Health Insurance License (2-15)

A life insurance company organized in Illinois, with its home office in Philadelphia, is licensed to conduct business in Florida. In Florida, this company is classified as what?

A Foreign Company

Selling variable universal life insurance policies as mutual funds is an example of a prohibited practice called?

Misrepresentation

Dual Regulation

Supreme Court in 1959 held that federal law applied to insurers selling variable contracts. Thus, these insurers are subject to federal regulation by the SEC and by the state's Office of Insurance Regulation.

Preliminary term for Interim coverage

Switching from life to term for no more than 11 months

What type of policy does not have cash value?

Term Insurance

Buyers Guide

The purpose of a buyers guide is to improve the buyer's ability to select the most appropriate plan of life insurance for his needs.

Group Policy

There is no minimum number of members (lives) required for a group policy in Florida so long as the organization is one that is eligible for a group life insurance.

Reinsurance

They pass a portion of the benefit to the reinsurer

Mini-COBRA

To ensure continued access to affordable health insurance coverage for employees of small employers and their dependents. Groups under 20 and not to exceed of 115%

Whats the purpose of MIB?

To prevent fraud

Buying insurance is one of the best ways of?

Transferring risk

Whole Life Insurace

Whole Life Insurance is designed to mature at age 100

Guaranteed

Whole life, straight and limited pay

Free-look (medicare)

can return the policy or certificate within 30 days of its delivery

Free-look Long term care

can return the policy with 30 days

Common stocks are predominantly used in the separate account portfolios because they

usually provide a hedge against inflation

Stock Companies

Can issue either participating or non participating policies. Which is a mixed plan.

Representation

Can lie and not matter

Mutual Plan

Can not participate in a mixed plan.

Free-look (health)

Can return the policy within 10 days of delivery

Warranty

Can't lie and don't have to be accurate

Peril

Cause of loss

Risk

Chance of loss

When values of an insurance policy are used to purchase another policy with the same insurer for the sole purpose of earnings additional premiums or commissions, this practice is called?

Churning

General Agent

Company selling multiple policy's

Agent

Contracts and Appointments

Permanent

Coverage + Saving

Disability Insurance

Covers your ability to work

When an agent spreads a false story that damages a competing agents reputation, the offense is called?

Defamation

FSA

Flexible Spending Account

Compliance

Follow the rules

Medicare

For people 65 years or older

Medicade

For the poor people

Insurable Interest

Has to be applicant or insured relationship of Blood, law, or finance.

HMO

Health Maintenance Organization is the term used to delineate the arrangement between the subscriber or group of subscribers and the HMO. It sets forth the services to be provided and the fixed fee or premium to be paid.

HRA

Health Reimbursement Account

HSA

Health Savings Account

2 Fundamental Prinicples

Law of large numbers Pooling of Risks

What term best describes a Life Insurance policy that provides a straight $100,000 of coverage for a period of five years?Level Term

Level Term

Coverage Term

Level, decreasing, and increasing.

Controlled Business

Life of health insurance or annuity contracts covering the agent or family members; officers, directors, stockholders, partners, or employees.

(Annuities) how the money is coming out?

Life only (straight life), life with period certain, refund installments of balance, and Joint + Survivor

Fraternal Benefit Society

Lodge System, Elected officers, Charitable ritualistic, and Operate not for profit.

Stop Loss

Max out of pocket

Industrial Insurance Life health and Annuity.

"Debit" agent, small death benefit. Premiums paid weekly sometimes monthly, and collected at home.

COBRA

(Consolidated Omnibus Budget Reconciliation Act) continuation of health insurance

Outline of Coverage

(Disclosure) A brief description of the principal benefits and coverage provided in the policy, a summary statement of the principal exclusions, and when home health care coverage is provided, a statement that such benefits are provided in the polcy

Waiting elimination period

6 months

Medicare open enrollment period

65 & over and is enrolled for benefits under Medicare Part B

Child Coverage

from the moment of birth to the age of 16

Which of the following best describes the function of insurance?

It spreads financial risk over a large group to minimize he list to anyone individuals.

(Annuities) when is the money coming out?

immediate, deferred

Capitation

is the fixed amount paid by the HMO to a health care physician or provider in exchange for the medical services rendered by that provider.

Unilateral Contracts

One Sided deal, means one side wrote the deal.

Cross purchase

When you buy life insurance on your partner in your business

Pure Risk

When you cant win

Free-look period

14 days life and 21 days variable

fiduciary

A fiduciary is a person in a position of a special trust and confidence.

Recordkeeping

A licensee must notify the department, in writing, within 30 days after a change of name, residence address, etc

Insolvent Insurer

A member insurer authorized to transact insurance in this state, wither at the time the policy was issued or when the insured event occurred.

Impaired Insurer

A member insurer deemed by the department to be potentially unable to fulfill its contractual obligations and not an insolvent insurer

Term

A period of time and has no cash value

Policy Summart

A written statement describing the elements of the policy.

Annuity Units

After retirement the number of annuity units stays the same

Automatic Premium Loan

Always a good thing.

Criminal Action

An agent must report in writing to the department within 30 if ever found guilty of a crime.

Policy loan

An insurance company can change a fixed rate of no more than 10% annual interest subject to restrictions.

Underwriter

Another term for risk selection, process to review

Receipts

Approved right away, application is signed and dated with check and medical exam

(Standard Provisions) Protection of beneficiaries from creditors

At death of the insured, life insurance death benefits will be paid exclusively to the benefit of the named beneficiary as designated in the policy.

4 ways to deal with risk

Avoid, risk reduction, risk retention, and transfer the risk for a premium.

Broker

Brokers and contracts. Can work for multiple insurance company's as a independent contractor

The authority that an insurer gives to its agent by means of the agents contract know as?

Express Authority

Churning

External

Exclusion Ratio

Determines how much of your annuity is taxable.

Flexible premium annuity

Different payments

Provider

Doctor

An insurance company organized and headquartered in Florida can be described as what type of company in Florida?

Domestic

Contributory

Employee Pays

ERISA

Employee Retirement Income Security Act of 1974

Group non-contributory

Employer Pays, Employer Deducts

Indemnification

If the key person (insure) dies, have to be replaced

Hazard

Increases the chance of a loss "physical", "Moral", or "Morale"

Legal consideration

Initial Premium

Ethics

Instructions on how to interact with fellow members of a group or community

Fixed (Annuities)

Insurance company guarantees your principle, interest rate, and monthly income.

Insurance license agent represents who?

Insurer

Producer training

Insurers providing long-term care insurance must maintain records that before any producer sells, solicits, or negotiates a long-term care insurance policy, that they receive necessary and sufficient training to understand partnership policies and they relationship to public and private coverage for long-term care.

Twisting

Internal

Accumulation units

Is shares that varies because of stocks

(Minors)

It can cause a legal issue.

(Estates)

It is not always good if you have a family.

Universal Life

Most important

Independent Agency

Multi-Company, Multi-Line. Direct market and mass market.

Variable Life

Must make payments

Aleatory

Never Fair

Variable

No Guarantees

Adhesion

No Negotiation

Universal life coverage + saving

No guarantees. Ultimate potential, flexible premiums, and stock market returns

Agent licensing

No person may sell variable contracts in Florida unless first dully licensed and appointed as a life including variable contracts agent.

Individual Health

Not deductible unless you itemize

Contract

Offered goods or services (legal Purposes)

PPO

Preferred Provider Organization

What are the two reserves?

Premium and Lost

What causes the insuring clause to be important of a policy?

President and Secretary

Market Conduct

Professionalism

Before proposing any variable product the agent must provide the prospect with what?

Prospectus

An Insurance salesperson who offers a $100 gourmet dinner in exchange for the purchase of a life insurance policy would be considered to have violated ethical sales practices by?

Rebating

What type of contract is Health Insurance?

Reimbursement

Sliding

Representing to the application that a specific ancillary coverage or product is required by law in conjunction with the purchase of insurance when such coverage or product is not required.

Periodic premium payments

Same amount

Pure Endowment

Savings account that you get at the end of your term if your still alive.

Variable life insurance and variable annuities contracts derive their product values largely from what?

Separate account performance

Endowment Policy

Shorter period like 65 years old

(Annuities) how the money goes into the annuities?

Single premium, Periodic premium

Coverage + Saving

Some guarantees and flexible premiums

Insurers selling variable contracts are subject to

State insurance regulation & federal securities regulation

Step RateIncreasing Premiums

Step Rate

The State Guaranty Association guarantees what?

That a claim will be paid if a insurer becomes insolvent

The period of time from a variable annuity's issue date until the start of payments is know as what?

The accumulation period

Buy-out Plans

The option to elect a lump-sum payment

The basis for many state statues regulating insurance advertising is the NAIC's

Unfair Trade Practices Act

Subscriber

User

Which of the following terms is used for a voluntary relinquishment of a known right?

Waiver

Speculative Risks

When theres a chance of loss or gain

Administrative action

Within 30 days after the final disposition of an administrative action

Variable and Universal variable life

You can borrow and withdrawal. Taking back what you put in is withdrawing or borrow but must put back. Will be charged interest for borrowing money

(Charities)

You can leave a charity as a beneficiary

(Business)

You can name a business as a beneficiary.

(Individuals)

You can name whoever for your beneficiary.

Variable Universal

You can skip payments and it won't matter

1035 Policy Exchange

You can transfer policies with it being tax free

Insurability Approval

Your not covered until the underwriter approves

Before variable annuity benefits can be paid out what must happen first?

account must be converted to annuity units