Test questions
Commissioner must be notified within 30 days.
If an insurance company cancels a producer's appointment, the
The individual insured
In a group policy, who is issued a certificate of insurance?
When an insurer's underwriter approves coverage
In forming an insurance contract, when does acceptance usually occur?
30
In instances where a coordination of benefits provision is necessary, and two relevant plans cannot agree on the order of benefits, they have to pay the claim in equal shares. How long do they have to determine the order of benefits?
Occasional nursing or rehabilitative care
In long-term care insurance, what type of care is provided with intermediate care?
Pay dividends to the policyowner
A participating insurance policy may do which of the following?
The policy remains in force without penalty for 31 days even though the premium due has not been paid.
A policy with a 31-day grace period implies
Limited Policy Notice
A policyowner is reading a statement on the first page of his health insurance policy, which says "this is a limited policy" What is the of this statement?
The insured will need a written consent of the insurer.
An insured wants to transfer his personal insurance policy to a friend, Under what conditions would this be possible?
The capital amount in a lump sum
An insured who has an Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this policy?
Increased benefits
Issue age policy premiums increase in response to which of the following factors?
To purchase a smaller amount of the same type of insurance as the original policy.
The paid-up addition option uses the dividend
Anindividual who was previously covered by group health insurance for 6 months is eleble
Under HiPAA, which of the following is INCORRECT regarding eligibility requirements for conversion to an individual policy?
Principal sum
Under the Accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death?
Unlimited
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?
6 months
What is the elimination period for Socia Security disability benefits?
Prohibit payment for regularly covered services if provided by non-network providers
A Medicare SELECT policy does all of the following EXCEPT
Proof of insurability is not required.
A couple owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?
Level benefit payment.
A fixed annuity contract provides for
Both subscribr and insured
A man bought an individual health insurance policy for himself. Which of the following roles does he now legally have?
Prospective review.
A man's physician submits claim information to his insurer before she actually performs a medical procedure on him. She is doing this to see if the procedure is covered under the patient's insurance plan and for how much. This is an example of
10 days
A producer has been notified by the Commissioner to stop using an unapproved trade name How many days does the producer have to charge the trade name before having to pay an additional fine?
Commingling.
A producer who fails to segregate premium monies from his own personal funds is guilty of
Other-insured rider.
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the
Copy of the original application
According to the entire contract provision, what document must be made part of the insurance policy?
A reinstated policy provides immediate coverage for an illness.
All of the following are correct about the required provisions of a health insurance policy EXCEPT
Premiums
All of the following are examples of risk retention EXCEPT
Suggesting negotiations in settling the claim.
All of the following are unfair claims settlement practices EXCEPT
A retired person age 50
All of the following individuals may qualify for Medicare health insurance benefits EXCEPT
A retired person age 50.
All of the following individuals may qualify for Medicare health insurance benefits EXCEPT
The policy is owned by the company
All of the following statements concerning the use of life insurance as an Executive Bonus are correct EXCEPT
The policy is owned by the company.
All of the following statenments concerning the use of life insurance as an Executive Bonus are correct EXCEPT
Taxation on accumulation
All of the following would be different between qualified and nonqualified retirement plans EXCEPT
Transfer of all ownership rights in a policy.
An absolute assignment is a
FINRA
An agent selling variable annuities must be registered with
Guaranteed insurability option
An individual is purchasing a permanent life insurance policy with a face afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should value of $25,000. While this is all the insurance that he can be included in the policy?
False advertising
An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of?
Her insurance would pay up to its limit
An insured has mistakenly failed to enroll in her husband's health plan. What would happen following a major health expense?
Guaranteed insurability.
At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. This rider is called
Predicted needs of the family after the insured's death.
Based on Human Life Value Approach, which of the following is NOT used to calculate an individual's life value?
Apparent
Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?
Dread Disease Policy
Because of the history of cancer in her family. Julie purchased a policy that specifically covers the expense of treating cancer. Her policy would be classified as what type of policy?
Yes, and they may use any preferred physician, even if not part of the HMO
Can an individual who belongs to a POS plan use an out-of-network physician?
Felony.
Committing insurance fraud is considered a/an
Itis fulty funded by Social Security taxes (FICA)
Concerning Medicare Part B, which statement is INCORRECT?
Seek higher returns.
Equity indexed annuities
100
For how many days of skilled nursing facility care will Medicare pay benefits?
The uncertainty or chance of loss.
For the purpose of insurance, risk is defined as
Increase benefit levels without providing proof of insurability
Guarantee of insurability option in long-term care policies allows the insured to
First premium has been paid and the application has been approved.
Health coverage becomes effective when the
6 months
How long is an open enrollment period for Medicare supplement policies?
5 days
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
Jumping juvenile policy
If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this?
Principal sum
If an individual is covered by a policy that includes an Accidental Death & Dismemberment rider, what term describes the maximum benefits he will receive if he loses sight in both eyes as a result of a fire?
The insured must have first been hospitalized for 3 consecutive days.
In order for an insured under Medicare Part A to receive benefits for care in a skilled nursing facility, which of the following conditions must be met?
5
In order to qualify for conversion from a group life policy that has been terminated to an individual policy of the same coverage, a person must have been insured under the group plan for how many years?
4
Insurers must keep files of all advertisements used in Louisiana for how many years?
Attending physician
Occasional visits by which of the following medical professionals will NOT be covered under LTC's home health care?
50 or more.
One of the differences between group underwriting and individual underwriting is that there is little or no medical information required regarding plan participants in groups of
They condition the payment of benefits.
Regarding Medicare SELECT policies, what are restricted network provisions?
Insurance companies from adverse selection by high risk persons.
The Medical Information Bureau (MIB) was created to protect
Universal Life
The Waiver of Cost of Insurance rider is found in what type of insurance?
The beneficiary will receive the greater of the money paid into the annuity or the cash value.
The annuity owner dies while the annuity is still in the accumulation stage. Which of the following is TRUE?
Annually Renewable Term
The death protection component of Universal Life Insurance is always
One-year term option.
The dividend option in which the policyowner uses dividends to purchasea term policy for one year is referred to as the
Life income with period certain.
The form of life annuity which pays benefits throughout the lifetime of the annuitant and also guarantees payment for a minimum number of years is called
A right to return the policy for a full premium refund
The free-look provision allows for which of the following?
The method of premium payment.
The insuring clause of a disability policy usually states all of the following EXCEPT
Incontestability clause.
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the
25%.
The limit on controlled business is
$1,000
The minimum fine for violating the Insurance Code is
The policyowner can specify the way proceeds are split in the pollcy
The owner of a life insurance policy wishes to name two beneficiaries for the policy proceeds. What will the soliciting insurance producer say?
Insuring clause.
The section of a health policy that states the causes of eligible loss under which an insured is assumed to be disabled is the
A statement that is sufficiently clear to identify the insured and the nature of the claim.
Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain
Prospective Review
Under which provision can a physician submit claim information prior to providing treatment?
Attending Physician's Statement
What document describes an insured's medical history, including diagnoses and treatments?
It allows guaranteed acceptance of all applicants.
What is NOT a benefit of a POS plan?
To protect the public
What is the main justification for the existence of the State Insurance Department?
To keep the policy in force
What is the purpose of establishing the target premium for a universal life policy?
6 months
What is the waiting period on a Waiver of Premium rider in life insurance policies?
Immediate
What type of annuity can be purchased with a single premium and provides benefit payments immediately?
When the premium is paid at the time of application
When is the insurability conditional receipt given?
When the expenses exceeda certain percentage of the insured's adjusted gross income
When may an insured deduct unreimbursed medical expenses paid under a long-term care policy?
Funds exceeding the premium paid are taxable as ordinary income.
Which is TRUE about the cash surrender nonforfeiture option?
Universal life
Which of the following Life Insurance policies would be considered interest sensitive?
Routine and major restorative care
Which of the following dental insurance categories would cover the filling of cavities?
Size of each installment
Which of the following determines the length of time that benefits will be received under the Fixed-Amount settlement option?
To minimize the insured's level of liability in the event of loss
Which of the following is NOTA goal of risk retention?
Creditor is the policyowner.
Which of the following is TRUE about credit life insurance?
Pay-in period
Which of the following is another term for the accumulation period of an annuity?
Its goal is to channel patients to providers that discount services.
Which of the following is true of a PPO?
They allow several small employers purchase less expensive insurance together.
Which of the following is true regarding METS?
It is nonrenewable
Which of the following is true regarding a term health policy
Universal Life - Option A
Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?
Buy-sell agreements are normally funded with a life insurance policy.
Which of the following statements concerning buy-sell agreements is true?
It transfers rights of ownership from the owner to another person.
Which of the following statements is TRUE about a policy assignment?
Every policy must offer nonforfeiture benefits to the applicant.
Which of the following statements is true regarding LTC insurance?
Insurer's guiaranteed minimum rate of interest
Which of the following ultimately determines the interest rates paid to the owner of a fixed annuity?
Paid-up option
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?
Adverse selection
Which term describes a situation in which people who are the most likely to have claims are also the most likely to seek insurance?
The individual member
Who chooses a primary care physician in an HMO?
Principal Sum
blindness of both eyes. His policy contains an Accidental While repairing the roof of his house an insured accidentally falls off and breaks his arm and sustains a head injury that results in total Death & Dismemberment Rider. What is the extent of benefits that he will receive?
FTC
Which of the following regulatory authorities participated in creating the National Do Not Call Registry?
Life income
Which of the following settlement options in life insurance is known as straight life?
Insureds cannot be randomly selected.
Which statement regarding insurable risks is NOT correct?
Indemnity
Which type of a hospital policy pays a fixed amount each day that the insured is in a hospital?
Insurers
Who makes up the Medical Information Bureau?
Payment of premium
With respect to the Consideration Clause, which of the following would be considered consideration on the part of the applicant for insurance
It will decrease the benetits paid to the beneticiary
Which of the following statements best describes the etfect the Accelersted Berefit provision would have on the benefits paid to the beneficiary?
Standard risk is representative of the majority of people.
Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles?
Creating an estate
Which of the following will NOT be an appropriate use of a deferred annuity?
Economic inflation
Which of the following would most directly affect the purchasing power of benefits paid on a fixed annuity?
Within 1 year of the revocation
A producer's license has been revoked fora violation of the Insurance Code. When can the producer apply for a new license?
It is reduced to the amount of what the cash value would buy as a single premium..
When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy?
Purchase a single premium policy for a reduced face amount.
When a whole life policy lapses or is surrendered prior to maturity, the cash value can be used to
By law, the new, individual policy must provide the same benefits as the group insurance policy.
After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true?
Premiums are determined by the age, sex and occupation of each individual certificate holder.
All of the following are characteristics of group life insurance EXCEPT
MIB reports are based upon information supplied by doctors and hospitals.
All of the following are true regarding the Medical Information Bureau (MIB) EXCEPT
Anyone who is willing to pay a premium.
All of the following qualify for Medicare Part A EXCEPT
The annuitant receives a fixed amount of return.
All of the following statements about equity index annuities are correct EXCEPT
The insured should contact the insurer to confirm her actual Social Security benefit amount. The SIS rider should pay the difference between the rider amount and the actual benefit.
An insured has a Social Insurance Supplement rider in her disability income plan. Following a disability, she begins receiving benefit payments from the insurer. She then begins receiving Social Security benefits that are smaller than the SIS benefit payments. At that point, her insurer ends the SIS benefit payments. Which of the following best describes the situation?
Concurrent review.
An insured is admitted to the hospital for surgery on a herniated disk. The insurance company monitors the treatment and progress in order to make sure that everything proceeds according to the insurer's schedule, This is called
Cost-containment
An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement?
Adjust the claim benefit to reflect the insured's true age
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued?
Re-entry
An insured owns a term policy with a guaranteed renewable option. When the end of the policy draws near, the insured answers medical questions in order to prove insurability and qualifies for a discounted premium rate. Which option best describes this scenario?
1
An insured's disability income policy includes an additional monthly receive payment from the insurer before Social Security benefits begin? benefit rider. For how many years can the insured expect to
Illegal
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?
Amy will be given the option to continue her coverage under the group plan, but will have to pay premiums for her coverage.
Andy and Amy, both 53 years of age, are married. Amy is covered under Andy's family health insurance plan at work. If Andy dies unexpectedly, which of the following is true regarding Amy's health coverage?
A joining together by employers to provide health benefits for employee
Which statement best defines a Multiple Employer Welfare Arrangement (MEWA)?
False financial statement
When an insurance agency published an advertising practices. In reality, its financial health is terrible, and the company brochure, it emphasized the company's financial stability and sound business will soon have to file for bankruptcy. Which of the following terms best describes the advertisement?
Amounts payable under the policy will reflect the insured's correct age.
When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she was 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision
A policy summary
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?
Those who have been insured under the plan for at least 5 years
Which of the following employees insured under a group life plan would be allowed to convert to individual insurance of the same coverage once the plan is terminated?
Owner's Rights
Which of the following explains the policyowner's right to change beneficiaries, choose options, and receive proceeds of a policy?
Payments stop after the first death among the annuitants
Which of the following is NOT true about a joint and survivor annuity benefit option?
They earn lower interest rates than fixed annuities.
Which of the following is NOT true regarding Equity Indexed Annuities?
It would not occur in a deferred annuity.
Which of the following is NOT true regarding the accumulation period of an annuity?
Care can be provided outside of the service anea
Which of the following is true regarding inpatient hospital care for HMO members?
Continuation provision
Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts?
Adjust the benefit in accordance with the increased risk
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?
Entire contract clause.
The provision in a health insurance policy that ensures that the insurer cannot refer to any document that is not contained in the contract is the
A presentation of nonguaranteed elements of a policy.
The term "illustration" in a life insurance policy refers to
SEC registration.
To sell variable life insurance policies, an agent must receive all of the following EXCEPT
Medicare Part A.
To sign up for a Medicare prescription drug plan, individuals must first be enrolled in
7.5%
Unreimbursed medical expenses paid for the insured may be claimed as deductions if the expenses exceed what percentage of the adjusted gross income?
To allow the consumer to compare the costs of different policies
What is the purpose of the buyer's guide?
O days
What is the shortest possible elimination period for group short-term disability benefits provided by an employer?
The insured's contingent beneficiary
When a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit?
