Financial Consultant

In non contributory health insurance, what % of eligible employees must participate in plan before a plan can be effective?

100%

HIPAA applies to groups of

2 or more

Following hospitalization, because of an accident, Bill was confined in SNF. Medicare will pay full benefits in this family for how nany days?

20

Dept. of insurance contacts agent about a claim that was settled 2 months ago. Within that time frame must the agent issue a complete response?

21 Days

Penalty for IRA distributions that are below the required minimum of the year?

50%

What is the penalty for excessive contributions to an IRA?

6%

With continuing education requirements, what's the minimum number of hours of continuing education specific to LTC Insurance to be completed prior to each license renewal?

8 hours

According to the Medical Loss Ratio (MLR), what is the minimum percentage of health coverage premium that must be applied to actual medical care in an individual health plan?

80%

A person caught violating provisions regarding misrepresentation could be subject to

A fine up to $25,000

Insurance policy is

A written instrument in which a contract of insurance is set forth

If an annuitant dies during accumulation period, what benefit will be included in the annuitants case?

Accumulated Cash Value

Medicare supplement policies are the core benefits found?

All plans

Bob was rendered totally disabled at the time his group health insurance plan was discontinued. Since benefits began to be paid while the policy was in force, which of the following would be required?

An Extension of benefits

If an insurer makes a statement that its policies are guaranteed by the existence of the insurance Guaranty Association, that would be considered

An unfair trade of practice

Who is eligible to purchase an IRA?

Anyone under the age of 70 1/2 who has earned income

Employer contributions made to a qualified plan

Are subject to vesting requirements

When must insurable interest exist in a life insurance policy?

At the time of application

The risk management technique that is used to prevent a specific loss by not exposing oneself to that activity is called

Avoidance

Which of the following is a generic consumer publication that explains life insurance policies in general term to help applicants make educated decisions?

Buyer's guide

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

Certificate of Authority

Best describes the effect of Accelerated Benefit provisions would have benefits paid to beneficiary?

Decreased benefits paid to beneficiary

Agreement specifies how a business will transfer hands when one of the owners dies or become disabled?

Disability buy sell

Under which of the following employer-provided plans are the benefits taxable to an employee in proportion to the amount of premium paid by the employer?

Disability income

Because of the history of cancer in her family, Julie purchased a policy that specifically covers the expense of treating cancer. Her policy would be classified as what type of policy?

Dread Disease Policy

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 least 30 days. This indicates that his policy is written with a 30-day

Elimination period

Who determines the eligibility and contributions limits in HRA?

Employee determines both

How do employers contribute to Health Savings Account affect insured taxes?

Employers contributions are not included in the individuals insured taxable income

A producer is acting in what capacity when he or she is trying to obtain creditable information about an applicant for health insurance?

Field underwriter

If a life policy allows the policy owner to make periodic additions to the face amount at standard rates, without proving insurability, the policy includes a

Guaranteed insurability riders

According to the nonforfeiture law, if the owner decides to surrender a deferred annuity prior to annuitization, the owner is entitled to which of the following?

Guaranteed surrender value

Associations could buy group insurance for its members if it meets all of the following except

Has at least 50 members

First Dollar coverage refers to a type of insurance which

Has no deductions

Medical Savings Accounts (MSAs) are available to small business employees and self-employed individuals who have

High deductible health insurance.

The key factor of representation that allows the injured party to rescind the contract is

If the representation is false in a material point.

.When agents are acting within the scope of their contract, their actions will be assumed to be the acts of the

Insurer

If a retirement plan/annuity is "qualified" this means?

It's approved by IRS

Settlement options which pays throughout the lifetimes of 2 or more beneficiaries is called?

Joint and Survivor

Which one is called a "second-to-die" policy?

Juvenile life

Which law is the foundation of the statistical prediction of loss upon which rates for insurance are calculated

Law of large numbers

Which type of care is NOT covered by Medicare?

Long-term care

Which of the following statements is NOT correct regarding Medicare?

Medicare Advantage must be provided through HMOs.

Which of the following premium modes would result in the highest annual cost for a life insurance policy? a. Monthly b. Quarterly c. Semi-annual d. Annual

Monthly

A person who does not lock the doors or does not repair leaks shows an indifferent attitude. This person presents what type of hazard?

Morale

Attempting to determine how much insurance an individual would require based upon their financial objective

Needs Approach

Shortly after a replacement transaction on a Medicare supplement policy, the insured decided to cancel the policy, but is unsure whether the free-look provision applies. The insured could find that information in the:

Notice Regarding Replacement

Shortly after a replacement transaction on a Medicare supplement policy, the insured decided to cancel policy, but, unsure whether the free look provision applies. The insured could find information where?

Notice of Replacement

Unilateral contract is

One-sided; Only one party makes an enforceable promise

Applicants who are blind may be rated substandard for life insurance?

Only on basis of information unrelated to their blindness

Medicare Part A services do NOT include which of the following?

Outpatient Hospital Treatment

An insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time that the insured had concealed information during the application process. What can they do?

Pay the death benefit

HSAs are owned by the individual, not the employer, which means the individual is not dependent on a particular employer to enjoy the advantages of having an HSA. What term is best describes this?

Portable

What is the term for the fee a policyowner must pay to the insurance company to maintain coverage?

Premium

How does a member of HMO see a specialist?

Primary care physician refers

Insurers may change which of the following on a guaranteed renewable health insurance policy

Rates by class

Which of the following is NOT true regarding Blue Cross and Blue Shield organizations?

They are insurance companies.

Which of the following is true regarding commissions for Medicare supplement policies?

They are permitted up to a certain amount each policy

How are employer contributions to health reimbursement accounts treated in regards to taxation?

They are taxed deductible

Which of the following is true about labor unions, fraternal and co-ops?

They may opt for a self-insured medical and disability plan

When must an insurable interest exist in a life insurance policy?

Time of Application

Which of the following is the best reason to purchase life insurance rather than annuities?

To create an estate

What is the purpose of coinsurance provisions?

To help the insurance company to prevent over utilization of the policy.

What is the purpose of key person in insurance?

To lessen risk of financial loss because id the death if key employee

can an individual who belongs to a POS plan use an out-of-network physician?

Yes, and they may use any preferred physician, even if not part of HMO

Bob was rendered totally disabled at the time his group health insurance plan was discontinued. Since benefits began to be paid while the policy was in force, which of the following would be required?

an extension of benefits

The advantage of qualified plans to employer is:

tax deductible contributions

The Commissioner of Insurance supervises and regulates the insurance affairs in the State of California, and is chosen by

the people

The validity of coverage under a life insurance policy may not be contested, except for nonpayment of premium, after the policy has been in force for at least how many years?

2 years

Making use directly or indirectly of any methods of marketing which fail to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contract will be made by an insurance agent or insurance company is known as

Cold lead advertising

When applying for an individual life insurance policy, an applicant states that he went to the doctor for nausea, but fails to mention that he was also having severe chest pains. This is an example of

Concealment

Gatekeeper of HMO?

Control Specialist Cost

The purpose of managed care health insurance plans is to

Control health insurance claims expenses.

A key person insurance policy can pay for which of the following?

Cost of training a replacement

In the Executive Bonus plan, who is the owner of the policy, and who pays the premium?

Executive is the owner, and the executive pays the premium

What type of group rating do the BCBS organization use as a factor in developing the rates to be exchanged?

Experience rating

An agent selling variable annuities must be registered with

FINRA

To sell variable life insurance policies, an agent must receive all of the following

FINRA registration A securities title A life insurance license

What does "level" refer to in level term insurance?

Face Amount

All of the following entities regulate variable life policies EXCEPT

Federal government

Modified guaranteed annuity?

Owner guaranteed a fixed interest rate for a specific time

What do living benefits riders do?

Pay part of the policy death benefit to insureds in order to helpfund long term care/nursing home

An insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time that the insured had concealed information during the application process. What can they do?

Refuse to pay the death benefit because of the fraud

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 insured wants to name her husband as the beneficiary pf her life policy. She also wishes to retain all of the rights of ownership. The policy owner should have her husband named as the

Revocable beneficiary

Which of the following best describes the underwriting process for life insurance?

Selection, classification, and rating of risks

An employee has group life insurance through her employer. After 5 years, she decides to leave the company and work independently. How can she obtain an individual policy?

She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan.

An applicant buys a nonqualified annuity, but, dies before starting date. Which beneficiaries would the contract interest not be taxable?

Spouse

The California Insurance Code is

Statues established by the State legislature

The California Insurance Code is

Statutes established by the State Legislature.

The advantage of qualified plans to employers is

Tax deductible contributions

The interest earned on policy dividend is

Taxable

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

The date of medical exam

Which of the following is INCORRECT concerning a noncontributory group plan?

The employees receive individual policies

Which of the following best describes a non-medical application?

The medical portion of an application that asks for medical information but does not require a medical exam

All of the following statements concerning the use of life insurance as an Executive Bonus are correct EXCEPT: a. The policy is owned by the company b. Any type of insurance policy may be used. c. The employer pays a bonus to a selected employee to fund the policy d. It is considered a nonqualified employee benefit.

The policy is owned by the company

What is the purpose of COBRA?

To provide continuation of coverage for terminated employees

HICAP counselors are primarily

Trained and registered volunteers.

When would a 20-pay whole life policy endow?

When the insured reaches age 100

When can earned surplus be returned to policyholder?

Whenever it exits and is not needed for other expense

Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE? a. withdrawals are not taxable b. Distributions before age 59 1/2 incur a 10% penalty on policy gains. c. Policy loans are taxable distributions d. Accumulations are tax deferred.

Withdrawals are not taxable