life, health, variable annuity
The tendency for less favorable risks to seek or continue insurance is known as: catastrophic loss adverse selection questionable moral standards questionable morale standards
adverse selection
A company that is licensed to sell insurance in a particular state is a domestic company an alien company a nonadmitted company an authorized company
an authorized company
Public adjusters prepare, complete and file claims on behalf of who? an insured an insurer both of the above none of the above
an insured
Which of the following can not be exchanged tax free under the 1035 exchange rule? life insurance to annuity annuity to life insurance annuity to annuity endowment to annuity
annuity to life insurance
Under the 1035 exchange rules, which would not be an acceptable course of action for tax purposes? changing from an annuity to life insurance changing from an endowment to annuity changing from an annuity to annuity changing from life insurance to annuity
changing from an annuity to life insurance
All of the following statements concerning a family plan life insurance policy are true EXCEPT: coverage for children is normally term children born later are immediately covered the coverage for children will usually terminate at age 18 or 21 the children's term can be converted
children born later are immediately covered
What presumption is made under the Uniform Simultaneous Death Act? The beneficiary died first The insured died first The insured & the beneficiary died at the same time The proceeds will be paid to the estate
The beneficiary died first
Which of the following statements is not true about exercising a Guaranteed Insurability option? The new insurance is available at the original issue age rate Evidence of insurability is not required Expiration of one option does not affect future options The maximum purchase amount is specified in the contract
The new insurance is available at the original issue age rate
A buy-sell agreement was established for a $300,000 partnership with 3 equal partners. Assuming a cross-purchase agreement, which of the following statements is true? The partnership purchases 6 policies for $50,000. The partners purchase 6 policies for $100,000. The partnership purchases 6 policies for $100,000. The partners purchases 6 policies for $50,000.
The partners purchases 6 policies for $50,000.
Which of the following most accurately describes the Health Maintenance Act of 1973? It requires all employers to offer enrollment into an HMO It requires all employers with 25 or more employees to offer enrollment into an HMO It requires all employers with 25 or more employees to offer enrollment into an HMOif they provide health care benefits to their workers It requires all employers with 25 or more employees to offer enrollment into an HMO as a minimum health care benefit offering
it requires all employers with 25 or more employees to offer enrollment into an HMOif they provide health care benefits to their workers
As compared to individual disability income policies, group disability income policies are generally: more costly and have less liberal provisions more restrictive in terms of covered medical expense less costly and have more liberal provisions tied more closely to Social Security disability benefits
less costly and have more liberal provisions
If a group life insurance contract is canceled the insurance company must notify the employees but can take this action by notifying the employer must notify each of the employees within 30 days must notify each of the employees within 14 days can not cancel the contract because of the Affordable Health Care Act
must notify the employees but can take this action by notifying the employer
The purpose of Disability Income insurance is to provide:
protection against economic death
99. Principle of agency law refers to the relationship between which two parties? the career agent and the general agent the career agent and the personal producing general agent the captive agent and the general agent the agent and the company
the agent and the company
With a Key Employee insurance policy, who is normally the beneficiary? the family of the insured the business the insured's estate the key employee
the business
Dividend projections may be included in a proposal for a life insurance policy when which of the following is true? The applicant has requested that they be included. There is a clear statement that payment of future dividends is not guaranteed. The projected amounts are calculated on the basis of the Commissioners Standard Ordinary Mortality Tables. The projected amounts do not exceed the dividends previously paid by the same insurance company.
There is a clear statement that payment of future dividends is not guaranteed.
Which of the following concerning deferred compensation plans is not correct? Life insurance may be used as a funding vehicle They are qualified plans They are non-qualified plans They may discriminate
They are qualified plans
An applicant for reinstatement may have to do all of the following EXCEPT: pay all back premiums provide evidence of insurability agree to a new suicide provision agree to a new incontestable provision
agree to a new suicide provision
Types of groups approved for group insurance include: Labor unions and trusteeships Fraternal Organizations Association Groups all the above
all the above
Which of the following are disadvantages of naming the insured's estate as beneficiary:I. Creditors can easily attach the proceedsII. Proceeds increase the size of the estateIII. If there is a will it may be contested.IV. The advantages of settlement options are lost I & II I & III II & III all the above
all the above
Which of the following statements concerning equity indexed annuities is/are correct:1. The returns are credited to a specific equity or stock index2. There are guaranteed interest rates3. The principal is guaranteed4. Annuitization can be fixed or variable 1 & 2 2 & 3 1 & 4 all the above
all the above
94. The opposite of a unilateral contract is a: collateral contract multi-lateral contract bilateral contract omni-lateral contract
bilateral contract
Any activity limiting a client's free choice regarding transacting insurance is intimidation coercion defamation twisting
coercion
Which of the following transactions would not result in a taxable event according to the 1035 exchange rules? exchanging an annuity contract for a life insurance contract exchanging an insurance contract for a mutual fund with the same company exchanging a life insurance contract for an annuity contract exchanging an endowment contract for a life insurance contract with the same company
exchanging a life insurance contract for an annuity contract
Lanny, covered under his company's group life plan, was terminated June 1. He died June 15. His life insurance policy will pay: nothing return premiums full benefit pro-rated benefit
full benefit
A field underwriter: decides who will be issued the policy. is responsible to agents in the field. is the agent. supervises agents in the field.
is the agent
Which is true concerning a VARIABLE LIFE insurance policy? It provides a minimum guaranteed death benefit. Benefits vary and are linked to the Dow-Jones stock averages. It has a guaranteed minimum cash value. Premiums and benefits are both variable.
it provides a minimum guaranteed death benefit
Which of the following would not be considered a "presumptive" disability, automatically qualifying an individual for full benefits under a disability policy?Cancer Blindness Loss of speech Deafness
Cancer
The amount paid by the HMO to the provider in exchange for services is called: Pre-payment arrangement Capitation Arrangement Provider agreement Co-payment Arrangement
Capitation Arrangement
A Guaranteed Insurability rider can be attached to which of the following types of health policies? A Hospital Indemnity policy Disability income policy Major Medical policy Cancer Policy
Disability income policy
The certificate that each member receives under an employee group insurance contract is a Contract between the insurance company and the individual employee Contract between the insurance company and the employer Document that identifies the employees as an insured under the master contract Document that identifies the employees as the owner of the master contract
Document that identifies the employees as an insured under the master contract
Which is true about Medicare? Part A is optional. Part B is mandatory. Both parts A and B are mandatory. Part A is mandatory and part B is optional.
Part A is mandatory and part B is optional.
Which of the following pertaining to Group Credit Life Insurance is correct? It is a form of whole life insurance. The insurance amount may exceed the amount of debt. Premiums are paid wholly by the insured. Policy proceeds are paid to the insured's spouse or other beneficiary.
Premiums are paid wholly by the insured.
John bought his individual disability income insurance a few years ago when he was a firefighter. Recently, John changed jobs and began selling insurance, but has not updated his disability income insurance policy to reflect the change. If John becomes disabled in a car accident today, how will the insurance company respond? The company will pay the stated benefit. The company will pay the stated benefit and refund the excess premium paid from the date he changed occupations. The company will reduce the benefit down to reflect a more hazardous occupation. The company will deny the claim since he changed his occupation without notifying the insurer.
The company will pay the stated benefit and refund the excess premium paid from the date he changed occupations.
89. Which of the following are true?1. Notification to the Department of Insurance is required within 30 days of change of address.2. Notification to the Department of Insurance is required within 30 days of change of company.3. An agent will lose licensure as a result of 1 year non-appointment.4. An agent will lose licensure as a result of 4 years non-appointment 1 & 2 1 & 3 1 & 4 2 & 4
1 & 4
In a health insurance policy, the length of the grace period can be determined by which of the following? 1. the mode of premium payment 2. the length of the benefit period 3. the length of the elimination period 1 only 1 & 2 2 & 3 1, 2, & 3
1 only
Most insurers require non-contributory group health plans to cover at least what percentage of eligible employees? 100% 75% 50% 25%
100%
Old Man AnnaCee, 67 yrs old, has had a policy for 16 years. In addition to his regular grace period he will have an additional grace period of how many days? 30 days 21 days 31 days there are no additional days
21 days
An agent must report to the Department of Financial Services any changes in address within what time period? 30 days 31 days 45 days 60 days
30 days
What % of an agent's business can be controlled business? 25% 50% 75% 100%
50%
The Legal Action provision states that a policyowner must wait a minimum of how many days after submitting Proof of Loss to an insurance company before making a lawsuit against the company? 30 60 45 90
60
There are _____ standard Medicare supplement policies. 8 10 12 14
8
While New Mexico Life Insurance Company is domiciled in Arizona and operating in the state of Florida, it would be considered by the state of Florida to be a/an: A Foreign Company. A Domestic Company. An Alien Company. A nonadmitted company.
A Foreign Company.
Which of the following statements regarding Blanket health insurance is true? Benefits change as the group changes Persons insured are named in the policy Each policy covers a specific number of insureds A blanket policy covers a changing group of people
A blanket policy covers a changing group of people
Sam's father had sickle-cell anemia, as well as his uncle. Sam otherwise represents a very favorable risk to the insurance company. Which course of action would the insurance company most likely pursue? The insurance company would deny Sam coverage because of his propensity to sickle-cell anemia. The insurance company would charge him a higher premium. The insurance company would reduce the benefits applied for. The insurance company would issue the policy as applied for.
The insurance company would issue the policy as applied for.
Dude paid a total of $25,000 for his $100,000 life insurance policy. He borrows $35,000 against the cash value. How much will Dude have to report as a gain? $35,000 $25,000 $10,000 $0
$0
Lucy has a $100,000 life insurance policy with $25,000 accumulated as cash value. If she were to borrow $20,000 from her policy how much cash value would be in her policy the next day? $5000 $80,000 $75,000 $25,000
$25,000
An individual may convert his industrial insurance policies to ordinary policies when his industrial policies total at least: $10,000 $5000 $1000 $3000
$3000
Which is not a qualified retirement plan? A Defined benefit plan A salary continuation plan Keogh Plan S.E.P.
A salary continuation plan
Double Indemnity applies to which of the following? Sickness Accident Sickness or Accident Death before age 55
Accident
Which of the following statements is/are true regarding misrepresentation? An innocent misrepresentation of a material fact is grounds to void a contract A fraudulent misrepresentation of an immaterial fact would not necessarily void the contract An advertisement that would cause a reasonable person to believe the state or federal government stands behind any returns on insurance products is a misrepresentation. All of the above
All of the above
Which of the following statements concerning SIMPLE plans is/are correct?For small businesses, or (Tax exempt organizations, or government entities) who have no more than 100 employees are eligible Mandatory employer contributions up to 3% of the employee's contribution annual compensation 100% immediate vesting All of the above are true
All of the above are true
Which of the following may not be limited or excluded in a long term care policy? Schizophrenia Preexisting conditions or diseases Nervous disorders Alzeimer's disease
Alzeimer's disease
Which of the following would be eligible for a Keogh Plan? Any business A small family held 'S' corporation An independent financial planner A large corporation
An independent financial planner
The special class of retirement plan available to employees of certain nonprofit charitable or educators is nown as a 401k plan a charitable profit sharing plan a tax-sheltered annuity a deferred compensation plan
a tax-sheltered annuity
If someone purchased a variable annuity, what type of units would the annuity be paid out in? Money Annuity Indexed Variable
Annuity
When would the insurance company require a statement of the insured's good health? At the delivery of the policy if a conditional receipt was given At the delivery of the policy if no money was given with the application At anytime when the policy is delivered if the agent feels the applicant's health has changed At no time will this be needed
At the delivery of the policy if no money was given with the application
The provision in a life insurance policy that provides protection against unintentional policy lapse is known as the: Reduction of Premium option Waiver of Premium benefit Payor clause Automatic Premium Loan provision
Automatic Premium Loan provision
An applicant for insurance may pay the initial premium and receive a document from the producer indicating that if the policy is issued as requested, coverage begins on the date of the document. What is this document called? Executing agreements Conditional receipt Warranty Notice of inspection
Conditional receipt
Replacement is defined as any life insurance transaction in which new insurance is to be purchased and existing insurance is to be modified in certain specific ways. A way in which the existing insurance may be modified that brings the transaction within the definition of replacement is: Conversion to reduced paid-up ins, continued as extended term Insurance, or otherwise reduced in value by use of nonforfeiture benefits or other policy values. Converting term insurance to variable life Borrowing 10% of the cash value from a policy to pay the premium on a new policy Re-issuing a newer policy form without any reduction in cash value
Conversion to reduced paid-up ins, continued as extended term Insurance, or otherwise reduced in value by use of nonforfeiture benefits or other policy values.
At what time can a person continue working without fear of having their social security check reduced? FRA Age 59 1/2 Age 62 Age 65
FRA
An agent's license will terminate if he or she allows how many years to pass without an appointment? Two years Four years Five years Six years
Four years
he following types of GROUP LIFE plans are available EXCEPT: Group paid up plans Group term life Group Universal Life Group deferred life plans
Group deferred life plans
Which of the following is NOT true concerning the Florida Insurance Guarantee Fund? 1. All life, health, and annuity insurers are members as a condition of their authority to transact insurance in Florida 2. Residents of other states whose company is domiciled in Florida 3. It does not cover Health Maintenance insurance 4. It automatically covers contracts covering Medicare Parts C & D
It automatically covers contracts covering Medicare Parts C & D
Which of the following are considered required provisions for an individual health insurance policy?I. Proof of lossII. Payment of claimIII. Illegal OccupationIV. Conformity with state statutes I & II III & IV II & IV I & III
I & II
Which of the following may administer a self-funded HMO? Insurance company Actuary PEO TPA
Insurance company
Disability Buy-Out plans feature: Long elimination plans up to two years Short elimination periods Short elimination periods and benefits up to 10 years Long elimination periods and benefits up to 10 years
Long elimination plans up to two years
The annuity rule would be applied to all of the following except: Fixed period option Fixed amount option Life income option Lump-sum cash option
Lump-sum cash option
If a stock company sells both participating and non-participating policies it is said to be operating on the: Conservative Plan Mixed Plan Specialized Plan They can't sell both
Mixed Plan
With which mode of payment are disability income benefits paid? Monthly Quarterly Semiannually The insured chooses the mode of payment.
Monthly
A Stock Bonus Plan is like a : Defined Benefit Plan Profit Sharing Plan S.E.P. 401K Plans
Profit Sharing Plan
A Health Savings Account does not allow: Tax deductible contributions Tax free growth Tax free withdrawals Tax free non-qualified withdrawals
Tax free non-qualified withdrawals
The USA PATRIOT Act was created in response to which of the following? The Korean War The Vietnam War Desert Storm The September 11th Attacks
The September 11th Attacks
All the following statements concerning deferred compensation plans are correct except: They receive favorable tax treatment from the IRS. They allow employers to pick and choose any employee they want to reward. They are more flexible than a qualified plan. They are usually funded with cash value insurance.
They receive favorable tax treatment from the IRS.
Which of the following policies allow for withdrawals: Universal Life and Variable Life Universal Life and Variable Universal Life Whole Life, Universal Life and Variable Universal Life All polices allow for withdrawals
Universal Life and Variable Universal Life
Which of the following does NOT constitute "constructive delivery"? Mailing the policy to the agent and the agent delivers it Mailing the policy to the agent and the agent does not deliver it Mailing the policy to the client When the policy is delivered and an inspection receipt obtained
When the policy is delivered and an inspection receipt obtained
Which of the following is considered an unfair practice? a gift valued at not more than $15 a gift valued at not more than $25 a gift valued at not more than $75 a gift valued at more than $100
a gift valued at more than $100
Which of the following is true about coinsurance? Coinsurance applies to the deductible as well as to claim payments. Premiums are higher for a policy that contains a coinsurance provision than for one that does not. It helps control overutilization of benefits. Insurance companies can change the coinsurance ratio after the policy has been issued.
It helps control overutilization of benefits.
Jane, on Medicare, enters the hospital on March 1 and is not discharged until April 1. On May 15 of the same year, she enters the hospital again, this time at a different hospital for a different reason. Which of the following is true regarding her Medicare benefits? Jane will have to pay a deductible when she enters the hospital on May 15. Jane will not have to pay a deductible when she enters the hospital on May 15. When Jane enters the hospital on May 15 she will begin paying a daily amount of the hospital room and board bill. When Jane enters the hospital on May 15 she will pay a deductible and begin paying a daily amount of the hospital room and board bill.
Jane will not have to pay a deductible when she enters the hospital on May 15.
John becomes sick on May 1 and is out of work for a month, returning on June 1. Then, on July 1 he is hit by a trolley car and is disabled until January 1 of the following year, when he returns to work. His disability policy has a 15-day probationary period and a 30-day elimination period. When will benefits initially be payable? May 15 May 30 July 1 July 30
July 1
ANNUITIES can be designed to provide all the following EXCEPT:A stable and predictable monthly income for the remainder of the annuitant's life.A variable monthly income based upon the value of a fixed number of mutual fund units being retired monthlyA regular monthly income from previously committed funds which do not require any decisions by an infirm or senile annuitant.A predictable death benefit to a beneficiary.
.A predictable death benefit to a beneficiary.
Dude paid a total of $25,000 for his $100,000 life insurance policy. He borrows $35,000 against the cash value. How much will Dude have to report as a gain?$35,000$25,000$10,000$0
0
JOINT LIFE insurance policies insure two lives for a single death benefit on one policy. They may be written in which of the following ways? 1. Joint Life pays the face at the first death 2. Joint Life pays the face at the SECOND death. 1 only 2 only 1 & 2 None of the above
1 & 2
Which of the following statements concerning annuities are true?1. Annuities liquidate estates, life insurance creates an estate2. Most annuities guarantee a death benefit3. May accept periodic payments during the annuity period4. Immediate annuities may be funded with fixed or periodic payments 1 only 1 & 2 1, 2, & 3 all the above
1&2
Which of the following concerning group disability insurance is/are true?I. Premiums are tax deductible by the employer, and benefits are taxable to the employee.II. Premiums are not tax deductible by the employer, and the benefits are taxable to the employees.III. Any amount contributed by the employee toward the premium makes the entire benefit tax free.IV. The percentage contributed to the premium by the employee makes the same percentage deductible by the employer. I II I & III I & IV
1. Premiums are tax deductible by the employer, and benefits are taxable to the employee.
What is the maximum interest rate an insurance company can charge the policyowner for a fixed or adjustable rate? 10% for a fixed rate, for an adjustable the rate will be tied to Moody's Bond Index 12% for a fixed rate, for an adjustable the rate will be tied to the Consumer Price Index A maximum of 10% for fixed or adjustable rates There are no maximums by law
10% for a fixed rate, for an adjustable the rate will be tied to Moody's Bond Index
Ima Yankee has been licensed for seven years. How many hours of continuing education does Ima need? 20 hours every two years 24 hours every two years none, he knows it all
20 hours every two years
Which of the following policies can be written on a non-cancelable and guaranteed renewable basis? A Dental Care Policy A Disability Income Policy Comprehensive Medical Expense Policy A Major Medical Expense Policy
A Disability Income Policy
While New Mexico Life Insurance Company is domiciled in Arizona and operating in the state of Florida, it would be considered by the state of Florida to be a/an:A Foreign Company.A Domestic Company.An Alien Company.A nonadmitted company
A FOREIGN COMPANY
An agent who holds a securities license is called A Registered Investment Advisor A Registered Representative A Registered Investment Counselor A Registered Financial Representative
A Registered Representative
When an employer establishes a group health insurance plan, what does each participating employee receive? An insurance notice A certificate of insurance A letter of confirmation A coverage form
A certificate of insurance
A Hospital Expense policy that pays a FLAT AMOUNT per day for hospital room and board pays benefits on what basis? Billing Reimbursement Automatic A fixed-rate plan
A fixed-rate plan
An insurable interest must exist when: A life insurance policy is issued Death proceeds become payable Policy ownership is transferred Cash values are borrowed
A life insurance policy is issued
Which of the following disability policies would have the lowest premium? A long elimination period with a long benefit period A long elimination period with a short benefit period A short elimination period with a long benefit period A short elimination period with a short benefit period
A long elimination period with a short benefit period
When a policy owner notifies the company in writing of a beneficiary change, this is called: A written method An absolute method A revocable method A recording method
A recording method
Which of the following non-insurance entities are NOT involved with self-insured plans? Third Party Administrator Administrative Services Organization Actuaries Health Maintenance Organization
Actuaries
Which of the following statements concerning the differences between IRA's and Simplified Employee Pension plans is/are correct? Contribution limits are 25% for SEPs, $6,000 for IRAs Both are individual retirement accounts No new SARSEPs may be established All of the above are true
All of the above are true
Variable Life insurance is considered: An insurance contract only A securities contract only An insurance and general contract An insurance and securities contrac
An insurance and securities contract
An applicant is applying for a disability policy. He states in the application that he used to have cancer but that the cancer has been cured and he is cancer free. What might the insurance company request during underwriting? Medical exam Attending Physician's Statement (APS) MIB Inspection report
Attending Physician's Statement (APS)
Which of the following regarding group disability income insurance is NOT correct? Benefits are supplemental to workers' comp Benefits are paid for non-occupational disabilities Benefits are expressed as a flat amount Benefits are generally taxable to the insured
Benefits are expressed as a flat amount
Which is not true concerning a Hospital Fixed-Rate plan? Claim costs are not affected by rising health care costs High benefits for relatively low premiums Simple underwriting and administration Benefits are paid directly to the hospital
Benefits are paid directly to the hospital
What is Business Overhead Expense insurance designed to pay? Business expenses incurred when the business owner is disabled Business expenses when the business closes due to a fortuitous loss Business expenses caused by a natural disaster Business expenses incurred when the business owner dies
Business expenses incurred when the business owner is disabled
When an applicant applies for insurance by completing an application and paying one month's premium, this constitutes:
Consideration and an offer to buy.
A Business Overhead Expense policy includes all of the following except: Benefits taxable as income Tax deductible premiums Coverage for Employee's Salaries Coverage for Employer's Salaries
Coverage for Employer's Salaries
The period of time following the death of a breadwinner during which the children are living at home is a/an: Loss of use period Income Period Blackout Period Dependency period
Dependency period
All of the following are features of non-participating policies except: Dividend options Cash surrender values Beneficiary options Assignment provisions
Dividend options
Fraud can involve the unintentional concealment of a non-material fact on an application.TrueFalse
FALSE
A Multiple Employer Welfare Arrangement (MEWA) is all of the following except: Fully Insured Tax exempt Self Insured Unionized
Fully Insured
Which of the following policy provisions defines a specific period in which an insured who has not paid the premium due remains covered by the policy?Ownership Rights Grace Period Consideration Waiver of Premium
Grace Period
Quack Inthebox turned 65 last month and is enrolled in both Medicare Parts A and B. She had a major stroke last year, and now is considering purchasing a Medicare supplement policy but is concerned that her health issues will make the policy unaffordable. What should the agent tell her? Her premium will only be rated if she received advice or treatment within the 6 months prior to the date she purchased the policy, and it will only be rated for the first 6 months of coverage. Her premium will only be rated if she received advice or treatment within the 6 months prior to the date she purchased the policy, and it will only be rated for the first year of coverage. Her premium will only be rated if she received advice or treatment within the 6 months prior to the date she purchased the policy, and the policy will exclude coverage for the preexisting condition for the first year of coverage. Her health issues will not effect the premium rate.
Her health issues will not effect the premium rate.
Which type of coverage is least affected by an increase in medical costs?Basic Medical Expense Hospital Indemnity Comprehensive Medical Major Medical
Hospital Indemnity
Which of the following statements about Medicaid is/are true?I. It is one of the major parts of Medicare.II. It is intended to provide medical assistance for certain categories of people who are needy.III. It supplements Medicare for those over age 65, who qualify.IV. It is funded entirely by the State Government. II, III, and IV I and II only II & III IV only
II & III
An insured purchased group Credit Disability insurance to cover a loan. He was injured and disabled for 7 months. What benefits were paid under his policy?I. The insured received Disability Income benefitsII. The insured's creditor received the equivalent of the monthly payment owed by the insured I only II only I and II Neither I nor II
II only
Regarding warranties and representations, which of the statements below are true? If a warranty is untrue, the insurer has the right to cancel the contract If a representation is untrue, the insurer has the right to cancel the contract only if the representation was not material If a representation is untrue, the insurer has the right to cancel the contract If a warranty is untrue, the insurer has the right to cancel the contract, even if it was not a material fact.
If a warranty is untrue, the insurer has the right to cancel the contract
Mary's age on the application for a $100,000 life insurance policy indicates that she is 31 when in fact she is actually 30 years old. This fact was discovered after her death. Which course of action would the company take? Increase the death benefit to what the premium would have purchased for a 30 yr old woman Pay the $100,000 and return the over charged premium Pay the $100,000 Lower the death benefit to what the premium would have purchased for a 30 yr old woman
Increase the death benefit to what the premium would have purchased for a 30 yr old woman
To help protect a Long Term Care policy from an unintentional lapse, all of the following are true except: There must be a grace period of at least 30 days. A notice must be sent to the policy owner and a secondary addressee. The insured may reinstate for at least five months from the date of lapse if lapse was due to a cognitive impairment or confinement in a care facility for more than 60 days. Insurance companies must notify the owner of the right to designate a secondary addressee at least every six months.
Insurance companies must notify the owner of the right to designate a secondary addressee at least every six months.
Which of the following types of policies' cash may NOT be affected by stock market/mutual funds? Variable Life Equity Indexed Universal Life Modified Whole Life Variable Universal Life
Modified Whole Life
Which of the following is NOT correct concerning Medicare Supplemental Insurance? Must cover the Part B copayment up to a maximum of $5000 Must cover the Part B copayment up to a maximum of $10000 Must include a minimum of 30 days free look provision Must provide full coverage for up to 365 days after Medicare benefits are exhausted
Must cover the Part B copayment up to a maximum of $10000
Golan Hites purchases a health insurance policy and is told that the insurance company cannot raise the premium or terminate the coverage. Which of the following types of renewability clauses does this policy contain? Optionally Renewable Conditionally Renewable Guaranteed Renewable Non-cancelable
Non-cancelable
If an employer pays the premiums for an insurance plan that automatically covers all eligible employees, the plan is known as Salary savings insurance Contributory group insurance Noncontributory group insurance Franchise group insurance
Noncontributory group insurance
Eustis had a $2000 per month disability policy with a benefit period to age 65 and a 6 month waiting period. She became disabled at age 64 1/2. How much would she receive? $2000 $1000 $12000 Nothing
Nothing
Health insurance policies generally do issue dividends in which of the following circumstances? Health insurance policies never issue dividends Only individual health insurance policies issue dividends Only group health insurance policies issue dividends Both individual and group health insurance policies issue dividenDS
Only group health insurance policies issue dividends
Which part of Medicare requires premium payments by most eligible participants? Part A, basic hospital insurance Part B, supplementary medical insurance Respite care All of the above
Part B, supplementary medical insurance
An annuitant, age 65, chooses a life income with a 20 year period certain. Which of the following statements concerning this option is true? If the annuitant died at age 75, his beneficiary would receive income for 20 years All payments would cease at age 85 Payments will continue for the life of the annuitant, no matter how long that life lasts There are no survivorship options with a life annuity
Payments will continue for the life of the annuitant, no matter how long that life lasts
Which of the following may pay the grandchildren of the insured? Per stirpes Per capita Uniform Simultaneous Death ActCommon Disaster
Per stirpes
Which method is usually used to determine the amount of benefits payable under a group disability income plan? Flat amount method Percent of earnings method Percent of disability method Presumptive disability method
Percent of earnings method
Which of the following service providers allows for a primary care physician as well as out-of-network care? Health Maintenance Organization (HMO) Preferred Provider (PPO) Point of Service Plan (POS) Exclusive Provider Organization (EPO)
Point of Service Plan (POS)
Joan elects to receive a straight life income option from her fixed annuity. The company has calculated that Joan will receive $850.00 per month for life. Which of the following statements is not correct? If Joan died after receiving one month's payment, the insurance company would keep the balance The benefit factor under a straight life income option is the highest of all options Should Joan die after receiving one month's payment the balance would be paid to a named beneficiary The straight life income option has the most risk to Joan
Should Joan die after receiving one month's payment the balance would be paid to a named beneficiary
Pamella is the sole proprietor of a craft shop. She decides it is time to start her retirement planning. In order to obtain the maximum legal amount in a qualified plan which should she choose? Individual Retirement Account Simplified Employee Pension Individual Retirement Account with a Spousal contribution 401k plan
Simplified Employee Pension
Which of the following is not true when an agent is soliciting Medicare Supplemental insurance? The agent must ask if the prospect has any other Medi-gap policies The agent can not sell a Medicare Supplement policy if insured is covered under Medicaid, unless Medicaid is paying the premium The agent can not sell a Medicare Supplement policy if insured is covered under Part C The agent can not sell an additional policy if replacing an existing one
The agent can not sell an additional policy if replacing an existing one
An applicant has been denied insurance coverage because of information contained in a consumer report. According to the Fair Credit Reporting Act, all of the following statements are true about this situation EXCEPT: The applicant has the right to obtain a copy of the consumer report directly from the insurance company that used the report. The applicant has the right to obtain disclosure of the substance of the information in the consumer report from the reporting agency. The applicant has the right to obtain the names of all people contacted within the past 6 months. Applicants must be notified within 3 days that a report has been requested.
The applicant has the right to obtain a copy of the consumer report directly from the insurance company that used the report.
Which is the only type of rider added at no additional cost to the policyowner? The waiver of premium rider The automatic premium loan rider The payor rider The cost of living rider
The automatic premium loan rider
Which of the following would not be found in the policy summary? The name of the agent The beneficiary Dividend information Loan interest rates
The beneficiary
Which of the following statements concerning an agent's license is not correct? The agent must report in writing, to the OIR, with-in 30 days of pleading guilty to a felony The insurance license will terminate if four years elapses without being appointed The insurance license is suspended automatically for bankruptcy An agent may appoint himself as an agent
The insurance license is suspended automatically for bankruptcy
Alice had a life insurance policy naming her husband, Tom, as the primary beneficiary, and her son as the secondary beneficiary. Alice divorced Tom and died several months after the divorce and had not taken time to change the beneficiary. The company will pay the proceeds to Tom The son The estate The court
The son
Which of the following statements about the reinstatement provision is true?It provides for reinstatement of a policy regardless of the insured's health.It guarantees the reinstatement of a policy that has been surrendered for cash.There is no new suicide exclusion with a reinstated policyIt permits reinstatement within 10 years after a policy has lapsed.
There is no new suicide exclusion with a reinstated policY
Which of the following statements is true about Basic Hospital, Medical, and Surgical Expense Policies? They have high deductibles. The benefits provided are usually equal to the actual expenses incurred. They usually have a stated limit for specific expenses. Benefits are provided for loss of income.
They usually have a stated limit for specific expenses.
The type of health insurance policy most likely to cover all students attending a large university is: a blanket policy a franchise policy an ASO a self-insured plan
a blanket policy
A group of pharmacists or dentists might be covered under: a reinsurance group a risk retention group a reciprocal group a fraternal group
a risk retention group
An insured has a $50,000 whole life insurance policy which has an accumulated cash value of $30,000. Upon the advice of his insurance agent he uses $20,000 of the cash value to pay for a single premium life insurance policy from the same company. The remaining $10,000 is used to purchase an annuity. Which of the following best describes the agent's recommendations?rebating twisting churning wisdom
churning
Father buys a life insurance policy, naming Mother as beneficiary, his child is named as contingent beneficiary. Mother dies before the father, then father dies. Who receives the proceeds? primary beneficiary estate tertiary beneficiary contingent beneficiary
contingent beneficiary
All of the following are eligible for Medicare except: those 65 or older dependents of those 65 or older folks with a chronic kidney disorder folks receiving Social Security Disability benefits
dependents of those 65 or older
An insurance company may nonrenew or cancel a health insurance policy for all the following reasons except: diagnosis of terminal illness fraud nonpayment of premiums the insurer ceases offering coverage in the market
diagnosis of terminal illness
Increasing term insurance will automatically increases the death benefit based on all of the following except: Consumer Price Index long-term care costs flat dollar amount flat percentage amount
long-term care costs
On May 8, a prospect filled out an application for a life insurance policy but paid no premium. The insurance company approved the application on May 14 and issued the policy on May 15. The agent delivered the policy on May 26 and collected the first premium. The coverage became effective on: May 8 May 14 May 15 May 26
may 26
Medicare supplements: may duplicate benefits provided by Medicare if such benefits are at least as favorable to the insured as those covered by Medicare may duplicate benefits covered by Medicare so long as the insured does not experience a profit from suffering a disability or hospitalization both of the above may not duplicate Medicare benefits
may not duplicate Medicare benefits
Long term care policies must offer coverage for all of the following except: home care mental disorders inflation protection nonforfeiture benefits
mental disorders
Which premium factor is not common to both life and health insurance? 1. age & sex 2. dividends 3. morbidity 4. amount of protection
morbidity
Which of the following statements is not correct regarding an association group? must have been in existence for one year must be a natural group if the plan is non contributory all members must participate if the plan is contributory at least 100 members must participate
must have been in existence for one year
Which of the following may generally be excluded under a major medical policy in Florida? foster children of the insured treatment for diabetes osteoporosis none of the above
none of the above
When an insured returns a policy to the insurance company within the Free Look Period, the Insurance company must do which of the following? refund all premiums paid refund the premiums paid, less issue expense chargesrefund the premiums paid, less the agent's commissions refund the premiums paid in excess of the cost of coverage for the time the insured had the policy
refund all premiums paid
An agent takes an application from a proposed insured without receiving payment of the first premium.The insurance company issues the policy and, when the agent visits the proposed insured to deliver it, she realized that the health of the applicant has deteriorated significantly since the application was taken. The agent should: obtain the premium from the prospect and send it to the company immediately. rate the policy and obtain any additional premium required. deliver the policy as it was issued. refuse to deliver the policy or to accept any premium offered.
refuse to deliver the policy or to accept any premium offered.
Adding on coverages without the knowledge of the insured/applicant is an example of: excess charges sliding rebating excess insurance
sliding
Which of the following is called the fifth dividend option? paid-up cash term reduction of premiums
term
Titus has absolutely assigned his $100,000 life insurance policy to the bank to cover a $75,000 mortgage. His wife is named as primary beneficiary. If Titus were to die which statement correctly reflects the insurance company's obligation? the insurance company would pay the bank $75,000 and $25,000 to his wife the insurance company would pay his wife $75,000 and the bank $25,000 his wife would receive the entire amount the bank would receive the entire amount
the bank would receive the entire amount
All of the following are exceptions to the "transfer for value" rule except: transfers to the insured transfers to a relative transfers to a corporation in which the insured is an officer transfers to a partner
transfers to a relative
Which of the following would not be a characteristic of an annuity? surrender charges in the first few years provides a life time income restrictions of how long an annuity can be deferred typical mandatory distributions by age 70 1/2
typical mandatory distributions by age 70 1/2
