insurance exam

An insured has a major medical policy with a $500 deductible and 80/20 coinsurance. The insured is hospitalized and sustains a $2,500 bill. What is the maximum amount that the insured will have to pay?

$900

According to OBRA, what is the minimum number of employees required to constitute a large group?

100

The Pregnancy Discrimination Act specifically prohibits pregnancy discrimination by employers with the minimum of how many employees?

15

Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts?

Continuation provision

An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement?

Cost-containment

Any licensed person who violates a cease and desist order must forfeit and pay a maximum sum of

$10,000 for each violation.

In order to maintain coverage under COBRA, how soon from termination of employment must an employee exercise extension of benefits?

60 days

A hospital indemnity policy will pay

A benefit for each day the insured is in a hospital.

All of the following statements concerning workers compensation are correct EXCEPT

A worker receives benefits only if the work related injury was not his/her fault.

Which of the following is not true of Disability Buy-Sell coverage?

Benefits are considered taxable income to the business.

in the event of a divorce, which of the following would allow the divorcee to continue receiving group coverage under an insured spouse's plan for an additional 36 months?

COBRA

A man is injured while robbing a convenience store. How does his major medical policy handle the payment of his claim?

Claim is denied if his policy contains the Illegal Occupation provision.

An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe?

Conditional

Which of the following is considered a qualifying event under COBRA?

Divorce

As it pertains to group health insurance, COBRA stipulates that

Group coverage must be extended for terminated employees up to a certain period of time at the former employee's expense.

Which document is used to assess risk associated with an applicant's lifestyle and character?

Investigative Consumer Report

Which of the following insurance coverages would be allowed with an MSA?

Long-term care

Julie must have orthodontic work performed on her incisors. Which type of service would this be called, under a nonscheduled plan?

Major service

Which of the following is NOT a service providers plan?

Medicare

An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do?

Offer the supplement policy on a guaranteed issue basis

Prior to purchasing a Medigap policy, a person must be enrolled in which of the following?

Parts A and B of Medicare

A guaranteed renewable health insurance policy allows the

Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class.

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?

Presumptive disability

In respect to the consideration clause, which of the following is consideration on the part of the insurer?

Promising to pay in accordance with the contract terms

Which of the following answers does NOT describe the principal goal of a Preferred Provider Organization?

Provide medical services only from physicians in the network

All of the following are ways in which a Major Medical policy premium is determined EXCEPT

The average age of the group.

When must an insurer send a copy of the Notice to the Commissioner of the producer's termination to the producer?

Within 15 days of the notice

According to the Diagnostic and Statistical Manual of Mental Disorders (DSM) which of the following would NOT be considered a biologically-based mental disorder?

a physical handicap

An insured has been quoted an estimated cost for a procedure from their health carrier. This quote must include all of the following EXCEPT

an exact and final price of the procedure

Which of the following is considered to be a morale hazard?

driving recklessly

All of the following may be excluded from coverage in a Major Medical Expense policy, EXCEPT

emergency surgery

in health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost

is not covered

All of the following are examples of risk retention EXCEPT

premiums

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

rates by class

With respect to the Consideration Clause, which of the following would be considered consideration on the part of the applicant for insurance?

payment of premium

How do employer contributions to a Health Savings Account affect the insured's taxes?

The employer contributions are not included in the individual insured's taxable income.

A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim,

The insurance through his company is primary.

In order for an insured under Medicare Part A to receive benefits for care in a skilled nursing facility, which of the following conditions must be met?

The insured must have first been hospitalized for 3 consecutive days.

An insured wants to transfer his personal insurance policy to a friend. Under what conditions would this be possible?

The insured will need a written consent of the insurer.

Which of the following is an example of a producer's fiduciary duty?

The trust that a client places in the producer in regard to handling premiums.

What is the purpose of the Insurance Guaranty Association?

To protect policyowners against insurer insolvency

What is the purpose of COBRA?

To provide continuation of coverage for terminated employees

How can a new physician be added to the PPO's approved list?

Agree to follow the PPO standards and charge the appropriate fees.

Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability?

Residual disability

Within how many days must a carrier send an insured a written acknowledgement of the receipt of the insured's grievance?

15 days

MassHealth is a public health insurance program that is a combination of

SCHIP and Medicaid.

Which of the following may NOT be included in an insurance company's advertisement?

That its policies are covered by a state Guaranty Association

Occasional visits by which of the following medical professionals will NOT be covered under LTC's home health care?

attending physician

all of the following are true regarding Key Employee Disability Insurance except

benefits are taxable to the employer

Which of the following is NOT provided by an HMO?

Reimbursement

An insured who has an Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this policy?

The capital amount in a lump sum