Illinois Life and Health Final Exam

Family Rider

A client wants coverage for himself as well as coverage for his wife and children all under one policy at an affordable price. Which of the following would best meet the need?

The insured has a say in the form and amount of coverage available to plan participants

A consumer should know and realize all of the following prior to obtaining coverage under a group insurance policy, except:

NAIC

A generic brochure was developed by the ________ to assist prospective buyers of life insurance, which includes descriptions of all the basic types of life insurance and comparisons of their relative costs.

$250,000

A married couple purchases a $250,000 Joint Life Policy. When the older of the two dies, what is the amount payable to the survivor?

Buy a Joint Survivorship Life Policy

A married couple wants to have funds available so that the heirs to their estate have the funds necessary to pay the estate taxes. Which of the following would be the most economical and effective way to accomplish this?

Replacement

A new life policy is being purchased, and the producer knows that an existing contract through a different insurer will be lapsed. This is an example of:

Long-Term Care

A product designed to provide coverage for necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services provided in a setting other than an acute care unit of a hospital is called:

Warranty

A statement that a person makes and guarantees to be true is a:

Entity

A(n) _________ plan calls for the business to purchase life insurance policies on each of the business owners.

Medical Exam

After K completed an application for health insurance, a paramedical scheduled an appointment to check height, weight, blood pressure, and collect blood and urine samples. This is an example of which source of underwriting?

Alice's estate

Alice is the insured, Bill is the primary beneficiary, and Claire is the contingent beneficiary. Bill dies, then Claire dies, then Alice dies, so who receives the policy proceeds?

Subscribers do not pay a copayment

All are true of HMO subscribers, except:

Leaving it with a neighbor if they are not at home at their scheduled delivery appointment time

All of the following are acceptable methods of policy delivery, except:

Mutual Farm

All of the following are classes of insurance requiring a producer's license except:

Automatic premium Loan

All of the following are nonforfeiture values, except:

Cancelling a policy due to nonpayment of premium

All of the following are prohibited provisions in a long-term care policy, except:

Vitamins

All of the following are qualified medical expenses for Heath Savings Accounts, except:

The insured's health has changed for the worse

All of the following are reasons why a new policy issued through a term conversion costs more, except:

Stroke

All of the following causes of death are covered under an AD&D policy, except:

Monthly Limit

All of these are payment structure options, except:

102

An employer may require a former employee who has COBRA coverage to pay up to _____% of the premium.

Return of Premium

An insured dies within the time limit of an Increasing Term Rider and the beneficiary receives the face amount plus the value of all paid premiums. Which rider is attached to the policy?

Collateral Assignment

An insured goes to the bank for a business start-up loan. Asking for more security, the bank agrees to accept a(n) __________ on a permanent life insurance policy owned by the customer.

Paid up additions

An insured with a participating life insurance policy receives annual dividends. She has opted for the insurer to use these funds to increase her overall amount of insurance. This would refer to which option:

Admitted

An insurer authorized to do business within this state is considered what type of insurer?

Prior to accepting the applicant's initial premium

An insurer must provide a Buyer's Guide to all prospective purchasers:

Before or at time of policy delivery

An insurer must provide a Policy Summary:

Participating

Angela bought a policy from her friend, an insurance producer. After looking it over thoroughly, Angela only has one question. Will she receive dividends? She will if the policy is which of the following?

"First Dollar" Coverage

Basic Health Insurance plans do not have a deductible, so they are known as providing:

Liz the beneficiary determines which option she would like to have

Burt named Liz as his beneficiary; however, he did not choose a Settlement Option. At the time of his death, who determines the option to be used to receive the benefits?

Providing the necessary care

Case managers do all of the following, except:

Newborn Infant

Common exclusions in accident and health insurance policies include all of the following, except:

Misrepresentation

Creating the impression that a governmental agency guarantees the terms of a policy is an example of:

Stockholders

Dividends issued by Stock insurers are paid to:

Have the applicant initial the change or start over with a completely new application

During the application process, a mistake is made by the applicant in answering one of the health questions and needs to be corrected. What is the best way to go about this?

A person buying a policy on themselves

Examples of third-party ownership include all of the following, except:

Medical Expense insurance

H has an individual standalone vision plan, in addition to his health insurance. During an annual examination, it is discovered that H has cataracts. Which plan will cover the cost of the treatment for cataracts?

Excluding benefits for conditions caused by war or acts of war

Home Health Care benefits under a LTC Policy may be limited or excluded by:

30 Days

How long is the free look period for a Medicare Supplement policy?

24(with 3 hours in ethics)

How many credit hours of continuing education must a producer complete every renewal period?

Additional charges to offset lost interest, earnings, and increased administrative costs

If a client chooses to pay premiums other than annually, what can he or she expect?

Become extended term

If overdue premiums are not paid by the end of the grace period, a traditional whole life policy will automatically:

Unless specified otherwise, the cash values buy extended term

If the premiums are not paid on a Traditional Whole Life policy that has been in force for decades with no loan outstanding, what happens?

Accelerated Benefit (Living Need)

If, as the result of an injury or illness, the insured is deemed to be terminal (i.e., expected to die within 1 or 2 years), what rider added to a life insurance policy would advance a portion of the face value?

Until 3 years after the policy is no longer in force

Illustrations must be retained as follows:

6

In a Medicare Supplement replacement sale, if the original policy has been in force for less than ______ months, the replacing insurer shall waive any time periods applicable to preexisting conditions to the extent that they have already been satisfied under the original policy.

Viator

In a viatical settlement transaction, the life insurance policyowner is referred to as the _________.

3

In a whole life policy, cash value must be made available to borrow against after _____ years.

Late

Individuals who do not enroll during the initial enrollment period are considered ___________ enrollees.

Life Income

James is nearing retirement and has accumulated $175,000 in an annuity. He wants the largest possible monthly benefit for as long as he lives. Which option should he choose?

$20,000

K has a $100,000 traditional whole life policy with $30,000 of cash values and a $10,000 loan outstanding. What is the maximum additional amount she could borrow from the policy at this time?

Take out a policy Loan

K needs funds and needs to maintain the life insurance she has at the same time. Which of the following should K do with her traditional whole life policy?

Term

Life insurance protection for a specified period of time is provided by what type of policy?

Short-term policies

Long-Term Care policies may not be written as which of the following?

Low amount of premium

Medical exams are requested in all of the following situations, except:

Cash Surrender

Mona let her permanent policy lapse. She discovered there was $2,498 in cash value remaining in the policy and decided to pay off some of her credit card debt. She exercised which Nonforfeiture Option?

Insures

Optional uniform provisions found in health insurance policies are designed to protect the:

None

Raymond owns an Accidental Death and Dismemberment Policy with a principal sum of $50,000, and a capital sum of $25,000. After owning the policy for several months, Raymond dies as the result of coronary artery disease. Lynn, his beneficiary, can expect to receive what amount of benefit from the policy?

Owner

Similar to life insurance, this party has all of the rights in the annuity policy. This party is referred to as the:

Her PPO will pay a reduced amount with Sylvia paying the balance

Sylvia is a participant in a Preferred Provider Organization and finds that if she opts to use a provider outside the network:

Premium or rate calculations

The Insuring Clause under an individual A&H policy would contain all the following, except:

$1,200

The Jones family a $1,000 annual family deductible with a coinsurance provision of 80/20. The family's claims for the year are $200, $300, $400, $500, $300, and $300 totaling $2,000. The Jones family is responsible for paying:

Auto and homeowners

The MIB is used in the underwriting of all of the following types of insurance, except:

Every LTC policy must be issued as noncacellable

The Minimum Benefit Standards under a qualified LTC policy include all of the following, except:

MIB

The _________ alerts insurer home office underwriters of errors, omissions, or misrepresentations made on insurance applications.

The actual overall health of the group

The cost of the group life insurance plan is determined by all of the following except one is the least important of them all. Which one is that?

Life with period certain

Tom is the beneficiary and is concerned about both running out of money during his lifetime and at the same time leaving funds behind to the insurer. Looking for some time period guarantee, Tom should consider the _________ settlement option.

Insurer's home office underwriter

Ultimately, insurability of an applicant is determined by the

Long Term Care (LTC)

What health insurance product is designed to provide coverage for necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services provided in a setting other than an acute care unit of a hospital?

To discourage individuals from purchasing an insurance policy while contemplating suicide

What is the intent of the suicide clause?

Entire Contract

What provision describes the parts of the life insurance contract?

Harold had 31 days to convert his policy to an individual plan

When Harold became no longer eligible for coverage under his employer's group benefit program, which of the following statements accurately reflects the conversion privilege defined by his group contract?

The applicant is making an offer to the insurer

When an applicant completes the insurance application in its entirety and provides the producer with a premium check, what in effect has taken place?

When all premiums paid in have fully recovered

When are dividend payments received by a policyholder fully taxable?

Explain the policy fully

When producer Pete delivers a policy, he should also do which of the following?

$2,500

Which major medical plan deductible will result in the lowest premium?

A contract in which both parties must perform specified duties in order for the contract to remain enforceable

Which of the following best describes a Conditional Contract?

Subrated

Which of the following is NOT a common rating classification?

Failing to inform a claimant about appealing arbitration awards

Which of the following is NOT an unfair claims practice?

concurrent review

Which of the following is a Managed Care Provision used by insurers to monitor hospital stays?

As long as there is sufficient cash value to cover policy expenses when due, the insured is not required to pay the planned premium

Which of the following is a true characteristic of a Variable Universal Life policy?

Condition eligibility for recuperative benefits on prior institutionalization

Which of the following is not a prohibited provision regarding Long-Term Care?

The policyowner

Which of the following is responsible for paying the premiums due on a life insurance policy?

Monthly

Which of the following is the most expensive premium mode overall?

It typically does not cover the cost to replace frames or lenses that are lost or broken

Which of the following is true regarding Vision insurance?

Deductibles for preventive care

Which of the following limitations is not included in most dental expense insurance plans?

A Buyer's Guide

Which of the following must be supplied to an applicant whose policy is being replaced?

Single Premium Whole Life

Which of the following policies would be deemed a MEC?

The insured is also the policyowner and at death no beneficiaries are alive

Which of the following scenarios will cause the value of a life insurance policy death benefit to be included in the insured's estate?

Any advertisement of annuities and variable life contracts directed toward a person age 65 or older must disclose that an insurer or insurance producer may contact the applicant

Which of the following statements is correct regarding advertising requirements?

A Medicare supplement policy may not deny coverage for preexisting conditions for more than 12 months after the effective date of coverage

Which of the following statements is false regarding required provisions for Medicare supplement policies?

Insuring Clause

Which of the following states the obligation of the insurer and the risk that is considered in a life insurance policy?

Legal Actions

Which provision is a Mandatory Uniform Provision?

Mandatory Second Surgical Opinion is when the physician submits claim information prior to treatment, to determine in advance if the procedure is covered

Which statement is false?

HMOs must provide basic health care services including physical therapy, vision and dental care

Which statement is incorrect regarding HMOs?

Contributory plans require 100% employee participation

Which statement would be considered inaccurate regarding the underwriting of a group plan?

Average age of both insureds

With Joint Life Insurance policies, the premium is based on the:

Short-Term medical

X retired 6 months before becoming eligible for Medicare. To fill in the gap of coverage during the interim before enrolling in Medicare, X can purchase which of the following limited policies to cover medical expenses?

comprehensive

_______________ Major Medical insurance coverage combines the features of the Basic Medical Expense policies and a Major Medical policy into a single policy and includes reimbursement for covered expenses on a 'usual, customary, and reasonable' basis.