Final Exam
Which of the following constitutes grounds for suspending a PA producer's license?
Felony conviction
Tom has a home health care benefit and is confined to his home. Which of these benefits is NOT typically covered?
Full-time nursing care
The IRS states that a taxpayer's medical expenses that exceed 7.5% of their adjusted gross income is tax deductible. Which of the following may be considered a medical expense under this rule?
Long Term Care Insurance premiums
Coming from an insurance point of view, which of the following is the main risk associated with disability?
Loss of income
What is the contract called that is issued to an employer for a Group Medical Insurance Plan?
Master policy
Bill the producer is collecting an initial premium on a health policy. Which of the following statements is true?
The contract is not in force without the initial premium being paid
The monthly benefit for an individual disability income policy is usually limited to a percentage of the insured's income in order to avoid
over insurance
Sole proprietors are permitted tax deductions for health costs paid from their earnings in the amount of
100% of costs
A closed network plan offers a primary physician copay of $25. If a subscriber chooses a PCP outside of the network, the subscriber will likely pay
100% of the billed amount
An insurer must furnish to a claimant forms for filing proof of loss within _______ days upon receiving a notice of a claim.
15
A life insurance policy becomes incontestable after it has been in force for
2 years
The deeds and actions of a producer indicate what kind of authority?
Apparent
Which of the following nursing home options would BEST suit an individual who needs some nursing care and supervision but NOT full-time care?
Assisted living facilities
With a scheduled dental policy, how are covered expenses paid?
Benefits are limited to a specific maximum dollar amount per procedure
According to PA law, which of the following is NOT considered to be personally identifiable information?
Blind trust data that does not include names and addresses
Jonas is a whole life insurance policyowner and would like to add coverage for his two children. Which of the following products would allow him to accomplish this?
Child term rider
Which of these is NOT considered to be a purpose of an annuity?
Annuities are intended to create an estate
Which type of annuity guarantees a stated number of income payments, whether or not the annuitant is still alive to receive them?
Life annuity certain
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?
Life income
Which of the following annuity payout options makes no additional payments regardless of when the annuitant dies? Life only Life with period certain Cash refund Installment refund
Life only
Group health plans may deny participation based upon the
member's part-time employment status
An Accelerated Death Benefit in Pennsylvania must be at least what percentage of the total death benefit?
25%
In Pennsylvania, the Time Limit on Certain Defenses provision provides that no misstatements (EXCEPT fraud) made by the applicant on a health insurance application can be used to void the policy or deny coverage after the expiration of
3 years
A licensed producer must report any administrative action taken against the licensee in another jurisdiction or by another agency department in Pennsylvania within how many days of the final deposition?
30 days
In a Long-Term Care policy, the right-to-examine period is
30 days
The legal action provision in a health contract is limited to no more than _______ years
5
Erica is 35 years old and owns an IRA. At what age can she begin to receive distributions without a tax penalty?
59.5
The Medicare Supplement open enrollment period is
6 month period that begins with the month in which enrollment in Part B Medicare occurred, typically at age 65.
Within how many days must a rollover be completed in order to avoid being taxed as current income?
60 days
What percentage of a participant's income are group long-term disability benefit amounts typically limited to
60%
Which of the following BEST describes a conditional insurance contract?
A contract that requires certain conditions or acts by the insured individual
A temporary license may be issued without state examination to all of the following EXCEPT
A prospective producer who is currently enrolled in a pre-licensing insurance class
Which of these is considered to be a Living Benefit option in a life insurance policy?
Accelerated death benefit
An accident and health Major Medical plan would provide coverage for
Accidental overdose of a prescription drug
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
Accumulation of Interest Option
What does the Group Life underwriting risk selection process help protect insurance companies from?
Adverse selection
Which of the following is INELIGIBLE to participate in a Section 125 Plan?
An S-Corp Owner with greater than 2% share
In Pennsylvania, who is responsible for Continuing Education (CE) course content approval?
Commissioner
In what part of an insurance policy are policy benefits found?
Declarations
The least expensive option to pay off a 30-year mortgage balance would be
Decreasing term life
A form of medical health insurance covering the treatment and care of gum diseases is called
Dental expense insurance
A life insurance policyowner was injured in an automobile accident which results in a total and permanent disability. Which rider would pay a month amount because of this disability?
Disability income rider
Lisa has recently bough a fixed annuity. Which of these is considered to be a disadvantage of owning this type of annuity?
During periods of inflation, annuitants will experience a decrease in purchasing power of their payments
Craig purchased a life insurance policy for enabling his heirs to pay estate taxes. What is this called?
Estate conversion
XYZ Company has applied for group health insurance for its employees.. What information would the insurer's underwriters likely use to determine the appropriate coverage and final premium rate given to the group?
Experience rating
All of these are settlement options for life insurance policies EXCEPT
Extended term (this is a nonforfeiture option, not a settlement option)
Which of these is considered a major tax advantage of life insurance?
Income tax is typically not owed on proceeds paid directly to a beneficiary
When a producer offers something of value in return for the purchase of an insurance policy, which prohibited sales practice has been committed?
Inducement
What is the purpose for having an accelerated death benefit on a life insurance policy?
It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill
The time limit for filing claim disputes is addressed in which provision of an accident and health policy?
Legal actions
Which contract element is insurable interest a component of?
Legal purpose
In Pennsylvania, completion of continuing education is required upon license renewal for which of the following?
Licensed individuals qualified in major lines of insurance
During the first two years a life insurance policy is in force, the insurer may contest a policy for all of the following reasons EXCEPT
Misstatement of age in the appliciation
How does one become eligible for Part D: Prescription Drug coverge?
Must have Medicare coverage
What is the required action to be taken by a Pennsylvania licensee before operating under an assumed business name? Notify Commissioner Notify Governor Notify the insurer where employed Obtain a permit
Notify Commissioner
Which of these is NOT considered to be a risk factor in life insurance underwriting?
Number of children
The document that describes policy features, benefits, exclusions and riders in a Long-Term Care policy is known as
Outline of Coverage
Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
Payor benefit
What is known as the immediate specific event causing loss and giving rise to risk?
Peril
Which annuity payout option allows the policyowner to choose a pre-determined number of benefit payments?
Period certain
Which of these factors is NOT taken into consideration when determining the cost of a long-term care policy?
Personal income
Which of the following is NOT a common exclusion for a medical expense policy?
Physical therapy
Which of the following would evidence ownership in a participating health insurance contract?
Policy ownership
All of the following are functions of an insurance clause EXCEPT
Primarily describes the free-look period
Which of the following is a person who negotiates an insurance contract on behalf of an insurer?
Producer
Which of the following is a reinstatement condition?
Proof of insurability
The branch of dentistry which deals with the replacement of missing parts is called
Prosthodontics
Any of the following may be an unfair claims practice EXCEPT
Refusing to pay persons brining false or fraudulent claims
An individual who removes the risk of losing money in the stock market by never purchasing stocks is said to be engaging in
Risk avoidance
In PA, a producer may have their license revoked for which of the following acts?
Signing a prospect's name without their knowledge or presence
Which of these ensures that proceeds of a life insurance policy will be free from attachment or seizure by the beneficiary's creditors?
Spendthrift Clause
In a Long-Term Care policy, activities in a daily living (ADL's) can be each of the following EXCEPT
Talking
Which of the following would be a valid reason why a policy premium would be higher than the standard premium?
The insured does not meet established underwriting requirements
A life insurance illustration showing future premiums being paid out of nonguaranteed values must disclose that
The policyowner may need to resume premium payments depending on actual results
Who were Keogh plans designed to provide pension benefits for?
The self-employed
The statement which best describes the relationship between the premiums of a whole life policy and the premium payment period is
The shorter the payment period, the higher the premium
Craig submits $500 claim for medical expenses. With a past due premium of $100, the insurer pays $400. Which of the Uniform Optional Provisions covers this situation?
Unpaid premium
A life insurance policy which contains cash values that vary according to its investment performance of stocks is called
Variable Whole Life
Which type of policy combines the flexibility of a universal life policy with investment choices?
Variable universal life policy
Charing a client less premium than what is stated in their insurance policy is called
a rebate
The double indemnity provision in a life insurance policy pertains to the insured's death caused by a(n)
accident
All of these are common exclusions to a life insurance policy EXCEPT
accidental death
An individual most likely will have an insurable interest in insuring a person's life if
an economic interest exists for the continuation of the insured's life
The purpose of the Coordination of Benefits provision in group accident and health plans is to
avoid overpayment of claims
Proceeds of the viatical settlement contract could be subject to the claims of
creditors
When collecting insurance premiums from a client, a producer MUST
forward premiums to the insurer on a timely basis
Underwriters can acquire information from all of the following sources EXCEPT
genetic testing
According to HIPAA, when an insured individual leaves an employer and immediately begins working for a new company that offers group health insurance, the individual
is eligible for coverage upon hire
An insured was injured by an innocent bystander when someone committed a felony. The insurer is
liable for the loss
An insurer's ability to make unpredictable payouts to policyowners is called
liquidity
The election of COBRA for continuation of health coverage will
maintain the same coverage and increase the premium
The two major actions required for a policyholder to comply with the Reinstatement Clause are
provide evidence of insurability, pay past due premiums
A life insurance company has transferred some of its risk to another insurer. The insurer assuming the risk is called the
reinsurer
Long-Term Care policies may provide coverage for claims arising from
senile dementia
The PA Insurance Department is responsible for each of the following EXCEPT
shareholders
In PA, an insurer may backdate policy issue not more than how many months from the date of a life insurance application?
six months
The type of policy which pays on the death of the last person is called
survivorship life
What types of life insurance are normally used for key employee indemnification?
term, whole, and universal life insurance
This MANDATORY health policy provision states that the policy, including endorsements and attached papers, constitues
the entire insurance contract between the parties
A disability elimination period is best described as
time deductible