WFG Questions

If an annuitant dies before annuitization occurs, what will the beneficiary receive?

Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount

How can a new physician be added to the PPO's approved list?

Agree to follow the PPO standard and charge the appropriate fees.

When truncating business in this state an insurer formed under the laws of another country is known as a

Allen insurer

What is interest only?

Allows the insurer to retain the face amount but pay some income on gain not the proceeds to the beneficiary at regular intervals

Assuming that all of the following people are covered by a High Deductible Health Plan and are not claimed as dependents on anyone's tax returns, which would NOT be eligible for a Health Savings Account?

Amanda is 67 and is covered by a basic medical expense policy

When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision

Amounts payable under the policy will reflect the insured's correct age

A Universal Life Insurance policy is best describes as

An Annually Renewable Term policy with a cash value account

All other factors being equal, the least expensive first year premium payment is found in

Annually Renewable Term

In texas, the Commissioner of Insurance is

Appointed by the Governor

If an agent fails to obtain an applicant's signature on the application, the agent must

Return the application to the applicant for a signature

A policy owner who is also the insured wants to name her husband as the beneficiary of her title policy. She also wishes the retain all the rights of ownership. The policy owner should have her husband names as the

Revocable beneficiary

Which location would skilled care most likely be provided?

In an institutional settling

Who makes up the Medical Information Bureau?

Insurers

Which of the following best describes the MIB?

It is a nonprofit organization that maintains underwriting information on applicants for life and insurance.

Best describes annually renewable term insurance

Level term insurance

An example of a limited-pay life policy

Life Paid-ip at age 65

Can a group that is formed for the sole purpose of obtaining group insurance qualify for group coverage?

No, the group must be formed for a purpose other than obtaining group insurance.

What is the major difference between a Stock Company and a Mutual Company?

Ownership

An insured has a continuous whole life policy. She would like to use the policy dividends to pay off her policy sooner than would have been possible otherwise. What dividend option could she use?

Paid up option

An insured pays her Major Medical Insurance premium annually on March 1. Last March she forgot to mil her premium to the company. On March 19, she had an accident and broke her leg. The insurance company would

Pay the claims

A prospective insured receives a conditional receipt but dies before the policy is insured. The insurer will

Pay the policy proceeds only if it would have issued the policy

Premium amounts and surrender values are included in

Policy summaries

Most agents try to collect the initial premium for submission with the application. When an agent collects the initial from the applicant, the agent should issue the applicant a

Premium receipt

Certain conditions, such as dismemberment or total and permanent blindness, will automatically qualify the insured for full disability benefits. Which disability policy provision does this describe?

Presumptive disability

The policy owner pays for her life insurance annually. Until now, she has collected a nontaxable dividend check each year. She has decided that she would rather use the dividends to help pay for her next premium. What option would allow her to do this?

Reduction of premium

If an agent wishes to sell variable life policies, what license must the agent obtain?

Securities

A "second-to-die" policy

Survivorship life

Which is an example of a producer being involved in an unfair trade practice of rebating?

Telling a client that his first premium will be waived if he purchased the insurance policy today

When attached to a permanent life insurance policy, allows the policy owner to customize the policy to provide an additional amount of temporary insurance on the insured, or allows amounts the temporary insurance to cover other family members?

Term rider

Not required to be stated in the outline of coverage provided with a long term care policy

Basic information about supplementary policies

The accelerated benefits provision will provide for an early payment of the death benefit when the insured

Becomes terminally ill

If an annuitant dies during the accumulation period, who will receive the annuity benefits?

Beneficiary

A man is injured while robbing a convenience store. How does his major medical policy handle the payments of his claim?

Claim is denied is his policy contains the illegal Occupation provision

A banker is ready to close on a customer's loan. The bank is prepared to offer the loan but only if the customer purchases a life insurance policy from the bank in the amount of the loan. This is an example of

Coercion

An individual borrowed money at the bank to send his daughter to college. Instead of purchasing Credit Life insurance, he used an existing life insurance policy to secure the debt. This would be called

Collateral Assignment

Cash surrender nonforfeiture option

Consider funds exceeding the premium paid are taxable as ordinary income

In a relative value system of determining coverage for a given procedure, what term describes the total amount payable per point?

Conversion factor

Recipient's life expectancy and amount of principal

Determines the amount of each installment paid in a Life Income Option arrangement

An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which terabits describes the insurer's classification in Wyoming?

Foreign

Another name for a primary care physician in an HMO?

Gatekeeper

What required provision protects against unintentional lapse of the policy?

Grace period

As it pertains to group health insurance, COBRA stipulates that

Group coverage must be extended for terminated employees up to a certain period of time at the former employee's expense.

J purchased a $100,000 Joint Life policy on himself and his wife. Eight years later, he died in an automobile accident. How much will his wife receive from the policy?

$100,000

Anyone who violates the Insurance Code of Texas may be fined up to

$25,000

An insured owns a $50,000 whole life policy. At age 47, the insured decided to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?

$50,000

T has a major medical policy with a $500 deductible and 80/20 coinsurance. L is hospitalized and sustains a $2,500 loss. What is the maximum amount that L will have to pay?

$900 (deductible + 20% of the bill after the deductible [20% of $2,000]

The death protection component of Universal Life insurance is always

Annually Renewable Term

A small hardware store owner is involved in a car accident that tenders him totally disabled for half a year. Which type of insurance would help him pay for expenses of the company during the time of his disability?

Business overhead expense policy

What type of policy allows the insurance company to cancel a policy at any time?

Cancellable

An insurer must obtain in order to transact insurance within a given state

Certificate of Authority

Which entity has the authority to grant a temporary life insurance agent's license?

Commissioner of Insurance only

Bankers cannot be

Insurers

What is the advantage of reinstating a policy instead of applying for a new one

The original age is used for premium determination

What is the advantage of reinstating a poolicy instead of applying for a new one?

The original age is used for premium determination

How does a member of an HMO see a specialist?

The primary care physician refers the member

What is a penalty tax for non qualified distributions from a health savings account?

20%

An insured wants to name her husband as the beneficiary of her health policy. She also wishes to retain all of the rights of ownership. The insured should have her husband named as what type of beneficiary?

Revocable

What is the purpose of coinsurance provisions?

To help the insurance company to prevent overutillization of the policy

The premium on the children's rider in a life insurance policy

remains the same no matter how many children are added to the policy

The aleatory nature of an insurance contract

Exchange of unequal values

An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?

Time of Payment of Claims

Why should the producer deliver the policy when the first premium has already been paid?

To help the insured understand all aspects of the contract.

The rider in a whole life policy that allows the company to forgo collecting the premium if the insurance is disabled is called

Waiver of premium

When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss. However, her agent did not notify the insurance company until 60 days after the loss. Which of the following statements correctly explains how this claim would be handled?

The insurer is considered to be notified since the notification to agent equals notification to the insurer.

The policy owner of a Universal Life policy may skip paying the premium and the policy will not lapse as long as

The policy contains sufficient cash value to cover the cost of insurance

If an insured continually uses the automatic premium loan option to pay the policy premium

The policy will terminate when the cash value is reduced to nothing

Under an extended term nonforfeiture option, the policy cash value is converted to

The same face amount as in the whole life policy

The main difference between immediate and deferred annuities as

When the income payments begin

In Texas, how is the Commissioner of Insurance placed in office?

Appointed by the Governor for a term of 2 years

A producer agent must

- Collect any premium due - Explain the rating procedures if the policy is rated differently than applied for. - Explain the policy provisions, riders, and exclusions.

If the insured under a disability income insurance policy changes to a more hazardous occupation after the policy has been issued and a claim is filed, the insurance company should do which of the following?

Adjust the benefit in accordance with the increased risk

The Commissioner of Insurance issues a Cease and Desist Order to an agent. If the agent wishes to contest the charges in court, how many days after the order was issued does the agent have to make the request?

30 days

An individual who could legally receive commissions from the sale of a life insurance policy?

A licensed life insurance agent

The free-look provision allows

A right to return the policy for a full premium refund

Which would be required to be licensed as an insurance producer?

A salaried employee who advertises and solicits insurance

Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain

A statement that is sufficiently clear to identify the insured and the nature of the claim

An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at lest 30 days. This would include that his policy was probably written with a 30-day?

Elimination period

A husband and wife both incur expenses that are attributed to a angel major medical insurance deductible. Which type of policy do they have?

Family

If an insured is not required to pay a deductible, what kind of coverage does he/she have?

First dollar

What is first dollar?

First dollar coverages do not require the insured to pay a deductible.

At the time the insured purchases her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. This rider is called

Guaranteed insurability

An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that the can afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?

Guaranteed insurability option

What is fixed period installments?

It is a settlement option, and not one of the dividend options.

What is the purpose of a conditional receipt?

It is intended to provide coverage on a date earlier than the date of the issuance of the policy

A married couple owns a permanent policy which covers both of their lives and pays the death benefit only upon the death of the first insured. Which policy is that?

Joint-Life policy

The provision which prevents the insured from bringing and legal action against the company for at least 60 days after proof of lost is known as

Legal actions

Term riders

May be used to customize a permanent life insurance policy to meet the needs of the policy owners

Describes the features and elements of the specific policy for which a person is applying

Policy summary

A guaranteed renewable health insurance policy allows the

Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?

The balance of the loan will be taken out of the death benefit.

Jim is covered by a high deductible health plan. He makes regular contributions to the HSA. How are those contributions treated in regards to taxation?

The contributions are tax-deductible

Who chooses a primary care physician in HMO?

The individual member

Who bears all the investments risk in a fixed annuity?

The insurance company

Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to

The insured

An insured purchased a noncancellable health insurance policy 1 year ago. Which of the following circumstances would NOT be a reason for the insurance company to cancel the policy?

The insured is in an accident and incurs a large claim

A 40 year old man buys a whole life policy and names his wife as his only beneficiary. His wife dies 10 years later. He never remarries and dies at 61, leaving 2 grown up children. Assuming he never changes the beneficiary, the policy proceeds will go to

The insured's estate