Life insurance take 2
Which of the following types of term life policies most likely contains a renewability feature?
10 year convertible term
XYZ Company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is
100%
An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.
15 days
An insured must notify an insurer of a medical claim within ____ days after an accident
20 days
The commissioner notifies the association of an insolvent insurer no later than __ days after receiving notice of the insurer's insolvency
3
An insured pays premiums on an annual basis for an individual health insurance policy. What is the MINIMUM number of days for the Grace Period provision?
31
Which of the following statements BEST describes the intent of a coinsurance clause In a major medical policy ?
Discourages overutilization of the insurance coverage
T purchased a $100,000 single premium, Straight Life annuity 5 years ago. He has received monthly payments since the inception of the annuity. If T dies, the insurance company
Does not have to make any further payments
What type of policy would only provide coverage for specific types of illnesses (cancer, stroke, etc)?
Dread disease insurance
Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?
Entire Contract
When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called the
Entire Contract provision
D owns a Whole Life policy that was purchased 10 years ago. If the premium payments suddenly stop and D takes no additional action, which Nonforfeiture Option will the insurer likely proceed with?
Extended term
N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?
Fixed Deferred
K is looking to purchase Renewable Term insurance. Which of these types of Term insurance may be renewable?
Level
When engaged in an insurance transaction in Tennessee, the producer represents the
insurer
According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?
monthly
Who is NOT required to sign a life insurance application?
beneficiary
The guarantee of insurability option provides a long-term care policyowner the ability to
buy additional coverage at a later date
The automatic premium loan provision is designed to
avoid a policy lapse
Medicaid was designed to assist individuals who are
below a specific income limit
The amount of coverage on a group credit life policy is limited to
the insured's total loan value
N is covered under an individual Disability policy with a 30-day Elimination period and a monthly benefit of $500. N is totally disabled for 3 1/2 months. N's total benefit received on this claim is
$1,250 (500+500+250)
V is insured under an individual Disability Income policy with a 30-day Elimination period. On July 1, he is involved in an accident and temporarily disabled. He returns to work on December 1. How many months of benefit are payable?
4 months
M's insurance company denied a reinstatement application for her lasted health insurance policy. The company did not notify M of his denial. How many days from the reinstatement application date does the insurance company have to notify M of the denial before the policy will be automatically placed back in force?
45 days
Q is severely injured in an automobile accident and becomes totally disabled. How many months must Q be disabled before being able to apply for Social Security disability benefits?
5 You are eligible to file for Social Security benefits after being totally disabled for 5 months.
Qualified Long-Term Care policies may take into consideration an applicant's pre-existing conditions for a maximum of not more than __ month(s) prior to the effective date of coverage.
6
Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?
A Whole Life Policy with an Other Insured Rider
The consideration clause in a life insurance contract contains what pertinent information?
Amount of premium payments and when they are due
Which of the following statements BEST describes what the legal actions provisions of an accident and health policy requires?
An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be file
When does a Probationary Period provision become effective in a health insurance contract?
At the policy's inception
At what time must a policyowner have insurable interest on the insured in order for the life policy to be valid?
At the time of application
T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?
Benefits are taxable to T
Accidental death coverage is provided to commercial airline passengers in which of the following types of policies?
Blanket Accident policy
For a change to a health policy to be valid, what is required?
Changes in the policy must be approved by an executive officer of the insurer
A major medical policy typically contains a provision that required the insurer to pay only part of a loss, while the balance is paid by the insured. This provision is called?
Coinsurance
Which of the following reimburses its insureds for covered medical expenses
Commercial insurers
An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?
Consideration clause
Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?
Decreasing term
How are surrender charges deducted in a life policy with a rear-end loaded provision?
Deducted when the policy is discontinued
S is the policyowner of a Major Medical policy. The premiums are paid monthly and due on the 1st of each month. S fails to make September's payment and is hospitalized October 15th. When S files the claim for this hospitalization, the insurer will likely:
Deny the claim
What is considered a valid reason for small business to insure the lives of its major shareholders?
Fund a buy-sell agreement
Which requirement must be met for an association to be eligible for a group life plan?
Group was formed for a purpose other than acquiring insurance
S wants to open a tax-exempt Health Savings Account. To qualify for this type of account, Federal law dictates that S must be enrolled in a
High Deductible Health Plan
Which of the following statements about Health Reimbursement Arrangements(HRA) is correct?
If the employee paid for qualified medical expenses, the reimbursements may be tax-free
How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy?
If the primary beneficiary dies before the insured
T owns an Accident & Health policy and notifies her insurance company that she has chosen a less hazardous occupation. Under the Change of Occupation provision, which of the following actions may her insurance company take?
Increase her policy's coverage amount
Information obtained from a phone conversation to the proposed insured can be found in which of these reports?
Inspection report
An insurance company normally has 2 years to content information provided on an accident and health application. This 2 a period begins on the date that the?
Insurer dates the policy
Which health policy clause specifies the amount of benefits to be paid?
Insuring
Which of the following health insurance policy provisions specifies the health care services a policy will provide?
Insuring clause
All of these Settlement options involve the systematic liquidation of the death proceeds in the event of the insured's death EXCEPT
Interest only
Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for disability income policy
Issue the policy with an altered Time of Payment of Claims provision
What is the purpose of a Policy Summary?
It highlights the critical parts of the policy issued
T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this?
Life Annuity with Period Certain
Which of these is NOT an example of a Nonforfeiture option?
Life Income
Which of these is NOT relevant when determining the amount of personal life insurance needed?
Local unemployment rate
Which of the following types of health coverage frequently uses a deductible?
Major Medical policy
The health insurance program which is administered by each state and funded by both the federal and state governments is called?
Medicaid
Which of the following are NOT managed care organizations?
Medical Information Bureau (MIB)
All of these insurance products require an agent to have proper FINRA securities registration in order to sell them EXCEPT for
Modified Whole Life
Which of these is NOT an element of Life insurance premiums?
Morbidity rate
In an insurance company issues a disability income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best describes this policy is called?
Noncancellable
Which of these statements concerning an individual disability income policy is true?
Normally includes an Elimination period
Under what system do a group of doctors and hospitals in a designated area contract with an insurer to provide services at a prearranged cost to the insured?
PPO (Preferred Provider Organization)
Which of these is considered a mandatory provision?
Payment of Claims
An individual health insurance policy is REQUIRED to contain.
Payment of Claims provision
Which of these statements concerning an individual straight life annuity is accurate?
Payments are made to an annuitant for life
Who has the right to change a revocable beneficiary?
Policyowner
A Limited-PayLife policy has?
Premium payments limited to a specified number of of years
How does group insurance differ from individual insurance?
Premiums are lower
T is the policyowner for a Life Insurance policy with an Irrevocable beneficiary designation. If T wishes to change the beneficiary, T must obtain permission from the
beneficiary
S buys a $10,000 Whole Life policy in 2003 and pays an annual premium of $100. S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. What kind of rider did S include on the policy?
Return of premium rider
Which of these terms accurately defines an underwriter's assessment of information on a life insurance application?
Risk classification
Post-tax dollar contributions are found in
Roth IRA investments
J chooses a monthly premium payment mode on his Whole Life insurance policy. Which of these statements is correct?
The gross premium is higher on a monthly payment mode as compared to being paid annually
Upon policy delivery, a signed good health statement is requested from the applicant. Why would this be necessary?
The initial premium was NOT submitted with the application
T was insured under an individual Disability Income policy and was severely burned in a fire. As a result, T became totally disabled. The insurer began making monthly benefit payments, but later discovered that the fire was set by T in what was described as arson. What actions will the insurer take?
The insurer will rescind the policy, deny the claim, and recover all payments made
The advantage of reinstating an original life policy is
The premiums are based on a younger age
T flies a claim on his Accident and Health policy after being treated for an illness. The insurance company believes that T misrepresented his actual health on the initial insurance application and is, therefore, disputing the claim's validity. The provision that limits the time period during which the company may dispute a claim validity is called
Time Limit on Certain Defenses
What type of life insurance incorporates flexible premiums and an adjustable death benefit?
Universal Life
Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling?
Variable Life
An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?
When the conditions of the receipt are met
L takes out a life insurance policy and dies 10 years later. During the claim process, the insurer discovers that L had understated her age on the application. Under the Misstatement of Age provision, the insurer will
adjust the death benefit to a reduced amount
Under a Graded Premium policy, the premiums
are lower during the policy's early years
A ____ of benefits of a health policy transfers payments to someone other than the policyowner
assignment
Which provision allows the policyowner to change a term life policy to a permanent one without providing proof of good health?
conversion
Non-occupational disability coverage is designed for
employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation
A Nonforfeiture clause gives the policyowner
guaranteed values even if the policy has lapsed
Which of the following will a Long Term Care plan typically provide benefits for?
home health care
T sends proof of loss to her insurer for an acceptable medical expense claim under her individual Health Insurance policy. Upon receipt, the insurer must pay the benefits
immediately
Which of the following BEST describes a short-term medical expense policy?
nonrenewable
In an individual retirement account (IRA), rollover contributions are
not limited by dollar amount
The Coordination of Benefits provision
prevents an insured covered by two health plans from making a profit on a covered loss
Which of these is NOT a type of agent authority
principal
The Legal Actions provision of an insurance contract is designed to do all of the following, EXCEPT:
protect the producer
Which of the following services is NOT included under hospitalization expense coverage?
surgical fees
The reason for backdating a policy is
to obtain a premium rate based on an earlier age
R becomes disabled and owns an individual Disability Income policy. When is R eligible to receive disability benefits?
upon satisfying the elimination period
A term life insurance policy matures
upon the insured's death during the term of the policy
