Oklahoma Life and Health Exam Study Guide Part 3

Most policies will pay the accident death benefits as long as the death is caused by the accident and occurs within a) 60 days. b) 90 days. c) 120 days. d) 30 days.

B. 90 days Most policies will pay the accidental death benefit as long as the death is caused by the accident and occurs within 90 days.

All of the following are exempt from the licensing requirement EXCEPT a) Employee of insurance company involved in the effectuation of the insurance contract. b) Employee of insurance company handling the incoming calls. c) Employee in charge of enrolling individuals into a group plan. d) Human Resource Benefit Personnel.

A. Employee of insurance company involved in the effectuation of the insurance contract An employee of an insurance company that effectuates an insurance contract would need to hold a valid insurance agent license as specified in O.S. 1424.

What is the purpose of establishing the target premium for a universal life policy? a) To cover all policy expenses b) To keep the policy in force c) To accumulate cash value faster d) To pay up the policy faster

B. To keep the policy in force The target premium is a recommended amount that should be paid on a policy in order to cover the cost of insurance protection and to keep the policy in force throughout its lifetime.

According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan? a) 10% b) 30% c) 40% d) 60%

D. 60% Under the bronze plan, the health plan is expected to cover 60% of the cost for an average population, and the participants would cover the remaining 40%.

Renewal fees for all licenses are the same as the initial license. However, late application for renewal of a license requires a fee of a) Triple the original license fee. b) One and one half the original license fee. c) Half the original license fee. d) Double the original license fee.

D. Double the original license fee Renewing late requires the applicant to pay double the licensing fee (O.S. 1425)

Which of the following entities established the Do-Not-Call Registry? a) The Better Business Bureau b) The NAIC c) The Consumer Protection Agency d) The Federal Trade Commission

D. The Federal Trade Commission The FTC established the do-not-call list in order to protect consumers against unwanted solicitations.

How many days does an insurer have to respond to a written communication from a claimant? a) 10 days b) 20 days c) 30 days d) 90 days

C. 30 days Insurers must respond to written communications from claimants within 30 days of receiving the communication.

Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values and death benefits for specific policy years? a) A policy summary b) A notice regarding replacement c) A privacy notice d) A buyer's guide

A. A policy summary A policy summary usually includes all the listed information, and must be delivered along with a new policy.

According to the telemarketing sales rules, what are the permissible calling hours for telemarketing calls? a) 10am until 10pm b) 7am until 7pm c) 7am until 9pm d) 8am until 9pm

D. 8am until 9pm Permissible calling hours for telemarketers are between 8am and 9pm.

Before an insurer pays fees or commissions to an agent, which of the following must happen? a) Funds from premiums must be placed in a fiduciary account. b) The insurer must register the agent with the NAIC. c) The 30 day Commissions Moratorium must be satisfied. d) The Commissioner must approve the agent's appointment.

D. The Commissioner must approve the agent's appointment Before collecting fees or commissions, an agent's appointment with an insurer must be approved by the Insurance Commissioner.

When an individual life insurance policy is being replaced by an insurer using an agent, the policyowner must be given an unconditional right to a full refund of premiums if the policy is returned within a) 10 days. b) 20 days. c) 30 days. d) 45 days.

B. 20 days The replacing insurer must provide in its policy, or in a separate written notice delivered with the policy, that the applicant has a right to an unconditional refund of all premiums paid, which may be exercised within a period of 20 days from the date the policy is delivered.

Regarding the taxation of Bussiness Overhead policies, a) Premiums are deductible and benefits are taxed. b) Premiums are not deductible and benefits are taxed. c) Premiums are not deductible, but benefits are deductible. d) Premiums are not deductible, but expenses paid are deductible.

A. Premiums are deductible and benefits are taxed The premiums paid for BOE insurance are tax deductible to the business as a business expense. However, the benefits received are taxable to the business as received.

The initial amount of credit life insurance may NOT exceed a) The amount to be repaid under the contract. b) An amount set by statute and adjusted regularly for inflation. c) The borrower's monthly income. d) The borrower's annual income.

A. The amount to be repaid under the contract The initial amount of credit life insurance may not exceed the total amount repayable under the contract of indebtedness.

All of the following are true regarding a decreasing term policy EXCEPT a) The payable premium amount steadily declines throughout the duration of the contract. b) It has a lower premium than level term. c) The contract pays only in the event of death during the term and there is no cash value. d) The face amount steadily declines throughout the duration of the contract.

A. The payable premium amount steadily declines throughout the duration of the contract Premiums remain level with a decreasing term policy; only the face amount decreases.

An insured owns a life insurance policy. To be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. There is a limit for a withdrawal and the insurer charges a fee. What type of policy does the insured most likely have? a) Universal life b) Adjustable life c) Term life d) Limited pay

A. Universal life Universal Life policies allow for policyholders to withdraw a limited portion of the policy's cash value. Each withdrawal, however, is usually charged, and the amount and frequency of withdrawals are usually limited.

All of the following are correct about the required provisions of a health insurance policy EXCEPT a) The entire contract clause means the signed application, policy, endorsements, and attachments constitute the entire contract. b) A reinstated policy provides immediate coverage for an illness. c) Proof-of-loss forms must be sent to the insured within 15 days of notice of claim. d) A grace period of 31 days is found in an annual pay policy.

B. A reinstated policy provides immediate coverage for an illness Accidental injury is covered immediately, but to protect the insurer against adverse selection, losses resulting from sickness are covered only if the sickness occurs at least 10 days after the reinstatement date.

If the policyowner defaults on any premium payment for a life insurance policy, the insurer must notify the policyholder in writing as to the policyholders options. This notification form must be provided to the policyholder within a) 6 months. b) 3 months. c) 2 months. d) 1 month.

B. 3 months Notification must be provided to the policyholder within 3 months, as specified in the Oklahoma Insurance Code.

If a telemarketer wants to make an unsolicited sales call to a potential customer, what is the earliest time the telemarketer can call the prospect's residence? A. 7 am B. 8 am C. 9 am D. Noon

B. 8 am Permissible calling hours for telemarketers are between 8am and 9pm

If the insured under a disability income insurance policy changes to a more hazardous occupation after the policy has been issued, and a claim is filed, the insurance company should do which of the following? a) Exclude coverage for on-the-job injury b) Adjust the benefit in accordance with the increased risk c) Cancel the policy d) Increase the premium

B. Adjust the benefit in accordance with the increased risk A part of the premium rating concerns the hazard of occupation.

Which of the following is TRUE about credit life insurance? a) Debtor is the policy beneficiary. b) Creditor is the policyowner. c) Debtor is the annuitant. d) Creditor is the insured.

B. Creditor is the policy owner In credit life insurance, the creditor is the policyowner and the beneficiary; the debtor is the insured.

How often must producers in this state complete continuing education requirement? a) Annually b) Every 2 years c) Every 3 years d) Every 5 years

B. Every 2 years Each insurance producer (except for title producers) must complete at least 24 hours of continuing education biennially (every 2 years). Three of those hours must be in ethics education.

If a producer allows his or her license to lapse, what is the maximum time period during which the producer can reinstate the license without having to retake the examination? a) 90 days b) 6 months c) 12 months d) 16 months

C. 12 months If an individual insurance producer allows his or her license to lapse, that same license may be reinstated without passing a written exam within 12 months of the lapse.

In a relative value system of determining coverage for a given procedure, what term describes the total amount payable per point? a) Translation factor b) Practical value c) Conversion factor d) Relative value

C. Conversion Factor In order to determine the amount payable for a given procedure, the assigned points (relative value) of 200 are multiplied by a conversion factor. This conversion factor represents the total amount payable per point. For example, if the conversion factor is $10 and the point value is 200, the policy would pay $2,000 for the procedure (200 x 10).

What characteristic makes whole life permanent protection? a) Guaranteed level premium b) Living benefits c) Coverage until death or age 100 d) Guaranteed death benefit

C. Coverage until death or age 100 Whole Life policies are referred to as permanent protection, since as long as the premium is paid coverage will continue for the life of the insured or till the insured's age 100.

Every insurer marketing Long-Term Care insurance must establish marketing procedures to ensure all of the following EXCEPT a) Excessive insurance will not be sold. b) Every reasonable efforts is made to identify an applicant's other insurance. c) LTC policies are marketed effectively to prospective insureds. d) Comparisons of policies are fair and accurate.

C. LTC policies are marketed effectively to prospective insureds All insurers marketing long-term care policies must establish these procedures. Additionally, companies must have marketing guidelines to insure that excessive insurance is not sold or issued.

Which of the following is true regarding health insurance coverage for a state resident whose policy has lapsed as a result of military service activation? a) Coverage will be reinstated automatically upon honorable discharge. b) The policy may be reinstated to the same status within 30 days of discharge from the military service. c) Lapsed coverage cannot be reinstated; the individual will have to apply for a new policy. d) The policy may be reinstated to a status recommended as a result of medical underwriting.

B. The policy may be reinstated to the same status within 30 days of discharge from the military service Oklahoma residents that are activated for military service may not be denied reinstatement into the same individual health insurance coverage with the same health plan that lapsed as a result of activation. Such individuals and their dependents have the right to reinstatement of coverage without medical underwriting, and in the same rating tier as prior to military service activation. A reinstatement request must be received no later than 30 days following deactivation of military service.

Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce a) Without receiving written consent from a Federal Judge. b) Without receiving written consent from an insurance regulatory authority. c) Under any circumstances. d) Unless they have served an appropriate prison sentence.

B. Without receiving written consent from an insurance regulatory authority Title 18, US Code, sections 1033-1034 makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce without receiving written consent from an insurance regulatory authority.

Which of the following is included on the certificate for credit life insurance? a) A list of all beneficiaries, whether participating members or not b) A list of all previous participants, as well as current participants c) The effective date and termination date d) A list of all dependents

C. The effective date and termination date All individual or group certificates of credit life or health must also include the effective date and termination date of the policy.

When would a 20-pay whole life policy endow? a) After 20 payments b) In 20 years c) When the insured reaches age 100 d) At the insured's age 65

C. When the insured reaches age 100 A limited-pay whole life policy, just like straight life, endows for the face amount if the insured lives to age 100. The premium is, however, completely paid off in 20 years.

Under the Affordable Care Act, what percentage of preventive care must be covered without cost sharing? a) 25% b) 50% c) 80% d) 100%

D. 100% The Act requires that 100% of preventive care be covered without cost sharing.

What is the purpose of a conditional receipt?

It is intended to provide coverage earlier than the date of issuance of the policy Coverage commences on the date of the application or the date of a medical examination, whichever is later, on the condition that the applicant is determined to be insurable at the rate applied for.