Health ?s answers
All of the following benefits are available under Social Security EXCEPT A. Welfare benefits B. Old-age and retirement benefits C. Disability benefits D. Death benefits
A. welfare benefits
The minimum number of credits required for partially insured status for Social Security disability benefits is A. 4 credits B. 6 credits C. 10 credits D. 40 credits
B. 6 credits
Which of the following is NOT provided by an HMO? A. Patient care B. Reimbursement C. Services D. Financing
B. Reimbursement
Peril is most easily defined as... A. Something that increases the chance of loss B. The cause of loss insured against C. An unhealthy attitude about safety D. The chance of a loss occurring
B. The cause of loss insured against.
Which type of insurance is based on mutual agreements among subscribers? A. Limited liability B. Reinsurance C. Reciprocal insurance D. Mutual insurance
C. Reciprocal insurance
An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of? A. Twisting B. Defamation C. False advertisement D. Unfair claims
C. false advertisement
Which of the following id true regarding risk retention?
it is a liability insurance company owned by its members
If an employer provides long-term group disability insurance for its employees, what percentage of monthly wages are lower-paid employees eligible to collect? A. 33 and 1/3% B. 50% C. 66 and 2/3% D. 90%
D. 66 and 2/3%
If a person does not comply with an order issued within 2 weeks after the commissioner has given notice, for each day that the violation continues, the commissioner may issue a fine of up to... A. $5000 B. $1500 C. $2000 D. $3000
A. $5000
The commissioner may issue a temporary license for an intermediary for a period of up to... A. 12 months B. 24 months C. 3 months D. 6 months
A. 12 months
An insurer terminates an agent's appointment. Within how many days of termination must the intermediary be notified? A. 15 B. 20 C. 30 D. 10
A. 15
What is the elimination period for social security benefits? A. 5 months B. 6 months C. 12 months D. 3 months
A. 5 months
In disability income policy, all of the following are considered Presumptive disabilities EXCEPT A. Loss of one eye B. Loss of hearing C. Loss of two limbs D. Loss of speech
A. Loss of one eye
All of the following benefits are available under Social Security EXCEPT A. Welfare benefits B. Old-age and retirement benefits C. Disability benefits D. Death benefits
A. Welfare benefits
How is the amount of Social Security disability benefits calculated? A. It is based on age, number of quarters worked in the last 25 years (minimum of 80) and the number of health claims made during that period of time B. It is based upon the worker's primary insurance amount (PIA), which is calculated from their average indexed monthly earnings over their highest 35 years
B.It is based upon the worker's Primary Insurance Amount (PIA), which is calculated from their Average Indexed Monthly Earnings over their highest 35 years.
According to the PPACA metal levels classification, if a health plan is expected to covered 90% of the cost for an average population, and the participants would cover the remaining 10%, what type of plan is that? A. Silver B. Gold C. Platinum D. Bronze
C. Platinum
Benefit periods for individual short-term disability policies will usually continue from A. 6 months to 2 years B. 2 years to age 65 C. 1 week to 4 weeks D. 3 months to 3 years
A. 6 months to 2 years
Which of the following expenses is NOT covered by a health insurance policy? A. Dental B. Funeral C. Hospital D. Disability
B. Funeral
In insurance policies, the insured is not legally bound to any particular action in the insurance contract, but the insurer is legally obligated to pay losses covered by the policy. What contract element does this describe? A. Conditional B. Unilateral C. Unidirectional D. Aleatory
B. Unilateral
The insurer must be able to rely on the statements in the application, and the insured must be able to rely on the insurer to pay valid claims. In the forming of an insurance contract, this is referred to as... A. Implied warranty B. Utmost good faith C. Reasonable expectations D. A warranty
B. Utmost good faith
If a policy is rated-up, which of the following in True? A. The number of exclusions decreases B. The number of benefits increases C. The premium increases D. The premium decreases
C. The premium increases
HIPAA applies to groups of A. At least 10 B. At least 100 C. More than 2, fewer than 50 D. 2 or more
D. 2 or more
Which services are associated with standard & poor's and AM best?
Rating the financial strength of insurance companies
In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party? A. Insurer to the insured B. Insured to the insurer C. Insurer to the department of insurance D. Insured to the department of insurance
A. Insurer to the insured
An applicant knowingly fails to communicate information that would help an underwriter make a sound decision regarding coverage. This is an example of... A. Breach of warranty B. Concealment C. Waiver D. Fraud
B. Concealment
All of the following are marketing arrangements used by insurers EXCEPT... A. Independent agency system B. Reinsurance system C. General agency system D. Direct response marketing system
B. Reinsurance system
Events in which a person has both the chance of winning or losing are classified as... A. Retained risk B. Speculative risk C. Insurable D. Pure risk
B. Speculative risk
What is the minimum age to apply for an insurance license in Wisconsin? A. 21 B. 25 C. 18 D. 19
C. 18
In insurance policies, contract ambiguities are automatically ruled in the favor of the insured. What privilege does the insurer have in order to balance this? A. The right to revoke the policy B. The right to raise premiums as a result of court rulings C. The right to determine the wording of a policy D. The right to refute the rulings
C. The right to determine the wording of a policy
What is the number of credits required for fully insured status for social security disability benefits? A. 4 B. 10 C. 30 D. 40
D. 40
An intermediary must notify the commissioner of a change of residence address within how many days of the change? A. 20 B. 30 C. 5 D. 10
B. 30 days
At what age does an individual qualify for Medicare? A. 60 B. 65 C. 70 D. 72
B. 65
Which of the following is the most common time for errors and omissions to occur on the part of an insurer? A. Application process B. Policy delivery C. Policy renewal D. Underwriting
B. Policy delivery
Which of the following is the most common way to transfer risk? A. Name a beneficiary B. Purchase insurance C. Increase control of claims D. Lessen the possibility of loss
B. purchase insurance
Which renewal option does NOT guarantee renewal and allows the insurance company to refuse renewal of a policy at any premium due date? A. Guaranteed renewable B. Noncancellable C. Optionally renewable D. Conditionally renewable
C. Optionally renewable
Which of the following types of agent authority is also called "perceived authority"? A. Express B. Implied C. Fiduciary D. Apparent
D. Apparent
When the insured purchased his health policy he was a window washer. He has since changed occupations and now manages a library. If the insurers is notified of the insured's change of occupation, the insurer should... A. Adjust the benefit in accordance with the decreased risk B. Replace the policy with a new C. Return an unearned premium D. Increase the premium
A. Adjust the benefit in accordance with the decreased risk
What is an important feature of a dental expense insurance plan that is NOT typically found in a medical expense insurance plan? A. Diagnostic and preventive care B. A broad coverage area C. A low monthly premium D. Low cost deductibles
A. Diagnostic Nd preventive care
What is the goal of the HMO? A. Early detection through regular checkups B. Providing free health services C. Limiting the deductibles and coinsurance to reduce costs D. Providing health services close to home
A. Early detection through regular checkups
In disability income insurance, the own occupation definition of disability applies A. For the first 2 years of a disability B. During the waiting period C. During the elimination period D. As long as an individual is unable to work
A. For the first 2 years of a disability
Which of the following is an eligibility requirement for all Social Security Disability Income benefits? A. Have attained fully insured status B. Be disabled for at least 1 year C. Have permanent kidney failure D. Be at least age 50
A. Have attained fully insured status
Which of the following is an eligibility requirement for all social security disability income benefits? A. Have attained fully insured status B. Be disabled for at least 1 year C. Have permanent kidney failure D. Be at least age 50
A. Have attained fully insured status
The amount of disability benefits that an insured receives often depends upon the insured's A. Income at the time of the application B. Marital status at the time of the application C. Number of children at the time of the application D. Medical history at the time of the application
A. Income at the time of the application
Which of the following is considered a presumptive disability under a disability income policy? A. Loss of two limbs B. Loss of one eye C. Loss of hearing in one ear D. Loss of one hand or one foot
A. Loss of two limbs
What type of benefit helps to pay for accidental injuries that are not severe enough to qualify as disabilities? A. Medical reimbursement benefit B. Partial disability C. Basic accidental injury D. Accidental death & dismemberment
A. Medical reimbursement benefit
A 37-year-old male owns a policy with a guaranteed insurability Rider. The policyowner would like to increase the benefit amount offered by the policy. What documentation will be required? A. No documentation B. Proof of insurability C. Medical records D. Attending physician's report
A. No documentation
Which of the following occupations would have the lowest disability insurance premiums? A. Personal trainer B. Construction worker C. Stunt pilot D. Police officer
A. Personal trainer
Which of the following are the main factors taken into account when calculating residual disability benefits? A. Present earnings and earnings prior to disability B. Earnings prior to disability and the length of disability C. Employee's full-time status and length of disability D. Present earnings and standard cost of living
A. Present earnings and earnings prior ro disability
In which of the following cases would an "any occupation" disability income policy pay the benefits? A. The insured is unable to perform any jobs in the field related to the insured's education and experience. B. The insured is unable to perform the duties of his or her specific occupation C. The insured changes jobs and is injured as a result of a more hazardous occupation D. The insured's family has unexpected expenses due to the insured's disability
A. The insured is unable to perform any jobs in the field related to the insured's education and experience.
According to the rights of renewability rider for cancellable policies, all of the following are correct about the cancellation of an individual insurance policy EXCEPT... A. Unearned premiums are retained by the insurance company B. The insurer must provide the insured a written notice of the cancellation C. Claims included before cancellation must be honored D. An insurance company may cancel the policy at any time
A. Unearned premiums are retained by the insurance company
Social Security was created to provide all of the following EXCEPT A. Unemployment income B. Survivor's benefits C. Disability income D. Retirement income
A. Unemployment income
Under a disability income policy, the insurer does not pay a monthly benefit that is equal to the insured's previous income. The reason for paying a benefit amount that is less than the insured's income is to A. Prevent overutilization and malingering B. Prevent the insured from obtaining excess insurance C. Enable the insurer to provide affordable coverage D. Enable the insurer to reduce variable costs
A. prevent overutilization and malingering
To be eligible under HIPAA regulations, for how long should an individual converting to an individual health plan have been covered under the previous group plan? A. 63 days B. 18 months C. 5 years D. 12 months
B. 18 months
An insured wants to buy a disability income policy that pays a maximum benefit of $1,200. To make sure that the disability benefit keeps up with inflation, the insured would need to add A. An additional monthly benefit rider B. A cost of living rider C. A guaranteed purchase option rider D. 5% more to the premium each year
B. A cost of living rider
Which of the following hospice expenses would NOT be covered in a cost-containment setting? A. Special hospital bed B. Antibiotics C. Tylenol D. Morphine
B. Antibiotics
The agent is known as the "field underwriter" because of the information he/she gathers for the insurer. This helps the insurer... A. Reduce the number of staff underwriters B. Avoid adverse selection C. Comply with state law D. Learn about the underwriting process
B. Avoid adverse selection
An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits? A. No benefits B. Full benefits C. Partial benefits D. Full benefits for 2 years
B. Full benefits
If an insured worker has earned 40 Quarters of coverage, the worker's status under Social Security disability is... A. Permanently insured B. Fully insured C. Partially insured D. Correctly insured
B. Fully insured
Under which of the following disability income plans would the benefits be subject to income tax? A. Partnership buyout B. Group C. Individual D. Key person
B. Group
Which benefits would a disability plan most likely pay? A. Medical expenses associated with a disability B. Income lost by the insured's inability to work C. Rehabilitation costs D. Copayments
B. Income lost by the insured's inability to work
The patient protection and affordable care act includes all of the following provisions EXCEPT A. Coverage for preventive benefits B. Individual tax deduction for premiums paid C. Right to appeal D. No lifetime dollar limits
B. Individual tax deduction for premiums paid
Which of the following refers to "own occupation" disability? A. Insured business owner is unable to perform the duties of any related business B. Insured is unable to perform duties of the occupation for which he/she was educated and trained C. Insured is unable to perform duties of any occupation D. Insured business owner is unable to perform the duties of his/her own business
B. Insured is unable to perform duties of the occupation for which he/she was educated and trained
Which of the following is NOT a metal level of coverage offered under the patient protection and affordable care act? A. Bronze B. Iron C. Gold D. Silver
B. Iron
In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary, and reasonable, the extra cost A. count towards coinsurance B. Is not covered C. Muct be covered by the insurer D. Counts toward deductible
B. Is not covered
An insured is covered by a disability income policy that contains an accidental means clause. The insured exits a bus by jumping down the steps and breaks an ankle. What coverage will apply? A. Coverage will apply, but will be reduced by 50% B. No coverage will apply, since the injury could have been foreseen C. No coverage will apply, since disability income policies cover sickness only D. Coverage will apply since the break was accidental
B. No coverage will apply since the injury could have been foreseen
When health care insurers negotiate contacts with health care providers or physicians to provide health care services for subscribers at a favorable cost, it is called A. Point of service plans (POS) B. Preferred provider organization (PPO) C. Managed care D. Indemnity plans
B. Preferred provider organization (PPO)
Which of the following is NOT a characteristic of a group long-term disability plan? A. The benefit can be up to 66 and 2/3% of one's monthly income B. The benefit can be up to 50% of one's yearly income C. The elimination period is the same as in the short-term plan's benefit period D. The benefit period may be to age 65
B. The benefit can be up to 50% of one's yearly income
Which statement accurately describes group disability income insurance? A. Short-term plans provide benefits for up to 1 year B. The extent of benefits is determined by the insured's income C. In long-term plans, monthly benefits are limited to 75% of the insured's income D. There are no participation requirements for employees
B. The extent of benefits is determined by the insured's income.
In a group prescription drug plan, the insured typically pays what amount of the drug cost? A. Full amount until a deductible is met, then a small copay B. Copayment C. None D. Full amount until a deductible is met, then nothing for the rest of the year
B. copayment
Which of the following procedures evaluations of insurers' financial status often used by state departments of insurance? A. Consumer's guide B. SEC C. AM best D. NAIC
C. AM best
Under HIPAA , which of the following is INCORRECT regarding eligibility requirements for conversion to an individual policy? A. An individual who doesn't qualify for Medicare may be eligible B. The gap of coverage for eligibility is a period of 63 days or less C. An individual who was previously covered by group health insurance for 6 months is eligible D. An individual who has used up COBRA continuation coverage is eligible
C. An individual who was previously covered by group health insurance for 6 months is eligible
The rider that may be added to a disability income policy that allows for an increase in the benefit amount under certain conditions is called A. Double indemnity B. Residual benefits C. Cost of living (COLA) D. Waiver of premium
C. Cost of living
Which of the following is NOT a cost-saving service in a medical plan? A. Second surgical opinions B. Risk sharing C. Denial of coverage D. Preventive care
C. Denial of coverage
Under the privacy rule for HIPAA, protected information includes all individually identifiable health information A. Held in a computer format B. Held or transmitted in paper form C. Held or transmitted in any form D. Transmitted electronically only
C. Held or transmitted in any form
An insurance company want to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding the information included on previous insurance applications? A. Integrated insurer's support B. Federal bureau of investigation C. Medical information bureau D. Insurer's protection guild
C. Medical information Bureau
What is the benefit that is based on the insured's loss of earnings after recovery from a disability? A. Partial disability B. Income replacement C. Residual disability D. Recurrent disability
C. Residual disability
Which of the following statements regarding conditional receipts is true? A. They purchase temporary insurance, up to 6 months B. They become part of the policy C. They are temporary insuring agreements D. They guarantee the insurer will approve the application
C. They are temporary insuring agreements
An insured has been injured in an accident. Although he is still receiving benefits from his disability income policy, he does not have to pay premiums. This means that the policy includes A. Benefit of payment clause B. Waiver of all payment C. Waiver of premium feature D. Return of premium rider
C. Waiver of premium feature
Insurers must report or list all appointments and all terminations of appointments to what authority? A. Federal Insurance Regulation Board B. NAIC C. Commissioner D. Department of insurance
C. commissioner
Insurance regulations in this state require prompt initiation and completion of claims investigations, and delivery of necessary claims forms and assistance to the insured and claimants. What constitutes prompt action? A. 30 days B. The time frame may be defined by each insurer C. 5 business days D. 10 consecutive days
D. 10 consecutive days
An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would she be receiving benefits under an "own occupation" disability plan? A. 1 month B. She would not received any benefits C. 3 years D. 2 years
D. 2 years
A hospital indemnity policy will pay... A. Income lost while the insured is in the hospital B. All expenses incurred by the stay in the hospital C. Any expenses incurred by the stay in the hospital, minus coinsurance payments and deductibles D. A benefit for each day the insured is in a hospital
D. A benefit for each day the insured is in a hospital
Which of the following would qualify someone for disability benefits? A. Injury only B. Intentionally self-inflicted injury C. Losses arising from war D. Both accident and sickness
D. Both accident and sickness
An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of of a tumor. What term best fits this arrangement? A. Selective coverage B. Limited coverage C. Claims saving D. Cost- containment
D. Cost-containment
All of the following are true about group disability income insurance EXCEPT A. benefits are usually short term B. The waiting period starts at the onset of the injury of sickness C. The longer the waiting period, the lower the premium D. Coverage applies both on and off the job
D. Coverage applies to both on and off the job
A producer is acting in what capacity when he or she is trying to obtain credible information about an application for health insurance? A. Office underwriter B. General agent C. Consumer report investigator D. Field underwriter
D. Field underwriter
Bethany studies in England for a semester. While she is there, she is involved in a train accident that leaves her disabled. If Bethany owns a general disability policy, what will be the extent of benefits that she receives? A. Full B. 50% C. 25% D. None
D. None
An insured's health claim internal appeal was denied. The insurer must so all of the following EXCEPT A. Notify the insured about the decision in writing B.Complete the appeal in 60 days after service was received C. Notify the insured how to obtain an outside review D. Offer a payment plan
D. Offer a payment plan
What would a physician utilize if he/she wanted to know if a treatment is covered under an insured's plan and at what rate it will be paid? A. Concurrent review B. Comprehensive review C. Supplementary chart D. Prospective review
D. Prospective review
When a group disability insurance policy is paid entirely by the employer, benefits paid to disabled employees are A. Deductible income to the employees B. Deductible business expense to the employer C. Taxable income to the employer D. Taxable income to the employee
D. Taxable income to the employee
An applicant is considered to be high-risk, but not so much that the insurer wants to deny coverage. Which of the following is NOT true? A. The insurer can increase the premium B. The insurer can add exclusions to the policy C. The insurer can rate-up the policy D. The insurer will issue a conditional coverage
D. The insurer will issue a conditional coverage
Which of the following definitions would make it easier to qualify for total disability benefits? A. The more liberal "any occupation" B. The more strict "own occupation" C. The more liberal "own occupation" D. The more strict "any occupation"
D. The more liberal "own occupation"
The amount of Social security disability benefits is based upon the worker's primary insurance amount (PIA), which is calculated from their average indexed monthly earnings over which years? Which years of income may be deleted for calculation? A. Their highest 40; lowest 5 B. Their highest 15; lowest 4 C. Their highest 20; lowest 2 D. Their highest 35; lowest 5
D. Their highest 35; lowest 5
How long are oral contracts valid in Wisconsin? A. 30 days B. Oral contracts are not valid C. 48 hours D. 3 business days
A. 30 days
An insured pays a $100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. What characteristic of an insurance contract does this describe? A. Aleatory B. Good health C. Adhesion D. Conditional
A. Aleatory
An insurance producer just sold an insurance policy to his sister. What kind of business is this? A. Controlled B. Illegal C. Internal D. Personal
A. Controlled
Which of the following best describes an insurance company that has been formed under the laws of this state? A. Domestic B. Sovereign C. Alien D. Foreign
A. Domestic
An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This indicates that his policy is written with a 30-day... A. Eliminatation period B. Blackout period C. Probationary period D. Waiver of benefits period
A. Elimination period
Health coverage becomes effective when the... A. First premium has been paid and the application has been approved B. Producer delivers the policy to the insured C. Medical examination has been completed and the premium paid D. First premium has been received in the insurance company's home office
A. First premium has been paid and the application has been approved
How many pairs of glasses in a 12-month period will a vision expense insurance plan cover? A. One B. Two C. Three D. Unlimited
A. One
Regarding health insurance premiums, all of the following statements are true EXCEPT... A. Substandard risks are not insurable and are always rejected B. Rated policies can be issued by standard insurers C. Preferred risks may be given a discounted rate for being a non-smoker or a non-drinker D. Standard risks pay the regular premium for their classification.
A. Substandard risks are not insurable and are always rejected
At what point must an outline of coverage be delivered? A. Upon delivery of the policy only B. At the time of application or upon delivery of the policy C. At any point up to 30 days after policy delivery D. At the time of application only
B. At the time of application or upon delivery of the policy
A man was in an a head-on collision during a car crash, but incurred no serious injuries. despite this, he decides never to ride/drive a car again. what method of risk management is this? A. Retention B. Avoidance C. Reduction D. Sharing
B. Avoidance
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated? A. Adhesion B. Consideration C. Good faith D. Representation
B. Consideration
Representations are written or oral statements made by the applicant that are... A. Immaterial to the actual acceptability of the insurance contract B. Considered true to the best of the applicant's knowledge C. Guaranteed to be true D. Found to be false after further investigation
B. Considered true to the best of the applicant's knowledge.
An insured wants to transfer his personal insurance policy to a friend. Under what conditions would this be possible? A. The insured can transfer policy to friend & the notify insurer of change B. The insured will need written consent of insurer C. It is impossible to transfer policy D. The insured would have to surrender his policy to insurer & friend could then ask to purchase.
B. The insured would need written consent of insurer
Not all losses are insurable, and there are certain requirements that must be met before a risk is a proper subject for insurance. These requirements include all of the following EXCEPT... A. The loss produced by the risk must be definite B. The loss may be intentional C. The loss must not be catastrophic D. There must be a sufficient number of homogeneous exposure units to make losses reasonably predictable
B. The loss may be intentional
What terms best describes the act of withholding material information that would be crucial to an underwriting decision? A. Breach warranty B. Concealment C. Withholding D. Leading
B. concealment
When applying for an individual life policy, an applicant state that he went to the doctor for nausea, but fails to mention that he was also having severe chest pains. This is an example of... A. Warranty B. Concealment C. Misrepresentation D. Fraud
B. concealment
Every producer must maintain a place of business in this state... A. And maintain an approval rating of 60% B. That is approved by the department C. Accessible to the public D. With the exception of resident licensees
C. Accessible to the public
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan but only if the customer purchases a life insurance policy from the bank in the amount of the loan. This is an example of... A. Defamation B. Twisting C. Coercion D. Loading
C. Coercion
All of the following statements concerning accidental death and dismemberment coverage are correct EXCEPT... A. Dismemberment benefits are paid for certain disabilities that are presumed to be total and permanent B. Accidental death and dismemberment insurance is considered to be limited coverage C. Death benefits are paid only if death occurs within 24 hours of an accident D. Accidental death benefits are paid only if death results from Accidental bodily injury as defined in the policy
C. Death benefits are paid only if death occurs within 24 hours of an accident
Under the accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death? A. Double the amount of the death benefit B. Refund of premiums C. Principal sum D. Capital sum
C. Principal sum
Which of the following is an example of a peril covered in an accident and health insurance policy? A. Smoking B. Death C. Sickness D. Alcoholism
C. Sickness
A hazard is defined as: A. Neglect to communicate B. A deliberate attempt to deceive C. Something that increases the risk of loss D. The uncertainty of loss
C. Something that increases the chance of loss
Which of the following groups would most likely be covered under a blanket accident policy? A. Factory workers at the automobile assembly plant B. Independent contractors who work for a general contractor C. Students at a public school D. Office workers for a retail business
C. Students at a public school
When an insurer is given an order of liquidation, which of the following will protect the insureds' unpaid claims? A. The Wisconsin insurers association B. A reinsurance company C. The Wisconsin insurance security fund D. The office of the commissioner of insurance
C. The Wisconsin Insurance Security Fund
When the policy premium wasn't submitted with the application, what should the agent obtain from the insured upon policy delivery? A. A medical report B. A conditional contract C. A unilateral contract D. A statement of good health
D. A statement of good health
Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe? A. Unilateral B. Conditional C. Personal D. Adhesion
D. Adhesion
Each of the following factors is a significant consideration in the underwriting of individual health insurance risks EXCEPT... A. Applicant's age B. Applicant's physical condition C. Applicant's occupation D. Applicant's geographic location
D. Applicant's geographic location
Which of the following includes information regarding a person's credit. character, reputation, and habits? A. Consumer history B. Insurability report C. Agent's report D. Consumer report
D. Consumer report
A producer is acting in what capacity when he or she is trying to obtain credible information about an applicant for health insurance? A. Office underwriter B. General agent C. Consumer report investigator D. Field underwriter
D. Field underwriter
When doing business in this state, an insurance company that is formed under the laws of another state is known as which type of insurer? A. Domestic B. Alien C. Nonadmitted D. Foreign
D. Foreign
Underwriting is a major consideration when an insured wishes to replace her current policy for all of the following EXCEPT... A. Due to age or health, the policy may change dramatically B. Pre-existing conditions that were previously covered may not be covered under the replacing policy C. Benfits may change D. Premiums always stay the same
D. Premiums always stay the same
Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to... A. creditors B. Beneficiary of the death benefit C. The spouse of the insured D. The insured
D. The insured
The risk of loss may be classified as... A. High risk and low risk B. Pure risk and speculative risk C. Certain risk and uncertain risk D. Named risk and un-named risk
B. Pure risk and speculative risk
In health underwriting, it would be inappropriate to deline a risk using any of the following factors EXCEPT... A. Mental illness B. Genetic characteristics C. Martial status D. Blindness
A. Mental illness
Which of the following are the authorities that an agent can hold? A. Primary and secondary B. Express and implied C. Apparent and allowed D. Authorized and admitted
B. Expressed and implied
A life insurance policy has a legal purpose if both of which of the following elements exist? A. Policyowners and named beneficiaries B. Insurable interest and consent C. Underwritingand reciprocity D. Offer and counteroffer
B. Insurable interest and consent
All of the following actions by a person could be described as risk avoidance EXCEPT... A. Not driving after an accident B. Investing in the stock market C. Refusing to scuba dive D. Never flying in an airplane
B. Investing in the stock market
Which of the following is not a limited line of insurance? A. Legal expense insurance B. Life insurance C. Credit insurance D. Title insurance
B. Life insurance
All funds collected by an intermediary for prompt payment to insureds, insurers, or producers as entitled are received in what is known as... A. Fiscal responsibility B. Accepted accounting principal C. Fiduciary capacity D. Premium accountability
C. Fiduciary capacity
The requirement that agents not commingle insurance monies with their own funds is known as... A. Express authority B. Accepted accounting principal C. Fiduciary responsibility D. Premium accountability
C. Fiduciary responsibility
Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization? A. Stock company B. Reciprocal association C. Fraternal benefit society D. Mutual company
C. Fraternal benefit society
Which of the following factors about the insured determines the amount of disability benefit that the insured will receive? A. Martial status B. Age C. Income D. Gender
C. Income
When would a misrepresentation on an insurance application be considered fraud? A. Never B. When application is incomplete C. All misrepresentation is fraud D. If it is intentional and material
D. If it is intentional and material
Which of the following is NOT true regarding a certificate of authority? A. It may be necessary for transacting business in a specific state. B. It is equivalent to an insurance license C. It is issued by the state department of insurance D. It is issued to group insurance participants
D. It is issued to group insurance participants
A person who does not lock the doors or does not repair leaks shows an indifferent attitude. This person presents what type of hazard? A. Moral B. Legal C. Physical D. Morale
D. Morale
Which document helps ensure that full and fair disclosure is provided to the recipient of a policy? A. Benefit limitations B. Policy summary C. Statue of limitations D. Outline of coverage
D. Outline of coverage
Because of the great amount of personal information that is available, and because of the increased number of agencies collecting and using this information, the privacy protection study commission was established to control the misuse of information and misinformation. This act is know as... A. The federal privacy act of 1974 B. The disclosure authorization act C. The pretext interview act B. The fair underwriting act
A. The federal privacy act of 1974
Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information? A. Consumer privacy act B. The fair credit reporting act C. Unfair trade practices law D. The guaranty association
B. The fair credit reporting act
An insurance company receives an application with some information missing and issues the policy anyway. What is this called? A. Aleatory B. Waiver C. Estoppel D. Subrogation
B. Waiver
Joe has just been diagnosed with a quickly-spreading, fatal form or cancer; his oncologist predicts that he will live for a month. He applies for an individual health insurance policy. What risk classification will he most likely receive? A. Poor B. Provisional C. Declined D. Substandard
C. Declined
According to the fair credit reporting act, all of the following would be considered negative information about a consumer EXCEPT... A. Late payments B. Failure to pay off a loan C. Disputes regarding consumer report information D. Tax delinquencies
C. Disputes regarding consumer report information
According to the law of agency, a principal is represented by a/an... A. Agent B. Insurer C. Broker D. Insured
A. Agent
What documentation grants express authority to an agent? A. Agent's contract with the principal B. Agent's insurance license C. Fiduciary contract D. State provisions
A. Agent's contract with the principal
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following? A. Consideration B. Legal purpose C. Contract of adhesion D. Acceptance
A. Consideration
Which of the following is NOT an essential element of an insurance contract? A. counteroffer B. Consideration C. Agreement D. Legal purpose
A. counteroffer
Which of the following isnthe basis of a claim against an insurance policy? A. Misrepresentation B. Loss C. Material change D. Hazard
B. Loss
Events or conditions that increase the chances of an insured loss occurring are referred to as... A. Risks B. Perils C. Hazards D. Exposures
C. Hazards
What method do insurers use to protect themselves against catastrophic losses? A. Pro rata liability B. Risk management C. Reinsurance D. Indemnity
C. Reinsurance
Which of the following is a person, other than an officer or employee of the ceding insurer, who solicits, negotiates, or places reinsurance cessions of behalf of a ceding insurer? A. ceding agent B. Reinsurance agent C. Reinsurance broker D. Managing general agent
C. reinsurance broker
If reasonably possible, a notice of proof of loss claim must be provided to the insurer within what time period after the time required by the policy? A. 3 months B. 6 months C. 9 months D. 12 months
D. 12 months
What documentation grants express authority to an agent? A. Agent's insurance license B. Fiduciary contract C. State provisions D. Agent's contract with the principal
D. Agent's contract with the principal
An insured has reduced physical activities and walks/jogs for 45 minutes each morning; he's also eliminated fatty foods. Which method of risk management is this? A. Transfer B. Avoidance C. Retention D. Reduction
D. reduction
An insurer decides to renew a policy but at a higher premium rate, starting on the renewal date. How many days in advance must the insured be notified? A. 30 B. 60 C. 90 D. 100
B. 60
If the commissioner issues an order and the person who is the object of the order demands a hearing within 30 days, within how many days must the hearing be held? A. 30 B. 60 C. 90 D. 120
B. 60
An intermediary failed to complete the CE requirements by the due date 14 months ago. What must they do to reinstate their license? A. Pay $1000 fine in addition to completing CE requirements B. Complete a prelicensing education course and pass the state exam C. Complete the CE requirements as usual D. File an extension with the commissioner
B. Complete a prelicensing education course and pass the state exam
Which of the following is true regarding the notice of the insured's right to file a complaint? A. The notice must be prominently displayed in the agent's office during the time of application. B. Every insurer must provide such notice to its policyholders when the policy is issued. C. The department of insurance is responsible for providing the notice to the insurance applicants. D. The notice may be provided to the policyholders upon request.
B. Every insurer must provide such notice to its policyholders when the policy is issued.
An insurance organization that does not issue insurance policies but provides a meeting place for underwriters to conduct business is known as a... A. Capital stock company B. Lloyd's association C. Fraternal society D. Mutual company
B. Lloyd's association
On a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are... A. Guaranteed B. Not taxable since the IRS treats them as a return of a portion of the premium paid C. Paid at a fixed rate every year D. Taxable as ordinary income
B. Not taxable since the IRS treats them as a return of a portion of the premium paid.
When may an insurer require an insured to provide genetic information? A. When establishing insurability B. Only during the underwriting process C. Never D. Upon renewal
C. Never
Which of the following is NOT a goal of risk retention? A. To increase control of claims reserving and claims settlements B. To fund losses that cannot be insured C. To minimize the insured's level of liability in the event of loss D. To reduce expenses and improve cash flow
C. To minimize the insured's level of liability in the event of loss.
Which of the following statements regarding conditional receipts is true? A. They guarantee the insurer will approve the application B. They purchase temporary insurance, up to 6 months C. They become part of the policy D. They are temporary insuring agreements
D. They are temporary insuring agreements
Which of the following is true regarding limited health insurance policies? A. They cover all sickness or accidents that are not specifically excluded B. They are limited to those enrolled in a group health plan C. They cover every need of health insurance policy holder D. They only cover specific accidents or diseases
D. They only cover specific accidents or diseases
Which of the following is an example of a producer's fiduciary duty? A. an obligation to state every known fact about the policy being sold. B. a duty to base all transactions upon the principle of Utmost good faith. C. The obligation to tell the truth to the best of one's knowledge. D. The trust that a client places in the producer in regard to handling premiums.
D. the trust that a client places in the producer in regard to handling premiums.
When an individual purchases insurance, what risk management technique is he or she practicing? A. Avoidance B. Sharing C. Retention D. Transfer
D. transfer