Life and Health

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What is a risk retention group?

An insurance organization that most often addresses a commercial casualty concern

If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered

An unfair trade practice.

The death protection component of Universal Life Insurance is always

Annually Renewable Term

All of the following can be insurers EXCEPT

Bankers.

Regarding the return of premium option for LTC policies, what happens to the premium if the policy lapses?

The insurer will return a percentage of the premiums paid.

Medicare Part B covers dental expense resulting

accident only

higher stop loss

lower premiums

The two types of assignments are

Absolute and collateral.

When must the Medicare Supplement Buyer's Guide be presented?

At the time of application

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 requirements of eligibility for Social Security disability income benefits EXCEPT

Being age 65.

What happens when a policy is surrendered for its cash value?

Coverage ends and the policy cannot be reinstated

Variable life insurance producer must register w

FINRA

What does "level" refer to in level term insurance?

Face amount

All of the following are factors that an underwriter could use to select and classify risk EXCEPT

National origin.

Jordan purchased a "core policy" (Plan A) to supplement his Medicare coverage. Following a stay in the hospital, Jordan found that her supplemental coverage paid for all of the following EXCEPT

Part A deductible.

Which type of dental treatment addresses the supporting tissue of teeth?

Periodontics

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

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

The date of medical exam (later than application)

Hospital indemnity/hospital confinement indemnity policy will provide payment based on

The number of days confined in a hospital.

Catastrophic plans

low prem., high deductible

Another name for medicare advantage plan

medicare select

bridgework is

prosthodontics dental care

Accumulation at interest is

retained by the company and taxable whether the policy receives it or not

HIPPA portability covers

self-employed, pregnant women, mentally ill

HMO pays w/

services not reimbursement

two major causes of loss (or perils) covered under a health insurance policy

sickness and accident

When a life insurance policy stipulates that the beneficiary will receive payments in specified installments or for a specified number of years, what provision prevents the beneficiary from changing or borrowing from the planned installments?

spendthrift provision

medicaid sponsored by

state and fed

Not a policy replacement

term conversion to whole

An employee will be taxed on the cost of group life insurance paid by the employer if the amount of coverage exceeds

$50,000

An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?

$50,000

An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would she be receiving benefits under an "own occupation" disability plan?

2 years

would authorize the commingling of premiums with the agent's personal funds?

A letter of consent from the principal

For what time period can coverage be excluded on permissible pre-existing conditions applicable to a Medicare supplement insurance policy?

A policy not purchased during the open enrollment period and which does not replace an existing Medicare supplement policy, can exclude coverage on permissible pre-existing conditions for a period of up to 6 months.

Rider that pays income during 6-month waiting period before SS benefits

Additional Monthly Benefit

A Universal Life Insurance policy is best described as a/an

Annually Renewable Term policy with a cash value account.

Which of the following is NOT true of Section 1035 Policy Exchanges?

Any exchange made under Section 1035 of the Internal Revenue Code must be completed within 30 days.

In disability income insurance, if an insured is considered disabled if they cannot perform any job they are suited for by prior education, training or experience, they fall under which definition of total disability?

Any occupation

When an insurer offers services like preadmission testing, second opinions regarding surgery, and preventative care, which term would best apply?

Case management provision

What is an important feature of a dental expense insurance plan that is NOT typically found in a medical expense insurance plan?

Diagnostic and preventive care

Which of the following terms is used to name the nontaxed return of unused premiums?

Dividend

The provision which states that both the policy and a copy of the application form the contract between the policyowner and the insurer is called the

Entire contract.

Which of the following statements is true regarding LTC insurance?

Every policy must offer nonforfeiture benefits to the applicant.

A man wants to buy a life insurance policy in which he can count on guaranteed minimum benefits. Which type should he buy?

Fixed

In disability income insurance, the own occupation definition of disability applies

For the first 2 years of a disability.

Which of the following health care plans would most likely provide the insured/subscriber with comprehensive health care coverage?

HMO

Issue age policy premiums increase in response to which of the following factors?

Increased benefits

The premium is guaranteed for an initial period and then the insurer can charge up to a maximum premium charge in what type of policy?

Indeterminate Premium

Which of the following entities must approve all Medicare supplement advertisements?

Insurance Commissioner or Director

Provided by skilled medical personnel to those who need occasional medical assistance or rehabilitative care

Intermediate Care

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

Which of the following is true regarding health insurance?

It could provide payments for loss of income.

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

Which of the following are responsible for making premium payments in an HMO plan?

Subscribers

Which is NOT true about beneficiary designations?

The beneficiary must have insurable interest in the insured.

A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then

The benefit is received tax free.

The policyowner of an adjustable life policy wants to increase the death benefit. Which of the following statements is correct regarding this change?

The death benefit can be increased by providing evidence of insurability.

The market value adjustment in modified guaranteed annuities refers to which of the following?

The difference between the contracted interest rate and the rate at surrender

When would a 20-pay whole life policy endow?

When the insured reaches age 100

who determines if particular group can be excluded from group health coverage

employer

Whole life surrendered for forfeiture value automatic option

extended term

A new employee who meets HIPAA eligibility requirements must be issued health coverage on what basis?

guaranteed

Reduce coinsurance on major medical insurance insured can expect

higher monthly prem

Survivorship life based on _______ and has _______ prem. compared to joint life

joint age; lower

Insured in business disability insurance

key employees

rider provides payment of part of DB if terminal illness

living needs

On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of

misrepresentation

PPACA health care tax credit excludes

people with public coverage such as Medicaid

Not renew optionally renewable on

premium due dates

Business overhead expense insurance taxation

premiums are tax-deductible and benefits are taxable

The restitution may not exceed

the amount of the actual economic damage, subject to the policy limits.

Which of the following is NOT a feature of a noncancellable policy?

the insurer may terminate the contract only at renewal for certain conditions.

An annuitant dies before the effective date of a purchased annuity. Assuming that the annuitant's wife is the beneficiary, what will occur?

the interest will continue to accumulate tax deferred.

considered a nonmedical insurance application?

the medical information is completed by the applicant and the agent only

For how many days of skilled nursing facility care will Medicare pay benefits?

100

Eligible for tax credits under ACA

100-400% FPL

In order to collect Social Security disability benefits, the claimant must be able to demonstrate that the disability will last at least

12 months.

A temporary agent's license is valid for what time period?

15 months

Max penalty for violating fair credit reporting act

$2,500

Which of the following long-term care benefits would provide coverage for care for functionally impaired adults on a less than 24-hour basis?

Adult day care

Which of the following long-term care benefits would provide coverage for care for functionally impaired adults on a less than 24-hour basis?

Adult day care (need help with ADLs but not around clock)

In reference to the standard Medicare Supplement benefits plans, what does the term standard mean?

All providers will have the same coverage options and conditions for each plan.

When must an IRA be completely distributed when a beneficiary is not named?

December 31 of the year that contains the fifth anniversary of the owner's death.

Which of the following is NOT a cost-saving service in a medical plan?

Denial of coverage

goal of the HMO

Early detection through regular checkups

What are the two components of a universal policy?

Insurance and cash account

General enrollment Medicare part B

Jan 1 to March 31

A married couple's retirement annuity pays them $250 per month. The husband dies and his wife continues to receive $125.50 per month for as long as she lives. When the wife dies, payments stop. What settlement option did they select?

Joint and survivor

NOT covered under Plan A in Medigap insurance?

Medicare Part A deductible

All of the following are examples of risk retention EXCEPT

Premiums.

An underwriter may reject an application for health insurance if the rejection is based upon which of the following?

Prescription usage

Which of the following statements is an accurate comparison between private and government insurers?

Private insurers may be authorized to transact insurance by state insurance departments.

Traditional IRA contributions are

Tax deductible.

What type of insurance can be obtained through SGLI by members of the armed forces?

Term group life insurance

Your client has a Social Insurance Supplement (SIS) rider on his disability policy. After he becomes disabled, he receives payments from the company. Shortly thereafter, he also begins receiving Social Security benefit payments. Which of the following will happen?

The SIS payment will be reduced dollar-for-dollar by the Social Security benefit payment.

What happens if a non-member physician is utilized under the Point-Of-Service plan?

The attending physician will be paid a fee for service, but the member patient will have to pay a higher coinsurance amount.

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

The average age of the group.

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true?

The group plan will not pay because the employee was injured at work.

All of the following would be factors in rating a health insurance policy EXCEPT

The nationality of the applicant.

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

Universal Life - Option A

Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?

Warranty

Purpose of surrender charge in deferred annuity

compensate company for loss of investment value

managed care plan

comprehensive case management, preventive care, controlled access providers; NOT risk retention

Beneficiary and insured

does not need insurable interest

What type of whole life insurance policy has premiums that are adjusted so that during the first years of the policy, the premiums are lower than those of a straight whole life policy, and in subsequent years the premiums are higher than those of a straight whole life policy?

modified life

The premium is guaranteed for an initial period and then the insurer can charge up to a maximum premium charge in what type of policy?

ndeterminate Premium

Attempting to determine how much insurance an individual would require based upon their financial objectives is known as

needs approach

Reduction of prem. uses dividend to reduce

next years prem

Which of the following is true regarding a term health policy?

nonrenewable.

If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered

unfair trade practice

replacement policy free-look

20 days

written notice of claim must be submitted to insurer within

20 days

Under a nonscheduled plan, what portion of the balance could an insured expect to pay for basic services?

20%

Max age for catastrophic plan

30

Free look for LTC

30 days

Licensees inform commissioner of name/address change within

30 days

representative must submit an appropriate application to the Commissioner and the Commissioner will, within _____________ issue a temporary license or reject the application

30 days

Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?

30 months

COBRA covers employees and their dependents for

36 months

For how many years is an insurer required to maintain a complete file of its advertisements?

4 years

What is the elimination period for Social Security disability benefits?

5 months

The minimum number of credits required for partially insured status for Social Security disability benefits is

6 credits during last 13-quarter period

producer's license can be reinstated retroactively it is has been expired

60 days

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 (doesn't cover curative measures)

What is franchise insurance?

It is health coverage for small groups whose numbers are too small to qualify for true group insurance

An insurer invests the money it receives from premiums paid by its insureds. Which of the following is TRUE regarding the interest earned on these investments?

It is used to lower premiums.

Which of the following is NOT true regarding the Life with Guaranteed Minimum annuity settlement option?

It provides a higher monthly benefit than a pure life annuity.

Which renewability provision allows an insurer to terminate a policy for any reason, and to increase the premiums for any class of insureds?

Optionally renewable (insurer can also increase premium for any class)

A rider attached to a life insurance policy that provides coverage on the insured's family members is called the

Other-insured rider.

A participating insurance policy may do which of the following? and based on what

Pay dividends to the policyowner based upon actual mortality cost, interest earned and costs

Which of the following will be included in a policy summary?

Premium amounts, surrender values, DB

Regarding the taxation of Business Overhead policies,

Premiums are deductible and benefits are taxed.

Which of the following is TRUE regarding a policy issued to a labor union insuring members of the organization for the benefit of persons other than the union or organization?

The members eligible for insurance under the policy must be all the members of the union or organization. b) The premiums for the policy must be paid either from funds of the union, or from funds contributed by the insured members specifically for their insurance, or from both. c) An insurer may exclude or limit the coverage on any person who provides unsatisfactory evidence of insurability to the insurer.

What is the advantage of reinstating a policy instead of applying for a new one?

The original age is used for premium determination (need proof of insurability)

What is the waiting period on a Waiver of Premium rider in life insurance policies?

6 months

Employees in a health benefit plan for a small employer may have to pay deductibles and cost-sharing for pre-existing conditions for what period of time?

6 months after becoming eligible for coverage

How long is an open enrollment period for Medicare supplement policies?

6 months

LI can be backdated to affect lower premium for up to

6 months

If a licensee intentionally violates the Insurance Code, what is the maximum monetary penalty that he or she would be required to pay?

$100,000

Which of the following Life Insurance policies would be considered interest sensitive?

) Universal life

Legal amount of time between completing authorization form and disclosure of information

1 year

Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to

10 years, if jeopardizes insurer up to 15 years

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

100

LTC CE hours

2 hours

Following hospitalization because of an accident, Bill was confined in a skilled nursing facility. Medicare will pay full benefits in this facility for how many days?

20

Existing insurers must provide policyowners with a policy summary for the existing life insurance how soon after receiving the written communication and replacement?

20 days

Treatment in a skilled nursing facility is covered in full for

20 days

How many year(s) after furnishing proof of loss does the insured have to take legal actions against the insurer?

3

Notify consumer in writing of investigative consumer report within

3 days

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?

3 days

An insurance producer is required to notify the Commissioner of any felony convictions within how many days of the conviction?

30 days

Inform commissioner of name/address change within

30 days

Full time employee

30 hours per week

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

Currently/partially insured under Social Security if

6 credits/quarters of coverage during previous 13 quarters

must submit proof of loss within

90 days

The term "illustration" in a life insurance policy refers to

A presentation of nonguaranteed elements of a policy.

Most health insurance policies exclude all of the following EXCEPT

Accidental injury.

If an annuitant dies during the accumulation period, what benefit (if any) will be included in the annuitant's estate?

Accumulated cash value

At what point must an Outline of Coverage be delivered?

At the time of application or upon delivery of the policy

A dental plan that provides coverage based upon a specified maximum scheduled amount for each procedure and pays on a 'first dollar' basis with no deductible or coinsurance is a

Basic or scheduled plan.

A man is still employed at age 65 and is now eligible for Medicare. He wants to know what health insurance coverage he is eligible to receive. Which of the following options are available to him?

Both group health and Medicare

After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true?

By law, the new, individual policy must provide the same benefits as the group insurance policy.

When a policyowner designates a group of individuals as the beneficiary of a life insurance death benefit without specifically naming the individuals, this is called

Class designation.

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/renewal provision

If a beneficiary wants a guarantee that benefits paid from principal and interest would be paid for a period of 10 years before being exhausted, what settlement option should the beneficiary select?

Fixed period

An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits?

Full benefits

Which of the following is another name for a primary care physician in an HMO?

Gatekeeper

Which of the following policies is characterized by a provision where the premiums are lower in the early years of the policy and increase over time to a point where they become level for the remainder of the policy?

Graded premium whole life

If a life policy allows the policyowner to make periodic additions to the face amount at standard rates, without proving insurability, the policy includes a

Guaranteed insurability rider.

What is the benefit of choosing extended term as a nonforfeiture option?

It has the highest amount of insurance protection.

Which of the following is true about the premium on the children's rider in a life insurance policy?

It remains the same no matter how many children are added to the policy.

A health insurance plan which involves financing, managing, and delivery of health care services and involves a group of providers who share in the financial risk of the plan or who have an incentive to deliver cost effective service, is called

Managed care plan.

medicare policy requires insureds to use specific healthcare providers and hospitals (restricted network provisions)

Medicare SELECT

On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of

Misrepresentation.

What type of whole life insurance policy has premiums that are adjusted so that during the first years of the policy, the premiums are lower than those of a straight whole life policy, and in subsequent years the premiums are higher than those of a straight whole life policy?

Modified life

Which of the following is NOT true regarding the needs approach method of determining the value of an individual's life?

Need is predicted using the number of years until the insured's retirement.

Attempting to determine how much insurance an individual would require based upon their financial objectives is known as

Needs approach.

After a brief emergency room visit, an insured discovered that his plan required a larger copayment for an out-of-network provider than for a local, in-network provider. Under the PPACA provisions, this is

Not permitted.

When is the open enrollment period through Maryland Health Connection?

November 1 through January 31

Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured?

Option B

An insured purchased an individual life insurance policy with a face amount of $15,000. He pays a premium each month. What type of policy is that?

Ordinary life

Which document helps ensure that full and fair disclosure is provided to the recipient of a policy?

Outline of Coverage

Medicare Part A services do NOT include which of the following?

Outpatient Hospital Treatment

Jordan purchased a "core policy" (Plan A) to supplement his Medicare coverage. Following a stay in the hospital, Jordan found that her supplemental coverage paid for all of the following EXCEPT

Part A deductible

Which of the following applies to partial disability benefits?

Payment is limited to a certain period of time.

When health care insurers negotiate contracts with health care providers or physicians to provide health care services for subscribers at a favorable cost, it is called

Preferred Provider Organization (PPO).

Another name for a substandard risk classification is

Rated.

Which of the following insurance options would be considered a risk-sharing arrangement?

Reciprocal

An insured committed suicide one year after his life insurance policy was issued. The insurer will

Refund the premiums paid.

What method do insurers use to protect themselves against catastrophic losses?

Reinsurance

When an employee is still employed upon reaching age 65 and eligibility for Medicare, which of the following is the employee's option?

Remain on the group health insurance plan and defer eligibility for Medicare until retirement

A policyowner who is also the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of ownership. The policyowner should have her husband named as the

Revocable beneficiary.

Roger has insurance coverage through his company. Who owns the policy?

Roger's employer

If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a

Settlement option.

When a life insurance policy stipulates that the beneficiary will receive payments in specified installments or for a specified number of years, what provision prevents the beneficiary from changing or borrowing from the planned installments?

Spendthrift provision

An applicant buys a nonqualified annuity, but dies before the starting date. For which of the following beneficiaries would the contract's interest NOT be taxable?

Spouse

Which state has jurisdiction over a group policy that covers individuals that reside in more than one state?

The state in which the policy was delivered

When the breadwinner that is insured by a Family Policy dies, what rights are provided to other family members that are covered under the policy?

They can convert their coverage to permanent life insurance without evidence of insurability.

Which of the following is NOT a goal of risk retention?

To minimize the insured's level of liability in the event of loss

Who has the legal title of the property in a trust?

Trustee

Medicare Part B covers dental expense resulting from

accident only

Doctor accepts Medicare approved amount

assignment

Restoring insured financially

indemnity

List of losses covered by insurer

insuring clause

General disability policies do not cover losses caused by

war, military service, intentionally self-inflicted injuries, overseas residence, or injuries suffered while committing or attempting to commit a felony.

If a policyowner transfers or gives away a life insurance policy _______________ prior to his/her death, the entire face amount of the policy will be included in his or her taxable estate.

within 3 years


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