ExamFX readiness exam #2

What are the continuing education requirements for agents who market long-term care insurance policies? 1. 8 hours of long-term care specific education included in the regular CE requirements 2. 4 hours of long-term care education every year 3. 4 hours of long-term care education every 4 years 4. 8 hours of long-term care specific education in addition to the regular CE requirements

1. 8 hours of long-term care specific education included in the regular CE requirements

The notice about policy cancellation delivered to senior consumers must include all of the following information EXCEPT 1. Explanation of where the premiums have been invested 2. Time limit for cancellation 3. To whom to return the policy 4. Possible surrender charge

1. Explanation of where the premiums have been invested

An insured's hospital policy state that it will pay him a flat fee of $75 per day for each day he is hospitalized. The policy pays benefits on what basis? 1. Indemnity 2. Reimbursement 3. Expense 4. Service

1. Indemnity

Which of the following indicated how much of the health coverage premium must go toward actual medical care? 1. Medical Loss Ratio (MLR) 2. Minimum Value (MV) calculator 3. Modified Adjusted Gross Income (MAGI) 4. Metal tiers

1. Medical Loss Ratio (MLR)

If an applicant's health is poorer than that of an average applicant, the policy must be issued 1. Substandard 2. Standard 3. Ordinary 4. Preferred

1. Substandard

In life insurance, which of the following is NOT required to have an insurable interest in the insured? 1. The beneficiary 2. The policyowner 3. The insured 4. The applicant

1. The beneficiary

Which of the following best depicts the law of large numbers? 1. The larger the pool of risks under study, the more accurate the predictions will be 2. Larger groups produce healthier applicants 3. Large groups offer less opportunity for loss 4. The larger the group is, the more likely it will be to get a good choice

1. The larger the pool of risks under study, the more accurate the predictions will be

A retail shop owner is insured under a business overhead expense policy that pays a maximum monthly benefit of $2,500. His actual monthly expenses are $3,000. If the owner becomes disabled, the monthly benefit payable under his policy will be 1. $2,100 2. $2,500 3. $3,000 4. $2,000

2. $2,500

What is the tax penalty for withdrawing money from an annuity prior to are 59 1/2? 1. 5% 2. 10% 3. 12% 4. 20%

2. 10%

There is a 10% penalty on the taxable portion of a deferred annuity when it is surrendered prior to what age? 1. 65 2. 59 1/2 3. 55 1/2 4. 40

2. 59 1/2

Which of the following terms is used to define the period of time during which an annuitant makes payments into an annuity? 1. Loading period 2. Accumulation period 3. Premium building period 4. Annuity period

2. Accumulation period

HMO members pay a small fee when they see their primary care physician. This fee is called a 1. Stop-loss 2. Copay 3. Coinsurance 4. Deductible

2. Copay

Which of the following is a daily nursing and rehabilitative care that can only be provided by medical personnel, under the direction of a physician? 1. Assisted living 2. Skilled care 3. Intermediate care 4. Custodial care

2. Skilled care

Which of the following elements of an insurance contract requires payment of premium? 1. Competent parties 2. Offer and acceptance 3. Consideration 4. Legal purpose

3. Consideration

All of the following are features of a health insurance plan purchased on the health insurance marketplace EXCEPT 1. Coverage for emergency services 2. Coverage for pre-existing conditions 3. Dollar limits on essential benefits 4. Guaranteed renewability

3. Dollar limits on essential benefits

Slippery floors, reckless driving, or providing false information are examples of 1. Causes of loss 2. Perils 3. Hazards 4. Pure risks

3. Hazards

Medicare Part B covers all of the following EXCEPT 1. Home health visits 2. Outpatient hospital services 3. Long-term care services 4. Doctor's services

3. Long-term care services

In insurance, what is the term used for the cause of a loss? 1. Material fact 2. Hazard 3. Peril 4. Causative factor

3. Peril

All of the following are consideration in an insurance policy EXCEPT 1. The premium paid at the time of application 2. The promise to pay covered losses 3. The cash value in the policy 4. The statements on the application

3. The cash value in the policy

The Probationary period is 1. The number of days the insured has to determine is he/she will accept the policy as received 2. The stated amount of time when benefits may be reduced under certain conditions 3. The period of days that must expire after the onset of an illness before benefits will be earned 4. A specified period of time that a person joining a group has to wait before becoming eligible for coverage

4. A specified period of time that a person joining a group has to wait before becoming eligible for coverage

A dread disease policy would cover which of the following? 1. Broken leg 2. Illness caused by exposure to chemicals 3. Infection due to liposuction 4. Cancer

4. Cancer

Which of the following is a correct statement about annuities? 1. Variable annuities provide minimum guaranteed rate of interest 2. Variable annuities place the funds into the company's general account 3. Fixed annuities have the annuitant assume the risks of investment 4. Fixed annuities do not provide against inflation

4. Fixed annuities do not provide against inflation

A person has a history of DUIs. To his insurer, this presents what type of hazard? 1. Legal 2. Physical 3. Moral 4. Morale

4. Morale

How do premiums in variable universal life policies vary from those in variable whole life policies? 1. Premiums are level 2. Premiums automatically decrease over the life of the policy 3. Premiums automatically increase over the life of the policy 4. Premiums are flexible

4. Premiums are flexible

Once the initial benefit limit in Medicare Part D is reached, how is the beneficiary affected? 1. The beneficiary is then responsible for 75% of prescription drug costs 2. The beneficiary is no longer responsible for prescription drug costs 3. Medicare Part A will cover all costs 4. The beneficiary is then responsible for a portion of prescription drug costs

4. The beneficiary is then responsible for a portion of prescription drug costs