Chapter 15 Test

Which of the following is NOT an acceptable type of group life insurance plan?

A group formed to purchase life insurance

Using a misleading policy comparison to induce an insured to convert any insurance is known as:

Twisting

An employer group plan A debtor group to insure repayment of the indebtedness A labor union group policy covering members

Type of group life insurance

A health policy may not exclude coverage for a preexisting condition for more than how many months from issuance?

12 Months

Every order by the Commissioner of Insurance suspending any license shall specify the period during which suspension will be effective but in no event exceed how many months?

12 Months

Every licensee must promptly reply in writing to an inquiry of the Commissioner of Insurance about his/her insurance business within ______ after the licensee receives the inquiry.

15 Days

Every licensee must reply within _____ days in writing to an inquiry of the Insurance Commissioner about his/her insurance business.

15 Days

The Commissioner may issue a temporary producer license for up to _____ days without an exam as necessary for servicing an insurer in certain cases.

180 Days

Each major line of insurance requires at least _____ credit hours of prelicensure instruction.

20 hours

How many hours of approved continuing education (CE) must resident producers complete per renewal period?

24 hours including 3 hours of ethics

An HMO plan must offer the option of covering any child under the age of:

26

Coverage for the newly born child must be no less than the coverage of the child's mother for no less than _____

3 Weeks

A Medicare Supplement must have a free-look period of:

30 Days

An insurance producer must report to the Commissioner any administrative action taken against the producer in another jurisdiction within ___ days of the final resolution of the matter.

30 Days

Within ___ days of the initial pretrial hearing date, an insurance producer must report to the Commissioner any criminal prosecution of the insurance produce taken in any jurisdiction.

30 Days

A person may not sell, solicit, or negotiate the sale of an annuity product unless he/she has successfully completed a one-time, _____-hour training course in annuity suitability.

4 Hours

In order to be able to sell, solicit, or negotiate LTC insurance after successfully completing his/her initial LTC coverage education, at least _____ hours of continuing education must be completed every 24 months.

4 Hours

A producer must establish and maintain records and an appropriate accounting system for all premiums and return premiums he/she receives subject to inspection by the Commissioner of Insurance for _____ years immediately after the transaction's date.

5 Years

A health policy may NOT establish a probationary or waiting period exceeding how many months?

6 Months

Premiums paid to reinstate a health policy cannot be applied to premiums more than days past due.

60 Days

How much Long-Term Care training must producers have before they can solicit or sell LTC insurance?

8 Hours

Which one of the following regarding the Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association is FALSE?

A licensee may use the Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association's existence to sell, solicit, or induce the purchase of any form of insurance

Which of the following statements regarding a producer's license is true?

A producer must hold a license in the line of authority he or she intends to sell

The Insurance Commissioner may take all of the following actions, EXCEPT:

Amend the insurance code as needed

Which one of the following is EXEMPT from the requirements of the replacement regulations?

An existing life policy or annuity has been or will be go through contractual changes or conversion privileges exercised with the existing insurer

Under the Health care False Claims Act, making a fraudulent claim against a health care policy is punishable:

As a felony

Which of following disclosure standards must be followed during the sale of a life insurance policy?

Before making any sales presentation, producers must inform prospective buyers that they are acting as life insurance producers

Cost sharing amounts for chemical dependency services may not be more than for other medical and surgical services HMOs must cover medically necessary detoxification as an emergency medical condition HMOs may apply a waiting period or pre-existing condition limitation

Chemical dependency treatment

Conducting the business of insurance without required or proper licensure is a(n):

Class B Felony

All of the following are unfair trade practices in the insurance business, except:

Fair discrimination on the basis of sex, marital status, or the presence of any sensory, mental, or physical handicap if substantiated by actuarial experience

Premiums or return premiums received by a producer or broker are received in a _________ capacity and must be promptly accounted for and paid to the entitled insured, insurer, or producer.

Fiduciary

Which one of the following standard provisions for health insurance policies is false?

If the age or sex were misstated, the premiums payable under the policy are adjusted so they would be what would have been paid if the age or sex had been correct

Under what conditions, if any, may an individual that is not licensed to sell a particular line of insurance be compensated for the sale of such insurance?

If the compensation is a deferred commission and the individual had been licensed at time of sale

The license fee for a producer's license is $55 After 60 days following one's license expiration date, a licensee may request reinstatement for a limited period of time A producer's license is not terminated until 60 days after the license expiration date

License Renewal

All of the following statements regarding license renewal are true, EXCEPT:

Licensees have 2 years to request a reinstatement

A policyowner must be given, upon request, a summary document describing the Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association's general purposes and current limitations The Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association assesses each member insurer an amount equal to the proportion of its net direct written premiums in the previous year to total net direct written premiums in the previous year for all member insurers The purpose of the Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association is to pay covered claims under certain policies when an insurer cannot pay due to the insurer's insolvency to avoid claimants' financial losses

Life-Disability Insurance Guaranty Association and the Washington Insurance Guaranty Association

The Commissioner of Insurance may place on probation, suspend, revoke, or refuse to issue or to renew any license for any of the following reasons, EXCEPT:

Obtaining a loan from a client who is a financial institution or a relative

All of the following are required to get a nonresident producer license in Washington, EXCEPT:

Passing the licensing exam

All of the following are required to get a nonresident producer license in Washington, except:

Passing the licensing exam

All of the following actions are prohibited as they relate to the marketing and sale of Medicare Supplements, EXCEPT

Pre-existing condition exclusions

Which of the following statements regarding the handling of premiums is correct?

Premium account records must be maintained for 5 years

What are the benefits of having a qualified long-term care insurance contract?

Premiums can be a deductible medical expense and benefits received are not taxable

Which of the following statements regarding long-term care insurance is correct?

Qualified LTC policies offer deductible premiums and tax-free benefits

An existing life policy or annuity has been or will be terminated (e.g. lapsed, forfeited, or surrendered) An existing life policy or annuity has been or will be pledged as collateral or borrowed against for over 25% of the loan value An existing life policy or annuity has been or will be converted to reduced paid-up insurance, continued as extended term insurance, or reduced in value by the use of nonforfeiture benefits

Requirements of the replacement regulations

Legal action may not be taken until after 60 days after written proof of loss has been provided nor after 3 years Unless the insured makes a designation of beneficiary irrevocable, he/ she retains the right to change beneficiary without consent of the beneficiary Upon receipt of a notice of claim, the insurer must supply the claimant forms to be used to file a proof of loss within 15 days

Standard provisions for health insurance policies

Any person, other than a licensed ___________, making an insurance contract in Washington on an unauthorized insurer's behalf is personally liable under the contract.

Surplus Line Broker

All of the following are unfair claims settlement practices, EXCEPT:

Taking up to 30 days to investigate a claim

Which of the following statements describes the Commissioner's ability to levy penalties?

The Commissioner may revoke a producer's license for obtaining a loan from a client who is not a financial institution or a relative

All of the following factors must be taken into account in recommending the purchase or exchange of an annuity, EXCEPT:

The incontestability provision

Failing to adopt reasonable standards for paying claim Refusing to pay claims without an investigation Paying claims without stating the coverage under which the payment is made

Unfair claims settlement practices

The Life-Disability Insurance Guaranty Association pays covered life insurance death benefit and cash value claims on one life of up to:

$500,000

Prohibited acts related to the marketing and sale of Medicare Supplements

- Cold-lead advertising - Attained age rating - High-pressure tactics - Twisting

Which one of the following do life insurance policy illustrations rules apply to, EXCEPT:

- Credit life - Variable life - Individual and group annuity contracts life

The free-look period for a life insurance policy is:

10 Days

The holder of any license that has been revoked or suspended must surrender the license certificate to the __________ at the Commissioner of Insurance's request.

Commissioner of Insurance

The Insurance Commissioner of Washington is _____ to a term of office of 4 years.

Elected

All of the following statements regarding the treatment of Chemical Dependency by health plans in Washington are correct, EXCEPT:

HMOs often exclude chemical dependency