Life and health insurance

What is true about nonforfeiture values?

They are required by state law to be included in the policy

What is true regarding taxation of accelerated benefits under a life insurance policy?

They are tax-free to terminally ill insured

What is a true statement about Social Security?

To be eligible, one must meet certain requirements

In a replacement situation, all of the following must be considered except

Assets

Which of the following is incorrect regarding a $100,000.20 year level term policy?

At the end of 20 years, the policy's cash value will equal $100,000.

At what point must an outline of coverage be delivered?

At the time of application or upon delivery of the policy

What is not a true statement about Medicare part B

It is a compulsory program

What is not true regarding a non-qualified retirement plan?

It needs IRS approval

All other factors being equal what would the premium be like in a survivorship life policy as compared to the premium in a joint life policy?

Lower

And insured has had a life insurance policy that he purchased three years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old and not 43 as stated on the application. What will the company do?

Hey a reduced death benefit

Wow a claim is painting, and insurance company may require

An independent examination as often as reasonably required

Which health insurance provision describes the insureds right to cancel coverage?

Renewal provision

All of the following statements about equity index annuities are correct except

The annuitant receives a fixed amount of return

Which of the following policy components contains the companies promised to pay?

Insuring clause

What is another name for Social Security benefits?

Old-age, survivors, and disability insurance

All of the following in today's regulate variable life policies except?

The guaranty association

How long does the initial enrollment period for Medicare part B last?

7 months

A Medicare supplement plan must have at least which of the following renewal provisions?

Guaranteed renewable

Medicaid does not provide what benefit

Income assistance or work related injury

What date must be contained in a policy summary?

The date the summary was prepared

The Florida health insurance coverage continuation act requires insurers that sell health plans to small employers to offer in those plan a right to elect to continue coverage, without providing evidence of a insurability, to employees who lose their coverage and are unable to replace it. The premium rate for this coverage may not exceed what percentage

115% of the regular group rate

If a person is disabled at age 27 and meet Social Security's definition of total disability, how many work credits must he/ she have earned to receive benefits?

12 credits because she is older than 24 and younger than 31

What is the required number of participants in a contributory group plan?

75%

Most policies will pay the accident death benefits as long as the debt is caused by the accident and occurs within how many days?

90 days

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within how many days of a loss?

90 days of a loss

What beneficiary would not be able to receive the death benefit directly from the insurer in the event of the insured's death?

A minor

What is true regarding the agents appointments?

A person may hold several appointments at one time

What persons is required to hold a producer license?

A person who negotiates entrance contracts

Which of the following documents delivered to the policy owner include information about premium amounts, cash values, surrender values and death benefits for specific policy years?

A policy summary

If an insurance company makes a statement that it's policies are guaranteed by the existence of the insurance guaranty Association that would be considered

An unfair trade practices

What is another term for the general enrollment period for Medicare part B?

Annual enrollment period

What is not true regarding a $100,000 20-year level term policy?

At the end of 20 years the policy's cash value will equal $100,000

What document describes an insured's medical history, including diagnosis and treatment?

Attending physician statement

And insured pays an annual premium to his insurer. In return, the insurer promises to pay benefits in accordance with the terms of the contract. This is called what?

Consideration

All of the following statements concerning dividends are true except

Dividend amounts are guaranteed in the policy

Adam stipulated in the contract that the insurer will not provide coverage for our found in the

Exclusions clause

And insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurers classification in Wyoming?

Foreign

The automatic premium loan provision is activated at the end of the

Grace period

Which of the following is not a type of whole life insurance?

Increasing term

What statement regarding HIV testing for insurance purposes is not true?

Insurers are barred from requesting a job the testing

All of the following are nonforfeiture options except

Interest only

A guaranteed renewable disability insurance policy

Is renewable at the insureds option to a specified age

Which of the following is not true regarding the accumulation period Of an annuity?

It would not occur in a deferred annuity

Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred and starting the business. What top of Ensurance would be the most affordable and still provide a death benefit should one of them die?

Joint life

What is the other term for the cash payment settlement option?

Lump sum

To sign up for Medicare prescription drug plan, individuals must first be enrolled in

Medicare part

Which of the following statements is correct about Medicare?

Medicare will cover nursing home care if it is part of the treatment for a covert illness

What universal life option has a gradually increasing cash value and a level death benefit?

Option A

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

Outline of coverage

What is another term for the accumulation period Of an annuity?

Pay-in period

What rider would not cause the death benefit to increase?

Payor benefit rider

Medicare part D provides what?

Prescription drug benefit

Which nonforfeiture option provides coverage for the longest period of time?

Reduced paid up

What determines the length of time that benefits will be received under the fixed amount settlement option?

Size of each installment

What would help prevent a universal life policy from lapsing?

Target premium

The interest earned on policy dividends is

Taxable

Which of the following information will be stated in the consideration clause of a life insurance policy?

The amount of premium payment

Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to who

The insured

Which of the following entities is responsible for agent licensing and administrative supervision?

The office of insurance regulation

If an insured continually uses the automatic premium loan option to pay the policy premium what will happen

The policy will terminate when the cash value is reduced to nothing.

What is true regarding the premium in term policies?

The premium in any type of term policy is level

Which of the following is true regarding the premium in term policies?

The premium in any type of term policy is level.

Which of the following is true regarding optional benefits with long-term care policies?

They are available for an additional premium

What is the purpose of a fixed period Settlement option?

To provide a guaranteed income for certain amount of time

Agents who persuaded insureds to cancel policy in favor of another one when it might not be to the insured's best interest or guilty of what

Twisting

When an HMO knowingly makes a miss leading representation, incomplete or fraudulent comparisons for the purpose of Indu seen any person to lapse, forfeit, terminate, surrender or convert any insurance policy or contract with another insurance company or HMO, they are in violation of the unfair trade practices of

Twisting

According to the rights of renewability rider for cancelable policies all of the following are correct about the cancellation of an individual insurance policy except

Unearned premium's are retained by the insurance company

And insured and his wife are both involved in a head on collision. The husband dies instantly, and the wife does 15 days later. The company pays the death benefit to the estate of the insured. This indicates that the life insurance policy had what provision?

Common disaster

What is true about the cash surrender nonforfeiture option?

Funds exceeding the premium paid or taxable as ordinary income

K purchased a $90,000 annuity with a single premium and began receiving payments two months after that. What type of annuity is it?

Immediate annuity

And insured buys a five-year level premium term policy with the face amount of $10,000. The policy also contains renewability and convertibility options. When the insurer renew the policy in five years what will happen to the premium?

It will increase because the insured will be five years older than when the policy was originally purchased

The ownership provision and toddles the policy owner to do all of the following except

Set premium rates

An insured has endured multiple surgeries and hospitalizations for an illness during the summer months. Her insurer no longer bills her for medical expenses. What term best describes the condition she has met?

Stop loss limit

What is not true regarding the accumulation at interest option

The interest credited under this option is not taxable since it remains inside the insurance policy

When would a 20-pay whole life policy endow?

When the insured reaches age 100.

Which of the following allows the insure to relieve a minor insured from premium payments if the minors parents have died or become disabled?

Payor benefit

What is the name of a clause that is included in a policy that limits or eliminates the death benefit if the insured dies as a result of war or while serving in the military?

Military service or war

The primary requirement in order to receive Medicaid benefits is based upon

Need

What is untrue concerning Medicaid?

That it is so federally administered program

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?

The balance of the loan will be taken out of the death benefit

The annuity owner dies while they annuity is still in the accumulation stage which of the following is true?

The beneficiary will receive the greater of the money paid into the annuity or the cash value.

What is the policy component that contains the companies promise to pay?

The insuring clause

All of the following are true statements regarding the accumulation at interest option except

The interest credited under this option is not taxable since it remains inside the insurance policy

All of the following are characteristics of a universal life policy except

The plan premium pays for mortality charges and expenses and any excess is returned to the policy owner

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

What type of care is not covered by Medicare?

Long term care

An employee quits her job or she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a traditional IRA how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer?

$10,000, no tax consequence

Cobra applies to employers with at least how many employees?

20 employees

How long must an insurer retain an advertisement for its long-term care policies?

3 years

Once the person meets the stringent requirements for disability benefits under Social Security, how long is the waiting period before any benefits will be paid?

5 months

Regulations for annuity recommendations would apply when a consumer is at least what age?

65 years old

In which Medicare supplemental policies are the core benefits found?

All plans

What product will protect an individual from outliving his or her money?

An annuity

All of the following information about a customer must be used in determining annuity suitability except

Beneficiaries age

Which of the following best describes a fixed -period Settlement option?

Both the principal and interest will be liquidated over a selected period Of time

What best describes fixed period settlement option?

Both the principal and interest will be liquidated over select period of time

And insured receives an annual life insurance dividend check. What term best describes this arrangement?

Cash option

What does liquidity referred to in a life insurance policy?

Cash values can be bought at any time

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

When I policy is surrendered for its cash value,

Coverage ends and the policy cannot be reinstated

An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that he can afford at this time, he wants to be sure that the additional coverage will be available in the future. What options should be included in the policy?

Guaranteed insurability option. This will allow the insured to purchase specific amounts of additional insurance at specific times without proving insurability

Shortly after replacement transaction on a Medicare supplement policy the insured decided to cancel the policy, but is unsure whether or not the free look provision applies. The insured could find the information and the

Notice regarding replacement

Sarah becomes disabled at age 22 and can no longer work. She meets the definition of total disability under social security. What other requirement must Sarah have met to receive Social Security disability benefits?

Sarah must have accumulated 6 work credits in the past three years

What is not a factor in determining qualifications for Social Security disability benefits?

Workers occupation

What feature of the indexed whole life policy is not fixed

cash value growth

What is not an example of third-party ownership of a life insurance policy?

And insured borrows money from the bank and makes a collateral assignment of a part of the death benefit to secure the loan

In comparison to a policy that uses the accidental means definition a policy that uses the accidental bodily injury definition would provide a coverage that is

Broader in general

An individual borrowed money at the bank to send his daughter to college. Instead of purchasing credit walked in Sherance, he used an existing life insurance policy to secure the debt this would be called what?

Collateral assignment

Under a 20 pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid for how long

For 20 years or until death, whichever occurs first. I

What phase begins after a new policy is delivered?

Free look period

You did not enroll in Medicare part B when you first became eligible. Which of the following would allow you another opportunity to enroll?

General enrollment period

Every insurer marketing long-term care insurance must establish marketing procedures to ensure all of the following except

LTC policies are marketed effectively to perspective insureds

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

What are the three basic types of coverage that are available based on how the face amount changes during the policy term?

Increasing, decreasing and level

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

It has the highest amount of insurance protection

What life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed period, during which, if the original recipient dies, The payments will continue to a designated beneficiary?

Life income with period Certain

Your client wants both protection and savings from the insurance and is willing to pay premiums until retirement at age 65. What would be the best policy for this client?

Limited pay Whole Life

How many pints of blood will be paid for by Medicare supplement Core benefits?

First 3 pints

According to the entire contract provision, what document must be made part of the insurance policy?

A copy of the original application

Both universal life and variable universal life have a what kind of premium?

A flexible premium

All of the following are true regarding a decreasing term policy except

The payable premium amount steadily declined throughout the duration of the contract

An underwriter must review an applicant with an extensive medical history. Which document would get the underwriter a better understanding of how the insured was treated for various illnesses?

An attending physicians statement

And insured has Medicare part D coverage. He has reached his initial benefit limit I must now pay 50% of his prescription drug cost. What is the term for this gap in coverage?

Donut hole

The policy, in combination with the application, is doing together into one entity called the what

Entire contract

The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the

Incontestability clause

What is true about a policy assignment?

It transfers rights of ownership from the owner to another person

And insured buy's a five-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renew the policy in five years what will happen to the premium?

It will increase because the insured will be five years older when the policy was originally purchased.

If a settlement option is not chosen by the beneficiary or policy owner which option will be used?

Lump sum

Underwriting is a major consideration when an insured wishes to replace her current policy for all of the following reasons except

Premiums always stay the same

The sole beneficiary airy of a life insurance policy dies before the insured if the policy owner fails to change the beneficiary airy before the insured's death the proceeds of the policy will go to

The insured's estate

What entity can legally bind coverage?

The insurer

And insured pays $1,200 annually for her life insurance premium. The insured applies this years $300 worth of accumulated dividends to the next years premium thus reducing it to $900. What option does this describe?

Reduction of premium

A life insurance policy does not have a war clause. If the insured is killed during a time of war, what will the beneficiary receive from the policy?

The full death benefit

What statement is not true regarding qualifications for Social Security disability benefits?

The individual must be at least 65 years old

The insured had his wife named as the beneficiary of his life insurance policy to ensure that his wife had income for life after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking into account all of the following except

The insured's age at Death

Hospice care is intended for what

The terminally ill

What is not true about the required provisions of a health insurance policy

A reinstated policy provides immediate coverage for an illness

The free look provision allows what?

A right to return the policy for a full premium refund

When a reduced paid up nonforfeiture option is chosen, what happens to the face amount of the policy?

It is reduced to the amount of what the cash value would buy as a single premium

A universal life insurance policy is best described as

And annually renewable term policy with a cash value account

What Must an agent receive in order to sell variable life insurance policies?

FINRA registration

What are the two components of a universal policy?

Insurance and cash account

What is true regarding the annuity period?

It may last for the lifetime of the annuitant.

What is not true about beneficiary designations?

The beneficiary must have a insurable interest in the insured.

Hey man is in Road in part a Medicare and not part B. Three months into coverage, he applies for a Medicare supplement policy. Which of the following is true?

The insurer can deny coverage

What is not a feature of guaranteed renewable provision

The insurer can increase the policy premium on individual basis

Which of the following will bury the length of the grace period in health insurance policies?

The mode of premium payment

Which of the following explains the policy owners right to change beneficiaries, choose options, and receive proceeds of a policy? It's

The owners rights

What is NOT TRUE regarding a decreasing term policy?

The payable premium amount steadily declined throughout the duration of the contract.