Exam Time Baby!

When health care insurers negotiate contracts with health care providers or physicians to provide health care services for subscribers at a favorable cost, it called

Preferred Provider Organization (PPO)

Which of the following describes taxation of individual disability income insurance premiums and benfits

Premiums are not tax deductible, and benefits are not taxable

Which of the following is correct regarding the taxation of group medical expense premiums and benefits?

Premiums are tax deductible, and benefits are not taxed

Which of the following are the main factors taken into account when calculating residual disability benefits?

Present earnings and earnings prior to disability

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

Presumptive disability

Under the Accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death

Principal Sum

Which of the following must be received by the insurer before a claim will be paid?

Proof ofloss

Which section of the policy explains the rights and characteristics of the contract?

Provisions

Insurers may change what on a guaranteed renewable health insurance policy?

Rates by class

All of the following are true regarding rebating rebates EXCEPT

Rebates are allowed if its in the best interest of the client

Which health insurance provision describes the insured's right to cancel coverage?

Renewal Provision

In the event of a loss, business overhead insurance will pay for what?

Rent

What is not covered under Part B of a medicare policy?

Routine Dental Care

All of the following long-term care coverage would allow an insured to receive care at home EXCEPT

Skilled care

The transfer of an insureds right to seek damages from a negligent [arty to the insurer is found in which of the following clauses?

Subrogation

Benefits from Business Overhead expense are taxable to who?

The Business

If an insurer becomes insolvent, which entity would pay benefits to policyholders?

The Guaranty Association

The commissioner may verify a nonresident applicant's license status through who?

The NAICs producer database

An insured who has Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this poicy?

The capital amount in a lump sum

Which of the following is a characteristic of a reciprocal insurers exchange?

The chief administrator of the insurer is called an "attorney in fact"

What is true of partial disability?

- can still report to work and receive benefits - benefit payments are typically 50% if the total disability benefit - insured would qualify if he couldn't perform some of his normal job

According to the rights of renewability rider for cancellable policies, what is true about the cancellation of an individual insurance policy

- claims incurred before cancellation must be honored - the insurer must provide the insured a written notice of the cancellation - an insurance company may cancel the policy at any time

As is 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 employees expense.

Once a person becomes eligible for Medicare Supplement Plans and during the open enrollment period, coverage must be offered on a ____ basis.

guaranteed issue basis

When reinstatement occurs, when does coverage start?

immediately for accidents, sickness has a waiting period for 10 days.

Under workers compensation what benefits are included and which are not?

included: death, medical and rehab, income Not included: legal benefits

Which of the following is correct regarding the taxation of group medical expense premiums and benefits

premiums are not tax deductible and benefits are not taxed

Which of the following statements is NOT true regarding health insurance policy provisions

- All individual policies contain Uniform mandatory Provision - Insurers may only offer optional provisions that are allowed by the state where the policy is delivered - Insurers may add provisions that are not in conflict with uniform standards - all additional provisions written by insurers are cataloged by their respected states

What are exclusions in medical expense insurance policies

- self inflicted injuries - military duty - routine dental care

Which of the following services will NOT be provided by an HMO

- unlimited coverage for treatment for drug rehabilitation - treatment of mental disorders - emergency care - inpatient hospital care outside the service area

What are allowable reasons for an insurer to cancel a noncancellable health insurance policy?

- within 2 years of application, the insurer discovers a misrepresentation - the insured does not pay premium - the insured reaches the max age limit in the policy

What are factors for determining Social Security Disability benefits?

1. Workers PIA 2. Workers Age 3. Number of work credits earned

What does the Insuring Clause specify?

1. the insurance company 2. the name of the insured 3. covered perils

An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?

10 days

If a producers license lapses, how much time does the producer have to apply for reinstatement without having to take an exam?

12 months

Ab insurer must notify the consumer in writing that an investigative consumer report has been requested within how many days of the initial request?

3 5 10 30

Under Social Security disability benefits, a person will have to wait how many months before any benefits will be paid?

5 months

Under the uniform required provisions, proof of loss should be filed when?

90 days

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within

90 days

What is the max period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?

As long as the policy is in force

According to the metal level what percentage will be covered under the plans?

Bronze: 60 Silver: 70 Gold: 80 Platinum: 90

A reinstated policy provides immediate coverage for what?

Covers accidental injury. Sickness is covered only if the sickness occurs at least 10 days after the reinstatement date

The provision in a health insurance policy that ensures that the insurer cannot refer to any doc that is not contained in the contract is the___

Entire Contract clause

A medicare supplement plan must have at least which of the following renewal provisions?

Guaranteed renewable

The section of a health policy that states the causes of eligible loss under which an insured assumed to be disabled is the

Insuring Clause

What provision concerns the insureds duty to provide the insurer with reasonable notice in the event of a loss?

Notice of Claim

Coinsurance and premiums

The larger the percentage that is paid by the insured, the lower the required premium will be

Which of the following varies the length of the grace period?

The mode of premium payment

Irrevocable Beneficiary

They can be changed only with the written consent of that beneficiary

According to the rights of renewability rider for cancellable policies, all of the following are correct about the cancellation of an individual insurance policy EXCEPT

Unearned premiums are retained by the insurance company

Under the Physical Exam and Autopsy provision, how many times can an insurer have the insured examined, at its own expense, while a claim is pending?

Unlimited

Impairment Rider

excludes a specified condition from coverage, therefore, reducing benefits. An insurance company will not charge extra for a rider that reduces benefits.

In respect to the consideration clause, which is consideration on the part of the insurer

paying for the loss

Part B of Medicare

pays 80% of out-patient medical cost after a deductible has been met. Part B covers physician and outpatient hospital services, and other medical and health services such as diagnostic test and physical therapy.

Which of the following is NOT mandatory under the Uniform Provisions Laws applied to accident and health policies

probationary period

The commissioner must verify that the insurance producer is eligible within how many days

30 days

Disability buy-sell agreement

- The buy-sell coverage benefits are tax free - An agreement between business co-owners that provides that shares owned by any one of them who becomes disabled shall be sold to and purchased by the other co-owners or by the business using funds from disability income insurance.

After an insurance company examination, the commissioner or the examiner appointed by the Commissioner must file a written report of the examination within

60 days

A free look provision allows for which of the following

A right to return the policy for a full refund

How is the Minnesota Comprehensive Health Association funded?

By its members- authorized insurers.

If an insured changes his payment plan from monthly to annually, what happens to the total premium?

Decreases

The portion of a loss that is considered the responsibility of the insured is called

Deductible

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT

Dividends from a mutual insurer

Which type of a hospital policy pays a fixed amount each day that the insured is in a hospital?

Indemnity

What is the deductible of a personal liability umbrella policy called?

The SIR

Which of the following determines whether disability insurance benefits are taxed?

Whether the premiums were tax deductible

Underwriting a group health insurance plan is paid for by the employer requires all of the following EXCEPT:

individual members of the group may select the level of benefits for their own coverage

In the event that the action by the commissioner is to non renew or deny an application, the commissioner must do what

must notify the applicant or licensee and advice in writing

Which type of insurance is based on mutual agreements among subscribers?

reciprocal insurance

What is the purpose of the Claims Made form?

to allow insurers to determine adequate rates for unknown losses claimed in the future

Features of Guaranteed renewable provision?

- The insured has a unilateral right to renew the policy for the life of the contract - coverage is not renewable beyond the insured's age 65 - the insured's benefits cannot be reduced

An elimination period may not have to be satisfied for a disability in which of the following

- an insured suffers a relapse of a prior disability within 6 moths of the intial covered disability - an insured suffered the diability from the results of active duty an insured is disabled from a work-related accident - as insured contracted an incurable disease

What is covered under Plan A in Medigap Insurance

- approved hospital costs for 365 additional days after Medicare benefits - The 20% Part B coinsurance amounts for Medicare approved services - The first three pints of blood each year

To be valid, an insurance policy must have all of the following EXCEPT

- countersignature -acceptance -consideration -offer

When can u apply for a temporary license

- death of a producer - producers disability - producers time in the military -NOT retirement

What characteristics is managed care?

- high quality care - shared risk - preventative care

True statements about PPO

- may chose medical providers not found on preferred list - allowed to receive care from anyone. If they select care from a PPO provider, there will be lower out of pocket costs - out of network: higher out of pocket

Medicare Part A services include

- post hospital skilled nursing facility care - hospice care - hospitalization

Which percentage of individually-owned disability income benefits is taxable?

0%

An insured has a major medical policy that calls for a $1,000 deductible and 80/20 participation. If this insured incurs covered medical expenses of 5000 would pay

1,800

An insured has a major medical policy that calls for 1,000 deductible and 80/20 participation. If this insured incurs covered medical expense of 5,000, the insured would pay

1,800. You would pay the deductible (1000) + 20% of the remaining 4,000 (800)

What is true of workers comp?

1. workers comp laws are established by each state 2. all states have workers comp 3. benefits include medical, disability income, and rehabilitation coverage

What is the max age to qualify for a catastrophic plan?

30

If a consumer requires additional info concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

If an insurer meets the state's financial requirements, their Certificate of Authority should arrive within how many days of applying?

60 days

At what age may an individual make withdrawals from an HSA for nonhealth purposes without being penalized?

65

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within

90 days of a loss

A hospital indemnity policy will pay for what?

A benefit each day the insureds is in a hospital

Any expenses incurred by the stay in the hospital, minus coinsurance payments and deductibles

A benefit for each day in the insured is in a hospital

Any regularly salaried employee of a licensed insurer, without license or other qualifications, may act on behalf of that insurer in the negotiations insurer, provided

A licensed producer participates in the sale of insured

Which type of liability would be association with handling explosives?

Absolute

Group health insurance is characterized by all of the following EXCEPT?

Adverse selection. (actual characteristics are conversion privilege, a master contract, lower administrative costs)

In which medicare supplemental policies are the core benefits found?

All plans

Which of the following is NOT among the primary ways deductibles for major medical plans can be paid?

An embedded deductible

Disability income coverage specifies that the policy covers the insured if he is unable to perform any job for which he is qualified. In this case

Any occupation- more restrictive than other defintions

What statement accurately describes the Change of Beneficiary provision?

Any policy that has a death benefit must also have a change of Beneficiary provision.

The premium charged for excising the Guaranteed insurability Rider is based upon the insureds

Attained age

Occasional visits by which of the following medical professionals will NOT be covered under LTC's home health care?

Attending physician

Which of the following statements regarding Business Overhead Expense policies is NOT true

Benefits are usually limited to six months

In life insurance, procedures are permitted to share or split commissions, provided that

Both are properly licensed for the line of insurance

A health plan policy cannot be issued or delivered in Minnesota until which of the following has been filed with the commissioner?

Both risks classification and premium rates

Which of following would use a commercial policy?

Business Owners

How is the minnesota comprehensive health association funded?

By its members-authorized insurers

The act of voluntarily giving up insurance by the insured is called

Cancellation

An applicant for individual health policy failed to complete the application properly. Before being able to complete the application and pay the initial premium she is confined to a hospital. This will not be covered because she has not met the conditions specified in what clause?

Consideration Clause

Which policy provision outlines the specific responsibilities of the insured in the event of a loss?

Duties of the Insured

Which of the following is NOT among the components that make up a commercial package policy (CPP)?

Dwelling

The provision that states that both the printed contract and a copy of the application form the contract between the policyowner and the insuerer is called the?

Entire Contract

What is correct concerning taxation of long term care insurance?

Excessive benefits may be taxable

An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits?

Full benefits

Carry over provision

If the insured did not incur sufficient medical costs during the year to meet the deductible, any medical expense incurred during the last three months may be carried forward to next year, offsetting the total deductible costs for that year

Which of the following riders would NOT increase the premium for a policyowner

Impairment rider

If a business owner becomes totally disabled, a Business Overhead policy will pay all of the following EXCEPT

Loss of the owners income

What would provide an underwriter with info concerning an applicants health history?

MIB

Under a Key Person disability income policy, premium payments are made by who?

Made by the business and are not tax deductible

An agent is evaluating the needs of a client who is considering Business owners Property Coverage. The clients business dependent on the use of air conditioning unit. Which of the following optional coverage should the agent recommend?

Mechanical breakdown

If a dental plans is integrated , it is combined with what type of plan

Medical

Which type of medicare policy requires insured to use specific healthcare providers and hospitals (network providers), EXCEPT in emergency situations?

Medicare SELECT

The primary eligibility requirement for Medicaid benefits is based upon

Need

Which of the following types of policies does NOT have a savings component?

Term Life

How does a member of an HMO see a specialist?

The primary care physician refers the member

The purpose of reinstatement provision is

To determine the process for reactivating coverage once a policy has lapsed

What is the purpose of coinsurance provisions?

To help the insurance company to prevent overutilization of the policy

Personal Lines Insurance

Type of coverage available to individuals and families for non-business risks.

An insured owes his insurer a premium payment. Since then , he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the difference. What provisions allows for this?

Unpaid Premium

An insured owes his insurer a premium payment. Since then, he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the difference. What provision allows for this?

Unpaid Premium

Manny has been injured in an accident. Although she is still receiving benefits from her policy, she does not have to pay premiums. Her policy includes

Waiver of Premium rider

How soon following the occurrence of a covered loss must an insured submit a written proof of such loss to the insurance company?

Within 90 days or as soon as reasonably possible but not to exceed 1 year

How soon following the occurrence of a covered loss must an insured submit written proof of such loss to insurance company

Within 90 days or as soon as reasonably possible, but not to exceed 1 year

Are premium paid for BOE tax deductible?

Yes

A guaranteed renewable disability insurance policy

is renewable at the insureds option to a specified age

In a group healthy policy, a probationary period is intended for people who

join the group after the effective date

Nonoccupational Coverage

only covers claims that result from accidents or sicknesses occurring off the job

The comprehensive health association contracts with all of following entities to provide coverage for their subscribers

private admitted insurers, fraternal insurers, health maintenance organizations (NOT surplus line insurers)

In forming an insurance contract, when does acceptance usually occur?

when an underwriter approves coverage

Are leased equipment expenses covered by Business Overhead plan?

yes

Proof of loss forms must be sent to the insured within____ days of notice of claim

15

To appoint a producer, the commissioner must know within how many days

15 days

If a license lapses, the commissioner suspends you license for how long?

2 years after the license was last effective.

Which of the following policy provisions is a general statement identifying the insured, the instance company, and the types of loss that will be covered

Insuring Clause

In health insurance, if a doctor charges 50 dollars more than what the insurance company considers usual customary and reason, the extra cost will do what?

It will not be covered

In a group health policy, a probationary period is intended for people who:

Join the group after the effective date

The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof ofl oss is known as:

Legal Actions

Which of the following whole life policies charges a level annual premium for the lifetime of the insured

Level Term

Under an individual policy, the MINIMUM schedule of time in which claim payments be made to an insured is:

Monthly

What provision would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner?

Payment of Claims

What must be present in all medicare supplement plans

Plan A

A policy with a 31-day grace period implies

The policy will not lapse for 31 days if the premium is not paid when due

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

In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party?

insurer to insured

If this occurs, the applicant can do what?

make a written demand within 30 days for a hearing to determine why.

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.

Elane's Basic Hospital Expense policy has a 500 per day limit for room and board in a hospital for a max of 5 days. Elaine got sick and had to spend 3 days in the hospital at 650 a day. How much will Elaine have to pay to cover the rest of her room and board charges?

- 0 - 150 - 350 - 450

In order for an alumni association to be eligible to purchase group health insurance for its members, all of these statements must be true EXCEPT when the association..

- has been active for 5 years - has a constitution by laws and must hold annual meetings - is organized for reasons other than buying insurance - has at least 100 members

Medicaid correct statements

- individuals claiming must prove they do not have the ability or means to pay for their own medical care - personas, at least 65 years of age, who are blind or disabled and financially unable to pay, may qualify for Medicaid Nursing Home Benefits - Individual states design and administer the Medicaid program under broad guidelines established by the federal gov.

Which of the following would best describe total disability?

A persons ability to work is significantly reduced or eliminated for the rest of his/her life

An insured carries health insurance with two different providers and is covered on an expense incurred basis. He has an appendectomy and files the claims to both insurers. Neither company is notified in advance that the insurer has other coverage. What should each insurer pay?

A proportionate amount

What is covered by Medicare?

Hospital, hospice, Respite

The Patient Protection and Affordable Care Act includes all of the following provisions EXCEPT

Individual tax deduction for premiums paid

What is not a benefit of a POS plan

It allows guaranteed acceptance of all applicants.

Which of the following is true regarding the master policy?

It is issued to the sponsor of the group

An insured purchased a health insurance policy for himself listing his wife as a dependent. Three years later they got divorced- now what is the deal regarding coverage for the wife?

It will continue until the former spouse becomes covered under another plan

The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof of loss is known as what?

Legal Actions

Under the Affordable Care Act, which classification applies to health plans based on the amount of covered costs?

Metal Level Classification

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?

Mutual

Are dividends received by policyholders taxable?

No

In an individual long term care insurance plan, the insured is able to deduct the premiums from taxes. What income taxation will be imposed

No Tax

On a participating insurance policy issued by a mutual insurance company, dividends paid to the policyholders are

Not taxable

In surety bonding, whose performance is being guaranteed?

Obligor

Which coverage in a personal auto policy would address losses such as hail, deer or falling objects

Other-than-collision

Residual Disability

Pays an amount to make up the difference between what the insured would have earned before the loss.

Who might receive dividens from a mutual insurer?

Policyholders

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true?

The group plan will not pay because the employee was injured at work

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

The insured

Which of the following best describes the "first-dollar coverage" principle in basic medical insurance

The insured is not required to pay a deductible

Under what condition are group disability income benefits received by an employee NOT taxable as income?

When the benefits received are eqaul or less than the employee's participating of the contribution

Under a Key Person disability income policy, premium payments

are made by the business and are not tax deductible

In property policy, which of the following policy provisions states that the interest in a policy may be transferred?

assignment

A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim,

the insurance through his company is primary. The policy that covers the person filing the claim will be considered the primary policy

What is the purpose of the impairment rider in a health insurance policy?

to exclude coverage for a specific impairment

The insuring clause of disability policy usually states all of the following

types of losses covered, identities of the insurance company and the insured, that insured against loss is provided.

Medicaid provides what?

- home health care services - eyeglasses - family planning services

Correct statements about Medicaid

- it provides medical assistance to low income people - it pays for hospital care, outpatient care, labs, and x ray - the federal government provides 56 cents for every Medicaid dollar spent

Following hospitalization because of an accident, Bill was confined in a skilled nursing facility. Medicare will pay full benefits in this facility for how many days?

20

For each licensing period, licensees must complete how many hours of continuing education?

24 hours

The relation of earning to insurance provision allows the insurance company to limit the insured's benefits to his/her average income over the last:

24 months

What coinsurance agreement would result in the lowest premium possible?

50/50

How long is an open enrollment period for Medicare supplement policies

6 months

Randy loses his full time job because his role in the company becomes obsolete. How long must he be given the option of continuing his group health insurance coverage, provided he doesn't find coverage somewhere else?

6 months 12 months 18 months 24 months

Under the mandatory uniform provision Legal Actions, an insured is prevented from bringing a suit against the insurer to recover on a health policy prior to:

60 days after written proof of loss has been submitted

Medicaid

A health care payment program sponsored by federal & state governments. It expands individual public assistance programs for people with insufficient income and resources

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 sufficient clear to identify the insured and the nature of the claim.

Medicare Advantage is also known as

Part C

Which provision states that the insurance company must pay medical expense claims immediatley?

Time of Payment of Claims

Stop-loss limit

a specified dollar amount beyond which the insured no longer participates in the sharing of expenses

Renewability Rider allows what?

allows the insurer to cancel the policy at any time, or at the end of the policy period. Any unearned premiums must be returned to the policyholder. If the insurer cancels, the unearned premium will returned on a pro rate basis

Long term care producers have to complete what?

initial 8 hour training course, and on going 4 hour training every 24 months

Insurers are forbidden to do all of the following with their advertisements, EXECPT

promote interest in insurance coverage

In addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health?

- By requiring that the insurance be incidental to the group - by having each enrollee undergo a paramedical examination - by obtaining MIB reports on each enrollee - by imposing case management provisions

Medicare SELECT policy does what?

- provide payment for full coverage under the policy for covered services not available through network providers - provide for continuation of coverage in the event that Medicare SELECT policies are discontinued due to failure of the Medicare SELECT program. - Make full and fair disclosure in writing of the provisions, restrictions, and limitations of the medicare SELECT policy to each applicant

An insured purchased a health insurance policy with a renewability clause that states the policy is "guaranteed renewable". This means that as long as the required premiums are paid, the policy will continue until the insured

- reaches age 65

Features of a noncancellable policy

- the guarantee to renew coverage usually applies until the insured reaches certain age - the insured has the right to renew the policy for the life of the contract - the premiums cannot be increased beyond the amount stated in the policy

What is true about the right of Renewability for cancellable polices?

- the insurer must provide the insured a written notice of the cancellation - claims incurred before cancellation must be honored - an insurance company may cancel the policy at any time

As part of the policy approval process, the commissioner may require the insurer to provide all of the following EXCEPT?

- the producers commission schedule - advertising material use with the policy - the premium rates filed with the policy - a copy of the policy

Waiver of Premium rider?

Causes the insurer to waive future premium when an accident or disease causes a disability lasting at least 6 months

The provision that provides for the sharing of expenses between the insured and the insurance company is?

Coinsurance