AD Banker PA exam
Which of the following statements regarding TRICARE is correct?
TRICARE Prime is mandatory for active duty members
Deferred annuities are normally purchased to defer ___________.
Taxes on any policy earnings
Which of the following statements is FALSE regarding Credit Life Insurance?
The amount of coverage is dependent upon the duration of the loan
When an applicant completes the insurance application in its entirety and provides the producer with a premium check, what in effect has taken place?
The applicant is making an offer to the insurer
Which of the following statements is accurate concerning the changing of an irrevocable beneficiary?
The beneficiary may be changed only with the written consent of the present beneficiary
Apparent authority is:
The demonstrated general appearance that authority exist
Which of the following provides the basis for the benefit amount paid to an insured under a disability income rider?
The face amount of the policy
All of the following are risks to the life settlement purchaser, except:
The insured dies sooner than expected
All of the following are acceptable conditions for payment of the accelerated death benefit of a life insurance policy in Pennsylvania, except:
The insured suffers from a medical condition that would result in death in 24 months or less
Which of the following would be considered a presumptive disability?
The loss of the ability to speak
All of the following are TRUE regarding a Variable Annuity, except:
The number of annuity units received upon annuitization, and the unit value, remain level
All of the following are correct regarding regulatory jurisdiction over group insurance, except:
The policy only needs to provide benefits as required by the state in which the insurer is incorporated
Generally, regulatory jurisdiction over a group insurance plan belongs to the insurance commissioner of:
The state in which the group contract was delivered to the policyowner
All of the following are true regarding annuities, except:
They are similar to life insurance
All of the following are true of Blue Cross and Blue Shield Associations, except:
They specialize only in sponsoring group plans
How can an annuity help fund college for a child or grandchild in an tax-efficient and effective manner?
Through systematic withdrawals or proper settlement option selection
Residual Disability Income pays funds to the insured, to make up for what the insured would have earned after returning to work, and while recovering from ___________.
Total disability
Gloria needs to use her annuity as a long-term savings plan rather than as a short-term tax shelter, otherwise she will incur a ____% penalty tax against any taxable withdrawals prior to age 59 1/2.
10
In all cases in Pennsylvania, the maximum time for an accelerated death benefit is _____ months.
12
If an insurer terminates the relationship between them and an insurance producer, how many days does the insurer have in which to notify the licensee in writing, at their home address, from the time the insurer notifies the Department of Insurance?
15
In Pennsylvania, the viator in a viatical settlement transaction has the right to rescind the viatical settlement contract for _____ days after receipt of the proceeds.
15
In Pennsylvania, when insured individuals become eligible for conversion to an individual policy, they must be given a notice of their right to convert at least _____ days before the expiration of the conversion right.
15
The pregnancy discrimination act applies to groups with ______ or more employees.
15
The Pennsylvania Department of Insurance may issue a nontransferable temporary insurance license for up to ____ days to certain persons in specified circumstances.
180
A typical life insurance application contains how many parts?
2
An individual life insurance policy in Pennsylvania is incontestable after it has been in force during the lifetime of the insured for ______ from the date of issue, except for nonpayment of premiums.
2 years
Notice of claim is required within _____ days of loss.
20
COBRA is a federal law requiring employers with _____ or more employees to provide the option of continuing the employee's existing health coverage for dependents for up to _____ months following qualifying events.
20,36
After an individual accident and health insurance policy in Pennsylvania has been in force for a period of _____ years, it becomes incontestable, except for fraudulent statements made by the applicant.
3
The time period within which to reinstate a lapsed life insurance policy in Pennsylvania is _____ years.
3
A licensee or applicant for an insurance producer license must notify the Pennsylvania Department of Insurance of a change of address within ______ days.
30
If the Commissioner has good reason to believe that any person is violating the law, they will be given _____ days' notice of a hearing, where they will have an opportunity to show cause why the Commissioner should not issue a Cease and Desist Order for the acts constituting a violation, and why administrative penalties should not be assessed.
30
Any time an agent's appointment is terminated, an insurer must notify the Commissioner within:
30 days
How long is the free look period for a Medicare Supplement policy?
30 days
Which of the following traditional whole life policies has the lowest first-year annual premium?
40-pay life
Generally, an insurer may defer the granting of a policy loan for up to ______ months.
6
In a Medicare Supplement replacement sale, if the original policy has been in force for less than ______ months, the replacing insurer shall waive any time periods applicable to preexisting conditions to the extent that they have already been satisfied under the original policy.
6
If an insurer makes a payment for a claim but the insured is dissatisfied with it, he/she must wait _____ days after proof of loss before he/she might take any legal action.
60
Under the Legal Actions Mandatory Uniform Provision, an insured must wait at least _____ days after providing proof of loss before he or she can take legal action against the insurer.
60 days
Pre-existing conditions under a group accident and health insurance contract in Pennsylvania may not be defined more restrictively than a disease or physical condition caused by illness or injury for which medical advice or treatment has been received within _____ days immediately prior to becoming covered under the group contract.
90
Proof of loss is required within _____ days of loss.
90
The National Association of Insurance Commissioners (NAIC):
Has no legal authority over insurance regulation
Which of the following is true of Medicare Part A, in terms of coverage?
Helps pay for hospital care and skilled nursing facility care as an inpatient plus home or hospice care
Which of the following statements best describes what we would define as being the co-pay provision in a health insurance policy?
A stated dollar amount applied per claim, in addition to any other cost-sharing
All of the following statements regarding advertising are correct, except:
Advertisements do not include radio scripts
What type of Long-Term Care policy can be renewable and convertible, and can also be purchased at lower rates than for individual coverage?
An Employer Group Policy
Which of the following individuals is not eligible to establish a Health Savings Account?
Anne, who is covered through a traditional HMO
If a father were to add a Child Rider to a policy to cover his children, when would coverage become effective for a newborn?
At 14 or 15 days of age
With Joint Life Insurance policies, the premium is based on the:
Average age of both insureds
_______________ is the process of selection, classification and rating, and determining if someone is insurable.
Home office underwriting
Sam is totally disabled and receiving benefits while attending an insurer-approved vocational training program. Which of the following guarantees the continuation of benefits while Sam participates in the training program and remains totally disabled?
Rehabilitation Benefits
Which provision is an Optional Uniform Provision?
Relation of Earnings to Insurance
A trust is established where the grantor can change the trustees whenever they want. Which of the following would best describe the type of trust that was set up?
Revocable Trust
What is the correct risk management term for minimizing the chance of a loss?
Risk Reduction
Which of the following is considered a field underwriter?
Producer
Which of the following statements about rates and premiums is not correct?
Rates may only be excessive if the insurer is making up for lost reserves
Long-Term Care policies may not be written as which of the following?
Short-term policies
Premiums for a variable universal life policy:
Can vary in amount as well as payment schedule
In a universal life policy, the two adjustments usually made to the cash value account are:
Cost of insurance protection is charged and current interest is credited
An initial amount the insured must meet per year before benefits are paid is known as the:
Deductible
Edward applies for a disability insurance policy. He pays the initial premium at the time of application and receives a conditional receipt. Three days after the insurance company conducts a medical examination, but before it issues a policy, Edward suffers a stroke. Upon reviewing the results of his medical exam, the company discovers that Edward has been diagnosed with high blood pressure and atherosclerosis. Under the terms of the conditional receipt, the insurance company:
Denies the claim because the insurer would not have issued the policy as applied for as standard or better
Which of the following is NOT an actual marketing and distribution model?
Exclusive Writing System
Which branch of the state government is responsible for enforcing the existing statutes that have been put in place?
Executive
Which type of producer authority is specifically stated in the producer's contract?
Express
Alice finds she no longer is able to pay premiums on her $50,000 Whole Life Policy, but needs that amount of protection for her family. Which Nonforfeiture Option provides this protection?
Extended Term
The nonforfeiture option that provides coverage for the shortest duration is:
Extended Term
The insurance company must meet requirements under the _____ when gathering information about an applicant from a third party.
FCRA
Blue Cross and Blue Shield are considered:
Fee-for-service plans
The McCarran-Ferguson Act of 1945:
Gave states the authority to regulate insurance
C has a $100,000 traditional whole life insurance policy with a $30,000 cash surrender value. He applies for and receives a $10,000 policy loan from the insurer. All of the following about this transaction are true, except:
If C were disabled, his beneficiaries would receive $70,000, less any outstanding interest charges
All of the following are general rules for viatical settlements in Pennsylvania, except:
If a viatical settlement provider requests verification of coverage from the insurer, the insurer must complete and transmit the verification form no later than 20 days after it's received
Which type of producer authority is not spelled out in the contract, but is necessary for carrying out the producer's duties?
Implied
One of your clients just reinstated an Accident and Health policy. When is coverage effective?
In 10 days for sickness and immediately for accidental injuries
Own occupation is the:
Inability to perform all duties of one's own occupation
Proceeds from a buy-sell agreement are received ___________.
Income tax free
Which of the following manufactures and issues insurance policies and contracts?
Insurance companies
The ______________ clause is the insurance company's promise to pay the policy's death benefit to the named beneficiary, after receiving due proof of death of the insured, as long as the policy is in force.
Insuring
Annuities are classified in all of the following ways, except:
Issuer of the annuity
No assignment of a policy will be binding on the insurer, unless:
It is in writing and received at the insurer's home office
All of the following regarding term life insurance renewability is correct, except:
It is similar to the re-entry provision found in some term policies
The ___________ branch is responsible for interpreting and determining the constitutionality of the statutes.
Judicial
Which statement is false?
Mandatory Second Surgical Opinion is when the physician submits claim information prior to treatment, to determine in advance if the procedure is covered
This type of policy covers various expenses that an insured may incur due to a routine accident or sickness.
Medical expense
All of the following are true regarding disclosures at the point of sale and issues relating to AIDS, except:
Much like illegal drugs and nicotine the applicant does not have to provide consent prior to insurer's testing for HIV
What taxes apply to the benefits under an individual Disability Income Policy on which the insured has paid the premiums?
No tax
Raymond owns an Accidental Death and Dismemberment Policy with a principal sum of $50,000, and a capital sum of $25,000. After owning the policy for several months, Raymond dies as the result of coronary artery disease. Lynn, his beneficiary, can expect to receive what amount of benefit from the policy?
None
How often may a person perform a rollover from one IRA to another?
Once Every 12 Months
After the blackout period has ended, the widow or widower may receive a Social Security income benefit based on the ___________.
PIA of the deceased spouse
Hank, an auto mechanic, had an accident in his garage. He was unconscious for several hours and he awoke in the hospital with a broken leg and missing an arm. His disability would be:
Partial, permanent
Which of the following is correct pertaining to underwriting a group health policy?
Premiums are generally re-evaluated annually and may be based upon prior claims
The contract type in which only one party is legally bound to its contractual obligations after a premium is paid is a(n)_______ contract.
Unilateral
Which of the following is TRUE regarding Indexed Annuities?
Values and benefits may increase, but not decrease
The insurer generally assumes the investment risk in all of the following annuities, except:
Variable
Which of the following is not a Mandatory Uniform Provision of an Accident and Health policy?
Waiver of Premium
Does the insured have the right to change the beneficiary designation of a health insurance policy?
Yes, unless the beneficiary is designated as irrevocable
A partial withdrawal is permitted on which of the following policies?
universal Life