Florida Life and Health Insurance practice questions
M becomes disabled and is unable to work for 6 months. M dies soon after from complications arising from this disability. M has a disability income policy that pays $2,000 a month. Which of the following statements BEST describes what is owed to her estate?
$2,000
An individual working part-time has an annual income of $25,000. If this individual has an IRA, what is the maximum deductible IRA contribution allowable?
$2,500
Advertising gifts not to exceed___ area allowed to be given by an agents to a prospective client
$25
J has an AD&D policy with a principal sum of $50,000. While trimming the hedges, J cuts off one of his fingers. What is the MAXIMUM J will receive from his policy?
$25,000
T took out a $50,000 life insurance policy with an accidental death and dismemberment rider. Five years later, T commits suicie. How much will the insurer pay?
$50,000
P purchases a $50,000 term life insurance policy in 2005. One of the questions on the application ask if P engages in scuba diving, to which P answers "No". The policy is then issued with no scuba exclusions. In 2010, P takes up scuba diving and dies in a scuba-related accident in 2011. What will the insurer pay to P's beneficiary?
$50,000 minus any outstanding policy loans
What is the required minimum percentage of employee participation for a noncontributory group health insurance plan according to Florida law?
0%
what percent of personal life insurance premiums is usually deductible for federal income tax purposes?
0%
In Florida, monthly-premium health insurance policies must provide a grace period of at least
10 days
A life policy loan in Florida cannot charge a fixed rate of interest higher than...
10%
All of the following statements about traditional individual retirement account are false EXCEPT
10% penalty is applied to withdrawals before age 59.5
Under the USA Patriot Act, insurers are required to report receipt of cash payment in excess of
10,000
What percentage of eligible persons must a policy cover in a noncontributory group?
100%
A Long-Term Care policy must offer a MINIMUM benefit period of how many months?
12
The minimum age at which a person can sign a life insurance application is...
15 years
A 15-year mortgage is best protected by what kind of life policy?
15-year decreasing term
Florida requires that coverage for newborns begins "from the moment of birth" and continues for...
18 months
What is the max social security disability benefit amount an insured can receive?
1oo% of the insured' primary insurance amount
An insurance company can contest a life insurance contract due to application fraud within
2 years
An insurance company can contest a life insurance contract due to application fraud within...
2 years
An insurance company can contest to a life insurance contract due to application fraud within
2 years
In Florida, most life insurance policies have a contestability period of
2 years
In Florida, most life insurance policies have a contestability period of...
2 years
A person insured under a health policy is required to give the insurance company a Notice of Claim within how many days after a covered loss?
20
An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.
20
Employers with less than __ employees are affected by Florida's health Insurance Coverage Continuation Act (Mini COBRA)
20
K pays on a $20,000 20 year endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?
20,000 death benefit
J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?
20-pay life
Agents that have been licensed for less than six years must complete __ hours of continuing education every two years
24
An insured must notify an insurer of a medical claim within how many days after an accident?
30
Within how many days after policy delivery can a Medicare Supplement policy be returned for a 100% premium refund?
30
Within how many days after policy delivery can a medicare supplement policy be returned for a 100% premium refund?
30
Within how many days must a licensee notify the Department of Financial Services of a change in address?
30
Individual Medicare Supplement policies must allow an insured a MINIMUM of how many days after policy delivery to return the policy and receive a refund of premium?
30 days
An insured covered by a group Major Medical plan is hospitalized after sustaining injuries that resulted from an automobile accident. Assuming the plan had a $1,000 deductible and an 80/20 Coinsurance clause, how much will the insured be responsible to pay with $11,000 in covered medical expenses?
3000 → 11,000 x .20 + 1,000
A group plan was recently terminated. In Florida how many days are covered individuals guaranteed coverage after a group plan's termination?
31 days
A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan's termination?
31 days
According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy reminds in force even though the premium has not been paid?
31 days
In Florida, a health policy that is paid on a quarterly basis requires a grace period of
31 days
The conversion period for a terminated employee to convert group life coverage to an individual plan is...
31 days
S is employed by a large corporation that provides group health coverage for its employees and their dependents. If S dies, the company must allow his surviving spouse and dependent to continue their group health coverage for a maximum of how many months under COBRA regulations?
36
How many days does an insurance company have to reject a reinstatement application before it is automatically reinstated?
45
M's insurance company denied a reinstatement application for her lapsed health insurance policy. The company did not notify M of this denial. How many days from the reinstatement application date does the insurance company have to notify M of the denial before the policy will be automatically placed back in force?
45 days
A licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?
48
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of law and ethics every 2 years
5
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of law and ethics every two years
5
One becomes eligible for social security disability benefits after having been disabled for
5 months
What is the maximum percentage of controlled business an agent may produce?
50%
A Loss-Purchase Buy and Sell agreement among three partners, funded with individual life insurance, would require how many policies?
6
The waiting period for a pre-existing condition under a Medicare Supplement policy may NOT go beyond...
6 months
The waiting period for a pre-existing condition under a medicare supplement policy may not go beyond
6 months
According to Florida law, an additional lapse notice must be issued after the standard grace period has expired for policyowners age
64 years or older
According to Florida law, an additional lapse notice must be issued after the standard grace period has expired for policyowners age...
64 years or older
Replacement is involved in all of the following situations EXCEPT when...
A Term policy is converted to a permanent plan with the same insurance company
According to Florida's rule on disclosure, a life insurance applicant is expected to be provided with
A buyer's guide and policy summary
An individual covered under a Group Life insurance policy is considered to be...
A certificate holder
What do families pay that are covered by the Florida Healthy kids Corporation?
A portion of the premium
A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as
A representation
An agent selling Medicare Supplement policies must provide every applicant with...
A suitability form
Which of the following statements describes what an accident and health policyowner may NOT do?
Adjust the premium payments
A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as
Adjustable life
Which of the following employer tasks does a Professional Employer Organization normally handle?
Administration tasks
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first 6 months. Q suddenly dies and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?
Aleatory
J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
All of the employees must be notified of the cancellation either by the insurance company or through J
All of the following provisions are required in a group life policy EXCEPT...
An accidental death and dismemberment provision
All of the following entries are classified under the four principal areas of Florida insurance law EXCEPT...
An agent's commission
Which of the following situations does not apply to the florida replacement rule?
An existing policyholder purchases an addition policy from the same insurer
Which of the following situations does NOT apply to the Florida Replacement Rule?
An existing policyholder purchases an additional policy from the same insurer
Which of the following statements BEST describes what the Legal Actions provision of an ancient and health policy requires?
An insured must wait at least 60 days after proof of loss has been submitted before a lawsuit can be filed
An incomplete life insurance application submitted to an insurer will result in which of these actions?
Application will be returned to the writing agent
traditional individual retirement annuity (IRA) distributions must start by
April 1st of the year following the year of the partipant attains age 70.5
In Florida, the underwriting and issuance of a master group health policy requires that all employees
Are eligibility to participate, regardless of their individual health history
In Florida, the underwriting and issuance of a master group health policy requires that all employees...
Are eligible to participate, regardless of their individual health history
In a qualified retirement plan, the yearly contributions to an employee's account
Are restricted to maximum levels set by the IRS
The Life and health Insurance Guaranty Association is funded by...
Assessments on member companies
When is a Group Health policy required to provide coverage for a newborn child?
At the moment of birth
When does a probationary period provision become effective in a health insurance contract?
At the policy's inception
According to Florida law, when must an agent deliver the Outline of Coverage to a Medicare Supplement applicant?
At the time of application
All of the following are Nonforfeiture Options EXCEPT
Automatic premium loan option
The Coordination of Benefits (COB) provision exists in order to...
Avoid duplication of benefit payments
P died 5 years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take?
Beneficiary will be paid the death benefit
Which of these is NOT considered to be a cost connected with an individual's death?
Business expenses
According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with...
Buyer's Guide and Policy Summary
Which of the following policy features allows an insured to defer current health changes to the following year's deductive instead of the current year's deductive?
Carryover provision
Which statement about a whole life policy is correct?
Cash value may be borrowed against
A policy loan is made possible by which of the following life insurance policy features?
Cash value provision
A policy loan is made possible by which of these life insurance policy features?
Cash value provision
An example of sliding would be
Charging for an additional product without the applicant's consent
Whose life is covered on a life insurance policy that contains a payor benefit clause?
Child
S is covered by a whole life policy. Which insurance product can cover his children?
Child term rider
How do life insurance companies handle cases where the insured commits suicide within the contract's stated contestable period?
Claims are denied under the suicide clause of the policy
The situation in which a group of physicians are salaried employees and conduct business in an HMO facility is called a
Closed panel
On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?
Collect initial premium along with a signed health statement
Which of the following areas of state regulation is NOT protected by the savings clause in ERISA?
Commerce
Which of the following organizations would make reimbursement payment directly to the insured individual for covered medical expenditures?
Commercial insurer
An applicant who pays the initial premium at the time of application is typically given a
Conditional receipt
When a policy owner exchanges a term policy for a whole life policy without providing proof of good health, which of these apply?
Conversion provision
The universal life policy is called an unbundled life policy because he policyholder can see the expense charges, the interest earned, and the
Cost of insurance
All of the following statements about health coverage for newborns are correct EXCEPT...
Coverage during the first year is limited to congenital defects
Which of the following BEST describes a hospital indemnity policy?
Coverage that pays a stated amount per day of a covered hospitalization
Which statement regarding the Misstatement of Age provision is considered to be true?
Coverage will be adjusted to reflect the insured's true age if a misstatement of age is discovered
The 14-day free look period for life insurance policies begins at the...
Day of delivery
A family income policy is a combination of whole life and
Decreasing term insurance
Which two entities regulate variable annuities?
Department of Financial Services and Securities Exchange Commission
Which two entities regulate variable annuities?
Department of financial services & Securities exchange commission
An agent takes an individual Disability Income application, collects the appropriate premium, and issues the prospective insured a conditional receipt. The next step the insurance company will take is to
Determine if the applicant is an acceptable risk by competing standard underwriting procedures
Which contract permits the remaining partners to buy-out the interest of a disabled business partner?
Disability buy-sell
Characteristic of PPO would be
Discounted fees for the patient
In Florida, an insurer domiciled and incorporated in this state is called...
Domestic company
Under a Long-Term Care policy, which of the following is considered an activity of daily living?
Dressing
K purchased a $10,000 life policy that will pay the face amount to her if she lives to age 65, or to her beneficiary if she dies before age 65. K purchased which of the following types of policies?
Endowment at age 65
The purpose of the Guaranty Fund is to...
Ensure that claims filed against involvement insurance companies will be paid
When an insurance company sends a policy to the insured with an attached application, the lament that makes the application part of the contract between the insured and the insurance is called the
Entire contract provision
Which of these statements describe a Modified Endowment Contract (MEC)?
Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as a life insurance contract
The life insurance and annuity replacement regulation defines replacement as
Exchanging an existing policy for a new policy
Long term care policies will usually pay for eligibility benefits using which of the following methods?
Expense incurred
All of the following provisions must be included in life insurance policies EXCEPT...
Extended term
All of these are characteristic of an Adjustable Life policy except
Face amount can be adjusted using policy dividends
N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?
Fixed deferred
Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency?
Florida Life and Health insurance guaranty association
In Florida, when agents recommend changes be made for existing coverage, the agent must follow established procedures. The name of this rule is called the...
Florida Replacement Rule
The Financial Services Commision may hold hearings...
For any reason deemed necessary
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called
Fraternal life insurance organizations
M completes an application for health insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT?
Free look period has expired
S, while in the process of converting her group life insurance to an individual policy, dies. What happens to the claim her beneficiary submits?
Full benefits are payable under the master contract
Which of the following employees may NOT be excluded from a group life plan?
Full-time employees after a probationary period
What is considered a valid reason for small businesses to insures the lives of its major shareholders
Fund a buy-sell agreement
The life and health insurance guaranty associate is
Funded by admitted insurance companies through assessments
Which of the following is a standard provision of the conversion privileges in a Group Life Policy?
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
The Florida Employee health Care Access Act was established to make...
Group health insurance available to employers with up to 50 employees
Which policy is EXEMPT from replacement regulations?
Group life policy
Which requirement must be met for an associate to be eligible for a group life plan?
Group was formed for a purpose other an acquiring insurance
K has a health policy that must be renewed by the insurer and the premiums can only be increased if applied to the entire class of insured. This type of policy is considered?
Guaranteed renewable
Which type of renewability best describes a disability income policy that covers an individual until the age of 65, but the insurer has the rights to change the premium rate for the overall risk class?
Guaranteed renewable
Which type of provider is known for stressing preventative medical care?
HMO's
All of the following statements about health coverage for physically handicapped dependents of insureds are correct EXCEPT that the dependent must...
Have been covered under the insured's policy at the time the handicap was incurred
J is a subscriber to a plan which contracts with doctors and hospitals to provide medical benefits at a predetermined price. What type of plan does J belong to?
Health maintenance organization (hmo)
With a Medical Expense policy, what does hospitalization expense cover?
Hospital room and board
Which of these statements is NOT the reason for purchasing life insurance on the life of a minor?
If both parents were to die, it would provide death benefits to the child
How would a contingent beneficiary receive the policy proceeds in a AD&D policy?
If the primary beneficiary dies before the insured
An insurer received proof of loss for an acceptable medical expense claim under an individual health insurance policy. Under the time of payment of claims provision, the insurer must pay the benefits
Immediately
A long-term care ride in a life insurance policy pays a daily benefit in the event of which of the following?
Inability of the insured to perform more than 2 activity of daily living
Which of the following actions require a policyowner to provide proof of insurability in an adjustable life policy?
Increase face amount
A Multiple Employer Welfare Arrangement (MEWA) provides what type of benefits?
Insurance
What would be an accurate definition of "controlled business"
Insurance business that is written on the agent's own life, property, or interests
Which of the following situations are NOT subject to Florida life insurance laws?
Insurance companies' day-to-day operations
What is being delivered during a policy delivery?
Insurance contract to the proposed insured
Which of the following BEST describes Credit Life Insurance?
Insurance issued on a debtor to cover outstanding balances on installment loans
Variable annuities may invest premiums in each of the following except
Insurer's corporate business account
How are policyowner dividends treated in regards to income tax?
Interest on accumulations is taxed
A policy owner would like to change the beneficiary on an Accidental Death and Dismemberment insurance policy and make the change permanent. Which type of designation would fulfill this need?
Irrevocable
What is a warranty?
Is a statement guaranteed to be true
In Florida, an element of an insurance transaction would be...
Issuing an insurance contract
Which of the following statements is CORRECT about the replacement of one insurance policy with another?
It is strictly regulated and requires full disclosure by both the agent and the replacing insurance company
Which of the following statements about accumulated interest earned on dividends from an insurance policy is true?
It is taxed as ordinary income
Which statement regarding third-party ownership of a life insurance policy is true?
It is used extensively in estate-planning as well as business circumstances
According to Florida law, which of the following statements accurately describes an admitted mail order insurance company?
It may solicit insurance business by mail only without the assistance of a licensed Florida agent
Who is a mutual insurance company owned by?
Its policyholders
A stock insurance company is owned by
Its stockholders
L, aged 50, and L's spouse 48, have one natural child and one adopted child. They purchase a family policy that covers L's spouse at age 65. A death benefit will NOT be paid in which of the following circumstances?
L's spouse dies at age 66
T has a Disability Income policy that pays a monthly benefit of $5,000. If T becomes partially disabled, what can he likely expect?
Less than $5,000 per month benefit regardless of the disability
If an agent would like to sell Variable annuities, which state examination must the agent pass?
Life and Variable contracts
The rules and regulations of the Life and health Insurance Guaranty Association apply to...
Life and health policies issues by companies authorized in that particular state
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?
Life income
Under Florida law, which of the following provisions is NOT required in a Medicare Supplement policy?
Limitations on preexisting condition for up to 12 months
An insured's inability to perform two or more activities of daily living may trigger which type of policy rider?
Long term care
An insurance company would MOST likely pay benefits under an Accidental Death and Dismemberment policy for which of the following losses?
Loss of eyesight due to an accidental injury
Which of these is an element of a single premium annuity?
Lump-sum payment
Which of the following types of health coverage frequently uses a deductible?
Major medical policy
Z owns a Disability income policy with a 30-day elimination period. Z contracted pneumonia that left him unable to work from Jan 1 until Jan 15. Z then becomes disabled from an accident on February 1 and the disability lasts until July 1 the same year. Z will become eligible to receive benefits starting on
March 1
According to Florida law, which of the following info does NOT need to be obtained by an agent recommending an annuity purchase?
Marital status
An agent MUST give a prospective insured in Outline of Coverage when taking an application for...
Medicare Supplement Policy
If a retiree on Medicare required for hospital stays in one year, which policy would provide the best insurance for excess hospital expenses?
Medicare supplement
Under Florida law, which of the following provisions is NOT required in a Medicare Supplement policy?
Miliation on preexisting conditions for up to 12 months
A stock life insurance company that issues both participating and nonparticipating policies is doing business on...
Mixed plan
When a life insurance policy exceeds certain IRS table values, the result would create which of the following?
Modified endowment contract
M purchases a 470,000 Life Insurance policy with premium payment of $550 a year for the first 5 years. At the beginning of the 6th year, the premium will increase to $800 per year but will remain level thereafter. The face amount will remain $70,000 throughout the life of the policy. The type of policy that M has purchased is
Modified premium life
K buys a policy where the premium stays fixed for the first 5 years. The premium then increases in year 6 and stays level thereafter, all the while the death benefit remains the same. What kind of policy is this?
Modified whole life
Which of these is NOT considered to be a right give to a policyowner?
Modify a provision in the insurance contract?
Periodic health claim payment must be maid at least
Monthly
What are adjustable rates for life policy loans in Florida based on?
Moody's corporate bond index
Which of the following statements is CORRECT about accelerated death benefits?
Must have terminal illness to qualify
Which type of insurance company allows their policyowners to elect a governing body?
Mutual
Which of the following professional organizations has its code of ethics incorporated into Florida law?
National Association of Insurance and Financial Advisors (NAIFA)
Which of the following professional organizations has its code of ethics incorporated into Florida law?
National association of insurance and financial advisors (naifa)
In Florida, which of the following practitioners normally do NOT receive payment from health insurance policies?
Naturopaths
Which of the following is NOT an unfair claim settlement practice?
Needing written documentation for claim details
Which of these statements concerning an individual disability income policy is true?
Normally includes an elimination period
Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy?
Notice of existing and replacing insurers of intention to replace
When an existing life insurance policy is being reissued with a reduction in cash value, the agent must sign the...
Notice regarding the replacement of life insurance or annuity
The Notice of Claims provision requires a policy owner to
Notify an insurer of a claim within specified time
S filed a written Proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning
November 1
What determines the full amount of social security retirement benefits a qualified individual is entitled to receive?
Number of dependents
An accident policy will most likely pay a benefit for a
Off the job accident
In Florida, agents are allowed to engage in rebating if...
Offered to all insured in the same actuarial class
An example of unfair discrimination would be
Offering different terms of coverage for different policyowners having the same risk classification
Which entity approves the insurance policy forms used in Florida?
Office of Insurance Regulation (OIR)
Which entity approves the insurance policy forms used in Florida?
Office of insurance regulation
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract
Once each year
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract...
Once each year
Upon reaching the limiting age, a handicapped child can extend their health insurance coverage as a dependent...
Only if the child is incapable of employment and chiefly dependent on the policyowner
Deductibles are used in health policies to lower
Overuse of medical services
A young, married teacher has 2 children and owns a whole life policy. If the teacher wants an increasing death benefit to protect against inflation, the teacher should select which ofthe following Dividend Options?
Paid-up additional insurance
K is an agent who made improper sales of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay a monetary restitution to the client
If, at the time of an insured's death, the insurance company discovers that the insured's age was misstated on the application for life insurance, the company will most likely...
Pay the policy proceeds in the amount the premiums would have purchased at the insured's actual age
The benefits under a disability buy-out policy are
Payable to the company or another shareholder
The provision that define to whom the insurer will pay benefits to is called
Payment of claims
Which action could result in a hearing being ordered by the Department of Financial Services?
Performing insurance transactions without a license
M has an insurance policy that also has an outstanding policy loan at the time of M's death. The insurer will deduct the outstanding loan balance from the
Policy proceeds
When an employee is terminated, which statement about a group term life conversion is true?
Policy proceeds will be paid if the employee dies during the conversion period
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?
Policy was returned within the free-look period, premium will be fully refunded
Which of these statement accurately describes the waiver of premium provision in an accident and health policy
Premiums are waived after the insured has been totally disabled for a specified time period
Which of the following actions is NOT possible with a universal life policy?
Premiums may be applied as a credit against income tax
Which of the following statement about a Guaranteed Renewable health insurance policy is correct
Premiums normally increase at time of renewal
Which of the following statements about a Guaranteed Renewable Health Insurance policy is CORRECT?
Premiums normally increase at time of renewal
Which of these is NOT a type of agent authority?
Principal
Which of the following is NOT required in the Outline of Coverage for a health insurance policy?
Projection of the policy's future costs
According to Florida law, group life insurance conversion privileges must NOT
Require evidence of insurability
D is an architect receiving disability income benefits who is not able to return to work full time, but can work on a part-time basis. Which of the these features would allow D to continue receiving benefits
Residual benefit clause → based on a proportion of income actually lost to the partial disability
When a person returns to work after a period of total disability but cannot earn as much as he or she did before the disability, this situation is called
Residual disability
S buys a $10,000 whole life policy in 2003 and pays an annual premium of $100. S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. What kind of rider did S include on the policy?
Return of premium rider
Group life policies MUST include all of the following provisions EXCEPT...
Right to loan proceeds
Post tax dollar contributions are found in
Roth IRA investments
Equity indexed annuities are invested in which of the following
S&P 500
A long-term care lapse notice must be delivered to both the applicant and
Secondary addressee
A long-term care lapse notice must be delivered to both the applicant and...
Secondary addressee
Which of the following provisions is NOT required in HMO contracts/certificates?
Seven day grace period
What is required in the Florida Employee Health Cares Access Act?
Small group benefit plans are to be issued on a "guaranteed-issue" basis
Which type of plan allows an employer to give money to an employee for buying a life insurance policy and also permits the employee to select the beneficiary?
Split dollar plan
The fund that assures policyholder payment of benefits on Life and Health Policies, if the company is involved at the time of the claim, is called the...
The Life and Health Insurance Guaranty Association
Which of the following parties must provide an insured with proper disclosure concerning the replacement of an insurance company?
The agent who sells the new insurance policy
Which of the following factors is NOT considered when the Department of Financial Services determines if an agent's home is an insurance agency?
The amount of premium collected at this location
On delivery of a policy, a signed statement of good health is typically requested if
The application was submitted without the initial premium
The Bureau of Unclaimed Property is overseen by...
The chief financial officer
If an annuity is terminated prior to the beginning of the income payment period, the contract owner received
The contract current value at that time
A noncontributory group term life plan is characterized by
The entire cost of the plan is paid for by the employer
The consideration clause in a life insurance policy indicate that a policyowner's consideration consists of a completed application and
The initial premium
Disclosure standards require that which of the following be delivered with a Medicare Supplement policy?
The outline of coverage
The Free-Look provision of any health policy begins the date...
The policy is delivered to the insured
When replacing or exchanging an annuity, the agent must disclose to the annuitant...
The possible tax ramifications as a result of the transaction
According to Florida law, in which of the following situations would a dependent handicapped child NOT be covered under a Family Health policy?
The premiums for the handicapped child are not paid
An Outline of Coverage for Medicare Supplement policy MUST be given to the applicant at which of the following times?
The time of application
Which of the following statements is CORRECT if an insured converts his Life policy to Paid-Up Insurance and buys new insurance?
The transaction is considered a replacement
Association Plans that are designed to provide health benefits to their members are regulated by the state because...
They are insured by an authorized insurer
How does a typical variable life policy investment account grow?
Through mutual funds, stocks, bonds
Which accident and health policy provision addresses preexisting conditions?
Time limit on certain defenses
Group Life policies in Florida are required to contain a conversion privilege that allows for conversion
To an individual policy for a stated period of time
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privilege gives T the right to convert...
To an individual policy upon employment termination
One of the stated purposes of the Life and Health Insurance Guaranty Association is...
To assist in the prevention of insurer insolvencies
An assignment of benefits of a Health Policy
Transfers payment to someone other than the policy owner
According to the time limit of certain defenses provision in an individual health insurance policy, non fraudulent misstatements first become incontestable
Two years from the date of the policy was issued
A 42-year old executive wants to purchase life insurance that will allow for increases or decreases to coverage as his/her needs change. Which of the following policies will best meet this need?
Universal life → characterized by flexible premiums and adjustable death benefit
When is the face amount paid under a joint life and survivor policy?
Upon death of the last insured
A written agreement to provide a Life Insurance Policy holder immediate cash in exchange for the sale and transfer of a Life Insurance Policy is...
Viatical settlement
A life insurance policyowner may sell their policy to a(n) ___ in order to receive a percentage of the policy's face value
Viatical settlement provider
What is the primary factor that determines the benefits paid under a disability income policy?
Wages
A variable life insurance agent must be licensed and appointed as a life and variable contract agent, as well as...
a broker dealer
which of these is an element of a variable life policy?
a fixed, level premium
A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as the
a representation
All of the following statements regarding group health insurance is true, except:
an individual policy is given to each member
When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n)
anti-money laundering violation
Any changes made on an insurance application requires the initials of whom?
applicant
Group/voluntary long-term care policy premiums are typically deducted from the employee's income and
are less costly as compared to individual long-term care coverage
what action can a policyowner take if an application for a bank loan requires collateral?
assign policy ownership to the bank
Variable Whole Life Insurance can be described as
both an insurance and securities product
Which rider provides coverage for a child under a parent's life insurance policy?
child term rider
N is covered by a term life policy and does not make the required premium payment which was due august 1. N died september 15. What action will the insurer take?
claim will be denied
A disability income policy owner recently submitted a claim for a chronic neck problem that has now resulted in total disability. The original neck injury occurred before the application was taken 5 years prior. The neck injury was never disclosed to the insurer at the time of the application. How will the insurer handle this claim?
claim will be paid and coverage will remain in force
Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan?
collateral assignment
K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?
conditional
An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?
consideration clause
the incontestable clause allows an insurer to
contest a claim during the contestable period
Which of the following consists of an offer, acceptance, and consideration?
contract
Insurance policies are offered on a "take it or leave it" basis, which makes them
contracts of adhesion
what type of group insurance plan involves employees sharing the cost?
contributory plan
Which of these types of policies may not have the automatic premium loan provision attached to it?
decreasing term
Medicare part a and b do not pay for
dental work
which of the following statements does not accurately describe the tax treatment of premiums and benefits of individual AD&D insurance?
disability income policy premiums are tax-deductible
which of the following does social security NOT provide benefits for?
dismemberment
a variable insurance policy
does not guarantee a return on its investment acounts
What type of policy would only provide courage for specific types of illnesses (cancer, stroke, etc)?
dread disease insurance
S takes out a health insurance policy which contains a provision that states that the agent does not have the authority to change the policy or waive any of its provisions. Which health policy provision is this?
entie contract
S is close to retiring and would like to purchase a policy that will yield greater gains than bonds, but will still protect the principal with a minimum level or risk. Which product would S be advised to purchase?
equity index insurance
Individual life insurance proceed are exempt from creditor's claims when they are payable to any of the following entities EXCEPT the insured's
estate
Which of the following is NOT included in the policy face?
excisions
All of these are characteristics of an Adjustable Life policy EXCEPT
face amount can be adjusted using policy dividends
What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?
family maintenance policy
N purchases an annuity by making payments in an amount no less than $100 quarterly. This describes which of the following annuities?
flexible installment deferred
what kind of special needs would a policy owner require with an adjustable life insurance policy?
flexible premiums
An insured is past due on his life insurance premium, but is still within the Grace Period. What will the beneficiary receive if the insured dies during this Grace Period?
full face amount minus any past due premiums
An insurance company may NOT reject a prospective insured's life application on the basis of
gender
A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What rider would the physician add if he wants the ability to increase his policy benefit as his practice and income grow?
guaranteed insurability option rider
HIPAA gives privacy protection for
health information
a medical care provider which typically delivers health services at its own local medical facility is known as a
health maintenance organziation
Tom has a qualified retirement plan with his employer that is currently considered to be 80% "vested". How can this be interpreted?
if Tom's employment is terminated, 20%of the funds would be forfeited
Medicaid was designed to provide health care
in poor health
When determining the monthly benefit amount for a disability income policy, the factor that limits the amount a prospective insured may purchase is
income
A 55 year old recently received a $33,000 distribution from a previous employer's 401K plan, minus $6,000 withholding. Which federal taxes apply if none of the funds were rolled over?
income taxes plus a 10% penalty tax on $30,000
T owns a Accident and Health policy and notified her insurance company that she has chosen a less hazardous occupation. Under the Change of Occupation provision, which of the following actions may her insurance company take?
increase her policy's coverage amount
how does an indexed annuity differ from a fixed annuity?
indexed annuity owners receive credited interest tied to the fluctuations of the linked index
Information obtained from a phone conversation to the proposed insured can be found in which of these reports?
inspection report
MEWA provides what type of benefits
insurance
A policy of adhesion can only be modified by whom?
insurance company
All of these statements about the Waiver of Premium provision are correct EXCEPT
insured must be eligible for social security disability for claim to be accepted
what is the initial requirement for an insured to become eligible for benefits under the waiver of premium provision?
insured must be under a physician's care
T was treated for an ailment 2 months prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards.How will the insurer likely consider this condition?
insurer will likely treat as a pre-existing condition which may not be covered for one year
The agreement in a life insurance contract that states a specific sum of money will be paid to a designated person up an insured's death is called a
insuring agreement
The clause identifying which losses resulting from an accident or sickness are insured by the policy is called the
insuring clause
All of these Settlement options involve the systematic liquidation of the death proceeds in the event of the insured's death EXCEPT
interest only
which of these types of coverage is best described as a short term medical policy?
interim coverage
How are policyowner dividends treated in regards to income tax?
interstate's on accumulations is taxed
an example of an unfair trade practice is
is an agent making a material misrepresentation to the insured
which of the following combination plans is designed to protect an insured from an unpaid mortgage balance upon premature death?
joint life
what types of life policy covers 2 lives and pays the face amount after the first one dies?
joint life policy
D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?
level term
Which of these are NOT an example of a Nonforfeiture option?
life income
in major medical expense policies, what is the intent of a stop loss provision?
limits an insured's out-of-pocket medical expenses
The Accelerated Death Benefit provision in a life insurance policy is also known as a
living benefit
a CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. which type of policy will pay a monthly benefit to the personal assistant?
major medical
When determining the monthly benefit amount for a disability income policy the factor that limits the amount a prospective insured may purchase is
medical condition
All of these insurance products require an agent to have proper FINRA securities registration in order to sell them EXCEPT for
modified whole life
Which of these life products is NOT considered interest-sensitive?
modified whole life
which of these is not considered to be a right given to a policyowner
modify a provision in the insurance contract
which type of insurance company allows their policy owners to elect a governing body?
mutual policyholders
According to Florida law, a Group Life insurance policy requires a minimum of how many insureds?
no minimum
J has a Disability Income policy that does NOT provide benefits for losses occurring as the result of his employment. What kind of coverage is this?
nonoccupational coverage
which of the following best describes a short-term medical expense policy?
nonrenewable
an example of rebating would be
offering a client something of value not stated in the contract in exchange for their business
all of these statements concerning settlement options are true, except
only the beneficiary may select
Replacement regulation applies to which of the following types of contracts?
ordinary life
M had an annual life insurance premium payment due January 1. She died January 10 without making the premium payment. What action will the insurer take?
pay face amount minus the past due premium
Which of the following provisions guarantees that premiums will be waived if a juvenile life policyowner becomes disabled?
payor clause
M has an insurance policy that also has an outstanding policy loan at the time of M's death. The insurer will deduct the outstanding loan balance from the
policy proceeds
which of the following actions is not possible with a universal life policy?
premiums may be applied as a credit against income tax
what is considered to be a characteristic of a conditionally renewable health insurance policy?
premiums may increase at time of renewal
what is the purpose of the time of payment claims provision?
prevents delayed claim payments made by the insurer
T is covered by two health insurance plans: a group plan through his employer and his spouse's plan as a dependent. Under the Model Group Coordination of Benefits provision, when T files a claim, his employer's plan is considered the
primary carrier
The Legal Actions provision of an insurance contract is designated to do all off the following, EXCEPT:
protect the producer
T has a term policy that allows him to continue the coverage after expiration of the initial policy period. What type of term coverage is this?
renewable
Statements made on an insurance application that are believed to be true to the best of the applicant's knowledge are called
representations
Which factors are taken into consideration when an insurance company determines the premium rate for a whole life policy on an applicant?
risk classification
Which of these is NOT a legal entity for selling life insurance in Florida?
risk management advisors
which of these factors does not influence an applicant's need for life insurance?
self-maintenance expenses
a prepaid application for individual disability income insurance was recently submitted to an insurer. when the insurer received the medical information bureau report, the report showed that the applicant had suffered a stroke 18 months ago, something that was not disclosed on the application. which of the following actions would the insurance company not take?
send a notice to the MIB that the applicant was declined
which of the following statements best describes dental care indemnity coverage?
services are reimbursed after insurer received the invoice
P is a new employee and will be obtaining non-contributory group Major Medical insurance from her employer. Which of the following actions must she take during the open enrollment period?
sign an enrollment card
S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation?
single premium
Which mode of payment is NOT used by health insurance policies?
single premium
an immediate annuity consists of a
single premium
Which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused by a third party?
subrogation
what type of insurance policy covers two people and pays upon the death of the lost insured?
suvivorship
when an individual is planning to protect his family with life insurance, one method of doing so is called needs analysis. What exactly does needs analysis involve?
takes into account the present value of future income earned by the breadwinner
What does a Guaranteed Insurability rider provide a Disability Income policyowner?
the ability to periodically increase the amount of coverage only WITHOUT evidence of insurability
If an annuity is terminated prior to beginning of the income payment period, the contract owner receives
the contract surrender value at that time
D was actively serving in the Marines when he was killed in an automobile accident while on leave. His $100,000 Whole life policy contains a War Exclusion clause. How much will D's beneficiary's receive?
the full face amount
In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and
the initial premium
T was insured under an individual Disability Income policy and was severely burned in a fire. As a result, T became totally disabled. The insurer began making monthly benefit payments, but later discovered that the fire was set by T in what was described as arson. What actions will the insurer take?
the insurer will rescind the policy, deny the claim, and recover all payments made
According to Florida's life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary Statement when it's requested by....
the policyowner
The Replacement of Life Insurance and Annuities regulation is designed to protect the interest of...
the policyowner
all of these statements about equity indexed life insure are correct except
the premiums can be lowered or raised, based on investment performance
W gave W's age as 50 when W purchased a Life policy. At the time of W's death seven years later, the company discovered W's true age at issue had been 59. What would the normal procedure be under the misstatement of age provision in regard to the payment of the death claim?
the proceeds would be reduced based on whatever the premium would have been if purchased at age 59
An agent who makes misleading statement that lead to the termination of an existing insurance policy so that a new policy with another insurer can be taken out has committed
twisting
according to the time limit of certain defenses provision in an individual health insurance policy, nonfraudluent misstatements first become incontestable
two years from the date of the policy was issued
which of the following is a characterstic of a variable annuity?
underlying equity investment
All of these are considered to be a benefit under social security, except for
unemployment
Which policy requires an agent to register with the national association of securities dealers before selling?
variable life
when a misrepresentation on a life insurance policy application is discovered, what action may an insurance company take?
void the policy only if it is discovered during the contestable period and proven to be material
What type of rider would be added to an Accident and Health policy if the policyowner wants to ensure the policy will continue if he/she ever becomes totally disabled?
waiver of premium rider
a life insurance policy that provides a policy owner with cash value along with a level face amount is called
whole life
a policy that becomes a MEC
will lose many of its tax advantages
