New Jersey Health Only
A producer or insurer who violates the solicitation regulations can be ordered to pay a fine for each violation of up to
$2,000.
Which of the following has the authority to issue regulations as are deemed necessary or desirable to establish minimum standards for the form, content, and sale of individual and group health insurance policies?
. Commissioner
Which of the following is NOT true regarding a flexible spending account?
1. It provides an opportunity to receive benefits on a pretax basis. 2. It is a cafeteria plan .3. It does not have limits on contributions.NOOO 4. It operates on "use-or-lose" basis.
Which of the following is NOT true regarding partial disability?
An insured would qualify if he couldn't perform some of his normal job duties. 2. This is a form of insurance that covers part-time workers.NOOOOO 3. The insured can still report to work and receive benefits .4. Benefit payments are typically 50% of the total disability benefit.
Which describes the features of a comprehensive major medical policy?
Basic medical expense benefits are provided in a single package
What type of policy allows the insurance company to cancel a policy at any time?
Cancellable
Alexander has a policy with his ex-wife as its beneficiary. What provision allows him to change the beneficiary to his new wife?
Change of beneficiary
Todd has been informed that he has a hernia which requires repair. When Todd researches the cost, he learns that his insurance plan will cover 200 points worth of surgical expenses. Each point represents $10, which means that $2000 of his surgery will be covered by his insurance plan. What system is Todd's insurance company using?
Conversion factor
Under the New Jersey Temporary Disability Law, a "covered individual" is any person who has been out of work for less than 2 weeks or who is employed by a
Covered employer.
A waiver of premium provision may be included with which kind of health insurance policy?
Disability income
An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurer's classification in Wyoming?
Foreign
In insurance terms, if a person has a chromosomal defect that may predispose him/her to a disease, this is called
Genetic characteristic.
When would a misrepresentation on the insurance application be considered fraud?
If it is intentional and material
An insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice?
Illegal
An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act?
Illegal under any circumstances
Which of the following riders would NOT increase the premium for a policyowner?
Impairment rider
A guaranteed renewable disability insurance policy
Is renewable at the insured's option to a specified age
Which of the following is true of a PPO?
Its goal is to channel patients to providers that discount services.
Which of the following provisions allows an insured to sue an insurance company for nonpayment of claim?
Legar action
Which of the following is NOT provided by an HMO?
Reimbursement b)Services c)Financing d)Patient care Traditionally the insurance companies have provided the financing while the doctors and hospitals have provided the care. The HMO concept is unique in that the HMO provides both the financing and the patient care for its members. The HMO provides benefits in the form of services rather than in the form of reimbursement for the services of the physician or hospital.
When an employee covered under a health reimbursement account changes employers, the HRA
Stays with the employe
A husband and wife are insured under group health insurance plans at their own places of employment, and as dependents under their spouse's coverage. If one of them incurs hospital expenses, how will those expenses likely be paid?
The benefits will be coordinated.
Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to
The insured.
Under the Physical Exam and Autopsy provision, how many times can an insurer have the insured examined, at its own expense, while a claim is pending?
Unlimited
A producer's appointment lasts for how long?
Until it is terminated
In forming an insurance contract, when does acceptance usually occur?
When an insurer's underwriter approves coverage In insurance, the offer is usually made by the applicant in the form of the application. Acceptance takes place when an insurer's underwriter approves the application and issues a policy.
Which of the following is NOT a factor in determining qualifications for Social Security disability benefits?
Worker's occupation
Which of the following authorities is in charge of investigating claims held against licensees?
commissioner
Which of the following insurers are owned by stockholders?
stock
An employee group with which of the following number of employees would qualify for a medical savings account?
50
What percentage of eligible employees must participate on a small employer group health insurance plan?
75%
Which of the following individuals would most likely be issued a nonresident producer's license?
A Massachusetts resident who sells insurance full-time in Boston but wants to expand his customer base by becoming licensed in New Jersey.
What is the maximum period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?
As long as the policy is in force
Which of the following is NOT true regarding Workers Compensation?
Benefits are regulated by the state government.b )Benefits are offered by the insurer. NOOOO c)Benefits are not regulated by the federal government. d)Benefits vary from state to state.
When twin brothers applied for life insurance from Company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered
Discrimination.
Circulating deceptive sales material to the public is what type of Unfair Trade Practice?
False advertising
Which of the following types of LTC is NOT provided in an institutional setting?
Home health care.
Individual health insurance policies must provide all of the following benefits for the treatment of alcoholism EXCEPT
Limited hospital policy benefits.
Which of the following riders will provide benefits above the base policy amount?
Multiple indemnity rider, The Multiple Indemnity rider, which is included in some life and accidental death policies, can confer double or triple the amount of a benefit when death of the insured is due to specified circumstances. Usually the insured must be below a specified age, and death cannot be a result of preventable causes.
An insured is involved in a car accident. In addition to general, less serious injuries, he permanently loses the use of his leg and is rendered completely blind. The blindness improves a month later. To what extent will he receive Presumptive Disability benefits?
No benefits Presumptive Disability plans offer full benefits for specified conditions. These policies typically require the loss of use of at least two limbs, total and permanent blindness, or loss of speech or hearing. Benefits are paid, even if the insured is able to work. Because the insured's blindness was only temporary and the loss of use in only 1 leg, he does not qualify for presumptive disability benefits.
Qualified medical expenses paid for participants in a Medical Savings Account (MSA) are
Not taxable.
All of the following professional designations are recognized by the Department as acceptable substitutes for education and examination requirements EXCEPT
Professional Insurance Agent (PIA)
Todd has been informed that he has a hernia which requires repair. When Todd researches the cost, he learns that his insurance plan will cover 200 points worth of surgical expenses. Each point represents $10, which means that $2000 of his surgery will be covered by his insurance plan. What system is Todd's insurance company using?
Relative value
Which health insurance provision describes the insured's right to cancel coverage?
Renewal provision Renewability provisions are included in each health insurance contract and outlines both the insurer's and insured's right to cancel or renew coverage. This is considered to be a very important provision required by HIPAA, the federal Health Insurance Portability and Accountability Act of 1996.
What program was established by New Jersey to guarantee access to health coverage for individuals and small employers, regardless of health status, age, claims history, or other risk factors?
The Individual Health Coverage Program
The Paul vs. Virginia case was decided in 1869. To what extent does the Supreme Court's decision still apply to insurance today?
The decision has changed. Insurance is considered to be interstate commerce, and is subject to regulation by the federal government.
How do employer contributions to a Health Savings Account affect the insured's taxes?
The employer contributions are not included in the individual insured's taxable income.
Which of the following statements concerning group health insurance is CORRECT?
The employer is the policyholder.
Which of the following is NOT covered under Plan A in Medigap insurance?
The first three pints of blood each year b)The Medicare Part A deductible NOOOT c)Approved hospital costs for 365 additional days after Medicare benefits end d)The 20% Part B coinsurance amounts for Medicare approved services
An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true?
The group plan will not pay because the employee was injured at work.
Insured Z's health insurance policy year begins in January. His policy contains a carry-over provision. In November, he has a small claim which is less than his deductible. Which of the following is true?
The insured may carry over the amount of this year's expenses to next year, which will help satisfy next year's deductible.
An insured purchased a noncancellable health insurance policy 1 year ago. Which of the following circumstances would NOT be a reason for the insurance company to cancel the policy?
The insured reaches the maximum age limit specified in the policy. b)Within two years of the application, the insurer discovers a misrepresentation. c)The insured is in an accident and incurs a large claim. NOOO d)The insured does not pay the premium.
An insurer hires an advertising agency to create an advertisement for a health insurance policy. The public complains that the way the advertisement presents the policy is misleading because of certain photographs that the advertiser put on the commercial. Who will be held liable for this?
The insurer
Which of the following is true regarding license cancellation and reinstatement?
The license needs to be returned to the Insurance Department. It can be reinstated by filling out an application and paying a fee.
An HSA holder who is 65 years old decides to use the money in the account for a nonhealth expense. Which of the following is true?
There will be a tax.
An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?
Time of Payment of Claims
Which of the following is included in the term "insurance-related conduct"?
Transmitting funds between producers and the insurance company
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as
adhesion.
The requirement that agents must account for all insurance funds collected, and are not permitted to comingle those funds with their own is known as
fiduciary responsibility
Which of the following provisions allows an insured to sue an insurance company for nonpayment of claim?
legal action
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?
mutual
An applicant for an individual health policy failed to complete the application properly. Before being able to complete the application and pay the initial premium, she is confined to a hospital. This will not be covered by insurance because she has not met the conditions specified in the
. Consideration Clause.
Which of the following entities has the authority to make changes to an insurance policy?
. Insurer's executive officer
All of the following are true regarding rebates EXCEPT
1. Dividends are not considered to be rebates .2. Rebates are allowed if it's in the best interest of the client. NOOO 3. Rebates are only allowed if specifically stated in the policy. 4. Rebating can be anything of economic value, given as an inducement to buy.
Which of the below statements does NOT describe a Blue Cross and Blue Shield Plan?
1. Most of the organizations are voluntary and not-for-profit. 2. Benefits are paid to the hospitals and physicians, not the insureds. 3. Services are paid for at the time of useNOOOO .4. The physicians and hospitals are considered to be the producers.
Which of the following is NOT the consideration in a policy?
1. The premium amount paid at the time of application -yes 2. The promise to pay covered losses-yes 3. The application given to a prospective insured-no 4. Something of value exchanged between parties-yes
A producer received a group master policy and certificates for delivery to the insured. Within how many days must the policy and certificates be delivered?
10 calendar days
If an applicant's license has lapsed within the past year, the applicant may apply for late renewal of the license within the maximum of how many months of expiration?
12 months
What is the minimum age that an insurance producer can be licensed in New Jersey?
18
If a producer dies or is rendered severely disabled, an unlicensed person can contract with another insurance producer to continue this person's insurance transactions for
180 days.
Which of the following does the Insuring Clause specify?
1The name of the insured Covered perils The insurance company
Producer licenses are valid for
2 years
Which of the following is required information a producer must provide before soliciting insurance?
2. The nature of producer's relationship with the insurer being represented 3. The name of the insurer the producer represents 4. Producer's name
Following an injury, a policyowner covered under Medicare Parts A & B was treated by her physician on an outpatient basis. How much of her doctor's bill will she be required to pay out-of-pocket?
20% of covered charges above the deductible
Bill's license was revoked 2 years ago. How much longer will he have to wait in order to request his license to be reinstated?
3 years
Licensees must file with the Department a branch office registration form within how many days before business is first conducted there?
30 days
If a producer has been convicted of a crime, he or she must notify the Commissioner within
30 days.
All of the following qualify for Medicare Part A EXCEPT
Anyone who is at the end stage of renal disease. 2. Anyone who is over 65, not covered by Social Security, and is willing to pay premium. 3. Anyone who is willing to pay a premium.NO 4. Anyone that qualifies through Social Security.
Which of the following policies is NOT required to include coverage for alcoholism?
A Medicare supplement policy
What is a material misrepresentation?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain
A statement that is sufficiently clear to identify the insured and the nature of the claim.
Presenting any written or oral statement in support of or in opposition to a claim payment, while knowing that the statement contains false or misleading information material to the claim, would be best considered
A violation of the New Jersey Insurance Fraud Prevention Act.
When the insured purchased his health policy he was a window washer. He has since changed occupations and now manages a library. If the insurer is notified of the insured's change of occupation, the insurer should
Adjust the benefit in accordance with the decreased risk.
When transacting business in this state an insurer formed under the laws of another country is known as a/an
Alien insurer.
Which of the following is a duty of the Commissioner of insurance in this state?
Amend rules and regulations
Which of the following statements is true concerning the alteration of optional policy provisions?
An insurer may change the wording of optional provisions, as long as the change does not adversely affect the policyholder.
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
An unfair trade practice.
The Department can run a report on a specific producer that lists his or her license information, current license status, and the types of insurance that he or she can transact. What is the name of this report?
Certification of license status report
Which of the following establishes minimum standards for any policy that will be marketed as a Medicare supplement policy?
Commissioner
A Medicare supplement plan must have at least which of the following renewal provisions?
Conditionally renewable b)Nonrenewable c)Noncancellabled) Guaranteed renewable YEEESSS Medicare supplements must be at least guaranteed renewable.
Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe?
Consideration
Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements
Consideration. Legal purpose. Offer and acceptance.
Which of the following is an insurance professional who offers advice regarding benefits or advantages of an insurance policy to clients for a fee?
Consultant.
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as
Contracts of adhesion.