Health

What type of rider would be added to an Accident and Health policy if the policy owner wants to ensure the policy will continue if he\she ever becomes a totally disabled? A. Accidental death and dismemberment rider B. Disability income rider C. Guaranteed insurability rider D. Waiver of premium rider

D. Waiver of premium rider

An insured owns an individual Disability Income policy with a 30 day Elimination period for sickness and accidents and a monthly indemnity benefit of $500. If the insured is disabled for 3 1/2 months, what is the MAXIMUM amount he would receive for an approved claim? A. $500 B. $1k C. $1250 D. $1750

C. $1250 3.5 months - 1 month elimination period = 2.5 months. 2.5 months X $500 monthly

J's Major Medical policy has a $2000 deductible and an 80/20 Coinsurance clause. If J is hospitalized and receives a bill for $10,000, J would pay: A. $1600 B. $2000 C. $3600 D. $8000

C. $3600 In this situation, ($2,000) + 20% of $8,000 the remaining bill ($1,600) = $3,600.

C was injured while deep sea diving and requires a hospital stay. C has a Major Medical policy with a 80\20 coinsurance clause and $400 deductible. What is the MAXIMUM C will pay if the covered medical expenses are $2000 A. $0 B. $400 C. $720 D. $1000

C. $720 In the situation $400 deductible + 20% of the remaining medical bill = $720

An insurer must provide an insured with claim forms within____ days after receiving notice of a loss. A.5 B. 10 C. 15 D. 20

C. 15

According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid? A. 7 days B. 10 days C. 31 days D. 60 days

C. 31 days

M's insurance company denied a reinstatement application for her lapsed health insurance policy. The company did not notify M for 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? A. 10 days B. 30 days C. 45 days D. 60 days

C. 45 days

The individual most likely to a buy a Medicare Supplement policy would be an: A. unemployed 64 year old female B. 62 year old male covered by Medicaid C. 68 year old male covered by Medicare D. uninsured 60 year old male

C. 68 year old male covered by Medicare

Which of the following statements BEST describes what the Legal Actions provision of an Accident and Health policy requires? A. An insured must settle a claim within 60 days after Proof of loss is submitted B. An insured must wait at least 30 days after Proof of loss has been submitted before a lawsuit can be filed C. An insured must wait at least 60 days after Proof of loss has been submitted before a lawsuit can be filed D. An insured may settle a claim within 30 days after Proof of loss is submitted

C. An insured must wait at least 60 days after Proof of loss has been submitted before a lawsuit can be filed

Which type of plan normally includes hospice benefits? A. Short term disability plans B. Group life plans C. Workers compensation D. Managed care plans

D. Managed care plans

Z owns a Disability Income policy with a 30 day Elimination period. Z contracts pneumonia that leaves him unable to work from January 1 until January 15. Z then becomes disabled from an accident on February 1 and the disability last until July 1 the same year. Z will become eligible to receive benefits starting: A. January 1 B. January 15 C. February 1 D. March 1

D. March 1 The elimination period is the period of time between the onset of a disability and the time you are eligible for benefits. It is best thought of as a deductible period for your policy. After a 30 day Elimination period , Z will become eligible for receiving benefits March 1.

According to the Time of Claims provision, the insurer must pay Disability income benefits no less frequently then which of the following options? A. Annually B. Semiannually C. Quarterly D. Monthly

D. Monthly

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? A. Limited coverage B. Workers compensation coverage C. Occupational coverage D. Nonoccupational coverage

D. Nonoccupational coverage

Which of the following BEST describes a short-term medical expense policy? A. Conditionally renewable B. Noncancellable C. Guaranteed renewable D. Nonrenewable

D. Nonrenewable

The provision that defines to whom the insurer will pay benefits to is called: A. Entire Contract B. Proof of loss C. Claim forms D. Payment of Claims

D. Payment of Claims

Which Long Term Care insurance statement is true? A. inflation protection is usually not offered B. Benefits are usually payable for alcohol rehabilitation C. Can only be offered to individuals under the age of 70 D. Pre exisiting conditions must be covered after the coverage has been in force for six months

D. Pre exisiting conditions must be covered after the coverage has been in force for six months

Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy? A. Past due premiums on a lapsed policy or waived in coverage is restored B. The insured is paid a monthly benefit to keep insurance premiums current in the event of total disability C. Premiums are waived after the insured has been unemployed for a specified time. D. Premiums are waived after the insured has been totally disabled for a specified time.

D. Premiums are waived after the insured has been totally disabled for a specified time.

The policy provision that entitles the insurer to establish conditions the insured must meet while a claim is pending is: A. Grace Period B. Physical Examination and Autopsy C. Entire Contract D. Time Limit on Certain Defenses

D. Time Limit on Certain Defenses This provision limits the period during which an insurer can deny a claim based on a misstatement made by the insured

R becomes disabled and owns an individual Disability Income policy. When is R eligible to receive disability benefits? A. Upon being laid off from employer B. Upon paying a deductible C. Upon being examined by a physician D. Upon satisfying the elimination period requirement

D. Upon satisfying the elimination period requirement

Which of the following types of care is typically not covered in a Long Term Care policy? A. Acupuncture B. Skilled care C. Home Health Care D. Custodial Care

A. Acupuncture

Q is hospitalized for 3 days and receives a bill for $10,100. Q has a Major Medical policy with a $100 deductible and 80/20 coinsurance. How much will Q be responsible for paying on this claim? A. $2100 B. $2200 C. $2000 D. $100

A. $2100 In this situation, $10,100 X 20% coinsurance + $100 deductible = $2100

Insurers may request a hearing within___ if their policy is rejected A. 20 Days B. 30 Days C. 60 Days D. 90 Days

A. 20 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 dependents to continue their group health coverage for a maximum of how many months under COBRA regulations? A. 36 B. 18 C. 15 D. 6

A. 36

When does a Probationary Period provision become effective in a health insurance contract? A. At the policy's inception B. 30 days after the policy's inception C. When a claim is submitted D. When a covered loss occurs

A. At the policy's inception

T is receiving $3k/month from a Disability Income policy in which T's employer has paid the premiums. How are the $3k benefit payments taxable A. Benefits are taxable to T B. Benefits are tax free to T C. Benefits are partially taxable to T D. Benefits are taxable to T employer

A. Benefits are taxable to T

A Disability Income policyowner 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 application. How will the insurer handle this claim? A. Claim will be paid and coverage will remain in force B. Claim will be denied and coverage will remain in force C. Claim will be denied and coverage will be cancelled D. Claim will be denied, coverage cancelled, and all premiums paid will be refunded

A. Claim will be paid and coverage will remain in force After a policy has been in force for 2 (sometimes 3) years, it enters the incontestable period, in which the insurer may not deny a claim based on information not disclosed at the time of application.

A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type policy will pay a monthly benefit to the personal assistant? A. Disability income B. Major Medical C. Key Employee D. Business overhead Expense

A. Disability income

A characteristic of a PPO would be: A. Discounted fees for the patient B. Not allowed to see out of network physicians C. Physicians are paid on a capitation basis D. Primary care physician is required

A. Discounted fees for the patient

In a Disability Income policy, which of these clauses acts as a deductible? A. Elimination period B. Waiver period C. Deductible Period D. Probationary Period

A. Elimination period

When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called the: A. Entire Contract provision B. Insuring clause C. Time Limit on Certain Defense provision D. Legal Contract clause

A. Entire Contract provision

Under an individual health insurance policy, the Time Limit of Certain Defenses provision states that non-fraudulent misstatements first become incontestable two years A. From the date that the policy was issued B. From the date that the application was signed C. From the date initial premium was collected D. From the date of the sales appointment

A. From the date that the policy was issued

With Accidental Death and Dismemberment policies, what is the purpose of the Grace Period? A. Gives the policyowner additional time to pay overdue premiums B. Gives the policyowner additional time to file a lawsuit C. Gives the policyowner additional time to file a claim D. Gives the policyowner additional time to provide proof of loss

A. Gives the policyowner additional time to pay overdue premiums

Which of the following provisions specifies how long a policy owner's health coverage will remain in effect if the policy owner does not pay the premium when it is due? A. Grace period B. Consideration C. Waiver of premium D. Reinstatement

A. Grace period

Bryce purchased a disability income policy rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this? A. Guaranteed Insurability rider B. Additional coverage rider C. Paid up option rider D. Extended insurability rider

A. Guaranteed Insurability rider

All of these characteristics of a Health Reimbursement Arrangement (HRA) Except A. HRA is entirely funded by the employee B. HRA is entirely funded by the employer C. Reimbursement for eligible medical expenses are allowed D. HRA can be offered with other health plans

A. HRA is entirely funded by the employee

Which health policy clause specifies the amount of benefits to be paid? A. Insuring B. Consideration C.Free-look D. Payment mode

A. Insuring

The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the: A. Insuring clause B. Contestable clause C. Consideration clause D. Free-look provision

A. Insuring clause

Which of the following health insurance policy provisions specifies the health care services a policy will provide? A. Insuring clause B. Usual, Customary, and Reasonable Clause C. Consideration clause D. Benefit clause

A. Insuring clause

A catastrophic illness would be best covered by which of the following health insurance plans? A. Major Medical B. Limited C. Indemnity D. Surgical Expense

A. Major Medical

Which of the following types of health coverage frequently uses a deductible? A. Major Medical policy B. Basic Surgical policy C. Basic hospital policy D. Workers compensation

A. Major Medical policy

Pre-hospitalization authorization is considered an example of: A. Managed-care B. PPO care C. Medicaid D. Major Medical Insurance

A. Managed-care

If an insurance company issued a Disability income policy that cannot cancel or for which it cannot increase premiums, a type of renewability that best describes this policy is called: A. Noncancellable B. Conditionally renewable C. Cancellable D. Guaranteed renewable

A. Noncancellable

Generally how long is a benefit period for a Major Medical Expense Plan? A. One year B. Two year C. Three year D. Four year

A. One year

Which of these is considered a mandatory provision? A. Payment of claims B. Insurance with other insurers C. Misstatement of age D. Change of occupation

A. Payment of claims

What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy? A. Premiums may increase at time of renewal B. Premiums may increase at any time C. Policy may be renewed at the discretion of the insured D. Policy may be amended by insurer at any time

A. Premiums may increase at time of renewal

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 these features would allow D to continue receiving benefits? A. Residual Benefit clause B. Waiver Benefit clause C. Concurrent benefit clause D. Guaranteed Benefit clause

A. Residual Benefit clause A residual amount benefit is based on the proportion of income actually lost due to partial disability, taking into account the fact that the insured is able to work and earn some income.

R had received full disability income benefits for 6 months, When he returns to work, he is only able to resume half his normal daily workload. which provision pays reduced benefits to R while he is not working at full capacity? A. Residual disability B. Recurrent disability C. Presumptive disability D. occupational disability

A. Residual disability a residual amount benefit is based on the proportion of income lost due to the partial disability

Which of the following statement about the classification of applicants is INCORRECT? A. Substandard applicants are never declined by underwriters B. Substandard applicants are occasionally declined by underwriters C. Preferred risk applicants typically have better premium rates than a standard risk applicants D. An applicant can be classified as a substandard risk because of a hazardous job

A. Substandard applicants are never declined by underwriters

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? A. The insurer will rescind the policy, deny the claim and recover all payments made. B. Due to the policy not being post claim underwritten the insurer must continue to pay this claim. C. Claim will be rejected because of this criminal act, but no recovery of payments will be made. D. Claim will be denied but the policy will remain in force without further premium payments due to the insureds total disability.

A. The insurer will rescind the policy, deny the claim and recover all payments made.

A(n) ______of benefits of a Health Policy transfers payments someone other than the policyowner. A. assignment B. transfer C. allocation D. designation

A. assignment

The guarantee of insurability option provides a long term care policyowner the ability to: A. buy additional coverage at a later date B. add the insureds spouse at a later date C. pay the same premium for life D. cancel the policy at anytime

A. buy additional coverage at a later date

Health insurance benefits NOT covered due to an act of war are: A. excluded by the insurer in the contract provisions B. assigned to a reinsurer C. given a longer probationary period D. charged a higher premium

A. excluded by the insurer in the contract provisions An exciusion is a provision that entirely eliminates coverage for a specified risk, such as an act of war or aviation

T sends proof of loss to her insurer for an acceptable medical expense claim under her individual Health Insurance policy. Upon receipt, the insurer must pay the benefits A. immediately B. within 6 months C. at the insurer's discretion D. within 3 months

A. immediately

Basic Hospital and Surgical policy benefits are: A. lower than the actual expenses incurred B. higher than the actual expenses incurred C. normally subject to deductibles D. normally subject to coinsurance

A. lower than the actual expenses incurred

Periodic health claim payments MUST be made at least: A. monthly B. weekly C. daily D. annually

A. monthly

The percentage of an individuals Primary Insurance Amount (PIA) determines the benefits paid in which of the following programs? A. social security disability income B. medicare supplements C. Medicaid D. COBRA

A. social security disability income

A disability elimination period is best described as a : A. time deductible B. dollar deductible C. eligibility deductible D. probation deductible

A. time deductible

N is covered under an individual Disability policy with a 30 day Elimination period and monthly benefit of $500. N is totally disabled for 3 1/2 months. N's total benefit received on this claim is: A. $2k B. $1750 C. $1500 D. $1250

After the 30 day Elimination period has been satisfied, the total benefit paid on this claim is $1250 ($500+$500+$250)

A Hospital\Surgical Expense policy was purchased for a family of four in March 2013. The policy was issued with a $500 deductible and a limit of four deductibles per calendar year. Two claims were paid in September 2013, each incurring medical expenses and excess of the deductible. Two additional claims were filed in 2014, each an excess of the deductible amount as well. What would be this family's out-of-pocket medical expenses for 2013? A. $500 B. $1000 C. $1500 D. $2000

B. $1000 In this situation, the insured's maximum out-of-pocket expenses for 2013 would be $1000

Medicare Part B does NOT cover: A. occupational therapy B. Inpatient hospital services C. physician and surgeon services D. medical equipment rental

B. Inpatient hospital services

What is the MINIMUM number of Activities of Daily Living (ADL) an insured must be unable to perform to qualify for Long Term Care Benefits? A. 1 B. 2 C. 3 D. 4

B. 2

An insured must notify an insurer of a medical claim within ____days after an accident. A. 10 B. 20 C. 30 D. 40

B. 20 Notice of a claim is typically required within 20 days afler the Occurrence or a commencement of the loss

How long is the typical free look period Long Term care insurance policies? A. 20 days B. 30 days C. 40 days D. 50 days

B. 30 days

Qualified Long Term policies may take into consideration to an applicants pre exisiting conditions for maximum of not more than__ month(s) prior to the effective date of coverage. A. 1 B. 6 C. 12 D. 24

B. 6

A "reimbursement policy" pays what amount of covered Long Term Care expenses? A. all expenses regardless of the policy limits B. Actual covered expenses up to the daily maximum C. a daily dollar amount regardless of the actual incurred expenses D. The usual, customary and reasonable expenses regardless of the policy limits.

B. Actual covered expenses up to the daily maximum

Which of the following is the MOST important factor when deciding how much Disability Income coverage an applicant should purchase? A. Applicants occupation B. Applicants monthly income C. Applicants health D. Applicants previous disabilities

B. Applicants monthly income

Which of the following policy features allows an insured to defer current health charges to the following years deductible instead of the current years deductible? A. Deferral provision B. Carryover provision C. Stop Loss provision D. Corridor provision

B. Carryover provision

When an insured changes to a more hazardous occupation, which disability policy provision allows an insurer to adjust policy benefits and rates? A. Relation of earnings to insurance provisions B. Change of occupation provision C. Conformity of state statues provision D. Entire contract provisions

B. Change of occupation provision

Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract? A. Consideration B. Entire Contract C. Free-look D.Insuring

B. Entire Contract

T owns an Accident and Health policy and notifies 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? A. Allow her to take a tax deduction on unearned premiums B. Increase her policy's coverage amount C. Decrease her policies coverage amount D. Nothing

B. Increase her policy's coverage amount

Which of the following actions will an insurance company most likely NOT take if an applicant who has diabetes applies for a Disability Income policy? A. Issue the policy with a diabetes exclusion B. Issue the policy with an altered Time of Payment of Claims provision. C. Issue the policy with a rating D. Decline the applicant

B. Issue the policy with an altered Time of Payment of Claims provision.

Which of the following situations does a Critical Illness plan cover? A. Asthma B. Leukemia C. Alcohol rehabilitation D. Severe car accident

B. Leukemia

Which of the following is NOT a limited benefit plan? A. Dental policy B. Life insurance policy C. Critical Illness policy D. Cancer policy

B. Life insurance policy

Nursing home benefits must be provided for at least 12 consecutive months in which the following types of policies? A. Blanket Custodial B. Long Term Care C. Critical Illness D. Medicare Supplements

B. Long Term Care

Comprehensive Major Medical policies usually combine: A. Major Medical with Disability Income coverage B. Major Medical with Basic Hospital/Surgical coverage C. Basic Hospital/Surgical with Accidental coverage D. Basic/ Hospital/Surgical with Disability Income coverage

B. Major Medical with Basic Hospital/Surgical coverage

A disability income policy that only the policy owner can terminate and which the rates will never go up is considered to be A. Optionally renewable B. Noncancellable C. Cancellable D. Guaranteed renewable

B. Noncancellable

Which of the following statements about a Guaranteed Renewable Health Insurance policy is CORRECT? A. Premiums normally decrease at time of renewal B. Premiums normally increase at time of renewal C. Policy can renewed at any time by the company D. Policy can be cancelled at any time by the company

B. Premiums normally increase at time of renewal

What is the purpose of the Time of Payment of Claims provision? A. Requires the insured to wait 60 days after submitting proof of loss before filing a lawsuit B. Prevents delayed claim payments made by the insurer C. Requires a probation for each claim filed by the insured D. Protects the insurer from frivolous lawsuits

B. Prevents delayed claim payments made by the insurer

Which of the following is cónsidered to be the time period after a Health Policy is issued, during which no benefits are provided for illness? A. Incontestable Period B. Probationary Period C. Trial Period D. Subrogation Period

B. Probationary Period

K failed to pay renewal premium within the time granted by the insurer. K then sends in the payment which the insurer subsequently accepts. Which policy provisions specifies that coverage may be restored in the situation? A. Free look B. Reinstatement C. Grace period D. Consideration

B. Reinstatement

Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company. What action should J take? A. Deposit the applicants check into his account and make a personal check out to the insurance company from his personal account. B. Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company C. Cross off his name on the "pay to" portion of the check, write the name of the insurance company and send the check back to to the insurance company. D. Deposit the check in to his personal account , use the funds to purchase a cashiers check, and send the new cashiers check back to the insurance company.

B. Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company

The insuring clause A. Specifies the additional time given to pay past due premiums B. States the scope and limits of the coverage C. States the amount of premium to be collected D. Prohibits the insured from suing the insurer for at least 60 days after filing a written proof of loss

B. States the scope and limits of the coverage

What should an insured do if the insurer does not send claims forms within the time period set forth in a health policies Claims forms provision? A. File a lawsuit B. Submit the claim in any form C. Wait for the claim form to arrive D. Resubmit the request for a claim form

B. Submit the claim in any form

G is involved in an automobile accident as a result of driving while intoxicated and suffers numerous injuries. According to the Intoxicants and Narcotics exclusion in G's policy, who is responsible for paying the medical bills? A. The reinsurer B. The insured C. The insurer D. The Guaranty Association

B. The insured

J, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J's age, as stated on the application five years ago, was found to be understated by ten years. Which of the following actions will the insurance company take? A. The insurer will pay the original benefit stated in the policy B. The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age C. The insurer will pay the original face amount minus any premium deficiencies owed D. The insurer will deny the claim and refund premiums paid

B. The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age

T files a claim on his Accident and Health policy after being treated for an illness. The insurance company believes that T misrepresented his actual health on the initial insurance application and is, therefore disputing the claim's validity. The provision that limits the time period during which the company may dispute a claim's validity is called: A. Insuring B. Time Limit on Certain Defenses C. Grace Period D. Free-look

B. Time Limit on Certain Defenses

What is the elimination period of an individual disability policy? A. Time period an insured must wait before coverage begins B. Time period a disabled person must wait before benefits are paid C. time period after the policy issue date in which the provisions are still contestable D. The point in time when benefits are no longer payable

B. Time period a disabled person must wait before benefits are paid

Which of the following BEST describes how pre admission certification is used? A. Used to assist in underwriting B. Used to prevent nonessential medical costs C. Used to minimize hospital lawsuits D. Used to help process claims

B. Used to prevent nonessential medical costs

What is the primary factor that determines the benefits paid under a disability income policy? A. Education level B. Wages C. Type of occupation D. Age

B. Wages

Disability policies do NOT normally pay for disabilities arising from which of the following? A. Accidents B. War C. Negligence D. Sickness

B. War

If an individual is covered under an Accidental Death Policy and dies, an autopsy can be performed in all these situations, EXCEPT: A. When the cause of death is unknown B. When the state prohibits this by law C. When consent for the autopsy is not obtained D. When foul play was a contributing factor

B. When the state prohibits this by law

Major Medical policy typically : A. pay 100% of covered expenses B. contain a deductible and coinsurance C. require a use of in network facilities only D. do not contain a deductible and coinsurance

B. contain a deductible and coinsurance

With Disability Income insurance an insurance company may limit the monthly benefit amount a prospective policy holder may obtain because of the insureds: A. monthly expenditures at the time of disability B. gross income at the time of purchase C. gross income at the time of disability D. occupation at the time of purchase

B. gross income at the time of purchase

Which of the following statements about the Health reimbursement Arrangements HRA is CORRECT? A. if the employee has a qualified medical leave from work, lost wages can be reimbursed B. if the employee paid for qualified medical expenses, the reimbursement may be tax free C. Any used amount are added to employees gross income D. Health insurance premiums can be reimbursed to the employee

B. if the employee paid for qualified medical expenses, the reimbursement may be tax free

When determining the monthly benefit amount for a Disability Income policy, the factor that limits the amount a prospective insured may purchase is : A. occupation B. income C. age D. medical condition

B. income

The first portion of a covered Major Medical insurance expense that the insured is required to pay is called the : A. corridor deductible B. initial deductible C. Stop loss deductible D. co insurance deductible

B. initial deductible

J was reviewing her Health Insurance policy and noticed the phrase "this policy will only pay for a semi-private room". This phrase is considered to be A. hidden deductible B. internal limit C. restricted provision D. stop loss

B. internal limit

The Notice of Claims provision requires a policyowner to: A. provide proof of loss to an insurer within a specified time B. notify an insurer of a claim within a specified time C. wait 60 days after filing a claim to initiate a lawsuit against an insurer D. notify their physician of a claim within a specified time

B. notify an insurer of a claim within a specified time The Notice of Claims provision spells out the insured's duty to provide the insurer with reasonable notice in the event of a loss

Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy? A. Have the customer sign a blank application then take the application back to his office to complete prior to sending it off to the insurance company. B. Complete the application over the phone with the customer, sign the application for the customer and send the application off to the insurance company. C. Complete the application and review the information with the customer prior to obtaining the customer signature then send the application out to the insurance company. D. Have the customer fill out the application and send it to his office for him to sign, then send it off to the insurance company.

C. Complete the application and review the information with the customer prior to obtaining the customer's signature then send the application out to the insurance company.

A prospective insured completes and signs an application for health insurance but intentionally conceals information about a pre-existing heart condition. The company issues the policy. Two months later, the insured suffers a heart attack and submits a claim. While processing the claim, the company discovers a pre-existing condition. In this situation, the company well: A. Continue covers but request a corrected application B. Deny coverage and increase premiums C. Continue coverage but exclude the heart condition D. Rescind the coverage and return the premiums

C. Continue coverage but exclude the heart condition If the insured did not cite the condition on the application and the insurer did not exclude the condition, the pre-existing condition provision still applies. Exclusions are subject to the "Time limit on certain defenses" provision, however

B is a teacher who was injured in a car accident and cannot work. She is now receiving monthly benefits as a result of this accident. Which type of policy does B have? A. Major Medical B. Blanket C. Disability Income D. Indemnity

C. Disability Income

"A producer does not have the authority to change a policy or waive any of its provisions". The health provision that best describes this statement is called the A. Grace Period B. Incontestable C. Entire Contract D. Time Limit on Certain Defenses

C. Entire Contract The Entire Contract provision states that The producer does NOT have the authority to change the policy or waive any of its provisions

The sections of an insurance contract which limit coverage are called: A. Waivers B. Riders C. Exclusions D. Limitations

C. Exclusions

Long Term Care policies will usually pay for eligible benefits using which of the following methods? A. Delayed B. Fee for service C. Expense incurred D. Respite

C. Expense incurred

This type of deductible provision waives the deductible for all family members after some of them have satisfied individual deductibles within the same year: A. Individual deductible B. Corridor deductible C. Family maximum deductible D. Common accident deductible

C. Family maximum deductible

A physician opens up a new practice and qualifies for a $7k/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? A. Extended Term rider B. Cost of living Adjustment rider C. Guaranteed Insurability Option rider D. Waiver of premium rider

C. Guaranteed Insurability Option rider

Which type of renewability best describes a Disability Income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class? A. Conditionally Renewable B. Noncancellable C. Guaranteed Renewable D. Optionally Renewable

C. Guaranteed Renewable The renewal provision in a guaranteed renewable policy specifies that the policy must be renewed (as long as premiums are paid) until the insured reaches a specified age. These usually have increasing premiums.

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 insureds. This type of policies considered. A. Absolutely renewable B. Conditionally renewable C. Guaranteed renewable D. Noncancellable

C. Guaranteed renewable

Information obtained from a phone conversation to the proposed insured can be found in which of these reports? A. Agents Report B. MIB report C. Inspection report D. Attending physicians report

C. Inspection report

In a Major Medical Expense policies, what is the objective of a Stop Loss Prevention? A. Limits an insurers premium increases B. Limits an insurers liability C. Limits an insureds out of pocket medical expenses D. Limits an insureds coverage for pre exisiting conditions.

C. Limits an insureds out of pocket medical expenses

Which of the following are NOT managed care organizations? A. Point of service plan (POS) B. Preferred provider organization (PPO) C. Medical Information Bureau (MIB) D. Health maintenance organization (HMO)

C. Medical Information Bureau (MIB)

If a retiree on a Medicare required five hospital stays in one year, which policy would provide the best insurance for excess hospital expenses? A. Long term care B. Indemnity C. Medicare Supplement D. Medicaid

C. Medicare Supplement covers and pays for excess charges (also known as medi-gap)

What type of renewability guarantees premium rates and renewability? A.Optionally renewable B. Conditionally renewable C. Noncancellable D. Warrantied renewable

C. Noncancellable

Which of these statements concerning an individual Disability Income policy is True? A. Premiums are normally tax deductible B. Age of the insured determines the amount of the benefits C. Normally includes an Elimination period D. Benefits are normally taxable

C. Normally includes an Elimination period

S filed a written Proof of Loss for a Disability claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning: A. September 21 B. October 16 C. November 1 D. December 1

C. November 1 The insured must wait 60 days after written proof of loss before legal action can be brought against the company

What must the policy owner provide to the insurer for validation that a loss has occurred? A. Proof of coverage B. Proof of claim C. Proof of loss D. Proof of payment

C. Proof of loss

X owns a Disability Income policy. X recently suffered a disability which was due to the same cause as a previous disability. The disabilities both occurred over a four month span. Which of the following provisions allows X's second disability to be covered without a new elimination period? A. Delayed Disability B. Partial Disability C. Recurrent Disability D. Residual Disability

C. Recurrent Disability

When an insured has the same disability within a specified time period and the insurance company provides the same benefits without a new waiting period, the second disability is covered under which of the following benefits? A. Residual Disability B. Presumptive Disability C. Recurrent Disability D. Repeat Disability

C. Recurrent Disability the insurer will provide the same benefits without a new elimination period under the Recurrent 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 which of the following? A. Waiver of premium B. Recurring disability C. Residual disability D. Presumptive disability

C. Residual disability

Which provision allows a portion of any used medical benefits to be restored following a particular amount of benefit has been used, or after the policy has been in effect for a particular period of time? A. Reimbursement benefit B. Restoration of unused benefit C. Restoration of used benefit D. Medical offset benefit

C. Restoration of used benefit

A prepaid application for individual Disability Income insurance was recently submitted to an insurer. When the insurer received the Medical Information Bureau (MIB) report , the report showed that the applicant has suffered a stroke 18 months ago, something was not disclosed on the application. Which of the following actions would the insurance company NOT take? A. Send the initial premium back to the applicant B. Send a notice to the applicant that the coverage was declined C. Send a notice to the MIB that the applicant was declined D. Send a notice to the agent that the applicant was declined

C. Send a notice to the MIB that the applicant was declined

What does a Guaranteed Insurability rider provide a Disability Income policy owner? A. The guarantee that the premiums will never increase B. The guarantee that the policy will never be cancelled C. The ability to periodically increase the amount of coverage without evidence of insurability D. The ability to periodically increase the amount of coverage only with evidence of insurability

C. The ability to periodically increase the amount of coverage without evidence of insurability

Which Accident and Health policy provision addresses preexisting conditions? A. Proof of Loss B. Legal Actions C. Time Limit on Certain Defenses D. Payment of Claims

C. Time Limit on Certain Defenses

Which of the following phrases refers to the fees charged by a healthcare professional? A. Deductible B. Coinsurance C. Usual, customary and reasonable expenses D. Hospital expense

C. Usual, customary and reasonable expenses

The provision in a health insurance policy suspends premiums being paid to the insurer while the insured is disabled is called the : A. Probation period B. Grace Period C. Waiver or premium D. Elimination period

C. Waiver or premium The Waiver of Premium provision ina health insurance contract suspends the insurers right to the receive premiums during a covered period of disability

In order to establish a Health Reimbursement Arrangement (HRA) it must: A. be offered in conjuction with other employer provided health benefits B. limit the benefits to prescription drugs only C. be established by the employer D. limit the amount of money the employee can contribute toward the account

C. be established by the employer

A Health Reimbursement Arrangement MUST be established: A. with employee funding B. with other employer sponsored benefit plans C. by the employer D. only during the specific open enrollment periods

C. by the employer

An insurance company normally has 2 years to contest information provided on an accident and health application. This 2 year period begins on the date that the: A. medical examination is given B. producer completes the application C. insurer dates the policy D. the first premium is paid

C. insurer dates the policy

Deductibles are used in health policies to lower: A. the incidents of fraud B. the coinsurance amount C. overuse of medical services D. adverse selection

C. overuse of medical services

The Legal Actions provision of an insurance contract is designed to do all of the following, EXCEPT: A. provide the insurer adequate time to research a claim B. protect the insured from having claim research delayed C. protect the producer D. give the insured guidelines for pursuing legal action against and insurer

C. protect the producer

P is self employed and owns an Individual Disability Income policy. He becomes totally disabled on June 1 and receives $2k a month for the next 10 months. How much of this income is subject to federal income tax? A. $20k B. $14k C. $6k D. $0

D. $0

An insured pays premiums on an annual basis for an individual health insurance policy. What is the MINIMUM number of days for the Grace Period provision? A. 7 B. 10 C. 20 D. 31

D. 31

V is insured under an individual Disability Income policy with a 30 day Elimination period. On July 1 he is involved in an accident and temporarily disabled. He returns to work on December 1. How many months of benefits are payable? A. 6 months B. 5 months C. 4 1/2 months D. 4 months

D. 4 months

P received Disability income benefits for 3 months then returns to work. He is able to work one month before her condition returns, leaving her disabled once again. What would the insurance company most likely regard this second period of disability as? A. A presumptive disability B. An occupational disability C. A residual disability D. A recurrent disability

D. A recurrent disability a second period of disability from the same or related cause of a prior disability is called a recurrent disability

Which of the following statements describes what an Accident and Health policyowner may NOT do? A. File a covered claim B. Assign ownership C. Cancel the coverage D. Adjust the premium payments

D. Adjust the premium payments The owner of an Accident and Health policy may not change the premium amount

In health insurance policies, a waiver of premium provision keeps the coverage in force without premium payments: A. Whenever an insured is unable to work B. During the time an insured is confined in a hospital C. Following an accidental injury, but not during sickness D. After an insured has become totally disabled as defined in the policy

D. After an insured has become totally disabled as defined in the policy The waiver of premium provision keeps the coverage in force without premium payments if the insured has become toally disabled as defined in the policy

Under a Long Term Care policy, which benefit would be typically excluded or limited? A. Intermediate nursing B. Skilled nursing C. Home health care D. Alcohol rehabilitation

D. Alcohol rehabilitation

All of the following statements about Major Medical benefits are true Except A. the deductible can be expressed as a fixed dollar amount B. The benefit period begins only after a specified amount of expenses have accrued C. Benefits are generally expressed as a percentage of eligible expenses D. Benefits have no maximum limit

D. Benefits have no maximum limit

P is a Major Medical policyowner who is hospitalized as a result of injuries sustained from participating in a carjacking. How will the insurer most likely handle this claim? A. Claim will be denied and policy terminated B. Claim will be partially paid C. Claim will be paid D. Claim will be denied

D. Claim will be denied If a person is injured while committing an illegal act, health insurance will Cover the expense of the injury.

This type of deductible provision states that should more than one family member be involved in a common accident, or suffer the same illness, only on individual deductible amount shall be applied. A. individual deductible B. Corridor deductible C. Family maximum deductible D. Common accident deductible

D. Common accident deductible

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? A. Entire contract clause B. MIB clause C. Insuring clause D. Consideration clause

D. Consideration clause

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: A. issue the policy only when the initial premium check has cleared B. Determine if the applicant is insurable by investigating family health history C. issue the policy on a standard basis D. Determine if the applicant is an acceptable risk by completing standard underwriting procedures

D. Determine if the applicant is an acceptable risk by completing standard underwriting procedures

In the event of an illness a ______ ______ policy would reimburse an insured for a loss earnings. A. Earning Indemnity B. Family Income C. Medicare Supplement D. Disability Income

D. Disability Income

K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would cover her loss of income? A. Indemnity B. Major Medical C. Travel D. Disability Income

D. Disability Income

M becomes disabled and is unable to work for six months. M dies soon after from complications arising from his disability. M has a Disability Income policy that pays $2k a month. Which of the following statements BEST describes what is owed for her estate? A. $2K B. A lump sum of six times the monthly benefit C. nothing D. Earned but unpaid benefits

D. Earned but unpaid benefits In this situation any earned but unpaid benefits will be paid

Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy? A. Waiver B. Exceptions and Reductions C. Incontestable D. Entire Contract

D. Entire Contract

Which of the following is NOT included in the policy face? A. Free Look provision B. Name of the insured C. Name of the insurer D. Exclusions

D. Exclusions The exclusions section is NOT included in the policy face (first page of an insurance policy

After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms? A. File a lawsuit B. Contact the insurer again requesting forms C. Nothing D. File written proof of loss

D. File written proof of loss

What is the initial requirement for an insured to become eligible for benefits under the Waiver of Premium provision? A. Insured must be unemployed B. Insured must be hospitalized C. Insured must demonstrate financial need D. Insured must be under a physician's care

D. Insured must be under a physician's care Under Waiver of Premium, which is a rider that will pay your premium while you're disabled, you must have a doctor certify that you meet the definition of disability as contained in the rider

T was treated for an ailment 2 months prior to applying for health insurance policy. This condition was noted on the application and then was issued shortly afterwards. How will the insurer likely consider this condition? A. Insurer will require a higher deductible for any claims resulting for this condition B. Insurer is required to initially cover this preexisiting condition C. Insurer will permanently exclude the condition from the policy D. Insurer will likely treat as a preexisiting condition which may not be covered for one year.

D. Insurer will likely treat as a preexisiting condition which may not be covered for one year.

The_____clause identifies which losses resulting from an accident or sickness are insured by the policy. A. Identification B. Benefit C. Payment D. Insuring

D. Insuring

T has a Disability Income policy that pays a monthly benefit of $5K. If T becomes partially disabled, what can he likely expect? A. $5K per month benefit B. $10K per month benefit if the cause was accidental C. More than $5k per month it cause was work related D. Less than $5k per month benefit regardless of the cause

D. Less than $5k per month benefit regardless of the cause in a $5k per month disability income policy a covered partial disability will typically result in less than $5k per month regardless of the nature of the disability.

Medicare part C is: A. government insurance B. available to those who are enrolled in a Medicare Supplement Plan with income under $12,000 per year C. original Part A and B Medicare D. available to those who are enrolled in Medicare Part A and Part B

D. available to those who are enrolled in Medicare Part A and Part B

Non occupational disability coverage is designed for: A. 24 hour protection B. Those who are exempted from Workers Compensation coverage C. sole proprietors and self employed individuals D. employees who suffer non work related disabilities since work related disabilites are covered by Workers Compensation

D. employees who suffer non work related disabilities since work related disabilites are covered by Workers Compensation

Which of the following will a Long Term Care plan typically provide benefits for? A. Disability income B. death C. unemployment D. home health care

D. home health care

A Major Medical policy typically : A. provides benefits for surgical expenses only, subject to policy limit B. contains more limitations than a Basic Hospital, Medical or surgical policy C. contains a 60 day Elimination period for losses due to accident D. provides benefits for reasonable and necessary medical expenses, subject to policy limits

D. provides benefits for reasonable and necessary medical expenses, subject to policy limits

With Optionally Renewable Health policies, the insurer may: A. renew the policy only if no claims have been filed the previous year B. renew the policy only with the insured's consent C. review the policy whenever they please and determine whether or not to renew it D. review the policy annually and determine whether or not to renew it

D. review the policy annually and determine whether or not to renew it

An individual Disability Income insurance applicant may be required to submit all of the following information EXCEPT: A. medical history B. gross income C. occupation D. spouses occupation

D. spouses occupation

The difference between group insurance and blanket health policies is A. Blanket Health policies do not issue certificates B. Group health policies do not issue certificates C. Group Health plans may be issued to an airline to cover passengers D. Blanket health policies are sometimes called wholesale plans

A. Blanket Health policies do not issue certificates

G is accountant who has ten employees and is concerned about the business would survive financially if G became disabled. The type of policy which BEST addresses this concern is: A. Business Overhead Expense B. Disability Income C. Key Employee Life D. Contributory

A. Business Overhead Expense

Many small business owners worry how their business will survive financially if the owner becomes disabled. The policy best addresses this concern is: A. Business Overhead Expense B. Disability Income C. Key Employee Life D. Contributory

A. Business Overhead Expense

K has an AD&D insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an auto accident where would the death proceeds be directed? A. Daughter B. Husbands estate C. K's estate D. Trust fund

A. Daughter

Which of the following statements best describes the intent of a coinsurance clause in a major medical policy? A. Discourages overutilization of the insurance coverage B. Minimizes the need for deductibles C. Discourages adverse selection D. Minimize the waiting period

A. Discourages overutilization of the insurance coverage

Which of these is considered a true statement regarding Medicaid? A. Funded by both state and federal governments B. intended to be used by individuals 65 and older C. provides disability income benefits D. automatically covers those receiving social security disability benefits

A. Funded by both state and federal governments

A medical care provider which typically delivers health services at its own local medical facility is known as a: A. Health Maintenance Organization B. Regional provider C. Multiple Employer Trust D. Preferred Provider Organization

A. Health Maintenance Organization

Which of these types of coverage is best described as a short term medical policy? A. Interim coverage B. provisional coverage C. transitional coverage D. Conversion coverage

A. Interim coverage

K is the insured and P is the sole beneficiary on an AD&D insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision which of these statements is true? A. Proceeds will be paid to the estate B. Proceeds will be divided equally between K's and P's estate. C. Proceeds will be paid to K's estate D. The courts will decide who will receive death benefits

A. Proceeds will be paid to the estate

Which of the following costs would a Basic hospital/surgical policy likely cover? A. Surgically removing a facial birthmark B. Care given at a nursing home C. Treating a wound from a soldier injured at war D. Lost income caused by hospital stay

A. Surgically removing a facial birthmark

All students attending a large university could be covered by: A. a blanket policy B. a franchise policy C. a jumbo group policy D. a commercial insurance policy

A. a blanket policy

The situation in which a group of physicians are salaried employees and conduct business in an HMO facility is called: A. closed panel B. open panel C. co-op panel D. capitation panel

A. closed panel

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers (and their families) whose employment has been terminated the right to: A. continue group health benefits B. take out an individual health policy C. transfer their coverage to another insurer D. convert to disability coverage

A. continue group health benefits

Medicare Part A and Part B do NOT pay for? A. dental work B. hospitalization C. skilled nursing care D. physical therapy

A. dental work

P is an employee who quits her job and want to convert her group health coverage to an individual policy. After the expiration of COBRA benefits, which of the following statements is true? A. she DOES need to provide evidence of insurability B. She does NOT need to provide evidence of insurability C. She will have up to 6 months to convert to an individual policy D. She will be paying exactly the same premium for the individual plan as she did the group plan

A. she DOES need to provide evidence of insurability Under COBRA, conversion of group accident and health coverage to an individual policy does not require evidence of insurability. However only applies to COBRA

Medicare is intended for all the following groups except: A. those enrolled as a full time student B. those receiving social security disability benefits for at least 24 hrs C. those afflicted with chronic kidney failure D. those 65 and older

A. those enrolled as a full time student

An insured covered by a group Major Medical plan is hospitalized after sustaining injuries that resulted from an auto 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? A. 0 B. $3k C. $8K D. $11K

B. $3k the insured is responsible for $1k deductible + 20% of the remaining bill = $3k

P loses an arm in a farm accident and is paid $10,000 from his AD&D policy. This benefit is known as the A. Dismemberment Sum B. Capital Sum C. Principal Sum D. Remnant Sum

B. Capital Sum The capital sum is the amount payable for the accidental loss of eyesight or for an accidental dismemberment. it usually a percentage of the principle sum and varies according to the severity of the injury

A major medical policy typically contains a provision that requires the insurer to pay only part of a loss, while the balance is paid by the insured. The provision is called A. Assignment of benefits B. Coinsurance C. Indemnity D. Co- deductible

B. Coinsurance

Which of the following organizations would make reimbursement payments directly to the insured individual for covered medical expenditures? A. Administrative services only plan B. Commercial insurer C. PPO D. HMO

B. Commercial insurer commercial health insurance companies use the reimbursement approach which allows policy owners to seek medical treatment then submit the charges to the insurer for reimbursement

Which of the following best describes a hospital indemnity policy? A. Coverage that reimburses and insured for surgeon expenses B. Coverage that pays a stated amount per day of a covered hospitalization C. Coverage that replaces lost income due to hospitalization D. Coverage that pays for hospital room and board

B. Coverage that pays a stated amount per day of a covered hospitalization

Which of the following statements does NOT accurately describe the tax treatment of premiums and benefits of individual Accident and Health Insurance? A. Disability income policy premiums are NOT tax-deductible B. Disability income policy premiums are tax deductible C. Major medical policy benefits are normally not taxed D. Disability income policy benefits are normally not taxed

B. Disability income policy premiums are tax deductible

Which of the following does social security NOT provide benefits for? A. Survivorship B. Dismemberment C. Disability D. Retirement

B. Dismemberment

The federal income tax treatment of employer provided group Medical Expense insurance can be accurately described as: A. Employees coverage paid for by the employer is considered taxable income to the employee. B. Employees premiums paid by the employer is tax deductible to the employer as a business expenditure. C. Employer is given tax credits for contributions made to an employer provided group health plan. D. Benefits are taxable to the employee

B. Employees premiums paid by the employer is tax deductible to the employer as a business expenditure.

The reason for a business having a Business Overhead Expense Disability Plan is to cover: A. the cost of providing group disability insurance to the employees B. Fixed business expenses C. the owners loss of income D. all business related expenses and salaries

B. Fixed business expenses The reason is to cover fixed business costs in the event the owner becomes disabled

Which of the following types of organizations are prepaid group health plans, where members pay in advance for the services of participating physicians and hospitals that have agreements? A. PPO B. HMO C. MEWA D. POS

B. HMO

Which of the following claims are typically excluded from Medical expense policies? A. Treatment of alcohol addiction B. Intentionally self inflicted injuries C. Treatment of mental illness D. Injuries sustained from an auto accident

B. Intentionally self inflicted injuries

An insurance company would MOST likely pay benefits under AD&D policy for which of the following losses? A. loss of life due to a heart attack B. Loss of eyesight due to an accidental injury C. Loss of the spleen due to an accidental injury D. Partial paralysis due to stroke

B. Loss of eyesight due to an accidental injury

The health insurance program which is administered by each state and funded by both federal and state governments is called: A. Long term care B. Medicaid C. Medicare supplemental program D. Medicare

B. Medicaid

Which of the following characteristics is associated with a large group disability income policy? A. No waiting periods B. No medical underwriting C. No elimination periods D. No limit of benefits

B. No medical underwriting A large group disability income policy can be distinguished by no medical underwriting

Which statement is true regarding a minor beneficiary? A. Normally the death proceeds are required to be held in a trust until the beneficiary reaches the age of 21. B. Normally a guardian is required to be appointed in the beneficiary clause of the contract C. The minor must pay the debts of the insureds estate before receiving any of the proceeds D. The minor is entitled to receive the death proceeds immediately

B. Normally a guardian is required to be appointed in the beneficiary clause of the contract

Under what system do a group of doctors and hospitals in a designated area contracted with an insurer to provide services at a prearranged cost to the insured? A. HMO B. PPO C. EPO D. PLHSO

B. PPO

Which of these options can an individual use their medical flexible spending account to pay for? A. Vitamins and supplements B. Prescription drugs C. Household expenditures D. Cosmetic procedures

B. Prescription drugs

The individual who provides general medical care for a patient as well as the referral for specialized care is known as a : A. Physicians Assistant B. Primary care physician C. secondary care physician D. Third party administrator

B. Primary care physician

Which of the following statements BEST describes dental care indemnity coverage? A. Services are reimbursed before the insurer receives the invoice B. Services are reimbursed after insurer receives the invoice C. In network dentists must always be used D. Very limited list of providers

B. Services are reimbursed after insurer receives the invoice Dental care indemnity plan reimbursed services only after the carrier receives the bill

Which of the following is the reimbursement of benefits for the treatment of a beneficiarys injuries caused by a third party A. indemnity B. Subrogation C. Legal action D. Consideration

B. Subrogation

Which of the following is the reimbursement of benefits for the treatment of beneficiary's injuries caused by a third party? A. Indemnity B. Subrogation C. Legal action D. Consideration

B. Subrogation

Which of the following services is NOT included under hospitalization expense coverage? A. Daily room and board B. Surgical fees C. Intensive care D. Miscellaneous expenses

B. Surgical fees While an insured is hospitalized the hospitalization expense coverage includes benefits for the cost of all of these services EXCEPT "surgical fees"

A Business Overhead Expense policy would cover which of the following if a business owner becomes disabled? A. Contributions to employee retirement plans B. Utilities and office rent C. Owners salary D. Meals and entertainment

B. Utilities and office rent business over head expense is designed to cover rent, taxes, utility bills, employees salaries etc. that continue when the business owner is disabled

The provisions in a Group Health policy that allows the insurer to postpone coverage for a covered illness 30 days after the policies effective date is referred to as the: A. Grace period B. Waiting period C. Postponement Period D. Elimination period

B. Waiting period waiting period in a group health policy gives an insurance company the rights to delay coverage for a covered sickness for a specified number of days after the effective date of the policy

What is medicare? A. a disability program B. a hospital and medical expense insurance program C. offers assistance in making health insurance premiums D. Part D provides payment for surgeon expenses

B. a hospital and medical expense insurance program

Under which of the following circumstances will the benefits under COBRA continuation coverage end? A. Employee has become uninsurable B. all group health plans are terminated by the employees C. Employer moves headquarters to another state D. Employee becomes permanently disabled

B. all group health plans are terminated by the employees

A Business Overhead Expense policy: A. covers any loss of income by the business owner B. covers business expenses such as rent and utilities C. covers employees wages only D. reimburses the company for any reduction in sales due to the owners disability

B. covers business expenses such as rent and utilities

Health Insurance Portability and Accountability ACT (HIPAA) gives privacy protection for: A. insolvency B. health information C. financial information D. overinsurance

B. health information

How would a contingent beneficiary receive the policy proceeds in a AD&D policy? A. if the primary beneficiary is a minor at the time of the insureds death B. if the primary beneficiary dies before the insured C. if the insured died of accidental causes D. if the insured died of natural causes

B. if the primary beneficiary dies before the insured

The Coordination of Benefits provision: A. allows an insured covered by two health plans to make a profit on a covered loss. B. prevents an insured covered by two health plans from making a profit on a covered loss. C. allows an insured to defer paying a claim for a work related injury until Workers Compensation Benefits have expired D. Prevents an insured to change insurers during a claim for a covered loss

B. prevents an insured covered by two health plans from making a profit on a covered loss.

Which of the following statements is correct regarding an employer/employee group health plan? A. the employer receives a certificate and the employees receives a master policy B. the employer receives a master policy and the employees receive a certificate C. the employer receives both the certificates and master policy D. the employees receives both the certificates and master policy

B. the employer receives a master policy and the employees receive a certificate

M Has a major medical insurance policy with a $200 flat deductible and an 80% coinsurance clause. IF M incurs a $2200 claim for an eligible medical expense how much will M receive in payment for this claim? A. $2000 B. $1760 C. $1600 D. $400

C. $1600 In this situation $2200 -$200 deductible X 80% = $1600

J has an Accidental Death and Dismemberment policy with a principal sum of $50K. While trimming the hedges J cuts off one of his fingers. What is the maximum J will receive from his policy? A. $0 B. $100k C. $25k D. $50k

C. $25k

B has a $100K Accidental Death and Dismemberment policy that pays triple indemnity for common carrier death. If B is killed from an accident on a commercial flight what will the policy pay B's beneficiary? A. $100K B. $200K C. $300k D. $400K

C. $300k

An individual has a Major Medical policy with a $5K deductible and an 80/20 Coinsurance clause. How much will the INSURED have to pay if a total of $15k in covered medical expenses are incurred? A. $2k B. $5K C. $7k D. $10K

C. $7k In this situation $5,000 + 20% of the remaining bill = $7,000

What is the maximum social security disability benefit amount an insured can receive? A. 50% of the insureds Primary Insurance Amount (PIA) B. 75% of the insureds Primary Insurance Amount (PIA) C. 100% of the insureds Primary Insurance Amount (PIA) D. 100% of the insured Primary Insurance Amount (PIA) minus any monies received from a retirement plan

C. 100% of the insureds Primary Insurance Amount (PIA)

All of the following statements regarding group health insurance is true EXCEPT A. Premiums are usually determined by the claims experience of the group B. A master contract is issued for the group C. An individual policy is given to each member D. Group health insurance premiums are typically lower than individual health insurance premiums

C. An individual policy is given to each member In a group health insurance each member receives a certificate, not an individual policy

Which type of policy would pay an employees salary if the employer was injured in a bicycle accident and out of work for six weeks? A. Key Employer Disability B. Disability Income C. Business Overhead Expense D. Workers Compensation

C. Business Overhead Expense

Which of these circumstances is a disability Buy-Sell policy designed to help in the sale of a business? A. company becoming insolvent B. death of a business owner C. Business owner becoming disabled D. Key employee becoming disabled

C. Business owner becoming disabled

Which of the following reimburses its insured for covered medical expenses? A. HMO B. PPO C. Commercial Insurers D. Service Providers

C. Commercial Insurers

When an employee is required to pay a portion of the premium for an employer/employee group health plan, the employee is covered under which of the following plans? A. Joint B. Noncontributory C. Contributory D. Participating

C. Contributory

Which contract permits the remaining partners to buy out the interest of a disabled business partner? A. Group Disability B. Business Continuation C. Disability Buy-sell D. Key Person Disability

C. Disability Buy-sell

What type of policy would only provide coverage for specific types of illness (cancer, stroke, etc.)? A. MEWA B. blanket insurance C. Dread disease insurance D. Disability insurance

C. Dread disease insurance Dread disease insurance provides benefits for only specific types of illnesses such as cancer or stroke

A comprehensive major medical health insurance policy contains an Eligible Expense provision which identifies the types of healthcare services that are covered. All of the following healthcare services are typically covered EXCEPT for: A. Hospital charges B. Physician fees C. Experimental and investigative services D. Nursing services

C. Experimental and investigative services

J is a subscriber to a plan which contracts with doctors and hospitals to provide benefits at a predetermined price. What type of plan does J belong to? A. Multiple Employer Welfare Arrangment B. Preferred Provider Organizations (PPO's) C. Health Maintenance Organization (HMO's) D. Co-op Arrangement

C. Health Maintenance Organization (HMO's)

Which type of provider is known for stressing preventative medical care and routine physical examinations? A. Multiple employer welfare arrangements (MEWA) B. major medical provider C. Health maintenance organizations (HMO's) D. Preferred Provider Organizations (PPO's)

C. Health maintenance organizations (HMO's)

S wants to open a tax exempt Health Savings Account. To qualify for this type of account federal law dictates that S must be enrolled in a A. Low deductible health plan B. Medicare supplement C. High deductible health plan D. Flexible savings plan

C. High deductible health plan

A policyowner would like to change the beneficiary on an Accidental Death and Dismemberment (AD&D) insurance policy and make the change permanent. Which type of designation would fulfill this need? A. Revocable B. Contingent C. Irrevocable D. Primary

C. Irrevocable

The individual health insurance policy that offers the broadest protection is a A. Surgical benefit B. Indemnity medical C. Major medical D. Hospital expense

C. Major medical

What does Medicare part A and B cover? A. Part A covers hospitalization, Part B covers long term care B. Part A covers doctors services Part B covers hospitalization C. Part A covers hospitalization Part B covers doctors services D. Part A covers prescription drugs Part B covers disability

C. Part A covers hospitalization Part B covers doctors services

On an AD&D insurance policy who is qualified to change the beneficiary designation? A. Payer B. Primary Beneficiary C. Policy owner D. Insurer

C. Policy owner

How does group insurance differ from individual insurance? A. Evidence of insurability is required B. Premiums are higher C. Premiums are lower D. Pre-exisiting conditions are not covered

C. Premiums are lower

T is covered by two health insurance plans: a group plan through his employer and his spouses plan as a dependent. Under the Model Group Coordination of Benefits provision, when T files a claim, his employers plan is considered the A. Principal carrier B. Surplus carrier C. Primary carrier D. Secondary carrier

C. Primary carrier

An insured covered by the AD&D insurance just died. What will happen if the primary beneficiary had already died before the insured and contingent beneficiary? A. Proceeds will go primary beneficiarys estate B. Probate will decide who receives proceeds C. Proceeds will go to the contingent beneficiary D. Proceeds will go to the insureds estate

C. Proceeds will go to the contingent beneficiary

Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy? A. Limited B. Special risk C. Reimbursement D. Blanket

C. Reimbursement

M purchased an AD&D policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son? A. Tertiary B. Irrevocable C. Revocable D. Contingent

C. Revocable

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? A. Authorize for payroll deductions B. Agree to physical examination C. Sign an enrollment card D. Register with her state residency

C. Sign an enrollment card A new employee must sign an enrollment card during the open enrollment period

Which mode of payment is NOT used by health insurance policies? A. Monthly B. Annual premium C. Single premium D. Semi annual premium

C. Single premium

Which statement is TRUE regarding a group accident & health policy issued to an employer? A. Neither the employer or employee are policyowners B. The employer is issued a certificate of coverage and each employee receives a policy C. The employer receives the policy and each employee is issued a certificate D. Both the employer and employees are policyowners

C. The employer receives the policy and each employee is issued a certificate

Which of the following statements is true about blue cross blue shield organizations? A. They are the same as private insurance companies B. They are federally sponsored C. They are non profit organizations D. They are owned by hospitals and physicians

C. They are non profit organizations

A Business Disability Buyout policy is designed: A. as an incurred expense plan B. With a very short elimination period C. To pay benefits to the corporation or other shareholders D. to pay benefits to the insureds spouse

C. To pay benefits to the corporation or other shareholders

Group/ voluntary long term care policy premiums are typically deducted from the employees income and, A. are approximately the same premium as compared to individual with long term care coverage B. are more expensive as compared to an individual long term care coverage C. are less costly as compared to individual long term coverage D. are substantially more costly as compared to the premiums for individual long term care coverage.

C. are less costly as compared to individual long term coverage

The benefits under a disability Buy Out policy are: A. normally paid installments B. taxable to the beneficiary C. payable to the company or another shareholder D. normally paid after a short elimination period

C. payable to the company or another shareholder Benefits payable under a Disability Buy Out policy are paid to the company or another shareholder

T ans S are named co-primary beneficiaries on a $500,000 AD&D policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much death benefit will the mother receive? A.$1,000,000 B. $500K C. $250K D. $0

D. $0 The mother receives $0 bc T is still alive and sole primary beneficiary, while the mother is still contingent beneficiary

XYZ company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is: A. 25% B.50% C. 75% D. 100%

D. 100% most noncontributory group health plans require 100% participation by eligible employees

Common exclusions to continuation of group coverage include: A. Dental care B. Dental care C. Other prescription drugs D. All the above

D. All the above

Which of the following medical expenses does Cancer insurance NOT cover? A. Chemotherapy B. Radiation Treatment C. Physician visit D. Arthritis

D. Arthritis

Accidental Death coverage is provided to commercial airline passengers in which of the following types of policies? A. Disability income policy B. Accident Reimbursement Accounts C. Accident Savings Plans D. Blanket Accident policy

D. Blanket Accident policy

M is insured under a basic Hospital/ Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for? A. Claim payment is equal to physicians actual charges B. Claim payment is negotiated between physicians and patient C. Determined by the schedule of benefits from the hospital D. Determined by the terms of the policy

D. Determined by the terms of the policy

Basic medical expense insurance: A. Normally has a deductible and coinsurance B. Covers an illness but not an accident C. Pays for lost wages while hospitalized D. Has lower benefit limits then Major Medical Insurance

D. Has lower benefit limits then Major Medical Insurance

A 66 year old is covered under a group health plan while employed with a business that has 40 employees. If she injures herself while walking in the park what coverage would be considered primary? A. Medicaid B. Long term care C. Medicare D. Her group health plan

D. Her group health plan if the employer has more than 20 employees the group health plan generally pays first

If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act? A. Primary beneficiarys estate B. Primary beneficiarys next of Kin C. Insured estate D. Insured contingent beneficiary

D. Insured contingent beneficiary

A policyowners rights are limited under which beneficiary designation? A. Revocable B. Tertiary C. Contingent D. Irrevocable

D. Irrevocable

Which of the following best describes how a policy that uses the "accidental bodily injury" definition of an accident differs from one that uses the "accidental means" deifinition? A. Double Indemnity B. Benefits are taxable C. More restrictive D. Less restrictive

D. Less restrictive

Which of the following BEST describes how a PPO is less restrictive than a HMO? A. Typically not subject to deductibles B. Not regulated by the federal government C. More benefits available D. More physicians to choose from

D. More physicians to choose from PPO's normally provide a wider choice of physicians and hospitals

P and Q are married and have three children. P is the primary beneficiary on Q's AD&D policy and Q's sister R is the contingent beneficiary. P, Q and R are involved in a car accident and Q and R are instantly killed. The AD&D will be paid to: A. R's estate B. Q's estate C. P and Q's estate D. P only

D. P only benefits will be paid to P bc P survived the accident and is the primary beneficiary

Which of these statements is INCORRECT regarding a PPO? A. PPO's normally have more providers to choose from as compared to an HMO B. Prices are negotiated in advance for PPO providers C. In network PPO providers offer members better coverage of incurred expenses D. PPO's are NOT a type of managed care systems

D. PPO's are NOT a type of managed care systems PPO's ARE considered to be managed health care system

T is covered by an AD&D policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary ? A. Request will be accepted only if in writing by insured B.Change will be made only if premiums are paid current C. change will be made immediately D. Request of the change will be refused

D. Request of the change will be refused an irrevocable designation may not be changed without the the written consent of the beneficiary

Which of the following statements BEST defines usual, customary, and reasonable (UCR) charges? A. The maximum premium an insurer can charge for their health insurance based on geography B. The maximum amount an employer can contribute to a contributory health plan C. The maximum deductible an insured can be charged D. The maximum amount considered eligible for reimbursement by insurance company under a health plan

D. The maximum amount considered eligible for reimbursement by insurance company under a health plan

Medicaid was designed to assist individuals who are: A. Federal employees B. disabled C. in poor health D. below a specific income limit

D. below a specific income limit

Dental care coverage is designed to cover the cost of all of the following Except: A. Oral Surgery B. Preventative care C. Orthodontic D. loss of income

D. loss of income

An accident policy will most likely pay a benefit for : A. self inflicted injury B. critical illness C. on the job accident D. off the job accident

D. off the job accident