Indiana Health + Life Exam
a
Which of the following is NOT a medicaid qualifier? a.) Insurability b.) Income level c.) Age d.) Residency
a
Which of the following is required in order for a plan to be qualified? a.) The plan must be formally written and communicated to the employees b.) The plan must not be permanent c.) The plan must be for the exclusive benefit of the employer d.) The plan's contribution formula is allowed to discriminate in favor of officers of the company
b
Which of the following policies can be described as a flexible premium adjustable life policy? a.) Credit life b.) Universal life c.) Whole life d.) Term life
d
How long is the grace period for an individual life insurance policy? a.) 2 weeks b.) 7 to 10 business days c.) 3 months d.) 1 month
a
All of the following are true about Group Life insurance EXCEPT a.) The employer is the beneficiary b.) It is usually written as annual renewable term insurance c.) Evidence of insurability is usually not required d.) The employee is the insured
c
Life insurance can provide which of the following? a.) Creation of a future liability b.) Liquidation of one's estate c.) Survivor protection d.) Protection against outliving one's assets
c
Which federal act defines rules pertaining to protected health information? a.) ERISA b.) COBRA c.) HIPAA d.) ACA
c
Which of the following would NOT trigger the payment of Accelerated Death Benefits. a.) Requiring an organ transplant for the insured to survive. b.) Being permanently institutionalized c.) Being permanently disabled d.) Terminal illness
a
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 a.) Subrogation b.) Indemnity c.) Insurable interest d.) Entirety
d
What does an annuity protect the annuitant against? a.) Estate taxes b.) The financial impact caused by premature death c.) Living longer than expected d.) Leaving beneficiaries without income
b
A whole life policy is surrendered for a reduced-paid up policy. The cash value in the new policy will a.) Reduce to the pre-surrender value b.) Continue to increase c.) Remain the same d.) Decreases over time
a
An insured purchased a health insurance policy with a renewability clause that states the policy is "Guaranteed Renewable." This means that as long s the required premiums are paid, the policy will continue until the insured a.) Reaches age 65 b.) Dies c.) Reaches age 100 d.) Becomes disabled
d
Because of an injury, an insured has been unable to work for 7 months. When his life insurance premium came due, he was unable to pay, yet the policy remained in force. The policy includes a.) Guaranteed insurability benefits b.) Facility of payment clause c.) Nonforfeiture options d.) Waiver of premium rider
d
Core benefits are included in all Medicare supplemental policies. What percentage of Part B coinsurance is required? a.) 35% b.) 10% c.) 15% d.) 20%
c
Dividends received on participating life insurance policies are a.) Not taxable because they are a return on your investment b.) Taxable because they are a return of unused premiums c.) Not taxable because they are a return of unused premiums d.) Taxable because they are a return on your investment
b
If a soliciting producer suspects that there could be misrepresentation on the part of the applicant for insurance, what must the producer do? a.) Refuse the applicant b.) Inform the insurance company c.) Change the applicant's answer to what the producer believes is correct d.) Erase the answer once the applicant submits the application
b
Premiums paid by an employer for group health insurances are a.)May be different amount for different employees b.) Tax deductible to employer c.) Tax deductible to employee d.) Included in the employers taxable income
a
The Guaranteed Insurability Rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following EXCEPT a.) Purchase of a new home b.) Approximately every 3 years between the ages of 25 and 40 c.) Birth of a child d.) Marriage
c
A married couple wants to include the entire family in their whole life policy under one rider. Which of the following riders will help them achieve that goal? a.) Inclusive term b.) Children's term c.) Family term d.) Other-insured term
a
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? a.) To cover the employer's administration costs b.) Penalty for termination c.) Premiums go up every year regardless of health conditions d.) To cover other employees who qualify to bypass premium payment
c
In whole life insurance, when is the policy cash value scheduled to equal the face amount? a.) When the insured paid up all policy loans b.) It depends on the type of whole life purchased c.) At the insured's age 100 d.) By the policy's 10th year
b
Under the mandatory uniform provision "Notice of Claim", written notice of a claim must be submitted to the insurer within what time parameters? a.) within 10 days b.) within 20 days c.) within 30 days d.) within 60 days
d
What happens to the copy of the application for health insurance once the policy is issued? a.) It is filed w/ the department of insurance b.) It is discarded. c.) It is returned to the insured d.) It becomes part of the entire contract
a
When may HIV-related test results be provided to the MIB? a.) Only if the individual is not identified b.) Under all circumstances c.) When given authorization by the patient d.) Only when the test results are negative
c
A dentist is off work for 4 months due to a disability. His dental assistant's salary would be covered by a.) Key employee disability b.) Partnership disability c.) Business overhead insurance d.) Disability income
d
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. a.) Flat b.) Annual c.) Per occurrence d.) Family
a
In addition to participation requirements, how does an insurer guard against adverse selection when underwriting group health? a.) By requiring that the insurance be incidental to the group b.) By having each enrollee undergo a paramedical examination c.) By obtaining MIB reports on each enrollee d.) By imposing case management provisions
d
In health insurance, what is coinsurance? a.) A portion of the deductible the insured must pay for treatment b.) The amount an insured pays for treatment c.) The amount the insurance company pays for the insured's treatment d.) A percentage of the cost of service that the insured and the insurer share
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? a.) Insuring Clauses b.) Coverage Provisions c.) Statement of Loss Coverage d.) Consideration Clause
a
The entire contract includes all of the following EXCEPT a.) A buyer's guide b.) The life insurance policy c.) A copy of the application d.) Any riders or amendments
Collateral assignment
The policyowner has an option to pledge the life insurance policy as collateral for a bank loan. This is called
b
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. a.) Reinstatement provision b.) Entire contract provision c.) Legal action provision d.) Grace period provision
b
Under the Payment of Claims provision, to whom will the insured's benefits be paid if the insured is deceased? a.) To any remaining debtors the insured owes b.) The insured's primary beneficiary c.) The insured's estate even if a beneficiary is living d.) The insured's beneficiary's first choice
d
Which of the following are characteristics of term life insurance? a.) Adjustable premiums and automatic increases in face amount at any given age b.) Coverage to age 100, cash value, and high premiums c.) Non forfeiture provisions and living benefits d.) Temporary protection, renewability, no cash value
b
Which of the following would be likely to establish a SEP? a.) Low-income individuals and families b.) Small employers c.) Military personnel d.) The elderly
a
According to the Common Disaster clause, if the insured and primary beneficiary are killed in the same accident and it cannot be determined who died first, which of the following would be assumed? a.) The primary beneficiary died before the insured. b.) The deaths occurred at the same time. c.) The estate of the primary beneficiary and the contingent beneficiary split benefits equally. d.) The insured died before the primary beneficiary.
c
The corridor deductible applies between a.) Minor and major coverage b.) Primary and secondary coverage c.) Basic and major medical coverage d.) Limited and comprehensive
c
In life insurance, which of the following is NOT required to have an insurable interest in the insured? a.) The insured b.) The applicant c.) The beneficiary d.) The policyowner
a
In order to reinstate a life insurance policy the insured must do all of the following EXCEPT a.) Pay next year's premium in advance b.) Pay back premiums c.) Pay any interest due on back premiums d.) Repay any outstanding loans and interest
b
Insurance contracts are unilateral in nature. What does that mean. a.) A promise is made only at the time of the policy application b.) Only one party makes a promise c.) The insured must make a promise to pay the premium d.) All parties to the contract exchange something of value
a
All of the following are characteristics of group health insurance plans EXCEPT a.) The parties that hold a group health insurance contract are the employees and the employer b.) The cost of insuring an individual is less than what would be charged for comparable benefits under an individual plan c.) Employers may require the employees to contribute to the premium payments d.) The benefits under a group plan are more extensive than those under individual plans
d
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 a.) Contributory Amount b.) Primary Amount c.) Principal Amount d.) Capital Amount
a
Insured's 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? a.) Submit the description in their own words on a plain sheet of paper b.) Be reimbursed any copayment or deductible on the claim c.) Demand full payment immediately for the claim d.) Speak with a claims adjuster or another representative from the insurance company.
a
The presumptive disability provision assumes the insured is totally disabled upon loss of all of the following EXCEPT a.) Feeling b.) Sight c.) Hearing d.) Two limbs
b
All of the following are true of the Survivorship Life policy EXCEPT a.) It can insure more than 2 lives b.) The premium is based on the age of each insured c.) The death benefit is not paid until the last death d.) The premium would be lower than in a joint life policy
d
An agreement that is enforceable by law is known as what kind of contract? a.) Conditional b.) Adhesion c.) Unilateral d.) Legal
b
On an Accidental Death and Dismemberment (AD&D) policy, the death benefit payable is known as the a.) Policy limit b.) Principal sum c.) Face amount d.) Capital sum
d
A new homebuyer wants to purchase a life insurance policy that would protect his family against losing the home, should he die before the mortgage was paid. The most inexpensive type of policy that would accomplish this need would be a.) Increasing term b.) Flexible term c.) Level term d.) Decreasing term
d
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 a.) $3,000 b.) $2,000 c.) $2,100 d.) $2,500
c
An applicant gives her agent a completed application and the initial premium. What can the agent issue her that acknowledges the initial premium payment? a.) Advanced premium receipt b.) Premium receipt c.) Conditional receipt d.) Provisional receipt
b
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? a.) If the mistake was found after incontestability period, the benefit will be paid in full. b.) Benefits paid will be those that would have been purchased at the correct age. c.) Benefits will not be paid. d.) The policy will automatically be dropped.
c
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 a.) Acute b.) Custodial c.) Intermediate d.) Skilled
b
An insured bought an insurance policy that requires him to pay $150 in premium on the 15th of each month. He then takes an extended vacation and forgets to pay the premium. Ten days later, his policy is still in effect and has not lapsed. Which policy provision allowed for this? a.) Incontestability b.) Grace period c.) Waiver of premium d.) Automatic premium loan
d
An insured decides to surrender his Whole Life insurance policy. The cash value at surrender is higher than the premiums paid into the policy, due to interest. What part of the surrender value would be income taxable? a.) nothing b.) The amount equal to the premiums paid c.) The entire cash value amount d.) The difference between the premiums paid and the cash value
d
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? a.) Medicare b.) MediCal c.) Worker's compensation d.) Social security
c
Following a covered loss, the Time payment of claims provision requires that an insurance company pay disability income benefits no less frequently than a.) Annually b.) Weekly c.) Monthly d.) Semi-annually
b
What is the purpose of a buy-sell agreement? a.) To protect business employees against loss of income due to the owner's death b.) To allow the business buyout in case of the owners death c.) To help the business meet overhead expenses in the case of the owners death d.) To reimburse the business in case of a key employee's death
b
What is the purpose of the impairment rider in a health insurance policy? a.) To identify pre-existing conditions b.) To exclude coverage for a specific impairment c.) To cover impairments that otherwise could not be covered d.) To provide disability coverage
d
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? a.) Either white out the answer or cross it out and write the new answer beside it. b.) Nothing. A fresh application must be obtained c.) White out the incorrect answer and write the new one over it d.) Cross the incorrect answer out, write the correct one beside it, and initial the answer.
d
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)? a.) 0% b.) 85% c.) 90% d.) 100%
b
Which of the following types of insurance is investment based, has a level fixed premium, and a nonguaranteed cash value? a.) Credit life b.) Variable whole life c.) Interest-based life d.) Universal Life
d
All of the following must sign an application for health insurance EXCEPT the a.) The proposed insured b.) applicant c.) producer d.) insurer
b
All of the following statements about indexed whole life insurance are correct EXCEPT a.) The cash value depends on the performance of the equity index b.) The death benefit is not guaranteed c.) The premium is fixed d.) There is a guaranteed minimum interest rate
c
All of the following statements are true regarding an Ordinary (Straight) Life policy EXCEPT a.) It builds cash value b.) If the insured lives to age 100, the policy matures, and the face amount is paid to the insured c.) It does not have a guaranteed death benefit d.) It is funded by a level premium
a
In a life insurance application, all of the following signatures will be required EXCEPT. a.) The home office underwriter b.) The insured c.) The owner (if different from the insured) d.) The agent
c
What does the application of contract of adhesion mean? a.) The insurer may go to another for representation b.) It makes sure that the insured does not get more than the value of the loss c.) Since the insured does not participate in preparing the contract, any ambiguities would be resolved in favor of the insured d.) The holder of the contract has the ultimate power of promise.
a
Who is obligated to make sure all questions are answered and all necessary signatures are collected on the application? a.) The agent b.) The applicant c.) The insurer d.) The issuer
c
Whose responsibility is it to ensure that the application for health insurance is complete and accurate. a.) The underwriter's b.) The applicant's c.) The agent's d.) The policyowner's
a
With adjustable life, the owner can change all of the following EXCEPT a.) The insured b.) The death benefit c.) The premium d.) The length of time the coverage will last
a
All other factors being equal, which of the following premium modes would result in the lowest overall premium? a.) Annual b.) Quarterly c.) Semi-Annual d.) Monthly
c
An annuity owner receives the same guaranteed payment every month. What type of annuity is it? a.) Guaranteed b.) Single c.) Fixed d.) Immediate
d
An individual has a $200,000 convertible term life insurance policy. If he chooses he can a.) Convert to another term policy w a lower face amount without proof of insurability. b.) Purchase an individual annuity for any face amount using the 1035 exchange privilege. c.) Purchase another term policy and increase his death benefit without proof of insurability. d.) Convert to a whole life policy for the same face amount without proof of insurability.
b
An insurer is attempting to determine the insurability of an applicant and decides to obtain medical information from several different sources. Which of the following must be notified of the investigation? a.) The medical examiner b.) The applicant c.) The Medical Information Bureau d.) The state department of insurance
b
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? a.) Medical exam b.) Attending Physician's Statement c.) MIB Report d.) Policy Application
a
Regarding the consideration clause, which of the following is NOT correct? a.) Consideration of the insurer and insured must be equal b.) Consideration is defined as the exchange of values c.) The insurer's consideration consists of providing coverage d.) The insured's consideration consists of providing information on the application, as well as agreeing to pay the premium
a
When term insurance is added to the main policy to enhance the policy or provide added benefit or coverage, it is called a a.) Term rider b.) Nonforfeiture option c.) Future income rider d.) Guaranteed insurability rider
a
Which of the following is provided by skilled medical personnel to those who need occasional medical assistance or rehabilitative care? a.) Intermediate care b.) Custodial care c.) Home health care d.) Skilled Care
b
Which of the following policies would NOT offer a policy loan option? a.) Variable universal life b.) Term Life c.) Whole Life d.) Universal Life
b
Which of the following riders pays a beneficiary a death benefit that is double or triple the face amount if the insured's death was caused by an accident as defined in the policy? a.) A covered peril rider b.) An accidental death rider c.) A double indemnity rider d.) A guaranteed insurability rider
d
Which of the following terms relates to disability income insurance? a.) Coinsurance stop loss b.) Deductibles c.) Insurable interest d.) Residual benefit
b
What is the purpose of a benefit schedule? a.) To list the insured's copayments and deductibles b.) To state what and how much is covered in the plan c.) To include the average charges for procedures d.) To provide the dates for the payment of benefits
c
Which of the following will NOT be included in the buyers guide? a.) Explanation on how to choose the amount and type of insurance. b.) Basic information about life insurance policies. c.) Specific information about the policy. d.) Comparison of policy Costs.
a
Which of the following would NOT be eligible for coverage under key person? a.) The owner of a shop b.) The executive officer of a company c.) The pharmacist officer of a company d.) The manager of a small store
c
Which risk classification is representative of the majority of people in a certain age group and with similar lifestyles? a.) Declined b.) Preferred c.) Standard d.) Substandard
c
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? a.) The man's workers comp will pay the claim in full b.) The insurance company will not pay the claim c.) The insurance company will pay the claim according to the benefits available if the correct premium had been paid d.) His coverage will be dropped.
c
A married couple purchase a life insurance policy on their newborn baby. They are concerned about what would happen to the policy if either one of them were unable to continue making the premium payments due to death or disability. Which policy rider would their agent recommend? a.) Automatic premium loan b.) Waiver of premium c.) Payor benefit d.) Guaranteed insurability
a
Which dividend option will increase the death benefit? a.) Paid-up additions b.) Accumulation c.) Extended term d.) Reduced paid up
c
Which of the following best defines the Probationary Period in group health policies? a.) The stated amount of time when benefits may be reduced under certain circumstances b.) The number of days that must expire after the onset of an illness before benefits will be earned c.) A specified period of time that a person joining a group has to wait before becoming eligible for coverage d.) The number of days the insured has to determine if he/she will accept the policy as received
d
Which of the following best describes a Major Medical Expense Policy? a.) It provides surgical coverage to an insured with a schedule indicating charges for each procedure b.) It provides coverage for in-hospital doctor visits that are of a nonsurgical nature c.) It provides coverage to an insured who is confined to a hospital with a daily benefit amount and a specified benefit period d.) It provides catastrophic medical coverage beyond basic benefits on a usual, customary and reasonable basis.
c
Which of the following individuals would be a likely candidate to purchase a deferred annuity? a.) Someone who wants to leave the death benefit to the beneficiaries b.) Someone who cannot afford life insurance c.) Someone who wants to grow retirement funds tax deferred d.) Someone who needs to start receiving benefit payments within 6 months of the annuity purchase
d
Which of the following statements concerning the Medical Information Bureau is correct? a.) The medical information bureau report must be attached to each life policy issued. b.) All applicants for life insurance receive a copy of the finding of the life insurance medical examination c.) Information contained in the medical information bureau report is available to all physicians d.) The medical information bureau assists underwriters in evaluating and classifying risks
d
What is the purpose of the Agents report in the application process? a.) To explain policy features and benefits to the applicant b.) To provide medical information about the applicant to the underwriters c.) To give disclosure to the applicant d.) To provide additional information about the applicant to the underwriters
a
Which of the following best describes a presumptive disability? a.) One that is severe enough that the insured automatically qualifies for full disability benefits b.) One that requires the insured to submit, to physical exams periodically c.) One that a doctor predicts may reoccur in the future d.) One that the insured will fully recover from in the future
a
Which of the following statements is INCORRECT a.) The insurer does not have the right to conduct an autopsy b.) The physical exam and autopsy provision gives the insurer the right to examine the insured, at it's own expense. c.) The physical exam and autopsy provision gives the insurer the right to examine the insured as often as may be reasonably necessary while a claim is pending d.) The insurer also has the right to conduct an autopsy, if not forbidden by state law
b
J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did J choose? a.) Joint and survivor b.) Fixed amount c.) Fixed period d.) Interest only
b
The purpose of the Fair Credit Reporting Act is to a.) Ensure coverage for all applicants b.) Protect consumers against the circulation of inaccurate or obsolete personal or financial information c.) Protect the insured from adverse selection d.) Ensure the consumers receive a copy of investigative consumer reports
a
What is the purpose of key-person insurance? a.) To cover decreased business revenues as a result of the death of a key employee b.) To provide key employees with life insurance coverage c.) To provide retirement benefits to key employees d.) To give senior managers the ability to purchase shares in the business
a
Which of the following best describes the type of care provided by HMOs a.) Preventive b.) Elective c.) Major medical d.) Fee-for-service
c
Which of the following is NOT a standard exclusion in life insurance policies? a.) War and military service b.) Aviation c.) Disability d.) Hazardous occupation