Life Insurance Guarantee Exam Questions
In a noncontributory group policy
- 100% of eligible employees must participate
What specific kind of insurance is often written in conjunction with hospital expense policies and includes surgeons and anesthesiologists fees?
- Basic surgical expense insurance
Which of the following losses would likely be covered under the accidental death rider?
- Death caused by a head on collision
Life insurance can provide which of the following?
- Survivor protection
Medicare is a health insurance program for all of the following except
- those with low income and low assets
What is the purpose of a benefit schedule?
- to state what and how much is covered in the plan
In a whole life insurance, when is the policy cash value scheduled to equal the face amount?
- At the insured's age 100
A major medical policy would exclude coverage for all of the following treatments except
- Drug addiction
Which of the following is true of level term insurance?
- It is temporary protection
Medicare Part A services do NOT include which of the following?
- Private duty nursing
Which dividend option will increase the death benefit?
- Paid-up additions
A core Medicare supplement policy (Plan A) will cover all of the following expenses EXCEPT
- Part A deductible
In order to reinstate a life insurance policy the insured must do all of the following EXCEPT
- Pay next year's premium in advance
The guaranteed insurability rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following except
- Purchase of a new home
An individual receives a lump sum inheritance. ' like to use the money to create a lifetime income since hell be retiring soon. He purchases an annuity and wishes to receive payments beginning in 2 months. What did he buy?
- Single premium immediate annuity
Which of the following is a daily nursing and rehabilitative care that can only be provided by medical personnel, under the direction of a physician?
- Skilled care
Upon a payment of a loss, the insured is obligated to surrender to the insurer the right to sue a negligent third party. This Is called
- Subrogation
Who is obligated to make sure all questions are answered and all necessary signatures are collected on the application?
- The agent
Whose responsibility is it to ensure that the application for health insurance is complete and accurate?
- The agent's
In life insurance, which of the following is NOT required to have an insurable interest in the insured?
- The beneficiary
What is the purpose of the impairment rider in a health insurance policy?
- To exclude coverage from a specific impairment
Because of an injury, an insured has been unable to work for 9 months. He paid the policy premium for his life insurance for the first 6 months of disability, but didn't have to pay anything for the remaining 3 months, yet the policy remained in force. The policy includes
- Waiver of premium rider
When an insured terminated membership in the insured group, the insured can convert to
- Whole life without proof of insurability
Which of the following is NOT correct concerning taxation of disability income benefits?
- if paid by the individual, the premiums are tax deductible
If a loan request is for payment of due premiums on the policy, how soon must the insurer issue a loan?
- immediately
Which of the following is true regarding pure life annuity settlement option?
- it provides the highest monthly benefit
All of the following are true of the survivorship life policy EXCEPT
- the premium is based on the age of each insured
Which of the following is provided by skilled medical personnel to those who need occasional medical assistance or rehabilitative care?
- Intermediate care
What happens to the copy of the application for health insurance once the policy is issued?
- It becomes part of the entire contract
All of the following statements are true regarding an ordinary (straight) life policy except
- It does not have a guaranteed death benefit
Which of the following statements is TRUE regarding an agent's report during the policy application process?
- It provides the agent's personal observations concerning the proposed insured
Which of the following time periods is the general enrollment for Medicare Part B?
- January 1 through March 31 each year
Medicare Part B covers all of the following EXCEPT:
- Long-term care services
An insured was seriously injured in a skiing accident that required him to be hospitalized for 5 weeks. His medical expense policy covered all of the following except
- Loss of income while hospitalized
When the owner of a participating whole life policy uses the dividend to provide more life insurance coverage, which of the following dividend options is being used?
- Paid-up additions
Key person insurance can provide protection for all of the following economic losses to a business except
- Pay the death benefit to the estate of the insured
Which of following is true regarding a joint life annuity?
- Payments stop at the first death
An equity indexed annuity will grow based upon
- Performance of a recognized index
In group insurance, the primary purpose of the coordination pf benefits provision is to
- Prevent over insurance
In a life insurance application, all of the following signatures will be required except
- The home office underwriter
Under the payment of claims provision, to whom will the insured's benefits be paid if the insured is deceased?
- The insured's primary beneficiary
Which entity has the option of including optional provisions in a health insurance policy?
- The insurer
Which of the following statements is incorrect?
- The insurer does not have the right to conduct an autopsy
If an applicant submits the initial premium with an application, which action constitutes acceptance?
- The underwriters approve the application
According to the common disaster clause, if the insured and primary beneficiary are killed in the same accident and it cannot be determined who died first, which of the following will be assumed?
- the primary beneficiary died before the insured
Policy loan requests, except for loan requests for payment of due premiums, may be deferred for up to a period of
- 6 months
Which of the following describes the relationship between the principal sum and a capital sum?
- A capital sum is a percentage of the principal sum
Regarding the consideration clause, which of the following is NOT correct?
- Consideration of the insurer and insured must be equal
A whole life policy is surrendered for a reduced paid-up policy. The cash value in the new policy will
- Continue to increase
When filling out an application for insurance, the applicant makes a mistake. If a fresh application were not available, what could the applicant do properly correct the mistake?
- Cross the incorrect answer out, write the correct one beside it, and initial the answer
Which of the following are considered activities of daily living in most long-term care policies?
- Eating and dressing
The "stop-loss" feature on a major medical policy is intended to
- Establish a maximum amount of out of pocket expense that an insured will have to pay for medical expense in a calendar year
All of the following are true about key-person insurance except
- The death benefit is taxable to the business
Life insurance creates an immediate estate. Which of the following best explains this statement?
- The face value of the policy is payable to the beneficiary upon the death of the insured
What is the purpose of a disability buy-sell agreement?
- To allow the business buyout in case of the owner's disability
The benefits for group disability plans are based on
- A percentage of the worker's income
Decreasing term insurance is often used to
- Cover a mortgage
Which of the following best describes pure life annuity?
- It provides the highest monthly benefits
Which of the following is not a Medicaid qualifier?
- insurability
Which of the following is NOT an indicator of a competent party?
Which of the following is NOT an indicator of a competent party? - Business profession
All of the following must sign an application for health insurance except
- Insurer
Under a group health insurance plan, benefits may be extended to all of the following dependents except?
a 27-year-old daughter who is marries and in college living with parents
Which of the following is not normally an excluded cause of disability income policy?
- Complications from pregnancy
If an individual willfully violates provisions of the fair credit reporting act, what is the maximum civil penalty?
- $2,500
An annuity has accumulated cash value of $70,000, of which $30,000 is from premium payments. The annuitant dies during the accumulation phase. The beneficiary will receive
- $70,000
Under the common accident provision, how many deductibles would be paid if five family members covered under the same major medical policy are injured in the same accident?
- 1
According to the time limit on certain defenses provision, statements or misstatements made in the application at the time of issue can be used to deny a claim after the policy has been in force for a minimum for how many years?
- 2 years
An insurer must notify the consumer in writing that an investigative consumer report has been requested, within how many days of the initial request?
- 3 days
A Medicare supplement policy must have a free-look policy of at least
- 30 days
Which of the following would NOT trigger the payment of accelerated death benefits?
- Being permanently disabled
An insured and his spouse recently had a child. Which of the following riders would allow the couple to insure the child for a limited period of time at a specified amount?
- Children's term rider
Which of the following elements of an insurance contract requires payment of premium?
- Consideration
A new homebuyer wants to purchase a life insurance that would protect his family against losing the home, should he die before the mortgage was paid. The most inexpensive type of policy that would accomplish this need would be
- Decreasing term
Where are premiums from fixed annuities invested?
- A general account
A subscriber has been treated for a medical condition by his primary care physician for 3 months with experimental remedies without significant health improvement before being referred to a specialist. Which of the following types of plans does the subscriber have?
- A gatekeeper HMO plan to control the costs
If an insured dies, and it is discovered that the insured misstated his/her age or gender, the life insurance company will
- Adjust the death benefit to what the premium would have purchased at the actual age or gender
An underwriter is reviewing an applicant with an extensive medical history. Which of the following would give the underwriter a better understanding of how the applicant has been treated for various illnesses?
- Attending Physicians statement
The corridor deductibles applies between
- Basic and major medical coverage
In a variable life insurance policy, all of the following assets are held in the insurance company's general account except
- Cash surrender values
When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?
- Extended term
A married couple wants to include the entire family in their whole life policy under one rider. Which of the following riders will help them achieve that goal?
- Family term
Which of the following is a correct statement about annuities?
- Fixed annuities do not provide protection against inflation
The owner of a deferred annuity pays $100 in premium one month and $130 the next month. Which of the following terms best describes this premium payment arrangement?
- Flexible premium
Which federal act defines rules pertaining to protected health information
- HIPAA
An agent delivers a life policy. He explains a policy change was made and asks the applicant to sign as statements acknowledging the changes were explained. The agent says the premium has not been paid and must be paid before the policy goes into effect. He collects a statements of good health, relinquishes the policy and leaves. what did he do wrong?
- He left the policy with the insured without collecting the first premium
An insured has had an individual disability income policy with a 30 day elimination period. He becomes disabled on June 1st for 15 days. When will he collects on his disability income payments?
- He wont collect anything
According to the fair credit recording act, all of the following statements are true except
- If an applicant is declined for an insurance policy, he or she has no right to know what was in the report
Which of the following best describes the difference between joint life and survivor annuity payment options?
- In joint life, the benefits stop after the first death
Which of the following is NOT true regarding a deferred annuity?
- Income payments begin within 1 year from the date of purchase
If a soliciting producer suspects that there could be misrepresentation on the part of the applicant for insurance, what must the producer do?
- Inform the insurance company
To purchase insurance, the policyowner must face the possibility of losing money or something of value in the event of loss what is this concept called?
- Insurable interest
Riley reads an agreement on the first page of her policy which includes a list of losses that will be covered by her insurer. What is the name of his agreement?
- Insuring clause
The provision that sets forth the basic agreement between the insurer and the insured and states the insurer's promise to pay the death benefit upon the insured's death is called the
- Insuring clause
With respect to the entire contract clause in health policies, who has the authority to make changes to an existing policy?
- Only an executive officer of the company
When may HIV-related test results be provided to the MIB?
- Only if individual is not identified
On an accidental death and dismemberment (AD&D) policy, the death benefit payable is known as the
- Principal sum
If a life insurance company uses HIV testing as a part of its underwriting, when must an applicant be notified of the procedure?
- Prior to performance of the test
The purpose of the Fair Credit Reporting Act is to
- Protect consumers against the circulation of inaccurate or obsolete personal or financial information
The elimination period in a disability income policy is better known as
- The period of time an insured must wait after the onset of an illness or injury before benefits begin
An employee is covered under COBRA. His previous premium payment was $100 per month. His employer now collects $102 each month. Why does the employer collect an extra $2?
- To cover employer's administration costs