Health insurance - guaranty exam
A Medicare supplement policy must have a free-look period of at least
30 days
The benefits for group disability plans are based on
A percentage of the worker's income.
The corridor deductible applies between
Basic and major medical coverage.
What is the maximum annual benefit for behavioral examinations of autistic children 13 years of age and under?
$25,000
Temporary disability benefits are not payable until after how many consecutive days of disability?
7 days
Which of the following is NOT mandatory under the Uniform Provisions Law as applied to accident and health policies?
Probationary Period
When an insured reinstated his major medical policy, he was involved in an accident that required hospitalization. When would this accident be covered upon reinstatement of the policy?
.Immediately
Guaranteeing future dividends is considered to be an unfair or deceptive act known as
Misrepresentation
Which of the following is NOT an example of the company's location of incorporation?
Authorized
Which of the following would be an example of an insurer participating in the unfair trade practice of discrimination?
Charging the insured higher premiums based on her race
Ed is covered under a health plan provided by his employer. He was told that his insurance would pay the majority of the covered expenses if he would choose to see a provider in his plan's list. If Ed chose to be treated by a provider who was not on the list, his portion of the bill would be greater. Ed is covered under a/an
Preferred Provider Plan.
An insured purchased a health insurance policy with a renewability clause that states the policy is "Guaranteed Renewable." This means that as long as the required premiums are paid, the policy will continue until the insured
Reaches age 65.
Under the Payment of Claims provision, to whom will the insured's benefits be paid if the insured is deceased?
The insured's primary beneficiary
If an applicant submits the initial premium with an application, which action constitutes acceptance?
The underwriters approve the application.
For any period of disability, temporary disability benefits cannot be issued for more than
26 weeks
How long does the Commissioner have to verify the eligibility of a licensee's appointment?
30 days
Which of the following statements is NOT true regarding health insurance policy provisions?
All additional provisions written by insurers are cataloged by their respective states.
An insurer incorporated under the laws of another state but doing business in this state is considered
Foreign
Which of the following is consideration on the part of an insurer?
Paying a claim
A retail shop owner is insured under a business overhead expense policy that pays a maximum monthly benefit of $2,500. His actual monthly expenses are $3,000. If the owner becomes disabled, the monthly benefit payable under his policy will be
$2500
An employee has a Flexible Spending Account (FSA) with a $5,000 annual benefit. This year the employee used $3,000. What would be the amount of the benefit available to the employee next year?
$5,000
Joe, age 63, was disabled and can no longer work. He meets the Social Security definition of total disability. How many work credits must Joe have accumulated to have the status of fully insured?
40
An individual is approaching retirement age and is concerned about having proper coverage should he have to be placed in a Long-Term Care (LTC) facility. His agent told him that LTC policies would provide necessary coverage at all of the following levels EXCEPT
Acute
An underwriter is reviewing an applicant with an extensive medical history. Which of the following would give the underwriter a better understanding of how the applicant has been treated for various illnesses?
Attending Physician's Statement
Which of the following is NOT a typical type of Long-Term Care coverage?
Child day care
Regarding the consideration clause, which of the following is NOT correct?
Consideration of the insurer and insured must be equal.
HMO members pay a small fee when they see their primary care physician. This fee is called a
Copay
To be valid, an insurance policy must have all of the following EXCEPT
Countersignature
A limited health insurance policy that will pay a lump sum to an insured diagnosed with a heart attack, stroke, or renal failure is known as
Critical illness insurance.
When filling out an application for insurance, the applicant makes a mistake. If a fresh application were not available, what could the applicant do to properly correct the mistake?
Cross the incorrect answer out, write the correct one beside it, and initial the answer.
The guaranteed purchase option is also referred to as the
Future increase option.
An agent delivers a life policy. He explains a policy change was made and asks the applicant to sign a statement acknowledging the changes were explained. The agent says the premium has not been paid and must be paid before the policy goes into effect. He collects a Statement of Good Health, relinquishes the policy, and leaves. What did he do wrong?
He left the policy with the insured without collecting the premium. If the agent delivers a policy, the premium must be collected at or before that point. If the premium is not paid, the policy cannot be issued. The other steps were done correctly. If the premium is not collected until the policy is delivered, the agent must receive a Statement of Good Health, which acknowledges that the person's health status has not changed since the policy was approved.
Which of the following is NOT correct concerning taxation of disability income benefits?
If paid by the individual, the premiums are tax deductible.
Which of the following is NOT a Medicaid qualifier?
Insurability
A licensee would like to use an assumed name. What action should she take to assure the legality of this decision?
Notify the Commissioner
Which of the following best describes the type of care provided by HMOs?
Preventive
Which of the following is NOT an activity of daily living?
Talking
If the insurance premiums were not tax deductible, what other taxation will this affect?
Taxation of benefits
Once a dependent child reaches a certain age, insurance coverage will be terminated UNLESS
The child is handicapped.
Who is authorized to share confidential insurance records and reports?
The commissioner
An insured needs ongoing treatment for a diabetic condition. Under PPACA, which of the following is correct?
The condition must be covered under the insured's plan.
What is the purpose of a disability buy-sell agreement?
To allow the business buyout in case of the owner's disability
For each violation of a cease and desist order, a person will be subject to possible license suspension or revocation and a maximum fine of
$10,000.
A part-time employee was injured at work and is seeking temporary disability benefits. Because her average weekly wage was $25, the amount of her disability benefit will be
$14
Under the mandatory uniform provision Proof of Loss, the claimant must submit proof of loss within what time period after the loss?
90 days
The document that indicates that an insurer has been approved and is authorized to transact insurance in a particular state is known as
Certificate of Authority.
Policy delivery refers to the delivery of the
Completed insurance policy to the policyowner.
When an individual obtains an insurance license for the primary purpose of writing insurance on him or herself, or for members of his or her immediate family or business, this is called
Controlled business
When an individual obtains an insurance license for the primary purpose of writing their own insurance or the insurance for members of their immediate family, or business, this is called
Controlled business
The Uniform Provision Law that prevents an insurance company from altering its agreement with a policyholder by referring to documents or other items not contained in the policy is called the
Entire Contract Provision.
The "stop-loss" feature on a major medical policy is intended to
Establish a maximum amount of out-of-pocket expense that an insured will have to pay for medical expense in a calendar year.
Which of the following would NOT be covered by a disability policy?
Homemaker being hospitalized for a leg amputation caused by a car accident
Insureds have the right to do which of the following if they have NOT received the proper claim forms within 15 days of their notice to the insurer of a covered loss under a major medical policy?
Submit the description in their own words on a plain sheet of paper. Insureds have the right to submit the description in their own words on a plain sheet of paper if a proper form is not supplied. This is a mandatory provision in all individual health insurance policies.
Which of the following statements concerning the Medical Information Bureau is correct?
The Medical Information Bureau assists underwriters in evaluating and classifying risks. The Medical Information Bureau is a source of underwriting information that specifically focuses on the applicant's medical history. The Bureau is supported by member insurance companies.
Whose responsibility is it to ensure that the application for health insurance is complete and accurate?
The agents
An insured is anxious to get treatment for a health condition, and is convinced that a specialist is needed to cure the condition. If the insured has a PPO plan, which of the following is true?
The insured can select any specialist, but non-network specialists will have higher out-of-pocket costs.
Over the summer, a school teacher who does not receive compensation for the summer is involved in a car accident and sustains major injuries, requiring a month-long period of hospitalization. Under the temporary disability benefit program, would the teacher receive disability benefits and for how long?
There will be no compensation.
An employee is covered under COBRA. His previous premium payment was $100 per month. His employer now collects $102 each month. Why does the employer collect an extra $2?
To cover the employer's administration costs
Under the mandatory uniform provision "Notice of Claim", written notice of a claim must be submitted to the insurer within what time parameters?
Within 20 days
Conrad receives $50,000 from a $100,000 Accidental Death and Dismemberment policy as a result of the loss of his left arm in an accident. Conrad has received the
Capital Amount.
If an insured is injured while committing an illegal act and his health policy contains the Illegal Occupation provision, what percentage of the claim will be paid?
50%
All of the following could qualify as a group for the purpose of purchasing group health insurance EXCEPT
An association of 35 people.
An elimination (waiting) period may NOT have to be satisfied for a disability in which of the following?
An insured suffers a relapse of a prior disability within 6-months of the initial covered disability
A Major Medical Expense policy would exclude coverage for all of the follow treatments EXCEPT
Drug addiction
In contrasting stock insurers with mutual insurers, which statement is true?
Stock insurers are owned by the shareholders and issue nonparticipating policies.
What is the purpose of the impairment rider in a health insurance policy?
To exclude coverage for a specific impairment
An applicant misstates his age on his application for a health insurance policy. He states that he is 39, but his actual age is 49. When he files a claim, what will most likely happen?
Benefits paid will be those that would have been purchased at the correct age.
When an insured reinstated his major medical policy, he was involved in an accident that required hospitalization. When would this accident be covered upon reinstatement of the policy?
Immediately
Which of the following used to be called Medicare + Choice Plans?
Medicare Advantage Plans
Upon payment of a loss, the insured is obligated to surrender to the insurer the right to sue a negligent third party. This is called
Subrogation
All of the following are characteristics of group health insurance plans EXCEPT
The parties that hold a group health insurance contract are the employees and the employer.
A husband and wife both incur expenses that are attributed to a single major medical insurance deductible. Which type of deductible do they have in their policy?
Family
An insured has an individual disability income policy with a 30-day elimination period. He becomes disabled on June 1st for 15 days. When will he collect on his disability income payments?
He won't collect anything.
Which of the following best describes a rebate?
A producer returning part of her commission to her client, as an inducement to buy
How long is a newborn covered without notification to the insurer?
From the moment of birth, and the insurer must be notified within 31 days
A core Medicare supplement policy (Plan A) will cover all of the following expenses EXCEPT
Part A deductible.
Your client is sole proprietor and wishes to include his family on a medical expense plan. How much of the cost of the medical expense plan can be deducted (since he is considered self-employed)?
100%
Under a group health insurance plan, benefits may be extended to all of the following dependents EXCEPT
A 27-year-old married daughter who is attending college and lives with her parents.
An insurer who transacts insurance in this state but whose articles of incorporation are registered in Canada is considered what type of insurer?
Alien
Which of the following statements is NOT true regarding health insurance policy provisions?
All additional provisions written by insurers are cataloged by their respective states. All health insurance policies are required to contain Uniform Mandatory Provisions, which are specific provisions that are required to be in every health insurance contract. An insurer may add provisions that are not in conflict with the uniform provisions, provided that the provision is approved by the state in which the policy is delivered. These additional provisions are not catalogued.
In addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health?
By requiring that the insurance be incidental to the group
An applicant gives her agent a completed application and the initial premium. What can the agent issue her that acknowledges the initial premium payment?
Conditional Receipt
Insurers CANNOT transact insurance in this state without a
Insurers CANNOT transact insurance in this state without a
Riley reads an agreement on the first page of her policy which includes a list of losses that will be covered by her insurer. What is the name of this agreement?
Insuring clause
In health insurance, the length of the grace period varies according to the
Mode of premium payment.
Among people in the same class and life expectancy, which of the following factors can be used to influence premium rates?
Occupation
Which of the following best describes a presumptive disability?
One that is severe enough that the insured automatically qualifies for full disability benefits
With respect to the entire contract clause in health policies, who has the authority to make changes to an existing policy?
Only an executive officer of the company
A stock insurer is defined as an insurer
Owned by its stockholders.
On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the
Principal sum
An insurer decided to terminate a producer. The insurer just notified the Commissioner of this decision. How long does the insurer have to mail a copy of the notification to the producer?
15 days
Which of the following elements of an insurance contract requires payment of premium?
Consideration
Which of the following is NOT true regarding a noncancellable policy?
Insurer can increase the premium above what is stated in the policy if claims experience is greater than expected.
Under the Affordable Care Act, when would pregnancy be considered a pre-existing condition?
Never
Which of the following optional provisions allows insurers to limit benefits to an insured's average income over the last 2 years?
Relation of Earnings to Insurance
All the following are true regarding qualifications for licensing in Hawaii EXCEPT
The applicant can apply if he or she has been convicted of a felony.
A man is an attorney when he applies for a health policy. He decides to become a professional bungee jumper. He files a claim. What should happen?
The insurance company will pay the claim according to the benefits available if the correct premium had been paid.
Which of the following services will NOT be provided by an HMO?
Unlimited coverage for treatment for drug rehabilitation
A retail shop owner is insured under a business overhead expense policy that pays a maximum monthly benefit of $2,500. His actual monthly expenses are $3,000. If the owner becomes disabled, the monthly benefit payable under his policy will be
$2,500
Elaine's Basic Hospital Expense policy has a $500 per day limit for room and board in a hospital for a maximum of 5 days. Elaine got sick and had to spend 3 days in the hospital at $650 a day. How much will Elaine have to pay to cover the rest of her room and board charges?
$450
Which of the following time periods is the general enrollment period for Medicare Part B?
January 1 through March 31 each year
On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the
Principal sum.
Palm Tree Insurance, based in California, wants to start doing business in Hawaii under the name Aloha Insurance on October 15. They must file a change of name request with the Commissioner by
September 15.
An insured was seriously injured in a skiing accident that required him to be hospitalized for 5 weeks. His medical expense policy covered all of the following EXCEPT
Loss of income while hospitalized.
An applicant for a disability insurance policy has a heart condition of which they are unaware and therefore they answer no to the question pertaining to heart problems on their application. Their answer is considered to be a
Representation
How old must an individual be to apply for a resident insurance producer license?
18
An insured, who is 44 years old, falls while mountain climbing on vacation. He is left paralyzed. After a year, doctors feel he will never recover from his injuries. From which of the following programs will he be able to collect disability income?
Social Security
Which of the following is NOT an indicator of a competent party?
Business profession
Under the mandatory uniform provision Legal Actions, an insured is prevented from bringing a suit against the insurer to recover on a health policy prior to
60 days after written proof of loss has been submitted.
Under the common accident provision, how many deductibles would be paid if five family members covered under the same major medical policy are injured in the same accident?
1
If an insured pays a health insurance premium each month, how long would the grace period be under the policy?
10 days
An example of an alien insurer doing business in this state is one formed under the laws of
Mexico
According to the Time Limit on Certain Defenses provision, statements or misstatements made in the application at the time of issue cannot be used to deny a claim after the policy has been in force for a minimum of how many years?
2 years
An insurer must notify the consumer in writing that an investigative consumer report has been requested, within how many days of the initial request?
3 days
The Probationary period is
A specified period of time that a person joining a group has to wait before becoming eligible for coverage.
What guarantees that the information explained in the insurance contract is true?
A warranty
If an insured is injured while committing an illegal act and his health policy contains the Illegal Occupation provision, what percentage of the claim will be paid?
Nothing
What does the application of contract of adhesion mean?
Since the insured does not participate in preparing the contract, any ambiguities would be resolved in favor of the insured.
Examinations can be made of any insurance company as often as the Commissioner considers appropriate; however, domestic insurer examinations must be made at least once every
120 days
What is the primary difference between Medigap and Medicare SELECT policies?
Medicare SELECT policies contain restricted network provisions.
Following a covered loss, the Time Payment of Claims Provision requires that an insurance company pay disability income benefits no less frequently than
Monthly
The presumptive disability provision assumes that the insured is totally disabled upon loss of all of the following EXCEPT
Feeling
Prepaid health plans must include coverage for in-patient hospital care, which covers at how many days of confinement in a calendar year?
120 days
An insured has a prepaid health care plan that includes inpatient benefits for detoxification. Under this coverage, how many admissions are allowed each year?
3
HMOs are known as what type of plans?
Service
Which of the following types of care could be provided at a community center?
Adult day care
In order to get a nonresident license is this state a producer must
Apply and pay a fee to a non-resident state that reciprocates.
Riley reads an agreement on the first page of her policy which includes a list of losses that will be covered by her insurer. What is the name of this agreement?
Insuring Clause
What happens to the copy of the application for health insurance once the policy is issued?
It becomes part of the entire contract.
Which of the following best describes a Major Medical Expense Policy?
It provides catastrophic medical coverage beyond basic benefits on a usual, customary and reasonable basis.
If an insured is not entirely satisfied with a policy issued, the insured may return it to the insurance company and receive a refund of the entire premium paid, at which of the following times?
Within 10 days of when the policy was delivered
