insurance exam
A man is injured while robbing a convenience store. How does his major medical policy handle the payment of his claim
Claim is denied if his policy contains the illegal occupation provision
When transacting business in this state an insurer formed under the laws of another country is known as a/an
Alien Insurer
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
An unfair trade practice
Disability income coverage specifies that the policy covers the insured if he is unable to perform any job for which he is qualified. In this case, the total disability is defined as
Any occupation- more restrictive than other definitions
All of the following qualify for Medicare Part A EXCEPT
Anyone who is willing to pay a premium
Concerning Medicare Part B, which statement is INCORRECT?
It is fully funded by Social Security taxes (FICA)
Which of the following is NOT true regarding policy loans?
Money borrowed from the cash value is taxable
An insured is involved in a car accident. In addition to less serious injuries, he permanently loses the use of his leg and is rendered completely blind. The blindness improves a month later. To what extent will the insured receive Presumptive Disability benefits?
No benefits
Which of the following explains the policyowners rights to change beneficiaries, choose options, and receive proceeds of a policy
Owners rights
All of the following are characteristics of group life insurance EXCEPT
Premiums are determined by the age, sex and occupation of each individual certificate holder
In the case of producer solicitation, at what point must a long-term care Shopper's Guide must be presented to the applicant?
Prior to the time of application
In respect to the consideration clause, which of the following is consideration on the part of the insurer
Promising to pay in accordance with the contract terms
When a whole life policy lapses or is surrendered prior to maturity, the cash value can be used to
Purchase a single premium policy for a reduced face amount
When an insurer issues an individual health insurance policy that is guaranteed renewable, the insurer agrees
To renew the policy until the insured has reached age 65
What is the typical deductible for basic surgical expense insurance?
$0
What is the maximum allowed value of promotional gifts that an agent may give to a prospective insured
$100
A noncontributory group disability income plan has a 30 day elimination period and offers benefits of $2000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive
$12,000, all of which is taxable
In order for a debtor group to qualify for group life insurance, what should be the minimum number of participants joining the plan every year?
100
S is a sole business proprietor who owns a medical expense plan. What percentage of the cost of the plan may he deduct?
100%
How long must an insurer retain an advertisement for its long-term care policies
3 years
If a licensee changes his or her residence address, within how many days must the department be notified?
30 days
Ray has an individual major medical policy that requires a coinsurance payment. Ray very rarely visits his physician and would prefer to pay the lowest premium possible. Which coinsurance arrangement would be best for Ray?
50/50
How long does the initial enrollment period for Medicare Part B last
7 months
How long does the initial enrollment period for Medicare Part B last?
7 months
If a claim is made on a policy during the grace period, an insurer is allowed to deduct the overdue premium and to charge interest. What is the maximum allowed interest rate?
8%
Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within
90 days of a loss
An investor buys a life policy on an elderly person in order to sell it for a life settlement. This is an example of
A STOLI policy
Which of the following statements is NOT true concerning insurable interest as it applies to life insurance
A debtor has an insurable interest in he life of a lender
The benefits for individual disability plans are based on
A flat amount
Employers can reduce health plan costs by coupling a HRA with
A high deductible health plan
Which of the following does the insuring clause NOT specify
A list of available doctors
Which of the following does the insuring clause NOT specify?
A list of available doctors
Which of the following individuals is eligible for a Health Savings Account?
A person insured under a high-deductible health plan
An individual has been diagnosed with Alzheimers disease. He is insured under a life insurance policy with the accelerated benefits rider. Which of the following is true regarding taxation of the accelerated benefits
A portion of the benefit up to a limit is tax free; the rest is taxable income
All of the following are correct about the required provisions of a health insurance policy EXCEPT
A reinstated policy provides immediate coverage for an illness
Which of the following Medicare supplement plans would be available to a reasonably healthy 91-year-old female
A-N
The two types of assignments are
Absolute and collateral
When the insured purchased his health policy he was a window washer. He has since changed occupations and now manages a library. If the insurer is notified of the insured's change of occupation, the insurer should
Adjust the benefit in accordance with the decreased risk
Which of the following is another term for an authorized insurer
Admitted
A 63-year-old man is planning to be employed until age 68. When will he be eligible for Medicare?
Age 65, regardless of his employment status
Which of the following is true regarding branch agency licensing
Agent in charge must be licensed
How can a new physician be added to the PPO's approved list?
Agree to follow the PPO standards and charge the appropriate fees
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?
Aleatory
What is reinsurance?
An agreement between a ceding insurer and assuming insurer
Under which condition would an employees group medical benefits be exempt from income taxes?
An employees group medical benefits are generally exempt from taxation as income
Under which of the following circumstances would an insurer pay accelerated benefits
An insured is diagnosed with cancer and needs help paying for her medical treatment
What is a foreign insurer
An insurer with a home office in another state
When an insurer begins underwriting procedures for an applicant, what will be the main source for its underwriting information?
Application
Employer contributions made to a qualified plan
Are subject to vesting requirements
SIMPLE Plans require all of the following EXCEPT
At least 1,000 employees.
How often must domestic insurance companies be examined by the Chief Financial Officer In Florida
At least every 5 years
When must insurable interest exist in a life insurance policy?
At the time of the application
What document describes an insureds medical history, including diagnoses and treatments?
Attending Physicians Statement
A producer who fails to separate premium monies from his own personal funds is guilty of
Commingling
What is the clause that describes the method of paying the death benefit in the event that the insured and beneficiary are both killed in the same accident?
Common disaster clause
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?
Consideration
An applicant for an individual health policy failed to complete the application properly. Before being able to complete the application and pay the initial premium, she is confined to a hospital. This will not be covered by insurance because she has not met the conditions specified in the
Consideration Clause
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as
Contracts of adhesion
In a relative value system of determining coverage for a given procedure, what term describes the total amount payable per point
Conversion factor
in a relative value system of determining coverage for a given procedure, what term describes the total amount payable per point
Conversion factor
Items stipulated in the contract that the insurer will not provide coverage for are found in the
Exclusions
Failure of a licensee to maintain an appointment with an insurance company within 48 months after the date the license became effective will result in
Expiration of the license
An agent selling variable annuities must be registered with
FINRA
An applicant is denied insurance because of information found on a consumer report. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company?
Fair Credit Reporting act
An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of
False advertising
If an insured is not required to pay a deductible, what kind of coverage does he/she have
First dollar
Another term used to describe "no deductible" is
First-dollar basis
How long must insurers maintain records of the information collected from senior consumers and other information used in making recommendations that were the basis for insurance transactions
For 5 years after the insurance transaction is completed by the insurer
An insured received a new life insurance policy 5 days ago, but after a closer inspection of the policy provisions, decides to return it to the insurer. What provision would allow the insured to return the policy for a full premium refund
Free look
Which is TRUE about the cash surrender nonforfeiture option
Funds exceeding the premium paid are taxable as ordinary income
What provision in a life insurance policy extends coverage beyond the premium due date?
Grace period
At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance In the future without having to prove insurability. This rider is called
Guaranteed insurability
Which of the following is available to employers of all sizes?
HRAs
What are the 2 types of Flexible Spending Accounts?
Health Care Accounts and Dependent Care Accounts
Which of the following riders would NOT increase the premium for a policyowner
Impairment rider
Under which of the following annuity options does the annuitant select the time period for the benefits, and the insurer determines how much each payment will be
Installments for a fixed period
Which of the following entities has the authority to make changes to an insurance policy
Insurers executive officer
An insured purchased a life insurance policy. The agent told him that depending upon the company's investments and expense factors, the cash value could change from those shown in the policy at issue time. The policy is an
Interest sensitive whole life
A guaranteed renewable disability insurance policy
Is renewable at the insured option to a specified age
Which of the following does NOT describe hospice care?
It provides care to people with life expectancies of 1 to 2 years
Which life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed period, during which, if the original recipient dies, the payments will continue to a designated beneficiary?
Life income with period certain
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?
Limited- pay life
If a settlement option is not chosen by the policy owner or the beneficiary, what option will be used by the insurer?
Lump sum
Which of the following is NOT considered a misrepresentation as it pertains to unfair trade practices
Making comparisons between different policies
Which of the following statements is NOT correct regarding Medicare
Medicare advantage must be provided through HMOS
Which of the following statements is correct
Medicare will cover nursing home care if it is part of the treatment for a covered illness
On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. What is the company guilty of?
Misrepresentation
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?
Mutual
Using a class designation for beneficiaries means
Naming beneficiaries as a group
Which provision concerns the insureds duty to provide the insurer with reasonable notice in the event of loss
Notice of claim
What is the definition of a unilateral contract?
One-sided: only one party makes an enforceable promise
Under a pure life annuity, an income is payable by the company
Only for the life of the annuitant
When does Medicare cover nursing home care?
Only if it is part of treatment for a covered illness or injury
Don has both a basic expense and a major medical policy. He is injured in an accident, which requires several major surgeries. This quickly exhausts Don's basic expense policy. What must Don do before his major medical policy can pick up where the basic expense policy left off?
Pay a special deductible on his major medical policy
A participating insurance policy may do which of the following
Pay dividends to the policy owner
Certain conditions, such as dismemberment or total and permanent blindness, will automatically qualify the insured for full disability benefits. Which disability policy provision does this describe?
Presumptive disability
Another name for a substandard risk classification is
Rated
An agent offers a client free tickets to a sporting event in exchange for the purchase of an insurance policy. What is the agent guilty of?
Rebating
The Federal Fair Credit Reporting Act
Regulates consumer reports
Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?
Replacement rule
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT
Signed waiver of premium
Which of the following determines the length of time that benefits will be received under the Fixed-Amount settlement option
Size of each installment
Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles
Standard risk is representative of the majority of people
Which of the following types of annuities will generally provide the highest monthly income
Straight life
The transfer of an insured right to seek damages from a negligent party to the insurer is found in which of the following clauses?
Subrogation
All of the following would be different between qualified and nonqualified retirement plans EXCEPT
Taxation om accumulation
A customer with an existing life insurance contract is considering exchanging it for a newer contract. What Florida Insurance regulation should the customers insurance agent consult?
The Florida Replacement Rule
All of the follow entities regulate variable life policies EXCEPT
The Guaranty Association
An employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?
The PPO will pay reduced benefits
Which of the following statements about HRA's is TRUE
The account allows roll-over of unused balances at the end of the year at the employers discretion
Which of the following is TRUE regarding variable annuities
The annuitant assumes the risks on investment
Which of the following is NOT true regarding the annuitant?
The annuitant cannot be the same person as the annuity owner
The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true?
The annuitant must be a natural person
All of the following statements about equity index annuities are correct EXCEPT
The annuitant receives a fixed amount of return
Which of the following is NOT the consideration in a policy
The application given to a prospective insured
How do employer contributions to a Health Savings Account affect the insured's taxes?
The employer contributions are not included in the individual insureds taxable income
Who determines the eligibility and contributions limits in a HRA?
The employer determines both
In a disability policy, the elimination (or waiting) period refers to the period between
The first day of a disability and the day the insured starts receiving benefits
Who bears all of the investment risk in a fixed annuity
The insurance company
The insuring clause of a disability policy usually states all of the following EXCEPT
The method of premium payment
Which of the following will vary the length of the grace period in health insurance policies
The mode of the premium payment
Which of the following statements regarding the Change of Beneficiaries provision is false
The policy owner has the right to change the beneficiaries in any case
If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE?
The policy will be interpreted as if the insurer waived its right to have an answer on the application
A policy with a 31-day grace period implies
The policy will not lapse for 31 days if the premium is not paid when due
An individual purchased a Medicare supplement policy in March and decided to replace it 2 months later. His history of coronary artery disease is considered a pre-existing condition. Which of the following is true
The pre-existing condition waiting period fulfilled in the old policy will be transferred to the new policy
All of the following are true about variable products EXCEPT
The premiums are invested in the insurers general account
How does a member of an HMO see a specialist?
The primary care physician refers the member
Which is true about a spouse term rider
The rider is usually level term insurance
All of the following are true regarding the guaranteed insurability rider EXCEPT
This rider is avaliable to all insureds with no additional premium
Which provision states that the insurance company must pay Medical Expense claims immediately
Time of Payment of Claims
An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?
Time of payment of claims
What is the purpose of coinsurance provisions?
To help the insurance company to prevent overutilization of the policy
The paid-up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy.
Long-term care policies require that in addition to the applicant at least one person must be designated to the policy. What is the role of that designated person?
To receive notice of policy lapse or termination
Which type of life insurance policy allows the policy owner to pay more or less than the planned premium?
Universal life
Which of the following policies would have an IRS-required corridor or gap between the cash value and death benefit?
Universal life- Option A
When must an insurance company present an outline of coverage to an applicant for a medicare supplement policy
at the time of application
Which of the following is NOT covered by Medicare
cosmetic surgery
Applications to an insurer must include all of the following information, EXCEPT
credit history report
If an insured worker has earned 40 quarters of coverage, the worker's status under Social Security disability is
fully insured
In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost
is not covered
Which of the following statements is NOT correct. concerning the COBRA act of 1985
it requires all employers, regardless of the number or age of employees, to provide extended group health coverage
What is the term for how frequently a policy owner is required to pay the policy premium?
mode
Under an individual disability income policy, the minimum schedule of time in which claim payments must be made to an insured is
monthly
A rider attached to a life insurance policy that provides coverage on the insureds family members is called
other-insured rider
The interest earned on policy dividends is
taxable
Who chooses a primary care physician in an HMO plan?
the individual member
An insurer hires a representative to advertise its company at a local convention. The representative lies about the details of some of the policies, in an attempt to secure more business for the company. Who is responsible for the representative's claims?
the insurer
For variable products, underlying assets must be kept in
A separate account
What is a material misrepresentation
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain
A statement that is sufficiently clear to identify the insured and the nature of the claim
Which of the following insurance products will be subject to the regulation on life insurance solicitation?
A term life policy
Licensed life insurance agents are expected to be familiar with which of the following laws?
All
In which Medicare supplemental policies are the core benefits found?
All plans
In reference to the standard Medicare Supplement benefits plan, what does the term standard mean
All providers will have the same coverage options and conditions for each plan
When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she was 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision
Amounts payable under the policy will reflect the insureds correct age
While a claim is pending, an insurance company may require
An independent examination as often as reasonably required
The current interest rate on an equity indexed annuity is often based on
An index like Standard & Poor's 500
The death protection component of Universal life insurance is always
Annually renewable term
Which of the following is a short-term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated
Annuity Certain
Which statement accurately describes the Change of Beneficiary provision
Any policy that has a death benefit must also have a change of beneficiary provision
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?
Authorized
All of the following information about a customer must be used in determining annuity suitability EXCEPT
Beneficiaries age
Which of the following is TRUE about a class designation
Beneficiaries are not identified by name
Which of the following is TRUE about a class designation?
Beneficiaries are not identified by name
Which of the following is a feature of a variable annuity?
Benefit payment amounts are not guaranteed
Which of the following statements regarding Business Overhead Expense policies is NOT true
Benefits are usually limited to six months
Which of the following statements regarding Business Overhead Expense policies is NOT true?
Benefits are usually limited to six months
Which of the following is NOT true regarding an annuity certain
Benefits stop at the annuitants death
Which of the following is a generic consumer publication that explains life insurance in general terms in order to assist the applicant in the decision making process
Buyers guide
In the event of a divorce, which of the following would allow a divorcee to continue receiving group health coverage under an insured spouse's plan for an additional 36 months?
COBRA
HMOs that contract with outside physicians to provide health care service to their subscribers compensate those providers on a
Capitation basis
Which of the following is true regarding inpatient hospital care for HMO members?
Care can be provided outside of the service area
An insured receives an annual life insurance dividend check. What term best describes this arrangement?
Cash option
Which of the following features of the Indexed Whole Life policy is NOT fixed
Cash value growth
To legally transact insurance in this state, an insurer must obtain which of the following?
Certificate of Authority
Which of the following must an insurer obtain in order to transact insurance within a given state
Certificate of authority
When a policy owner designates a group of individuals as the beneficiary of a life insurance death benefit without specifically naming the individuals, this is called
Class designation
A business owner was trying to obtain a bank loan to fund the purchase of a new business facility, but the bank required proof of additional assets to secure the loan. The business owner then decided to use her $250,000 life insurance policy to secure the loan. Which provision makes this possible?
Collateral assignment
Which of the following is the term for the specific dollar amount that must be paid by an HMO member for a service?
Copayment
Which of the following is NOT true regarding Basic Surgical Expense coverage?
Coverage is unlimited
The term "fixed" in a fixed annuity refers to all of the following EXCEPT
Death benefit
Which of the following authorities grants and revokes licenses
Department of Financial Services
Other than for a qualified life event, when can a change be made in benefits for a Flexible Spending Account (FSA)?
During the open enrollment period
What is the goal of the HMO?
Early detection through regular checkups
Which of the following is NOT covered by Health Maintenance Organizations?
Elective services
In disability income insurance, the time between the onset of an injury or sickness and when the benefits begin is know as the
Elimination period
Concerning group Medical and Dental insurance, which of the following statements is INCORRECT?
Employee benefits are tax deductible the year in which they were received
All of the following statements are true regarding tax-qualified annuities EXCEPT
Employer contributions are not tax deductible
When the insured selects the extended term nonforfeiture option, the cash value will be used to purchase term insurance with what face amount?
Equal to the original policy for as long as the cash values will purchase
How long must insurers maintain records of the information collected from senior consumers and other information used in making recommendations that were the basis for insurance transactions?
For 5 years after the insurance transaction is completed by the insurer
The agent in charge of an agency must hold which of the following licenses?
General lines
Life insurance death proceeds are
Generally not taxed as income
The automatic premium loan provision is activated at the end of the
Grace period
What kind of policy issues certificates of insurance to insureds?
Group insurance
What are the 2 types of Flexible Spending accounts?
Health Care Accounts and Dependent Care Accounts
What are the three basic coverages for medical expense insurance
Hospital, surgical, medical
A health insurance policy lapses but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for accidents become effective?
Immediately
Life income joint and survivor settlement option guarantees
Income for 2 or more recipients until they die
The benefits received by the business in a Disability Buy-Sell policy are
Income tax free
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the
Incontestability clause
The Medical Information Bureau (MIB) was created to protect
Insurance companies from adverse selection by high risk persons
Which of the following entities can legally bind coverage
Insurer
Which of the following best describes a misrepresentation
Issuing sales material with exaggerated statements about policy benefits
What is the main purpose of the Seven-pay test
It determines if the insurance policy is an MEC.
Which of the following is NOT true regarding a Certificate of Authority
It is issued to group insurance participants
In which of the following situations is it legal to limit coverage based on marital status
It is never legal to limit coverage based on marital status
If an insured surrenders his life insurance policy, which statement is true regarding the cash value of the policy?
It is only taxable if the cash value exceeds the amount paid for premiums
In the underwriting process, it was determined that the applicant for life insurance is in poor health and has some dangerous habits. Which of the following is true concerning the policy premium
It will likely be higher because the applicant is a substandard risk
Every insurer marketing Long-Term Care insurance must establish marketing procedures to ensure all of the following EXCEPT
LTC politieel are marketed effectively to prospective insureds
Variable Whole Life Insurance is based on what type of premium?
Level fixed
Which of the following settlement options in life insurance is known as straight life?
Life income
Which of the following is NOT true regarding policy loans
Money borrowed from the cash value is taxable
Which of the following premium modes would result in the highest annual cost for an insurance policy?
Monthly
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report
Must be informed of the source of the report
Premium payments for personally-owned disability income policies are
Not tax deductible
Under a straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive
Nothing; the payments will cease
Shortly after a replacement transaction on a Medicare supplement policy, the insured decided to cancel the policy, but is unsure whether the free-look provision applies. The insured could find that information in the
Notice regarding replacement
Which of the following documents must be provided to the policy owner or applicant during policy replacement
Notice regarding replacement
An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do?
Offer the supplement policy on a guaranteed issue basis
Which of the following explains the policyowners right to change beneficiaries, choose options, and receive proceeds of a policy?
Owners rights
An insured has a continuous premium whole life policy. She would like to use the policy dividends to pay off her policy sooner than would have been possible otherwise. What dividend option could she use?
Paid-up option
Prior to purchasing a Medigap policy, a person must be enrolled in which of the following?
Part A and B of medicare
An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?
Pay a reduced death benefit
An insured purchased a life policy in 2010 and died in 2020. The insurance company discovers that the insured has misstated information in her insurance history on the application. What should the insurer do?
Pay the death benefit
Which of the following is another term for the accumulation period of an annuity?
Pay-in period
Which of the following applies to partial disability benefits
Payment is limited to a certain period of time
Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner
Payment of claims
Which of the following riders would NOT cause the Death Benefit to increase?
Payor Benefit rider
Which of the following provisions is mandatory for health insurance policies
Physical examination and autopsy
Which of the following individuals must have insurable interest in the insured?
Policyowner
Regarding the taxation of Business Overhead policies,
Premiums are deductible and benefits are taxed
Which of the following describes taxation of individual disability income insurance premiums and benefits?
Premiums are not tax deductible, and benefits are not taxable
Which of the following is NOT among the goals of a medicare supplement application
Presuming the applicant is eligible for Medicaid, based on the nature of the policy
An employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called?
Profit sharing plan
A couple owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?
Proof of insurability is not required
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as
Rebating
What method do insurers use to protect themselves against catastrophic losses?
Reinsurance
Todd has been informed that he has a hernia which requires repair. When Todd researches the cost, he learns that his insurance plan will cover 200 points worth of surgical expenses. Each point represents $10, which means that $2000 of his surgery will be covered by his insurance plan. What system is Todd's insurance company using?
Relative Value
In the event of a loss, business overhead insurance will pay for
Rent
If an employer decides to change its life insurance policy to a similar one with a different insurer, which of the following describes the extent that replacement regulations will be exercised
Replacement regulations will not apply in this situation
A man decided to purchase a $100,000 Annually Renewable Term Life policy to provide additional protection until his children finished college. He discovered that his policy
Required a premium increase each renewal
Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must
Respond to the consumers complaint
Which of the following is NOT covered under Part B of a Medicare policy?
Routine dental care
To sell variable life insurance policies, an agent must receive all of the following EXCEPT
SEC registration
Which of the following best details the underwriting process for life insurance?
Selection, classification and rating of risks
If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a
Settlement option
An employee has group life insurance through her employer. After 5 years, she decides to leave the company and work independently. How can she obtain an individual policy?
She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan
Which of the following determines the length of time that benefits will be received under the Fixed-amount settlement option?
Size of each installment
An insurance agent B likes to add additional coverages to applicants policies and charge them for such converges without their knowledge. This agent is guilty of
Sliding
Which benefit is based on the persons Primary Insurance Amount PIA
Social security disability benefit
Which of the following would be considered a non qualified retirement plan?
Split- dollar plan
When an employee covered under a health reimbursement account changes employers, the HRA
Stays with the employer
Which of the following types of insurers is owned by stockholders
Stock
Which of the following terms describes the specified dollar amount beyond which the insured no longer participates in the sharing of the expenses
Stop-loss limit
Which of the following groups would most likely be covered under a blanket accident policy
Students at a public school
Health plan issuers are prevented from collecting genetic information for underwriting purposes or limited in their requests for genetic tests by
The Genetic information and nondiscrimination act
If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?
The balance of the loan will be taken out of the death benefit
How will a life insurance beneficiary designation naming a spouse be changed by divorce?
The beneficiary designation will be voided
An employer offers group life insurance to its employees for the amount of $10,000. Which of the following is true?
The cost of coverage is a deductible expense by the employer
In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?
The customers associates, friends, and neighbors provide the reports data
Which of the following dates must be contained a policy summary
The date the summary was prepared
Which of the following dates must be contained in the policy summary?
The date the summary was prepared
If an insured withdraws a portion of the face amount in the form of accelerated benefits because of a terminal illness, how will that affect the payable death benefit from the policy?
The death benefit will be smaller
Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to
The insured
An insured had $500 left in his Health Reimbursement Account when he quit his job. What happens to that money?
The insured can have access to the $500 at his previous employers discretion
An insured purchased a noncancellable health insurance policy 1 year ago. Which of the following circumstances would NOT be a reason for the insurance company to cancel the policy
The insured is in an accident and incurs a large claim
Insured Z's health insurance policy year begins in January. His policy contains a carry-over provision. In November, he has a small claim which is less than his deductible. Which of the following is true?
The insured may carry over the amount of this years expenses to next year, which will help satisfy next years deductible
Which of the following is correct regarding selecting a primary care physician in a PPO claim
The insured may choose medical providers not found on the preferred list
An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT?
The insured may choose to convert to term or permanent individual coverage
Under a SIMPLE plan, which of the following is TRUE regarding taxation on both contributions and earnings?
They are tax deferred until withdrawn
Which of the following is true regarding taxation of accelerated benefits under a life insurance policy?
They are tax free to terminally ill insured
Which of the following statements is most correct concerning the changing go an irrevocable beneficiary?
They can be changed only with the written consent of that beneficiary
All of the following are requirements for life insurance illustrations EXCEPT
They must be part of the contract
What is the purpose of a disclosure statement in life insurance policies
To explain features and benefits of a proposed policy to the consumer
If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?
Unilateral
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?
Unilateral
What kind of policy allows withdrawals or partial surrenders?
Universal life
Which of the following types of policies allows the policy owner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount
Universal life
All of the following are TRUE regarding the convertibility option under a term insurance policy EXCEPT
Upon conversion, the death benefit of the permanent policy will be reduced by 50%
A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges which fall within the standard range of fees normally charged for a specific procedure by a doctor fo similar training and experience in that geographic area is known as
Usual, customary and reasonable
Which of the following products requires a securities license?
Variable annuity
Which of the following types of policies allows for a flexible premium and a variable investment component
Variable universal life insurance
Manny has been injured in an accident. Although she is still receiving benefits from her policy, she does not have to pay premiums. Her policy includes
Waiver of Premium rider
Social Security Supplement (SIS) or Social Security Riders would provide for the payment of income benefits in each of the situations below EXCEPT
When the amount payable under Social Security is more than the amount payable under the rider
When is the earliest a policy may go into effect?
When the application is signed and a check is given to the agent
Under what condition are group disability income benefits received by an employee NOT taxable as income?
When the benefits received are equal or less than the employees percentage of the contribution
The main difference between immediate and deferred annuities is
When the income payments begin
When would a 20-pay whole life policy endow
When the insured reaches age 100
How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?
Within 90 days or as soon as reasonably possible, but not to exceed 1 year
Which type of misrepresentation persuades an insured, to his or her detriment, to cancel, lapse, or switch policies from one to another?
twisting
The continuation of coverage provision allows terminated employees to continue coverage under a group health insurance plan for up to
18 months
What is the maximum elimination period in long-term care policies issued in Florida?
180 days
Following hospitalization because of an accident, Bill was confined in a skilled nursing facility. Medicare will pay full benefits in this facility for how many days?
20
In order to maintain an insurance license, an agent licensed for less than 6 years will need to satisfy Floridas continuing education requirement of
24 hours every 2 year period
Relation of Earnings to Insurance provision allows the insurance company to limit the insureds benefit to his/her income over the last
24 months
In this state, long-term care benefits may be triggered by inability to perform how many activities of daily living?
3
In order to qualify for conversion from a group life policy that has been terminated to an individual policy of the same coverage, a person must have been insured under the group plan for how many years?
5
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 days
The inflation protection feature in long-term care policies issued in this state must provide protection at what percent annually
5%
An insured decides to surrender his $100,000 Whole Life policy. The premiums paid into the policy added up to $15,000. At policy surrender, the cash surrender value was $18,000. What part of the surrender value would be income taxable?
$3000
An insured under a group health plan has a dependent child who has an intellectual disability. When the child was enrolled in the insureds policy, the insurer offered coverage at a much higher rate than for other dependents. Which of the following is true?
This is considered an illegal discrimination
Coverage of a newborn includes all of the following EXCEPT
Transportation costs of up to $3000 if medically necessary
An agent has been convicted of a crime punishable by a 1-year imprisonment. Within how many days must the agent notify the department of insurance?
30 days
All of the following are duties and responsibilities of producers at the time of the application EXCEPT
Change any incorrect statements on the application by personally initialing next to the correct statement
In a disability policy, the probationary period refers to the time
During which illness-related disabilities are excluded from coverage
