Virginia Laws and Rules Pertinent to Insurance

A Medicare Supplement policy can impose a pre-existing condition exclusion for up to

6 months

Individual life insurance policies can charge no more than _____ interest per year on cash value loans

8%

With whom may an agent share commissions with

A licensed agent with the same license type

In Virginia, which of the following insurance transactions do NOT require records be maintained A) Delivery receipt records B) Premium quotes not accepted by the client C) Premium receipt records D) Replacement records

B) Premium quotes not accepted by the client

Which of the following is the requirement for an individual to perform the duties of an insurance agent

Be duly licensed

Which of the following is a requirement for an applicant to receive an agent license in Virginia

Be of good character

A client would like to purchase an annuity from an agent. The agent does NOT need to make reasonable efforts to obtain information from the client on which of the following? A) Client's financial status B) Client's tax status C) Client's marital status D) Client's investment objectives

C) Client's marital status

According to the Rules Governing Advertisement of Life Insurance and Annuities, an agent may NOT take which of the following actions during a sales presentation A) Asking for referrals B) Comparing another insurance company's policy C) Mentioning guaranteed policy dividends D) Comparing the costs of two similar policies

C) Mentioning guaranteed policy dividends

Which of the following items are governed by the Rules Governing Advertisement of Life Insurance and Annuities? A) Intra-company communications relating to insurance product development B) Employer announcements notifying employees about the availability of group insurance C) Prepared sales presentations used by insurance agents D) Insurance company announcements to policyholders about premium adjustments

C) Prepared sales presentations used by insurance agents

All of the following are examples of insurance advertisement EXCEPT A) A direct mail brochure announcing specific Accident and Health insurance plans B) A newspaper notice announcing free insurance advice C) A television spot announcing an insurance company's new product D) An employer newsletter announcing the availability of coverage for employees

D) An employee newsletter announcing the availability of coverage for employees

Defamation occurs when an agent makes a false statement intended to

malign another insurer

J the agent makes false statements to a prospective client about the projected dividends for a policy. J may be found guilty of

misrepresentation

In Virginia, Long-Term Care insurance

must offer inflation protection to applicants

An example of rebating would be

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

XYZ corp was issued a group health policy for its employees. Under this plan a

policy must be issues to XYZ, and a certificate must be issued to each employee

Under which circumstance may an agent combine business funds with an insured's premiums

when duly appointed and contractually authorized by an insurer

An insurance consultant's license MUST be renewed every

year

All of these are unfair trade practices EXCEPT A) Rebating B) Coercion C) Reinsurance D) Twisting

C) Reinsurance

Which of these policies does NOT require a policy loan provision A) Whole Life B) Universal Life C) Term Life D) Variable Life

C) Term Life

How often must an insurance agent's license be renewed

Every 2 years

Which of the following actions does the Commission in Virginia have the power to perform

Examine insurer solvency

Which of the following would be a valid reason for the State of Virginia to deny an insurance agent license

Felony Conviction

An agent charged an insurance applicant an administration fee. At what point must the agent give a written disclosure for this fee?

Prior to any services being rendered

An agent has returned part of his commission to the insured as an inducement to purchase the insurance. This illegal action is called

Rebating

An agent who willfully violates the insurance code may, after a hearing, pay UP TO _________ per violation as a penalty

$5,000

A Long Term Care policy issues in Virginia must provide coverage for at LEAST

12 months

If an agent holds 1 license type, the biennial continuing education requirement is ___ hours

16

Which of these circumstances requires an agent to make reasonable efforts to obtain information concerning the suitability of an annuity? A) Agent helps a client with the purchase of an annuity B) Agent sets up a sales appointment C) Agent purchases advertisement regarding a new annuity product D) Agent explains the benefits of annuities to the consumer and the consumer decides to purchase an endowment instead

A) Agent helps a client with the purchase of an annuity

Which of these statements accurately reflects Virginia law regarding life insurance advertisements A) An insurance agency is responsible for advertisements placed by its insurance agents B) The commission must approve advertisements before they are used C) Testimonials may not be used D) Guaranteed dividends may be advertised

A) An insurance agency is responsible for advertisements placed by its insurance agents

Which of the following is a requirement to be eligible for a group life policy in Virginia A) Group must be formed for a purpose other than obtaining insurance B) Group must designate one of its members to be the name insured C) Group must have been formed for obtaining insurance D) Group must include at least 5 employers

A) Group must be formed for a purpose other than obtaining insurance

Under Virginia Law, all of these are required to be kept by licensed agents EXCEPT A) records of premium quotations that were rejected by the insured B) application records once the policy has been issued C) an accounting of premiums paid on the policy D) the insured's files if the policy cancels mid-term

A) records of premium quotations that were rejected by the insured

Which of the following will happen if a licensed resident insurance agent moves to another state

Agent's license shall terminate immediately

Which of the following BEST describes an insurance agent conducting business in Virginia

An individual who sells, solicits, or negotiates contracts of insurance

Which of the following does COBRA allow a terminated employee to receive A) Continued health coverage at no cost B) Continued coverage in group health plan C) Continued coverage for the souse of the employee only D) Continued coverage without administrative fee

B) Continued coverage in group health plan

Which of the following coverages does NOT need to be provided under the ACA? A)Preventative services as set by the CMS B) Elective cosmetic surgery C) Emergency services D) Pre-existing Conditions

B) Elective cosmetic surgery

J is an insurance agent who maintains premiums in a fiduciary account. Which of the following expenses may NOT be paid using funds withdrawn from this account A) Return on premiums due to insureds B) Personal medical expenses C) Commissions due to other licensees D) Premiums due to insurers

B) Personal medical expenses

The Rules Governing Life Insurance and Annuity Replacements do NOT apply to A) Whole life B) Universal life C) Increasing Term Life D) Credit Life

D) Credit Life

Who issues Medicare Supplement policies

Insurance companies

During a sales transaction, which of the following forms must be completed by an agent if the customer has existing insurance coverage

Notice Regarding Replacement of Life Insurance or Annuity

What organization approves continuation courses in Virginia

Virginia Insurance Continuing Education Board

When must an agent report a felony conviction to the Bureau of Insurance

Within 30 calendar days

Which of the following actions must be taken by an insurance company that wishes to conduct business in Virginia

acquire a certificate of authority

According to the ACA, a dependent child's eligibility status is determined by

age

Insurance companies are required to hold an appointment on a(n) _______ who represents them

agent

Individual Accident and Health insurance coverage must meet minimum standards in Virginia. These minimum standards

apply to policy definitions as well as to benefits

If an existing Accident and Health policy is being replaced with a new policy, the decision to replace should NOT be based on

commissions to be paid

T circulated false statements the were maliciously critical of an insurer's financial condition. T may be found guilty of

defamation

An Accident and Health insurance applicant who fails to include material medical information on an application would be reason for the insurer to

deny any future claims and to refund the premium

A business entity acting as an insurance agent MUST

designate at least 1 licensed producer to be responsible for the entity's compliance with the insurance laws and rules

Life insurance and annuity replacement can be BEST described as

exchanging an existing policy for a new policy

Replacement can be defined as

exchanging an existing policy for a new policy

After passing the State exam, an applicant is required to obtain the appropriate license within ___ calendar days

183

A group life insurance policy can be converted to an individual whole life policy under which circumstance

Employment termination

An example of an Adverse Underwriting Decision is

Terminating insurance coverage

Who may assign benefits from a group life insurance policy

insured

If an insurance agency has moved its office to a new location, the Bureau of Insurance MUST be notified within ____ calendar days of the move

30

According to Virginia law, a Group Life insurance policy requires a minimum of how many insureds

2

What is the qualification for being considered a small group in Virginia

2 to 50 members

If an agent holds 2 license types, the continuing education requirement is ____ credits by December 31 in even numbered years

24

Under the ACA, health coverage is provided for dependents up to the age of

26

Insurance transactions MUST be maintained by an agent for at LEAST ____ calendar years

3

An agent must notify the Bureau within ___ days of an address change

30

Each Long Term Care policy sold in Virginia must include a Free Look provision that refunds all premiums within _____ days of policy delivery

30

What is Virginia's definition of Life insurance replacement

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

Which of the following does NOT qualify as a creditable coverage under HIPAA A) Accident plans B) Individual major medical plans C) Medicare plans D)Group major medical plans

A) Accident Plans

Which of the following is NOT a requirement for testimonials used in Accident and Health insurance A) Testimonials must represent the current opinion of the person giving the testimonial B) Testimonials must be accurately reproduced C) Testimonials must be applicable to the advertised policy D) Testimonials must be approved by the Commission

D) Testimonials must be approved by the Commission

All of these are eligible groups for purchasing group insurance EXCEPT a(n) A) labor union B) employer C) association D) nonprofit organization

D) nonprofit organization

If an agent has not completed the continuation education requirement by November 30, a final opportunity to complete this requirement is extended to

December 31 every even year

What would be a potential consequence for an agent who misappropriates insurance funds held in a fiduciary capacity

The Commission may suspend or revoke the agent's license

The Rules Governing Advertisement of Life Insurance and Annuities were created to provide

full disclosure to the public of all material and relevant information

A hearing must be held before an agent's license can be suspended or revoked. Prior to the hearing, the Commissioner is required to

give written notice to the agent

If an administration fee is charged by an agent, the customer's written signature is REQUIRED

in every occurence

An insurance agent that solicits a Medicare Supplement policy must disclose to the applicant that the agent

is there to determine what is appropriate for the purchaser, while taking into consideration any existing coverage

A Medicare Supplement policy can be cancelled by the insurer for

nonpayment

A health insurer in Virginia may NOT discontinue coverage in which of the following situations A) Failure to pay premium B)Insured engaged in fraud C) Insured no longer residers in the service area D) Insured's health status has been declined

D) Insured's health status has been declined

Under Virginia law, which of the following provisions is NOT required in a Medicare Supplement policy A) Suitability form B) Guaranteed issue C) Free-look period of 30 days D) Limitation on pre-existing conditions for up to 12 months

D) Limitation on pre-existing conditions for up to 12 months

Which of these actions by a licensee would NOT likely result in license suspension of revocation A) Maliciously aligning another insurance company's financial status B) Willfully submitting false insurance applications C) Knowingly accepting insurance business from an unlicensed individual D) Sharing commission with another similarly-licensed agent

D) Sharing commission with another similarly-licensed agent

Which of the following is information that an insurer is NOT expected to provide to an employer when offering health coverage to an employee A) The provisions relating to renewability of coverage B) The provisions relating to exclusions C) The benefits and premiums available under all health insurance coverage for which the employer is qualified D) The terms of the insurer's provider agreements

D) The terms of the insurer's provider agreements

Which situations does NOT require an agent to provide a suitability statement to the annuity company A) When an annuity contract is recommended and sold as a solution to a client's financial objectives B) After evaluation of a client's retirement goals, an annuity is proposed and sold C) When an agent advises a client to purchase a fixed annuity to provide retirement income and an application is taken D) When an agent discusses annuities in general with a client, but no specific recommendation is made

D) When an agent discusses annuities in general with a client, but no specific recommendation is made

A Health Maintenance Organization (HMO) MUST A) Be licensed to operate in only one state B) Be operated by a fully accredited hospital C) Be federally funded D) require its providers must be under contract or employment

D) require its providers must be under contract or employment

A long-term care lapse notice must be delivered to both the applicant and

secondary addressee

When making a recommendation to a consumer to purchase an annuity, the agent must make reasonable efforts to obtain

suitability information

An Accident and Health policy is required to provide Essential Benefits without annual and lifetime limits when purchased individually or with group coverage through

the Federal Marketplace

An individual received a quote from an insurance company that is a different rate from individuals in the same risk class. The insurance company may be accused of

unfair discrimination

When must a licensee provide insurance records to the State Corporation Commission

upon request for examination