Health Insurance Basics

Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by an underwriter? a. Applicant's character b. Personal habits c. General reputation d. Medical History

d) Medical history

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? a. Capital sum b. Double the amount of the death benefit c. Refund of premiums d. Principal sum

d) Principle sum

According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan?

60%

A ___ policy covers all members of the insured group without requiring individual applications or without issuing individual policies.

Blanket disability

A health insurance plan that covers all accidents and sicknesses that are not specifically excluded from the policy is referred to as a

Comprehensive plan

In a group prescription drug plan, the insured typically pays what amount of the drug cost?

Copayment

A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as

Critical Illness

A policyowner is reading a statement on the first page of his health insurance policy, which says "this is a limited policy." What is the name of this statement?

Limited Policy Notice

In franchise insurance, premiums are usually

Lower than individual policies, but higher than group policies

An insurance company wants to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding information included on previous insurance applications?

Medical Information Bureau

Who is involved in completing the agent's report?

Only the agent

An insurance advertisement exaggerates the benefits of an insurance policy, due to human error at the insurer's advertising agency. Who will the Department of Insurance hold responsible for the exaggeration?

The insurer

An insurer hires a representative to advertise its company at a local convention. The representative lies about the details of some of the policies, in an attempt to secure more business for the company. Who is responsible for the representative's claims?

The insurer

A health insurance policy may cover all of the following EXCEPT

War related injuries

Which of the following groups would probably be covered by blanket insurance? a. A university's sports team b. A large family c. A publishing company d. People who obtain temporary insurance

a) A university's sports team

All of the following statements concerning Accidental Death Dismemberment coverage are correct EXCEPT a. Death benefits are paid only if death occurs within 24 hours of an accident b. Accidental death benefits are paid only if death results from accidental bodily injury as defined in the policy c. Dismemberment benefits are paid for certain disabilities that are presumed to be total and permanent d. Accidental death and dismemberment insurance is considered to be limited coverage.

a) Death benefits are paid only if death occurs within 24 hours of an accident

Which of the following would NOT be considered a primary risk factor in underwriting individual health insurance policies? a. Martial status b. Physical condition of the applicant c. Occupation of the applicant d. Moral hazard

a) Martial status

A group blanket health policy is best suited for which of the following? a. A large family b. A summer camp c. A small employer d. A manufacturer

b) A summer camp

Which of the following entities protects policyowners, insureds, and beneficiaries under insurance contracts when insurers fail to perform contractual obligations due to financial impairment? a. Consumer Protection Agency b. Life and Health Guaranty Association c. Insurance Consumer Protectorate d. Insurance Solvency Association

b) Life and Health Guaranty Association

An insured is upset that her new health insurance policy was delivered to her by certified mail and not through her agent. Which of the following is true? a. The policy will not be legal until it is delivered by an agent b. There is nothing wrong with this form of policy delivery c. The insured should complain to the insurer d. The insured should ask for a new policy to be delivered

b) There is nothing wrong with this form of policy delivery

A typical Accidental Death & Dismemberment policy covers all of the following losses EXCEPT a. Limb b. Life c. Income d. Eyesight

c) Income

Underwriting is a major consideration when an insured wishes to replace her current policy for all of the following reasons EXCEPT a. Pre-existing conditions that were previously covered may not be covered under the replacing policy. b. Benefits may change c. Premiums always stay the same d. Due to age or health, the policy may change dramatically

c) Premiums always stay the same

An underwriter may reject an application for health insurance if the rejection is based upon which of the following? a. Blindness b. Genetic characteristics (such as sickle cell) c. Prescription usage d. Sexual preference

c) Prescription usage

An applicant for health insurance has not had a medical claim in 5 years. He exercises daily and does not smoke or drink. What classification do you assume the applicant would receive from his insurer?

Preferred

Which of the following statements regarding conditional receipts is true? a. They purchase temporary insurance, up to 6 months b. They become part of the policy c. They are temporary insuring agreements d. They guarantee the insurer will approve the application

c) They are temporary insuring agreements

In which of the following situations is it illegal for an insurer to disclose privileged information about an insured? a. The Department of Insurance to assess legal compliance b. Law enforcement authorities for law-oriented purposes c. An auditor for auditing purposes d. A researcher for marketing purposes

d. A researcher for marketing purposes