracts of Adhesion

C is a key employee at ABC Incorporated. If a Key Employee life policy is purchased on her life, which of these statements would be true?

ABC is the policy owner C is the insured ABC is the beneficiary

The option that provides an additional death benefit for a limited amount of time at the lowest possible cost is called a(n)

Accidental death and dismemberment (AD&D)

P is blinded in an industrial accident. Which provision of his life insurance policy will pay a stated benefit amount?

Accidental death and dismemberment clause

The director of Business Regulation CANNOT take which of the following actions?

Activate an insurer's financial reserves

A "reimbursement policy" pays what amount of covered Long -Term care expenses

Actual covered expenses up to the daily maximum

B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of

Additional Whole Life coverage at specified times

An Accident and Health policy owner may NOT

Adjust the premium payments

In Health Insurance policies, a waiver of premium provision keeps the coverage in force without premium payment

After an insured has become totally disabled as defined in the policy

According to the Affordable Care Act a dependent child's eligibility status is determined by

Age (up until 26)

How long does coverage normally remain on a limited pay life policy

Age 100

Under a long term care policy this is typically excluded/limited

Alcohol Rehabilitation

Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?

Aleatory

An example of life insurance policy replacement would be which of the following

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

All individuals covered under a group contract will receive a(n)

Certificate

What type of employee welfare plans are not subject to ERISA regulations?

Church plans

One definition of replacement is "the act of replacing an existing insurance policy with another" Replacement is

Closely regulated and requires full disclosure

Which of these actions is taken when a producer uses Life insurance policy as collateral for a bank loan

Collateral assignment

Advertisement for Accident and Health insurance can be considered all of the following EXCEPT

Company's financial rating

K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?

Conditional

The incontestable clause allows an insurer to:

Contest a claim during the contestable period

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers (and their families) whose employment has been terminated the right to:

Continue group health benefits

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

Continue the coverage and exclude the heart condition

Which of these require an offer, acceptance, and consideration?

Contract

This statement is true regarding a minor beneficiary?

Normally, a guardian is required to be appointed in the Beneficiary clause of the contract

When the Insurance Commissioner deems the public interest would best be served by the issuance of a temporary license the commissioner may issue the license for a period

Not to exceed a max of 180 days without requiring an examination

When the insurance Commissioner deems hat the public interest would best be served by the issuance of a temporary license, the Commissioner may issue this license for a period

Not to exceed a maximum of 180 days without requiring an examination

The Notice of Claims provision requires a policyowner to

Notify an insurer of claim within a specified time

An example of rebating would be

Offering a client something of value not stated in the contract in exchange for their business

Generally, how long is a benefit period for a Major Medical Expense Plan

One year

Upon reaching the limiting age, a handicapped child can extend their health insurance coverage as a dependent

Only if the child is incapable of of employment and chiefly dependent on the policy owner

This statement concerning Settlement options is NOT true

Only the beneficiary may select

In RI a Fraternal Benefit Society is which of the following?

Order or lodge soliciting insurance from its members

P is the insured on a participating life policy. Which statement is true if P's premiums are waived due to a disability?

P will still receive declared dividends

K owns a Whole Life policy. If K wants an increasing Death Benefit to protect against inflation, which Dividend Option should she choose

Paid-Up Additional Insurance

A Business Disability Buyout plan policy is designed to:

Pay benefits to the corporation or other shareholders

M had an annual life premium payment due January 1st. She died January 10 without making the premium payment. What action will the insurer take?

Pay face amount minus the past due premium

Which of these terms accurately defines an underwriters assessment of information on a health insurance application

Risk Classification

Which factors are taken into consideration when an insurance company determines the premium rate for a whole life policy on an applicant

Risk classification

What is the Suicide provision designed to do?

Safeguard the insurer from an applicant who is contemplating suicide

This statement BEST describes mental care indemnity coverage?

Services are reimbursed after insurer receives the invoice

P is a producer who notices 5 questions on a life application were not answered. What actions should P take?

Set up a meeting with the applicant to answer the remaining questions

Annuity suitability regulations in RI require that a producer obtain each of the following criteria EXCEPT:

Sexual Orientation

Annuity suitability regulations in the state of RI require that a producer obtain each of the following criteria EXCEPT

Sexual orientation

Rebating can be described as which of the following?

Sharing commissions with a client

The Director of Business Regulation may revoke a producer's license upon the finding of

Sharing of commissions

The Director of Business Regulation may revoke a producer's license upon the finding of...

Sharing of commissions

Which of the following is an example of the Unfair Trade Practice known as rebating?

Sharing the commissions with the insured

P is an employee who quits her job and wants to convert her group health coverage to an individual policy. After the expiration of COBRA laws, which of the following statements is TRUE?

She DOES need to provide evidence of insurability

An immediate annuity consists of a

Single Premium

Which mode of payment is NOT used by health insurance policies?

Single premium

Which type of plan allows an employer to give money to an employee for buying a life insurance policy and also permits the employee to select the beneficiary

Split dollar

Under a Renewable Term policy

The renewal premium is calculated on the basis of the insured's attained age

In RI misappropriation of funds on the part of a licensed producer is defined as

Theft

Stranger Owned Life Insurance (STOLI) is when a person purchases life insurance only to sell to a(n)

Third party with no insurable interest

Medicare is not intended for

Those enrolled as a full time student

How does a typical life variable policy investment account grow?

Through mutual funds, stocks and bonds

Essential Benefits without annual and lifetime limits are required on any health policy purchased

Through the Federal Marketplace

What is the elimination period of an individual disability policy?

Time period a disabled person must wait before benefits are paid

Life and Health Producers, who hold Property Casualty authority , are required to complete timely continuing education credits in order to renew their license. Which of the following requirements must be satisfied?

Total of 24 credit hours in Life and Health or Property Casualty. 3 of which must be in ethics

In an insurance contract the insurer is the only party who makes a legally enforceable promise. What kind of contract is this?

Unilateral

Life and health insurance policies are

Unilateral contracts

Which of the following Life insurance policies combine term insurance with an investment element?

Universal Life

What type of life insurance incorporates flexible premiums and an adjustable death benefit?

Universal life

A Life insurance policy owner would like to take out a policy loan against the cash value in his Whole Life policy. The interest rate applied to this loan may vary over time. This is referred to as a(n)__________ rate loan

Variable

A(n)____________ annuity pays benefits based on units rather than stated dollar amounts

Variable

Which type of life policy contains a monthly mortality charge as well as self-directed investment choices?

Variable Universal Life

Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?

Variable life

Term Life Policies that have the ability to be converted by permanent coverage may do so during a specific time period. This conversion period

Varies according to the contract