Life and Health Missed Questions
A long-term care policy can exclude from coverage all of the following, except: A Alzheimer's disease B Rest cures C Hospitalization (acute care) D Intentionally self-inflicted injuries
A Alzheimer's disease Alzheimer's disease cannot be excluded from long-term care coverage.
Proof of loss is required within _____ days of loss. A 60 B 90 C 180 D 45
B 90 The Proof of Loss Provision (a Mandatory Uniform Provision) stipulates that the insured must generally provide proof of the loss within 90 days of the loss, or within the shortest time possible, but not exceeding 1 year unless the insured suffers legal incapacity.
K owns a variable annuity with an assumed interest rate of 4%. If the actual performance of the separate account(s) is 4%, the effect on this month's income benefit check will be such that it: A Becomes Higher B Remain the Same C Becomes Lower D All Depends on the Separate Account(s) Selected
B Remain the Same If the actual return is lower than the AIR, the monthly annuity payment will be reduced. If the actual return is equal to the AIR, the monthly annuity payment will remain the same as the previous month. If the actual return is greater than the AIR, the monthly annuity payment will increase from the previous month.
The HMO provider is paid a set fee per enrollee, known as a: A Provider fee B Service fee C Capitation fee D Enrollee fee
C Capitation fee Typically, the HMO provider is paid a set fee, known as a capitation fee, per enrollee.
Beth has a contract stating she must be disabled for 3 months before benefits will begin to be paid. This 3-month period is known as the: A Contingency Period B Grace Period C Elimination Period D Probationary Period
C Elimination Period The Elimination Period is a period of time that must elapse after onset of a disability before benefits begin to be paid.
Which provision is an Optional Uniform Provision? A Claim Forms B Physical Examination C Payment of Claims D Relation of Earnings to Insurance
D Relation of Earnings to Insurance Relation of Earnings to Insurance is an Optional Uniform Provision. The other choices are Mandatory Uniform Provisions.
Social Security pays an eligible surviving spouse (or minor child) a one-time benefit upon the death of a covered worker. Which of the following is the amount of that benefit? A $255 B $355 C $250 D $350
A $255. A one-time benefit of $255 is paid to a surviving spouse or child if he/she is eligible for Social Security benefits.
A viatical settlement contract must provide the viator with an unconditional right to rescind the contract for at least: A 15 days after the receipt of the viatical settlement proceeds or 30 days after the contract is executed B 10 days after the receipt of the viatical settlement proceeds or 30 days after the contract is executed C 5 days after the receipt of the viatical settlement proceeds or execution of the contract D 30 days after the receipt of the viatical settlement proceeds or 15 days after the contract is executed
A 15 days after the receipt of the viatical settlement proceeds or 30 days after the contract is executed A viatical settlement contract must provide the viator with an unconditional right to rescind the contract for at least 15 days after the receipt of the viatical settlement proceeds or 30 days after the contract is executed.
In a viatical settlement, a third party purchases a policy from a terminally ill insured for approximately _____ to _____% of the policy's face amount. A 60/80 B 40/60 C 50/70 D 30/50
A 60/80 The viatical settlement provider purchases the policy at 60 to 80% of the face amount, expecting to profit as the new policyowner at the time of claim.
Social Security uses which of the following definitions to determine total disability? A Any substantial gainful activity B Loss of income C Own occupation D Any occupation
A Any substantial gainful activity Under Social Security, total disability means an individual must be unable to engage in any substantial gainful activity due to a medical condition.
Insurers include provisions in contracts to help reduce unnecessary claims and the overpayment of claims. Which of the following is not one of those provisions? A Consideration Clause B Mandatory Second Surgical Option C Concurrent Review D Emergency Services
A Consideration Clause The other choices are Managed Care Provisions designed to contain costs. The Consideration Clause stipulates that the payment of the first premium and the statements in the application are the applicant's consideration, and the insurer's consideration is the promise to pay within the contract terms.
Which provision of group health plans is used to determine primary and secondary coverage when an insured is covered by more than one insurance plan? A Coordination of Benefits B Schedule of Benefits C Extension of Benefits D Primary Care Coverage
A Coordination of Benefits The Coordination of Benefits provision describes how primary and secondary coverage will be determined when an insured is covered by more than one group policy.
Upon receipt of all of the necessary information, the home office underwriters can issue the coverage applied for in all of the following ways, except: A Declined B Substandard C Preferred D Standard
A Declined Declined means that the policy would not be issued. The other choices indicate an acceptable risk at different pricing based on insurability.
Which annuity product offers interest rates linked to the positive performance of the S&P 500? A Equity-indexed annuity B Variable annuity C Variable Universal Life D Indexed Universal Life
A Equity-indexed annuity An equity-indexed annuity offers interest rates that are linked to the positive performance of a stock market-related (equity) index, typically Standard & Poor's 500 Index.
Alice finds she no longer is able to pay premiums on her $50,000 Whole Life Policy, but needs that amount of protection for her family. Which Nonforfeiture Option provides this protection? A Extended Term B Reduced Paid-Up C Paid-Up Option D Fixed Amount
A Extended Term Extended Term would allow the present cash value of the policy to buy a single premium term policy of the same face amount for the time period stated in the policy's nonforfeiture table. Fixed Amount is a Settlement Option, and Paid-Up Option is a Dividend Option.
A(n) ________ report is a general report of the applicant's finances, character, morals, work, hobbies, and other habits. A Inspection B Agent's C Attending physician's D Motor vehicle
A Inspection An Inspection Report is a general report of the applicant's finances, character, morals, work, hobbies, and other habits.
The annuity settlement option that pays out the highest monthly income for as long as the annuitant lives, and leaves no residual value upon the annuitant's death, is the: A Life Income Option B Joint Life Option C Life Income Joint and Survivor Option D Life Income with Refund Option
A Life Income Option The annuity Life Income Option (like the Life Income Settlement Option in life insurance) pays a benefit for as long as the annuitant lives, and upon death, all payments cease. It also provides the highest monthly income, all other factors being equal.
J purchased a policy that includes a carryover provision, common accident and family deductible. J owns a _______________ policy. A Major Medical B Basic Hospital C Basic Medical D Group Disability
A Major Medical The provisions listed in the question are those typically included in a Major Medical Policy.
Which of the following correctly describes the practice of Twisting? A Misleading and convincing an insured to surrender, lapse or exchange an existing policy for a different one, to the insured's detriment B Offering anything of value to a client that is not already a part of the policy, as an incentive to purchase insurance C Representing to the applicant that a specific coverage or product is required by law in conjunction with the purchase of insurance when such coverage or product is not required D Entering into any agreement to commit an act of boycott, coercion, or intimidation resulting in an unreasonable restraint of the business of insurance
A Misleading and convincing an insured to surrender, lapse or exchange an existing policy for a different one, to the insured's detriment Misrepresentation with the purpose of inducing a person to lapse, cease, or forfeit an existing policy is known as twisting.
All of the following are true regarding a nonresident license except: A Nonresident licenses are not issued in Indiana B A person residing in another state may be licensed as a nonresident producer if the person's home state issues nonresident producer licenses to Indiana residents on a reciprocal basis C A person residing in another state must be in good standing in addition to being currently licensed in his/her home state D A person residing in another state may be licensed as a nonresident producer if the person is currently licensed in his/her home state
A Nonresident licenses are not issued in Indiana Nonresident licenses are issued in Indiana subject to the requirements set forth.
The following are an example of boycott, coercion, or intimidation except: A Offering a premium discount or credit that is not specified in the policy B Coercing a debtor into getting requisite insurance through a particular agent C Requiring a mortgager to pay a handling charge on a policy required to secure a loan D Unreasonably disapproving a policy that provides requisite coverage
A Offering a premium discount or credit that is not specified in the policy Offering a premium discount or credit not specified in the policy constitutes rebating and not boycott, coercion or intimidation; Items b, c and d are correct examples of boycott, coercion or intimidation.
Which of the following is the best definition of a Limited Accident Policy? A Provides specific benefits for specific injuries from specific causes B All answers are correct C Limited in geographical scope (i.e. only in the state where written) D Only covers for a limited time after the acciden
A Provides specific benefits for specific injuries from specific causes A Limited Accident Policy restricts benefits to those injuries and causes of loss named in the policy. For example, a person injured in a car accident, must be a passenger in/on a 'common carrier' not a private passenger vehicle.
Which type of LTC coverage is designed to provide relief for the primary caregiver of a long-term care patient? A Respite Care B Hospice Care C Home Health Care D Adult Day Care
A Respite Care Respite care gives a primary caregiver the opportunity to rest from his/her care responsibilities to the insured.
All of the following are risks to the life settlement purchaser, except: A The insured dies sooner than expected B The insurer will not honor the claim based on lack of insurable interest C The third party runs out of funds to pay on-going premiums D The insurer becomes insolvent
A The insured dies sooner than expected If the insured dies sooner than expected then the purchaser will achieve a greater return than they had planned on.
Which of the following policies allow for a partial withdrawal or partial surrender? A Universal Life B Current Assumption Life C Variable Whole Life D Traditional Whole Life
A Universal Life A partial withdrawal of cash value is permitted in a Universal or a Variable Universal Life policy.
Which of the following annuities would potentially be the most negatively impacted by the overall stock market falling in value? A Variable B Fixed C Indexed D Guaranteed
A Variable In order to achieve the goal of wealth accumulation while offsetting the effects of inflation, most if not all of a Variable Annuity separate account investments are based off the stock market. None of the other annuities would lose value if the stock market 'crashed'.
An insured purchases a 20-Pay Life Policy with a face amount of $25,000 and an annual premium of $1,000. The insured dies 15 years later when the cash value is $5,000. What amount will the beneficiary receive? A $15,000 B $25,000 C $20,000 D $30,000
B $25,000 If death occurs at any point prior to age 100, the beneficiary receives the death benefit of $25,000.
An insured should receive necessary claim forms within _____ days after notice of claim. A 20 B 15 C 5 D 10
B 15 According to the Claim Forms Provision (a Mandatory Uniform Provision), the insured should receive the necessary claim forms within 15 days after notice of claim.
In a legal sense, premium functions as the insured's _______. A Fee B Consideration C Credit D Tender
B Consideration The premium paid by the insured represents their consideration--a required element of a legal contract.
A Disability Income Policy has a period of deductibility immediately following a disability during which time benefits are not payable. This period is called a(n): A Loss of Time B Elimination Period C Probationary Period D Loss of Income
B Elimination Period A policy may state 6 months elimination period for sickness and immediate coverage or as little as 7 days in case of an accident. Although waiting period means the same thing, elimination period is the most correct term.
An insured has a $175,000 permanent life insurance policy and is having difficulty keeping up with the premium payments. Which Nonforfeiture Option would allow him to forego the premiums and retain the same face amount until the cash surrender value is exhausted? A Reduced Paid-Up B Extended Term C Cash Surrender D Premium Reduction
B Extended Term Cash Surrender is a Nonforfeiture Option that terminates the policy. Extended Term continues the same coverage until the cash value from which the premium is paid is exhausted.
The nonforfeiture option that provides coverage for the shortest duration is: A Reduced Paid-Up B Extended Term C Automatic Premium Loan D Convertible Term
B Extended Term Extended Term provides the most amount of coverage for the least amount of time. Reduced Paid-Up provides the least amount of coverage for the longest period of time. Convertible Term and Automatic Premium Loan are not nonforfeiture options.
Which of the following provisions commence at the time of the delivery of the policy to the insured? A Insuring Clause B Free Look Period C Misstatement of Age or Gender D Suicide Clause
B Free Look Period The insured/owner has the right to examine the policy for 10 days (this may vary by state) after receipt of delivery. If returned within that period, a full refund of premium is granted. It is the insurer's responsibility to prove date of receipt.
Own occupation is the: A Presumption an individual is disabled due to the loss of sight, hearing, speak, or the loss of 2 limbs B Inability to perform all duties of one's own occupation C Inability to perform all duties of any occupation for which one is qualified based upon education, training, and experience D Inability to perform one or more duties of one's occupation
B Inability to perform all duties of one's own occupation Own Occupation requires the insured's inability to perform the main duties of one's own occupation.
Which provision is a Mandatory Uniform Provision? A Misstatement of Age B Legal Actions C Change of Occupation D Illegal Occupation
B Legal Actions The only response that is a Mandatory Uniform Provision is Legal Actions. All of the other responses are Optional Uniform Provisions.
This type of policy covers various expenses that an insured may incur due to a routine accident or sickness. A Disability income B Medical expense C Dental expense D Long-term care
B Medical expense A Medical Expense contract covers the various expenses which an insured may incur due to an accident or sickness.
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? A Individual vision plan B Medical expense insurance C Cataract treatment is not covered and must be paid out-of- pocket D The medical expense plan will pay out first and the vision plan will pay the balance
B Medical expense insurance Medical expenses incurred from disease or injuries to the eye, such as cataracts, are excluded from coverage under this policy but are covered under medical expense insurance.
When buying a $25,000 life insurance policy on his daughter, a father wanted to make sure the premium would be paid, even if he became disabled, so he also purchased a: A Long-term Care Rider B Payor Rider C Waiver of Premium D Waiver of Cost of Insurance
B Payor Rider The payor rider is a special rider that pay the premiums on a minor's policy if the adult who owns the policy dies or becomes disabled while the insured is still a minor. Do not confuse it with the Waiver of Premium, which pays if the insured becomes disabled.
Normally, when the insurer determines that the insured is an acceptable risk, the insurer will send the policy to the ____________. A Insured B Producer C Beneficiary D Policyowner
B Producer Normally, the insurer will mail the issued policy to the producer for delivery so that if any outstanding premium is due, it can be collected, if a statement of good health is required, it can be obtained, and any questions the applicant has about the policy can be answered.
All of the following are modes of premium payment for health insurance, except: A Monthly B Single pay C Annually D Quarterly
B Single pay Single pay is not considered a mode of premium payment for health insurance.
If a client is unsure about whether or not he/she can obtain coverage or how much it would cost, what can the producer suggest to see what the insurer can do without tying up any of the client's funds? A Submit a whole life application B Submit a trial application C Issue a binding receipt D Submit a term life application
B Submit a trial application A trial application is one submitted without a premium. The policy would not take effect until the policy is issued by the insurer, delivered by the agent, and the premium is paid. It is used when insurability and pricing are in doubt.
The interest earned on dividends is: A Tax-deductible B Taxable C Nontaxable D Tax-deferred
B Taxable The dividends themselves are generally not taxable, but any interest earned on the dividends is taxable.
The Initial Enrollment Period for Medicare is 7 months in length. Which of the following are the start and stop dates for this period? A The 1st day of the month before the individual turns age 65 and the last day of the 5th month after the month the individual turns age 65 B The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65 C 7 months after his/her 65th birthday D January 1 to July 31 in the year of his/her 65th birthday
B The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65 The initial enrollment window spans the entire 3 months before and after the month in which a person turns age 65.
One characteristic of life insurance is that the insurer is obligated to pay a claim in the event of the death of the insured, however, the insured is not contractually obligated to do anything other than keep the policy in force. This is a: A Conditional Contract B Unilateral Contract C Aleatory Contract D Contract of Adhesion
B Unilateral Contract In a Unilateral Contract, only one party is legally bound to contractual obligations after the premium is paid.
Accident and Health policies provide coverages for all, except: A Accidental death and dismemberment B Workers' Compensation claims C Medical expenses D Dental expenses
B Workers' Compensation claims Workers' Compensation is a form of casualty insurance contract, and can only be written with a Property/Casualty license. It is not a disability policy written by Accident and Health insurers.
C has a $100,000 traditional whole life insurance policy with a $30,000 cash surrender value. What is the maximum loan C can obtain from the insurer using the policy as collateral for the loan? A $130,000 B $70,000 C $30,000 D $100,000
C $30,000 The policy can be used as collateral for a loan from the insurance company, but the loan amount is limited to the amount of cash value in the policy.
Gary participates in a group long-term care insurance program through his employer. The employer pays for a standard level of coverage for all employees, and Gary pays for an additional voluntary amount of coverage. In all, Gary's employer pays two thirds of the cost and Gary pays the remaining one third of the cost. If Gary makes a claim under this policy, what percentage of his benefits would be taxable based on the premium structure? A 33% B 100% C 0% D 67%
C 0% This is a long-term care insurance plan, not disability insurance. The tax-status of benefits does not depend on who pays the premium.
Which of the following term life insurance policies would have the highest 1st-year annual premium, all other factors being equal? A 5-year B 1-year C 15-year D 10-year
C 15-year The 15-year term life insurance policy would have the highest first-year premium of the choices provided. In essence, there is a slight overcharge in the early years, to be able to level out the premium for the balance of the years.
An insurer is prohibited from contesting any claim on a life insurance policy after the annual premiums have been paid for: A 1 year B 3 years C 2 years D 5 years
C 2 years An insurer is prohibited from contesting any claim on the policy after the annual premiums have been paid for 2 years.
The waiting period from the start of a disability to be eligible to apply for Social Security disability is: A 3 months B 6 months C 5 months D 12 months
C 5 months The waiting period to apply for Social Security is 5 full months from the start of a qualified disability.
Which of the following is a typical benefit period for a group short-term disability benefit? A 5 years B 2 years C 52 weeks D To age 65
C 52 weeks Short-Term Disability Income plans are characterized by maximum benefits for periods of rather short duration, such as 13, 26, or 52 weeks.
How much of a cash value policy loan will an insurer normally grant with a variable type policy? A 50-75% B 80-90% C 75-90% D 100%
C 75-90% Policy loans are available from either the general account or the separate account. Typically 75-90% of the cash value can be borrowed against.
What are the two types of life insurance assignments? A Entire amount and percentage amount B Complete and partial C Absolute and collateral D Revocable and irrevocable
C Absolute and collateral The two types of assignment are Collateral (temporary), and Absolute (permanent).
Which of the following is a true characteristic of a Variable Universal Life policy? A The insurer bears all risks in accumulating cash value B The policy requires only a life license to sell C As long as there is sufficient cash value to cover policy expenses when due, the insured is not required to pay the planned premium D The policy has a fixed premium schedule
C As long as there is sufficient cash value to cover policy expenses when due, the insured is not required to pay the planned premium A characteristic of universal life insurance is that there is no requirement to pay any premium other than the first. As long as there is sufficient cash value to pay policy expenses (cost of insurance, riders, and other fees) when due, the policy remains in force.
Which of the following is NOT an example of a prohibited practice? A Rebating B DEfamation C Backdating D Twisting
C Backdating Backdating the age of an insured by no more than 6 months to save age is not an example of a prohibited practice.
Which of the following are incorrect regarding provisions for life policies? A The free look period on individual life insurance policies is 10 days B The policy must provide interest payments on claims not paid within 30 days C For permanent policies, the policy must begin to accrue cash values after the first premium payment D The policy may be backdated up to 6 months to conserve age
C For permanent policies, the policy must begin to accrue cash values after the first premium payment For permanent policies, the policy must begin to accrue cash values by the third policy year.
Which of the following documents used for underwriting can be completed by talking to the proposed insured over the phone? A APS B Agent's report C Inspection report D MIB
C Inspection report The inspection report can be filled out during a conversation with the applicant/insured over the phone. The inspection report consists of an interview with the applicant to confirm and elaborate information submitted on the application. The APS, MIB, and Agent's report are all completed by third parties.
The Commissioner may revoke, suspend, or refuse to renew a license for all the following except: A Mishandling funds B Being in arrears in paying child support C Issued insufficient coverage to a customer through apparent authority D Cheated on an insurance examination
C Issued insufficient coverage to a customer through apparent authority If a licensee issues insufficient coverage to an individual through apparent authority, this is not grounds for license suspension, non-renewal or revocation.
All of the following are TRUE about the Automatic Premium Loan (APL) Provision, except: A It becomes effective, if elected, at the end of the grace period B It can be cancelled at any time by the policyowner C It is available on any type of life insurance policy D It must be elected by the policyowner
C It is available on any type of life insurance policy The Automatic Premium Loan Provision is available on cash value policies only.
Which of the following best describes a Statement of Good Health? A It is the producer's authority to raise the rate if the insured does not appear to be in good health at the time of policy delivery B It is what comes along with the policy at the time of delivery confirming the underwriting class the insured falls into if the policy was issued standard or better C It verifies that the insured has not suffered a serious illness or injury requiring surgery or hospitalization since the application date D It is a sworn oral statement made by the insured at time of delivery which allows for coverage to come into effect
C It verifies that the insured has not suffered a serious illness or injury requiring surgery or hospitalization since the application date Generally, this is used when the policy was issued with an outstanding premium requirement to assure the issuer that the health status of the insured has not significantly changed since the time of application.
Which provision is an Optional Uniform Provision? A Claim Forms B Physical Examination C Misstatement of Age D Payment of Claims
C Misstatement of Age Misstatement of Age is an Optional Uniform Provision. All of the other answers are Mandatory Uniform Provisions.
Coordination of Benefits is a provision designed to reduce ________ when an insured is covered under multiple health plans. A Continuation of coverage B Excess coverage C Overinsurance D Extension of benefits
C Overinsurance Overinsurance means having more than 100% of a claim paid. This could happen if a person were covered by more than one health plan.
Which of the following best describes the general tax rules regarding individual disability health insurance plans? A Premiums are deductible, the benefits are taxable B Premiums are not deductible, the benefits are not taxable C Premiums are deductible, the benefits are not taxable D Premiums are not deductible, the benefits are taxable
C Premiums are deductible, the benefits are not taxable While there are some exceptions to the general rule, premiums paid for individual disability health insurance plans are generally not deductible, and the benefits are not income taxable.
Which of the following is NOT an unfair claims practice? A Requiring an insured to sue by offering less than the amount due B Misrepresenting pertinent policy facts or provisions to claimants C Promptly acknowledging communications pertinent to a claim. D Failing to attempt, in good faith, to promptly, fairly, and equitably settle a claim in which the insurer's liability has become reasonably clear
C Promptly acknowledging communications pertinent to a claim. Promptly acknowledging communications pertinent to a claim is required with respect to claim practices.
A $100,000 policy with a waiver of premium rider and $30,000 of cash value is in force. The base policy costs $750 and the rider is $50. What is the total premium annually the policyowner must pay to keep the policy in force? A $750 B $50 C $700 D $800
D $800 Riders such as the waiver of premium are a provided benefit for an additional cost, therefore the annual premium would be $800 ($750 + $50).
Wayne incurs a $2,000 medical bill. If his health policy has a $1,000 deductible and an 80/20 coinsurance percentage, how much will the insurer pay? A $1,000 B $1,200 C $1,800 D $800
D $800 Wayne will first have to pay his deductible of $1,000. Then, Wayne will pay 20% of the remaining $1,000 and the insurer will pay 80%, or $800.
Notice of claim is required within _____ days of loss. A 90 B 10 C 15 D 20
D 20 Under the Notice of Claim Provision (a Mandatory Uniform Provision), the insured is required to notify the insurer, in writing, within 20 days of any loss.
Generally, an individual is eligible to enroll in Medicare at age: A 62 B 67 C 59 1/2 D 65
D 65 Medicare is available to individuals at age 65 as a general rule.
A Social Security retirement benefit recipient will receive the greatest benefit starting at which of the following ages? A 62 B 63 1/2 C 60 D 65
D 65 The earlier retirement benefits are requested and received, the smaller they are.
Until yesterday, J. J. worked for his father's company and was covered by the company's large group health plan. He stopped working to go to college. He is 26 years of age and wants to keep the same coverage until he earns his degree in approximately 24 months. Which of the following statements is true? A J.J. can obtain coverage under COBRA, but it won't be the same coverage he had under his father's group plan B As a student, J.J. is still covered under his father's group plan C J.J.'s only option is to buy a personal plan of coverage D A good option for J.J. is to exercise the COBRA option under his father's group plan
D A good option for J.J. is to exercise the COBRA option under his father's group plan Since J.J has lost his dependent status, but still wants the same group coverage, he can continue that coverage under COBRA for up to 36 months.
Which of the following statements is NOT correct regarding insurable interest? A An employee consents to be insured if the employee is provided written notice of the insurance coverage and does not object to the insurance within 30 days of receiving the notice B The trustee of a trust established by an employer has an insurable interest in the life of the employee for whom benefits are to be provided C An employer has an insurable interest in the life of the employee for whom benefits are to be provided D An employer may acquire insurance on an employee in whom the employer has an insurable interest without the consent of such employee
D An employer may acquire insurance on an employee in whom the employer has an insurable interest without the consent of such employee An employer must have the consent of an employee to acquire insurance on such employee.
If an individual starts receiving Social Security retirement benefits at age 62, when are they eligible for Part A benefits? A 24 months after receiving Social Security retirement benefits B Age 62 C An individual is not eligible for Part A if they receive Social Security retirement benefits D Automatically at age 65
D Automatically at age 65 Regardless of when an individual starts receiving Social Security retirement benefits, they cannot be eligible for Part A until age 65 unless they have been receiving Social Security disability (not retirement) benefits for 24 months.
The policy loan amount cannot exceed the ____________. A The face amount of the policy B The loan balance C The cumulative premiums paid D Available cash surrender value
D Available cash surrender value The policy loan amount cannot exceed the available cash surrender value.
Which type of policy determines benefits based on a relative value scale? A Hospital indemnity B Major medical C Dental expense D Basic surgical expense
D Basic surgical expense Basic surgical expense plans determine benefits based on either a surgical schedule or a relative value scale, which assigns a value to a procedure with the highest level of difficulty and benefits for all other covered procedures are based on a percentage.
Hank was in the hospital last month for 2 days for which he received a check for $200. This month Hank was in the hospital for 5 days for which he received a check for $500. These checks are most likely: A Refunds from his doctor B Refunds of premium C Payments from Medicare D Benefit payments from a Hospital Income or Indemnity Policy
D Benefit payments from a Hospital Income or Indemnity Policy A Hospital Income or Indemnity Policy pays a specified dollar amount per day of hospitalization directly to the insured.
Which of the following plans could generate a taxable event to the recipient? A Key person disability income B Disability buy-sell C Medical expense policy owned by a sole proprietor D Business overhead expense
D Business overhead expense Since the premiums are deductible, the benefit is taxable.
Which of the following limitations is not included in most dental expense insurance plans? A Coverage only for the least expensive treatment B Deductibles for restorative care C Coinsurance D Deductibles for preventive care
D Deductibles for preventive care Dental expense plans typically waive deductibles for preventive care.
Edward applies for a disability insurance policy. He pays the initial premium at the time of application and receives a conditional receipt. Three days after the insurance company conducts a medical examination, but before it issues a policy, Edward suffers a stroke. Upon reviewing the results of his medical exam, the company discovers that Edward has been diagnosed with high blood pressure and atherosclerosis. Under the terms of the conditional receipt, the insurance company: A Delays the effective date of the policy B Pays the claim because a receipt has been provided C Pays a reduced benefit since the results of the medical exam show a pre-existing condition D Denies the claim because the insurer would not have issued the policy as applied for as standard or better
D Denies the claim because the insurer would not have issued the policy as applied for as standard or better The insurer will deny the claim because they cannot issue the policy as written. If the insurer chooses to issue a policy, it will either be a rated/substandard policy or a standard policy with an exclusion for Edward's medical condition.
For those individuals who have health issues, which of the following would be an insurance plan to consider? A Decreasing Term B Joint Life C Variable Universal Life DGroup
D Group If an individual has health issues, then a group insurance plan could be a valuable consideration. It offers the opportunity to obtain coverage without providing evidence of insurability.
The MIB obtains its information from which of the following? A Physicians B Producer's agencies C Hospitals D Insurers
D Insurers The primary purpose of the Medical Information Bureau (MIB) is to collect adverse medical information about an applicant's health that is known to insurers to which the applicant has previously applied for coverage.
Which of the following life insurance policies is ideally suited for estate planning purposes? A Joint Life B Universal Life with death benefit Option B C Variable Whole Life D Joint Survivorship
D Joint Survivorship If owned by an irrevocable trust, a Joint Survivorship policy can keep the value of the policy out of the estate and create much needed cash to pay for estate taxes, which come due 9 months after the second spouse dies.
When a policy is mailed to an agent by an insurer after being accepted as applied for and the initial premium paid, it is considered to be: A Issued B Purchased C Rated D Legally Delivered
D Legally Delivered A policy may be delivered by registered or certified mail with a signed receipt of delivery. 'Constructive delivery' occurs when the insurer places the policy with the delivery service and no longer has physical custody of the policy.
Which of the following Medicare Supplement policies have Core Benefits? A Plans C through J only B Plan A through C only C Plan A only D Plans A through N
D Plans A through N The Core Benefits found in Plan A must be found in all plans.
ERISA sets minimum standards for pension plans primarily in the ______ industry. A Public B Quasi-government C Public and Private D Private
D Private ERISA focuses in on the private industry pension plans.
Each of the following are characteristics of a Current Assumption Whole Life insurance policy, except: A The insurance company can change the interest rate credited to the policy B If interest rates increase premiums can be reduced or cash values can increase at a faster rate C The insurance company can change the premium D The death benefit is not guaranteed
D The death benefit is not guaranteed Current Assumption Whole Life guarantees a death benefit just like any other whole life insurance product. However based on interest rates premiums can be reduced or increased and cash values can be credited with a higher or lower interest rate.
All of the following are correct regarding the coverage of a cancer policy, except: A Benefits are provided for losses associated with a cancer diagnosis B Coverage for experimental treatments is usually provided C Coverage under this policy will pay for losses before primary medical expense policiesr to prevent an insured from reaching annual or lifetime policy limits D The policy will only provide benefits for losses covered on an underlying medical expense policy
D The policy will only provide benefits for losses covered on an underlying medical expense policy This coverage will provide for experimental treatments and other losses that traditional insurance excludes.
Which of the following best describes the consideration on the part of an insurer? A The purpose of the contract must be legal B The acceptance of the contract C The offer of the contract D The promise to pay in the event of a covered claim
D The promise to pay in the event of a covered claim Consideration is something promised, given, or done that has the effect of making an agreement a legally enforceable contract.
Which provision states that the insurance company must pay claims immediately? A Relation of Earnings to Insurance B Payment of Claims C Legal Actions D Time of Payment of Claims
D Time of Payment of Claims Time of Payment of Claims (a Mandatory Uniform Provision) stipulates that claims are to be paid immediately upon written proof of loss.
A partial disability is defined as an individual: A Unable to perform all duties of any occupation for which he/she is qualified based upon education, training, and experience B Unable to perform all duties of his/her occupation C Presumed to be disabled due to the loss of sight, hearing, speech, or the loss of 2 limbs D Unable to perform one or more duties of his/her occupation
D Unable to perform one or more duties of his/her occupation Partial Disability is a disability resulting in an inability to perform 1 or more of the regular duties of an occupation. The benefit usually pays up to 50% of a total disability benefit for 3 to 6 months.
