practice exam

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.

Which of the following long-term care benefits would provide coverage for care for functionally impaired adults on a less than 24-hour basis?

Adult day care

Assuming that all of the following people are covered by a High Deductible Health Plan and are not claimed as dependents on anyone's tax returns, which would NOT be eligible for a Health Savings Account

Amanda is 67 and is covered by a basic medical expense policy

An insured is the recipient of an Accidental Death and Dismemberment (AD&D) policy purchased by his employer. The policy pays triple indemnity in case of accidental death. If the insured died as a result of an accident stipulated in the policy, how will the benefits paid be taxed?

Benefits received are considered income tax free.

Which of the following is true regarding inpatient hospital care for HMO members?

Care can be provided outside of the service area.

A man is injured while robbing a convenience store. How does his major medical policy handle the payment of his claim?

Claim is denied if his policy contains the Illegal Occupation provision.

Which of the following is NOT covered by Medicare?

Cosmetic surgery

Which of the following statements about occupational vs. nonoccupational coverage is TRUE?

Disability insurance can be written as occupational or nonoccupational.

treatment of the dental pulp within natural teeth, such as aroot canal.

Endodontics

An annuity owner is funding an annuity that will supplement her retirement. Because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the Standard and Poor's 500 Index. She would likely purchase a(n)

Equity Indexed Annuity.

An agent selling variable annuities must be registered with

FINRA

Health coverage becomes effective when the

First premium has been paid and the application has been approved.

Events or conditions that increase the chances of an insured loss occurring are referred to as

Hazards.

The type of dental plan which is incorporated into a major medical expense plan is a/an

Integrated dental plan.

Which of the following best describes a misrepresentation?

Issuing sales material with exaggerated statements about policy benefits

In a Disability Income policy, all of the following are considered presumptive disabilities EXCEPT

Loss of one eye.

A producer is helping a married couple determine the financial needs of their children in the event one or both should die prematurely. This is a personal use of life insurance known as

Survivor protection

Under an extended term nonforfeiture option, the policy cash value is converted to

The same face amount as in the whole life policy.

On a health insurance application, a signature is required from all of the following individuals EXCEPT

The spouse of the policyowner.

Which of the following statements regarding conditional receipts is true?

They are temporary insuring agreements.

All of the following statements about Medicare supplement insurance policies are correct EXCEPT

They cover the cost of extended nursing home care.

What do long-term care policies offer to policyholders to account for inflation?

They offer the option of purchasing coverage that raises benefit levels accordingly.

A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges which fall within the standard range of fees normally charged for a specific procedure by a doctor of similar training and experience in that geographic area is known as

Usual, customary and reasonable.

Which of the following premium payment modes will incur the lowest overall payment?

annual

Which of the following types of agent authority is also called "perceived authority"?

apparent

Any payment to a producer from an insurer that is contingent on the sale of an insurance policy or contract is called a

commission

When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty of

defamation

An insured has a major medical policy with a $500 deductible and 80/20 coinsurance. The insured is hospitalized and sustains a $2,500 bill. What is the maximum amount that the insured will have to pay?

$900

How many days does a producer have to notify the Department of a change of address?

30

What is the number of credits required for fully insured status for Social Security disability benefits?

40

How long must a licensee keep records of insurance transactions on file, available for inspection by the Director?

5 years

All of the following could own group life insurance EXCEPT

A group needing low-cost life insurance.

Which of the following is INCORRECT regarding a $100,000 20-year level term policy?

At the end of 20 years, the policy's cash value will equal $100,000.

The section of a health policy that states the causes of eligible loss under which an insured is assumed to be disabled is the

Insuring clause.

Why is an equity indexed annuity considered to be a fixed annuity?

It has a guaranteed minimum interest rate.

Variable Whole Life insurance is based on what type of premium?

Level fixed

Which part of an insurance application would contain information regarding the cause of death of the applicant's deceased relatives?

Medical Information

A producer who fails to act as a fiduciary is guilty of a

Misdemeanor.

An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called

Paid-up additions.

The part of Medicare that helps pay for inpatient hospital care, inpatient care in a skilled nursing facility, home health care and hospice care, is known as

Part A.

treatment of the surrounding and supporting tissue ofthe teeth such as treatment for gum disease.

Periodontics

Which of the following is the most common time for errors and omissions to occur on the part of an insurer?

Policy delivery

Who might receive dividends from a mutual insurer?

Policyholders

All of the following are examples of risk retention EXCEPT

Premiums

Which of the following describes taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable.

Which of the following is NOT among the goals of a Medicare supplement application?

Presuming the applicant is eligible for Medicaid, based on the nature of the policy

Rose bought three policies from the same insurer. Her benefits have exceeded the maximum allowed by the insurer. Which of the following will happen?

Pro rata benefit reduction

the replacement of missing teeth with artificial deviceslike bridgework or dentures.

Prosthodontics

What type of care is Respite care?

Relief for a major care giver

Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must

Respond to the consumer's complaint.

In dental insurance, what type of care will cover crowns?

Restorative

A domestic insurer issuing variable contracts must establish one or more

Separate accounts.

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

The date of medical exam

In a group policy, who is issued a certificate of insurance?

The individual insured

The insuring clause of a disability policy usually states all of the following EXCEPT

The method of premium payment.

Which of the following determines the cash value of a variable life policy?

The performance of the policy portfolio

Which of the following is TRUE about nonforfeiture values?

They are required by state law to be included in the policy.

The Waiver of Cost of Insurance rider is found in what type of insurance?

Universal Life

Which of the following describes the taxation of an annuity when money is withdrawn during the accumulation phase?

Withdrawn amounts are taxed on a last in, first out basis.

Which of the following is an example of a producer's fiduciary responsibilities?

. A producer promptly forwarding premiums to the insurance company

Which of the following disability income policies would have the highest premium?

15-day waiting period / 10-year benefit period

.The relation of earnings to insurance provision allows the insurance company to limit the insured's benefits to his/her average income over what period of time?

2 years

How soon must nonresident producers notify this state's Director of change of address?

30 days

In which of the following situations is it illegal for an insurer to disclose privileged information about an insured?

A researcher for marketing purposes

All of the following statements concerning workers compensation are correct EXCEPT

A worker receives benefits only if the work related injury was not his/her fault.

The classification "small employer" means any person actively engaged in a business that during the preceding year employed

At least 2 and not more than 50 persons.

operative treatment of the mouth such as extractions of teethand related surgical treatment.

Oral surgery

What part of the Internal Revenue Code allows an owner of a life insurance policy or annuity to exchange or replace their current contract with another contract without creating adverse tax consequences?

Section 1035 Policy Exchange

Equity indexed annuities

Seek higher returns.

A person steps off a street car and trips and breaks his ankle. This type of injury can be described as

Sudden and unforeseen.

Nonforfeiture values guarantee which of the following for the policyowner?

That the cash value will not be lost

Which of the following expenses is NOT covered by a health insurance policy?

funeral

What type of licensee represents the insurance company?

producer

Which of the following is NOT true regarding a Certificate of Authority?

It is equivalent to an insurance license.

A health insurance plan which involves financing, managing, and delivery of health care services and involves a group of providers who share in the financial risk of the plan or who have an incentive to deliver cost effective service, is called

Managed care plan.

Which of the following statements pertaining to Medicare Part A is correct?

Medicare Part A is automatically provided when an individual qualifies for Social Security benefits at age 65.

In order to transact insurance business in this state, an agency must meet all of the following requirements EXCEPT

Obtain an insurance agency license.

What is the official name for the Social Security program?

Old Age Survivors Disability Insurance

treatment of natural teeth to prevent and/or correct dental anomalies with braces or appliances.

Orthodontics

Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early?

Paid-up option

All of the following are ways in which a Major Medical policy premium is determined EXCEPT

The average age of the group.

An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of

rebating

Which of the following is NOT provided by an HMO?

reimbursement

treatments, which restore functional use to natural teethsuch as fillings or crowns.

restorative

For the purpose of insurance, risk is defined as

the uncertainty or chance of loss