Insurance Exam

# 133. Who maintains responsibility for claims made in an advertisement on behalf of an insurance company ? a ) The insurer b ) The producer c ) The Department of Insurance

A

# 26 . If a consumer requests additional information concerning an investigative consumer report , how long does the insurer or reporting agency have to comply ? a ) 5 days b ) 7 days c ) 10 days d ) 3 days

A

# 44 . What is the purpose of a conditional receipt ? a ) It is intended to provide coverage on a date prior to the policy issue . b ) It guarantees that a policy will be issued in the amount applied for . c ) It serves as proof that the applicant has been determined insurable . d ) It is given only to applicants who fully prepay the premium .

A

# 54. Untrue statements on the application unintentionally made by insureds that , if discovered , would alter the underwriting decision of the insurance company , are called a ) Material misrepresentations . b ) Fraudulent statements . c ) Warranties . d ) Common errors .

A

# 62. Certain conditions , such as dismemberment or total and permanent blindness , will automatically qualify the insured for full disability benefits . Which disability policy provision does this describe ? ( a ) Presumptive disability b ) Dismemberment disability c ) Partial disability d ) Residual disability

A

# 86 . Which of the following is a short - term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated ? a ) Annuity certain b ) Fixed annuity c ) Refund life d ) Variable anquity

A

# 108. How long is the free look period on a Medicare supplement policy ? a ) 20 days b ) 30 days c ) 10 days d ) 15 days

B

# 118 . A temporary producer license could be issued , without examination , to all of the following EXCEPT a ) The employee of a disabled licensed producer . b ) The spouse of a retiring insurance producer . c ) The spouse or legal representative of a deceased insurance producer . d ) The designee of a license insurance producer who enters active duty in the U.S. Armed forces .

B

# 122. During replacement of life insurance , a replacing insurer must do which of the following ? a ) Send a copy of the Notice Regarding Replacement to the Department of Insurance b ) Obtain a list of all life insurance policies that will be replaced ( c ) Guarantee a replacement for each existing policy d ) Designate a new producer for a replaced policy .

B

# 134. Who is required to keep and maintain a register of appointed producers ? a ) The Department of Insurance b ) Insurers ( c ) The National Association of Insurance Commissioners ( NAIC ) d ) Producers

B

# 139. How often must a health carrier provide a certificate of compliance to the Department of Insurance indicating that the carrier has established grievance procedures for each of its health benefit plans ? a ) Twice a year b ) Once a year c ) Once every 3 years . d ) Once every 5 years

B

# 141. An insured pays a monthly premium of $ 100 for a health insurance policy . What would be the duration of the grace period under the policy ? a ) 7 days b ) 10 days c ) 31 days d ) 60 days

B

# 151 . All of the following are true regarding rebates EXCEPT a ) Dividends are not considered to be rebates . b ) Rebates are allowed if it is in the best interest of the client . c ) Rebates are only allowed if specifically stated in the policy . d ) Rebating can be anything of monetary value given as an inducement to purchase insurance .

B

# 153 . What must contain a notice of the graded death benefit in a life insurance policy with graded death benefits ? a ) The policy's exclusions section b ) The policy application c ) The policy underwriting explanation d ) The policy's provisions section

B

# 18. Which nonforfeiture option provides coverage for the longest period of time ? a ) Accumulated at interest . b ) Reduced paid - up c ) Extended term d ) Paid - up option

B

# 20 . Which of the following describes taxation of individual disability income insurance premiums and benefits ? a ) Premiums are tax deductible , and benefits are taxable . b ) Premiums are not tax deductible , and benefits are not taxable c ) Premiums are not tax deductible , but benefits are taxable . d ) Premiums are tax deductible , but benefits are not taxable .

B

# 40. All of the following statements about equity index annuities are correct EXCEPT a ) They invest on are aggressive basis aiming for higher returns . b ) The annuitant receives a fixed amount of return , c ) They have a guaranteed minimum interest rate . d ) The interest rate is tied to an index such as the Standard & Poor's 500 ,

B

# 53. The term " fixed " in a fixed annuity refers to all of the following EXCEPT a ) Amount and length of payments b ) Death benefit c ) Guaranteed rate of interest d ) Equal annuity payments

B

# 64 . The Federal Fair Credit Reporting Act a ) Prevents money laundering . b ) Regulates consumer reports . c ) Protects customer privacy . d ) Regulates telemarketing .

B

# 79. On a participating insurance policy issued by a mutual insurance company , dividends paid to policyholders are a ) Guaranteed . b ) Not taxable since the IRS treats them as a return of a portion of the premium paid c ) Paid at a fixed rate every year . d ) Taxable as ordinary income .

B

# 88 . Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner ? a ) Proof of Loss b ) Payment of Claims c ) Change of beneficiary d ) Entire Contract Clause

B

# 114. How long must an insurer retain an advertisement for its long - term care policies ? a ) 1 year b ) 2 years c ) 3 years d ) 5 years

C

# 115 . No insurance policy form can be issued , delivered , or used in this state unless it has been a ) Developed by the Director . b ) Filed with and approved by the Guaranty Association c ) Approved by the Department of Insurance , d ) Reviewed by the Department and approved by the Governor .

C

# 127 . Which of the following provisions in universal life policies stipulates that a written notice of the termination of coverage must be sent to the policyowner ? a ) Illustrations b ) Periodic disclosure c ) Grace period and lapse d ) Policy guarantees

C

# 130. All individual health policies issued in the state of Missouri which provide coverage for hospital treatment must also provide coverage for treatment of alcoholism , which may be limited to how many days ? a ) 180 b ) There is no limit for the treatment of chemical dependency c ) 30 d ) 60

C

# 137. If a policyholder declines the nonforfeiture benefit , what must the insurer provide to the client upon the lapse of the policy ? a ) A full refund of premiums b ) Pro Rata premiums c ) A contingent benefit d ) An aleatory benefit

C

# 143 . In Missouri , it is illegal to receive a commission from the sale of insurance UNLESS a ) The insured gives written consent allowing the commission to be split . b ) The payor and payee both hold valid insurance producer licenses . c ) The payee holds a valid insurance producer license d ) The payor holds a valid insurance producer license .

C

# 152. What is the maximum policy loan interest rate in Missouri ? a ) 15 % b ) 59 % ( c ) 8 % d ) 10 %

C

# 16. Which of the following is true regarding taxation of dividends in participating policies ? a ) Dividends are taxable in some life insurance policies and nontaxable in others . b ) Dividends are considered income for tax purposes . c ) Dividends are not taxable . d ) Dividends are taxable only after a certain amount is accumulated annually .

C

# 19 . A deductible is a ) An insurer's obligation to the service provider . b ) A nominal fee for the use of an insurer's services . c ) A specified dollar amount that the insured must pay first before the insurance company will pay the policy benefits . d ) A percentage of the medical bill the insured must pay before services will be rendered .

C

# 35. When Linda suffered a broken hip , she notified her agent , in writing , within 12 days of the loss . However , her agent did not notify the insurance company until 60 days after the loss . Which of the following statements correctly explains how this claim would be handled ? a ) The insurer may settle this claim for less than it otherwise would have had the notification been provided in a timely manner . b ) The insurer may deny the claim since it was not notified within the required 20 - day time frame . c ) The insurer is considered to be notified since the notification to agent equals notification to the insurer . d ) The insurer may delay the payment of this claim for up to 6 months .

C

# 39. Which of the following named beneficiaries would NOT be able to receive the death benefit directly from the insurer in the event of the insureds ' death ? a ) The wife of the deceased insured b ) The former wife of the deceased insured c ) A minor son of the insured d ) A business partner of the insured

C

# 65 . An employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized . What is this called ? a ) Tax - sheltered account plan b ) HR 10 plan c ) Profit sharing plan d ) 401 ( k ) plan

C

# 73 . All of the following statements are true regarding installments for a fixed amount EXCEPT a ) This option pays a specific amount until the funds are exhausted . b ) The annuitant may select how big the payments will be . c ) The payments will stop when the annuitant dies , d ) Value of the account and future earnings will determine the time period for the benefits .

C

# 90. Which of the following is NOT true of a major - medical health insurance policy ? a ) The benefits are subject to deductibles . b ) It is designed to cover hospital and medical expenses of a catastrophic nature . c ) It is designed to pay on a first dollar of expense basis . d ) It usually has a maximum benefit amount .

C

# 101 Which of the following is a feature of a disability buyout plan ? a ) Tax deductible premiums b ) Taxable benefits c ) A short elimination period d ) A lump - sum benefit payment option

D

# 106 . According to the Fair Credit Reporting Act , all of the following would be considered negative information about a consumer EXCEPT a ) Tax delinquencies . b ) Late payments . c ) Failure to pay off a loan . d ) Disputes regarding consumer report information .

D

# 125 . What is the purpose of the insurability provision in group life policies issued in this state ? a ) To automatically renew coverage for a new policy term b ) To require the insurer to provide certificates of insurance to individual insured c ) To guarantee insurability for all eligible applicants d ) To allow the insurer to require proof of insurability from individual insured

D

# 135. When twin brothers applied for life insurance from Company A , the company found that while neither of them smoked and both had a very similar lifestyle , one of the twins was in a much stronger financial position than the other . Because of this , the company charged him a higher rate for his insurance . This practice is considered a ) Twisting . b ) Controlled business . c ) Adverse selection . d ) Discrimination .

D

# 155. An insurance producer license contains all of the following information EXCEPT a ) Issuance date and expiration date of the license . b ) Name and address of the licensee . c ) Producer identification number . d ) Name of the insurer ( s ) represented by the licensee .

D

# 25 . Under the mandatory uniform provision Notice of Claim , the first notice of injury or sickness covered under an accident and health policy must contain a ) A statement from the insured's employer showing that the insured was unable to work . b ) An estimate of the total amount of medical and hospital expense for the loss . c ) A complete physician's statement . d ) A statement that is sufficiently clear to identify the insured and the nature of the claim .

D

# 30. A policy will pay the death benefit if the insured dies during the 20 - year premium - paying period , and nothing if death occurs after the 20 - year period . What type of policy is this ? a ) Term to specified age b ) Ordinary life policy c ) Limited pay whole life d ) Level term

D

# 48 . The term " illustration " in a life insurance policy refers to a ) A depiction of policy benefits and guarantees . b ) Pictures accompanying a policy . c ) Charts and graphs . d ) A presentation of nonguaranteed elements of a policy

D

# 51. What is a penalty tax for nonqualified distributions from a health savings account ? a ) 8 % b ) 10 % c ) 12 % d ) 20 %

D

# 63. If a person is disabled at age 27 and meets Social Security's definition of total disability , how many work credits must he / she have earned to receive benefits ? a ) 20 credits b ) 6 credits c ) 40 credits d ) 12 credits

D

# 72 . Which of the following is NOT true regarding Equity Indexed Annuities ? a ) The insurance company keeps a percentage of the returns . b ) They have guaranteed minimum interest rates . c ) They are less risky than variable annuities . d ) They earn lower interest rates than fixed annuities .

D

# 82 . In the event a policy lapses due to nonpayment of premium , within how many days would the policy be automatically reinstated once the outstanding premium is paid ? a ) 10 days b ) 25 days c ) 30 days d ) 45 days

D

#1 Regarding Medicare Select Policies what are restricted network provisions. A.) They determine who can be insured B.) They determine Premium rates C.) They help avoid adverse Selection D.) They condition the payment of benifits

D

#11 A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as a ) Major medical . b ) AD & D . c ) Medical expense . d ) Critical illness .

D