Accident and Health Insurance Basics

An applicant for an individual health policy failed to complete the responses to the medical history questions because they had forgotten some important past treatment dates. They did, however, sign the application. Before being able to complete the responses and pay the initial premium, they were confined to a hospital for a condition that would ordinarily be covered by the policy. In this situation, they were not insured because they had not met the conditions specified in:

Consideration Clause

In order to comply with Fair Credit Reporting Act, at which times must a producer notify an applicant that a credit report may be requested:

At the time of application

Health coverage becomes effective when the:

First premium has been paid and the application has been approved

All of the following statements about pre-existing conditions are true, EXCEPT:

Policies usually define accidents that occur within 15 days after the effective date as pre-existing conditions

Health insurance rates may be based upon all of the following, EXCEPT:

Religion

An applicant for a disability insurance policy has a heart condition of which they are unaware and therefore they answer "no" to the question pertaining to heart problems. Their answer is considered to be a:

Representation

Which statement about a Conditional Receipt is true:

It is an interim insuring agreement

All of the following are true when a producer recommends that their client switch from one individual medical expense policy to another in order to obtain a lower premium, EXCEPT:

It is an unlawful practice known as "replacement"

Under the Fair Credit Reporting Act, persons rejected for insurance, employment or credit due to information contained in a consumer report:

Must be informed of the source of the report

All of the following are true regarding health insurance policies, EXCEPT:

An agent may change an application with the verbal consent of the applicant

An applicant purchased a disability policy on his wife that included an Accidental Death and Dismemberment benefit. He named himself as the beneficiary and specified that the death benefits were to be payable to his son if he, the applicant, were to predecease his wife. In this situation, the applicant's son would be considered the:

Contingent beneficiary

A limited health insurance policy that will pay a lump-sum to the insured if they are diagnosed with life-threatening cancer, stroke, heart attack or Alzheimer's disease is known as:

Critical Illness insurance

No type of health insurance covers:

Death due to sickness

A producer's underwriting responsibility would include which of the following:

Making sure all material facts are included in the application

The Fair Credit Reporting Act requires that:

The applicant for insurance be advised, in advance, that a consumer report may be requested

All of the following statements about sources of underwriting information are true, EXCEPT:

The contents of an inspection report cannot be disclosed to the applicant

Emily Jones fills out an application for a disability policy and pays her producer the initial premium. The producer gives Ms. Jones a Conditional Receipt. Her coverage will become effective when:

The insurance company accepts the risk

An underwriter could most likely use all of the following sources of underwriting information when evaluating the insurability of an applicant, EXCEPT:

National Association of Health Underwriters (NAHU)

Most health insurance policies exclude all of the following, EXCEPT:

Accidental injury

Any death benefit under a health insurance contract is limited to deaths caused by:

Accidental injury only

The Pre-existing Condition Exclusion in disability insurance is designed to protect the insurance company against:

Adverse selection

A specified policy would cover which of the following:

Cancer

Policy delivery refers to the delivery of the:

Completed insurance policy to the applicant

On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the:

Principal sum

Which of the following could an underwriter not use when determining the insurability of an individual:

Results from genetic testing

A person's eligibility for Workers' Compensation coverage is determined by the:

State

The Insuring Clause of a disability policy usually states all of the following, EXCEPT:

The method of premium payment

Health insurance policies cover all of the following risks, EXCEPT:

War related injuries