Life & Health Exam Questions
Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member? A) Spouse rider B) Children's rider C) Additional insured rider D) Family term rider
D) Family term rider
A noncontributory group disability income plan has a 30-day elimination period and offers benefits of $2,000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive A) $12,000, all of which is taxable. B) $14,000, none of which is taxable. C) $14,000, all of which is taxable. D) $12,000, none of which is taxable.
A) $12,000, all of which is taxable.
Which of the following groups would probably be covered by blanket insurance? A) A university's sports team B) A large family C) A publishing company D) People who obtain temporary insurance
A) A university's sports team
In a group policy, who is issued a certificate of insurance? A) The individual insured B) The health care provider C) The insurance company D) The employer
A) The individual insured
The validity of coverage under a life insurance policy may not be contested, except for nonpayment of premium, after the policy has been in force for at least how many years? A) 1 year B) 2 years C) 5 years D) 7 years
B) 2 years
Under an extended term nonforfeiture option, the policy cash value is converted to A) A higher face amount than the whole life policy. B) The same face amount as in the whole life policy. C) The face amount equal to the cash value. D) A lower face amount than the whole life policy.
B) The same face amount as in the whole life policy.
In group insurance, what is the policy called? A) Certificate of insurance B) Master policy C) Entire contract D) Certificate of authority
B) Master policy
Which of the following entities has the power to issue a cease and desist order? A) The Guaranty Association B) The Commissioner C) The state police D) The NAIC
B) The Commissioner
A group blanket health policy is best suited for which of the following? A) A large family B) A summer camp C) A small employer D) A manufacturer
B) A summer camp
Mortality - Interest + Expense = A) Benefits budget B) Operating expenses C) Net premium D) Gross premium
D) Gross premium
COBRA applies to employers with at least A) 60 employees B) 50 employees C) 20 employees. D) 80 employees.
C) 20 employees.
How many pints of blood will be paid for Medicare Supplement core benefits? A) None; Medicare pays for it all B) Everything after first 3 C) 1 pint D) First 3
D) First 3
In a group policy, the contract is between A) The individual and the insurance company. B) The employer and the union. C) The employee and the employer. D) The employer and the insurance company.
D) The employer and the insurance company.
When a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit? A) The insurance company B) The insured's estate C) The primary beneficiary's estate D) The insured's contingent beneficiary
D) The insured's contingent beneficiary
If an insurance company wishes to order a consumer report on an applicant to assist in the underwriting process, and if a notice of insurance information practices has been provided, the report may contain all of the following information EXCEPT the applicant's A) Habits. B) Prior insurance. C) Ancestry. D) Credit history.
C) Ancestry
Evaluating information that establishes adverse selection risk is the purpose of which stage of insurance? A) Contract Review B) Application C) Underwriting D) Contract negotiation
C) Underwriting
Who can provide skilled nursing care? A) Spouse B) Family Member C) Community volunteer D) Doctor
D) Doctor
All of the following statements concerning dividends are true EXCEPT A) Dividend amounts are guaranteed in the policy. B) Lower insurance company costs generate higher dividends. C) They stem from favorable underwriting experience. D) Favorable investment results generate higher dividends.
A) Dividend amounts are guaranteed in the policy.
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 A) Guaranteed insurability. B) Waiver of cost of insurance. C) Accelerated benefits. D) Cost of living.
A) Guaranteed insurability.
Which of the following is true regarding a single life settlement option? A) It provides income the beneficiary cannot outlive B) Payments continue until the entire principal is exhausted. C) Proceeds are paid out in a lump sum. D) It provides income for a specified period of time.
A) It provides income the beneficiary cannot outlive.
A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this? A) Level term B) Term to specified age C) Ordinary life policy D) Limited pay whole life
A) Level term
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
Which o the following are the authorities that an agent can hold? A) Authorized & Admitted B) Primary & Secondary C) Express & Implied D) Apparent & Allowed
C) Express & Implied
Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium? A) Extended term B) Reinstatement C) Reduce paid-up option D) Automatic premium loan
D) Automatic premium loan
Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured? A) Corridor option B) Variable option C) Option A D) Option B
D) Option B
The Waiver of Cost of Insurance rider is found in what type of insurance? A) Whole Life B) Joint and Survivor C) Juvenile Life D) Universal Life
D) Universal Life
An annuity owner is funding an annuity that will supplement her retirement. Because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the Standard and Poor's 500 Index. She would likely purchase a(n) A) Equity Indexed Annuity B) Variable Annuity C) Flexible Annuity D) Immediate Annuity
A) Equity Indexed Annuity
The Ownership provision entitles the policyowner to do all of the following EXCEPT A) Set premium rates. B) Receive a policy loan. C) Assign the policy. D) Designate a beneficiary.
A) Set premium rates
Which of the following types of risk will result in the highest premium? A) Substandard risk B) Standard risk C) Preferred risk D) All risks pay equal premiums
A) Substandard risk
All of the following actions by a person could be described as risk avoidance EXCEPT A) Never flying in an airplane B) Not driving after being in an accident C) Investing in the stock market D) Refusing to scuba dive
C) Investing in the stock market
All of the following are requirements of eligibility for Social Security disability income benefits EXCEPT A) Fully insured status. B) Waiting period of 5 months. C) Being age 65. D) Inability to perform any gainful work.
C) Being age 65.
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) Claims incurred before cancellation must be honored. B) An insurance company may cancel the policy at any time. C) Unearned premiums are retained by the insurance company. D) The insurer must provide the insured a written notice of the cancellation.
C) Unearned premiums are retained by the insurance company.
Social Security was created to provide all of the following benefits EXCEPT A) Disability income. B) Retirement income. C) Unemployment income. D) Survivor's benefits
C) Unemployment income.
If a resident producer or solicitor has a change of residential or business address, how soon must the licensee notify the Commissioner? A) As soon as possible B) Within 15 days C) Within 30 days D) At license renewal
C) Within 30 days
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? A) $50,000 B) $18,000 C) $15,000 D) $3,000
D) $3,000
Which of the following answers does NOT describe the principal goal of a Preferred Provider Organization? A) Provide medical services at a reduced cost B) Provide medical services only from physicians in the network C) Provide the subscriber a choice of physicians D) Provide the subscriber a choice of hospitals
B) Provide medical services only from physicians in the network
Which of the following is NOT covered under Plan A in Medigap insurance? A) The first three pints of blood each year B) The Medicare Part A deductible C) Approved hospital costs for 365 additional days after Medicare benefits D) The 20% Part B coinsurance amounts for Medicare approved services.
B) The Medicare Part A deductible
An employee insured under a group health is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true? A) The group plan will pay depending on the employee's recovery. B) The group plan will not pay because the employee was injured at work. C) The group plan will pay. D) The group plan will pay a portion of the employee's expenses.
B) The group plan will not pay because the employee was injured at work.
How does a member of an HMO see a specialist? A) The member is allowed to choose his or her own specialist. B) The primary care physician refers the member. C) The insurer chooses the specialist. D) HMOs do not cover specialists.
B) The primary care physician refers the member.
What is the main justification for the existence of the State Insurance Department? A) To protect the State from harmful practices of companies and producers B) To protect the public C) To protect companies from malicious law suits D) To protect producers rom the National Association of Insurance Commission
B) To protect the public
An agent is completing an application for a long-term care policy. The agent is required to do all of the following EXCEPT A) Ask where the applicant has another LTC policy in force. B) Warn the applicant about the 10-day free-look period. C) Make sure the policy is appropriate for the applicant's needs. D) Provide the applicant with the Outline of Coverage.
B) Warn the applicant about the 10-day free-look period.
All of the following are true of the Key Person disability income policy EXCEPT A) It is typically written to protect the company in the event a key employee becomes disabled and is unable to work. B) The income may be used to find a replacement for the key employee. C) Benefits are considered taxable income to the business. D) Premiums are not deductible to the business.
C) Benefits are considered taxable income to the business.
After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true? A) The employee can convert from group to individual insurance within 31 days of termination. B) The premium of the individual health insurance policy can be higher than the original policy. C) By law, the new, individual policy must provide the same benefits as the group insurance policy. D) Continuation of group coverage need not include dental, vision, or prescription drug benefits.
C) By law, the new, individual policy must provide the same benefits as the group insurance policy.
A man is injured while robbing a convenience store. How does his major medical policy handle the payment of his claim? A) If the man is not convicted, he will get 75% of his claim paid. B) The claim is paid in full. C) Claim is denied if his policy contains the Illegal Occupation Provision. D) 50% of claim will be paid.
C) Claim is denied if his policy contains the Illegal Occupation Provision.
If an insured changes his payment plan from monthly to annually, what happens to the total premium? A) Doubles B) Increases C) Decreases D) Stays the same
C) Decreases
Which of the following is NOT a metal level of coverage offered under the Patient Protection and Affordable Care Act? A) Silver B) Bronze C) Iron D) Gold
C) Iron
Who is involved in completing the agent's report? A) Only the underwriter, if no agent B) Attending physician and the agent C) Only the agent D) The agent and the applicant
C) Only the agent
Which of the following describes taxation of individual disability income insurance premiums and benefits? A) Premiums are tax deductible, but benefits are not taxable. B) Premiums are tax deductible, and benefits are taxable. C) Premiums are not tax deductible, and benefits are not taxable. D) Premiums are not tax deductible, but benefits are taxable.
C) Premiums are not tax deductible, and benefits are not taxable.
When an employee is still employed upon reaching age 65 and eligible for Medicare, which of the following is the employee's option? A) Enroll in Medicare when eligible; otherwise, Medicare benefits will be forfeited. B) Wait until the next birthday to enroll C) Remain on the group health insurance plan and defer eligibility for Medicare until retirement D) Enroll in Medicare, while the company must provide additional retirement benefits.
C) Remain on the group health insurance plan and defer eligibility for Medicare until retirement
Which of the following dental insurance categories would cover the filling of cavities? A) This type of work is not covered. B) Routine and preventative maintenance C) Routine and major restorative care D) Orthodontic care
C) Routine and major restorative care
Which of the following statements concerning a Simplified Employee Pension plan (SEP) is INCORRECT? A) SEPs have a higher tax deductible contribution limit than an IRA. B) Employer contributions are not included in the employee's gross income. C) SEPs are suitable for large companies. D) SEPs allow the employer to make annual tax deductible contributions up to 25% of an employee's earned income.
C) SEPs are suitable for large companies.
A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim, A) The insurance plans will split the coverage evenly. B) Both plans will pay the full amount of the claim. C) The insurance through his company is primary. D) The insurance through his wife's company is primary.
C) The insurance through his company is primary.
Who is the beneficiary in a credit disability income policy? A) The estate of the borrower B) The Federal Government C) The lending institution D) The insurer
C) The lending institution
What is the purpose of the rehabilitation benefit in disability insurance? A) To refund the insured's premium paid during the disability B) To help the insured recover from a disability C) To cover the expenses of retaining the insured to return to work D) To compensate the insured for the lost income
C) To cover the expenses of retaining the insured to return to work
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued? A) Deny any claims and cancel the policy B) Deny paying a claim based on misrepresentation C) Pay the full amount of a claim because the contestable period has ended D) Adjust the claim benefit to reflect the insured's true age
D) Adjust the claim benefit to reflect the insured's true age
In reference to the standard Medicare Supplement benefits plans, what does the term standard mean? A) Coverage options and conditions comply with the law, but will vary from provider to provider. B) All plans must include basic benefits A-N. C) Coverage options and conditions are developed for average individuals. D) All providers will have the same coverage options and conditions for each plan.
D) All providers will have the same coverage options and conditions for each plan.
An insured is the recipient of an Accidental Death and Dismemberment (AD&D) policy purchased by his employer. The policy pays triple indemnity in case of accidental death. If the insured died as a result of an accident stipulated in the policy, how will the benefits paid be taxed? A) Benefits received will be taxed as capital losses. B) No taxes will be taken because no benefits will be paid. C) Benefits will be taxed as ordinary income. D) Benefits received are considered income tax free.
D) Benefits received are considered income tax free.
To be eligible for tax credits under the ACA, individuals must have income that is what percent of the Federal Poverty Level? A) Higher than 300% B) Less than 10% C) Between 10% and 100% D) Between 100% and 400%
D) Between 100% and 400%
When an insurer offers services like preadmission testing, second opinions regarding surgery, and preventative care, which term would best apply? A) Cost reduction B) Claims reduction C) Claims discrimination D) Case management provision
D) Case management provision
According to agency law, the producer always represents the A) Client. B) Public. C) State Insurance Department. D) Insurance company.
D) Insurance company.
When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income? A) Both principal and interest B) Neither principal nor interest C) Principal only D) Interest only
D) Interest only
Which of the following is true regarding a term health policy? A) It is conditionally renewable. B) It is guaranteed renewable. C) It is noncancelable. D) It is nonrenewable.
D) It is nonrenewable.
Which of the following statements is NOT correct concerning the COBRA Act of 1985? A) It covers terminated employees and/or their dependents for up to 36 months after a qualifying events. B) It applies only to employers with 20 or more employees that maintain group health insurance plans for employees/ C) COBRA stands for Consolidated Omnibus Budget Reconciliation Act D) It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.
D) It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.
Under the Affordable Care Act, which classification applies to health plans based on the amount of covered costs? A) Guaranteed and nonguaranteed B) Grandfathered and nongrandfathered C) Risk classification D) Metal level classification
D) Metal level classification
Which of the following statements is INCORRECT concerning Medicare Part B coverage? A) Participants under Part B are responsible for an annual deductible. B) Part B will pay 80% of covered expenses, subject to Medicare's standards for reasonable charges. C) It is a voluntary program designed to provide supplementary medical insurance to cover physician services, medical services and supplies not covered under Part A D) Part B coverage is provided free of charge when an individual turns age 65.
D) Part B coverage is provided free of charge when an individual turns age
Which of the following applies to partial disability benefits? A) An insured is entitled to a principal sum benefit for the partial loss of a limb. B) Payment is based on termination of employment. C) Benefits are reduced once an insured is no longer under a doctor's care. D) Payment is limited to a certain period of time.
D) Payment is limited to a certain period of time.
Which of the following provisions is mandatory for health insurance policies? A) Recurrent disability B) Unpaid premiums C) Intoxicants and narcotics D) Physical examination and autopsy
D) Physical examination and autopsy
If an individual is covered by a policy that includes an Accidental Death & Dismemberment rider, what term describes the maximum benefits he will receive if he loses right in both eyes as a result of a fire? A) Reciprocal amount B) Capital sum C) Percentage of full amount D) Principal sum
D) Principal sum
Which of the following is NOT true regarding Equity Indexed Annuities? A) The insurance company keeps a percentage of the returns. B) They have guaranteed minimum interest rates. C) They are less risky than variable annuities. D) They earn lower interest rates than fixed annuities.
D) They earn lower interest rates than fixed annuities.
A health insurance policy may cover all of the following risks EXCEPT A) Dental expenses B) Loss of income due to disability C) Medical expenses D) War-related injuries
D) War-related injuries
Which of the following is NOT covered by Medicare? A) Cosmetic surgery B) Outpatient expenses C) Surgery D) Doctor bills
A) Cosmetic surgery
A Louisiana insurance company ran an advertisement in June 2008. When could the company discard the file on this advertisement? A) June 2012 B) June 2013 C) June 2009 D) June 2011
A) June 2012
Installing deadbolt locks on the doors of a home in an example of which method of handling risk? A) Reduction B) Avoidance C) Transfer D) Self-insurance
A) Reduction
If a telemarketer wants to make an unsolicited sales call to a potential customer, what is the earliest time the telemarketer can call the prospect's residence? A) 7 am B) 8 am C) 9 am D) Noon
B) 8 am
Which of the following named beneficiaries would NOT be able to receive the death benefit directly from the insurer in the event of the insureds' death? A) The former wife of the deceased insured B) A minor son of the insured C) A business partner of the insured D) The wife of the deceased insured
B) A minor son of the insured
In a group health policy, a probationary period is intended for people who A) Want lower premiums. B) Join the group after the effective date C) Have a pre-existing condition at the time they join the group D) Have additional coverage through a spouse
B) Join the group after the effective date
If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this? A) Single premium policy B) Jumping juvenile policy C) Limited pay whole life policy D) Modified life insurance policy
B) Jumping juvenile policy
All of the following statements describe a MEWA EXCEPT A) MEWAs can be self-insured. B) MEWAs are group of at least 3 employers. C) MEWAs can be sponsored by insurance companies. D) MEWA employers retain full responsibility for any unpaid claims.
B) MEWAs are groups of at least 3 employers.
A 55-year-old employee has worked part-time for his new employer for 3 months now, but has not been offered health insurance. What factor has limited the employee's eligibility? A) Income B) Numbers of hours worked per week C) The total amount of time worked for the company D) Age
B) Numbers of hours worked per week
Which renewability provision allows an insurer to terminate a policy for any reason, and to increase the premiums for any class of insureds? A) Guaranteed renewable B) Optionally renewable C) Conditionally renewable D) Cancellable
B) Optionally renewable
With respect to the Consideration Clause, which of the following would be considered consideration on the part of the applicant for insurance? A) Notice of policy cancellation B) Payment of premium C) Promise to renew the policy at the end of the policy period D) Providing warranties on the application
B) Payment of premium
Regarding the taxation of Business Overhead policies, A) Premiums are not deductible, but expenses paid are deductible. B) Premiums are deductible, and benefits are taxed. C) Premiums are not deductible, and benefits are taxed. D) Premiums are not deductible, but benefits are deductible.
B) Premiums are deductible, and benefits are taxed.
All of the following are characteristics of group life insurance EXCEPT A) Certificate holders may convert coverage to an individual policy without evidence of insurability. B) Premiums are determined by the age, sex and occupation of each individual certificate holder. C) Amount of coverage is determined according to nondiscriminatory rules. D) Individuals covered under the policy receive a certificate of insurance.
B) Premiums are determined by the age, sex and occupation of each individual certificate holder.
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 permanent insurance in the new future. Which of the following will she need to provide for proof of insurability? A) Medical exam and parents' medical history B) Proof of insurability is not required. C) Medical exam D) Her parents' federal income tax receipts
B) Proof of insurability is not required.
Health insurance underwriting is best defined as A) Reporting and rejection of risks. B) Selection, classification, and rating of risks. C) Transacting of insurance. D) Issuance of policies.
B) Selection, classification, and rating of risks.
An insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured's age 100 is called A) Graded premium whole life. B) Single premium whole life. C) Modified Endowment Contract (MEC). D) Level term life.
B) Single premium whole life.
An insured stops making payments on a loan taken from his cash value policy. What will most likely happen? A) The policy will be reduced to an extended term option. B) The policy will terminate when the loan amount with interest equals or exceed the cash value. C) The insurer will increase the interest rate on the loan and charge a penalty. D) The insurer will not permit the policyowner to take out any more loans.
B) The policy will terminate when the loan amount with interest equals or exceeds the cash value.
What type of group rating uses the actual experience of the group as a factor in developing the rates to be charged? A) Community rating B) Individual rating C) Experience rating D) District rating
C) Experience rating
What required provision protects against unintentional lapse of the policy? A) Payment of premiums B) Reinstatement C) Grace period D) Assignment
C) Grace period
What describes the specific information about a policy? A) Buyer's guide B) Producer's report C) Policy summary D) Illustrations
C) Policy summary
Which of the following is NOT the purpose of HIPAA? A) To prohibit discrimination against employees based on their health status B) To limit exclusions for pre-existing conditions C) To provide immediate coverage to new employees who had been previously covered for 18 months D) To guarantee the right to buy individual policies to eligible individuals
C) To provide immediate coverage to new employees who had been previously covered for 18 months
When an employee terminates coverage under a group insurance policy, coverage continues in force A) For 60 days. B) Until the employee can obtain coverage under a new group plan. C) Until the employee notifies the group insurance provider that coverage conversion policy is issued. D) For 31 days.
D) For 31 days.
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? A) Installments for a fixed amount B) Installment refund C) Cash refund D) Installments for a fixed period
D) Installments for a fixed period
An insured is dissatisfied with her insurance policy and wants to negotiate certain provisions of the contract. What entity would her producer represent? A) The Commissioner of Insurance B) The government C) The insured D) The insurer
D) The insurer
If a company has a Simplified Employee Pension plan, what type of plan is it? A) A qualified plan for a small business B) The same as a 401(k) plan C) The same as an IRA, with the same contribution limits D) An undefined contribution plan for large business
A) A qualified plan for a small business
Under which condition would an employee's group medical benefits be exempt from income taxes? A) An employee's group medical benefits are generally exempt from taxation as income. B) An employee's group medical benefits are never exempt from taxation as income. C) When the premiums and other unreimbursed medical expenses exceed 5% of the employee's adjusted gross income. D) When the premiums and other unreimbursed medical expenses exceed 10% of the employee's adjusted gross income.
A) An employee's group medical benefits are generally exempt from taxation as income.
A 70-year-old individual who bought a Part B Medicare policy 2 months ago just began kidney treatments this week. The individual is now applying for a Medicare supplement policy, which would begin in 8 months. Which of the following following could the insurer do to avoid paying for the dialysis? A) Declare a pre-existing condition B) Permanently exclude coverage for dialysis C) Deny the supplement policy D) Charge a higher premium
A) Declare a pre-existing condition
As deductible amounts increase, premium amounts change in what way? A) Decrease B) Increase C) Remain the same. Changes in premium amounts do not affect deductible amounts. D) Either increase or decrease.
A) Decrease
Which of the following statements about occupational vs. nonoccupational coverage is TRUE? A) Disability insurance can be written as occupational or nonoccupational. B) Group medical expense policies and individual medical expense policies always cover both occupational and nonoccupational injuries. C) Individual disability policies never cover nonoccupational injuries. D) Only group disability income policies can be written on an occupational basis.
A) Disability insurance can be written as occupational or nonoccupational.
All of the following are true regarding the Medical Information Bureau (MIB) EXCEPT A) MIB reports are based upon information supplied by doctors and hospitals. B) MIB information is reported to underwriters in coded form. C) MIB reports contain previous insurance information. D) Insurers may not refuse to accept an application solely due to information in an MIB report.
A) MIB reports are based upon information supplied by doctors and hospitals.
What is the major difference between a stock company and a mutual company? A) Ownership B) Amount of benefits C) Numbers of producers D) Types of policies issued
A) Ownership
What type of information is NOT included in a certificate of insurance? A) The cost the company is paying for monthly premiums B) The policy benefits and exclusions C) The procedures for filing a claim D) The length of coverage
A) The cost the company is paying for monthly premiums
What phase begins after a new policy is delivered? A) Grace period B) Free-look period C) Insurability period D) Elimination period
B) Free-look period
The section of a health policy that states the causes of eligible loss under which an insured is assumed to be disabled is the A) Probationary period B) Insuring clause C) Incontestability clause D) Consideration clause
B) Insuring clause
Which of the following is TRUE of a qualified plan? A) It may allow unlimited contributions. B) It has a tax benefit for both employer and employee. C) It does not need to have a vesting schedule. D) It may discriminate in favor of highly paid employees.
B) It has a tax benefit for both employer and employee.
A 60-year-old participant in a 401(k) plan takes a distribution and rolls it over to an IRA within 60 days. Which of the following is true? A) The amount distributed is subject to ordinary income tax. B) The amount of the distribution is reduced by the amount of a 20% withholding tax. C) No taxes are due since the plan participant is over age 59 1/2. D) There is a 10% early withdrawal penalty.
B) The amount of the distribution is reduced by the amount of a 20% withholding tax.
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.
Which of the following is an eligibility requirement for all Social Security Disability Income benefits? A) Have permanent kidney failure B) Be at least age 50 C) Have attained fully insured status D) Be disabled for at least 1 year
C) Have attained fully insured status
When is the earliest a policy may go into effect? A) When the insurer approves the application B) After the underwriter reviews the policy C) When the application is signed and a check is given to the agent D) When the first premium is paid and the policy has been delivered
C) When the application is signed and a check is given to the agent.
An insured's disability income policy includes an additional monthly benefit rider. For how many years can the insured expect to receive payment from the insurer before Social Security benefits begin? A) 5 B) 3 C) 2 D) 1
D) 1
When an annuity is written, whose life expectancy is taken into account? A) Beneficiary B) Life expectancy is not a factor when writings an annuity. C) Owner D) Annuitant
D) Annuitant
Which of the following would NOT be an underwriting consideration for a health insurance applicant? A) Applicant's personal habits B) Applicant's medical history C) Applicant's credit rating D) Applicant's sexual orientation
D) Applicant's sexual orientation
Which of the following would NOT be used in preventive care? A) Pap smear B) Annual physical exam C) Mammogram D) Chemotherapy
D) Chemotherapy
Which of the following terms describe a specific dollar amount of the cost of care that must be paid by the member? A) Cost share B) Prepayment C) Contractual cost D) Copayment
D) Copayment
What is an important feature of a dental expense insurance plan that is NOT typically found in a medical expense insurance plan? A) A broad coverage area B) A low monthly premium C) Low cost deductibles D) Diagnostic and preventive care
D) Diagnostic and preventive care
When twin brothers applied for life insurance form Company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered A) Twisting. B) Controlled business. C) Adverse selection. D) Discrimination.
D) Discrimination
Which of the following statements is most correct concerning the changing of an irrevocable beneficiary? A) They may be changed at any time. B) They can never be changed. C) They may be changed only on the anniversary date of the policy. D) They can be changed only with the written consent of that beneficiary.
D) They can be changed only with the written consent of that beneficiary.
In an annuity, the accumulated money is converted into a stream of income during which time period? A) Annuitization period B) Payment period C) Amortization period D) Conversion period
A) Annuitization period
What does "level" refer to in level term insurance? A) Cash value B) Interest rate C) Face amount D) Premium
C) Face amount
Which Universal Life option has a gradually increasing cash value and a level death benefit? A) Term insurance B) Option B C) Option A D) Juvenile life
C) Option A
Which of the following individuals is eligible for a Health Savings Account? A) Allison is insured by a High Deductible Health Plan (HDHP) B) Margaret is 68 years old C) Suzie is a dependent on her parent's tax returns D) Tomas is insured by a Low Deductible Health Plan (LDHP)
A) Allison is insured by a High Deductible Health Plan (HDHP)
To comply with Fair Credit Reporting Act, when must a producer notify an applicant that a credit report may be requested? A) At the time of application B) When the applicant's credit is checked C) When the policy is delivered D) At the initial interview
A) At the time of application
Which of the following statements regarding Business Overhead Expense policies is NOT true? A) Benefits are usually limited to six months. B) Premiums paid for BOE are tax-deductible. C) Any benefits received are taxable to the business. D) Leased equipment expenses are covered by the plan.
A) Benefits are usually limited to six months.
A business wants to make sure that if a key employee becomes disabled, the business will be protect from any resulting loss. Which kind of insurance will protect the business A) Business Disability B) Individual Disability C) Management Loss D) Business Loss
A) Business Disability
In disability income insurance, the time between the onset of an injury or sickness and when benefits begin is known as the A) Elimination period B) Qualification period C) Enrollment period D) Probationary period
A) Elimination period
Under the Privacy Rule for HIPAA, protected information includes all individually identifiable health information A) Held or transmitted in any form. B) Transmitted electronically only. C) Held in a computer format. D) Held or transmitted in paper form.
A) Held or transmitted in any form.
Which of the following types of LTC is NOT provided in an institutional setting? A) Home health care B) Custodial care C) Skilled nursing care D) Intermediate care
A) Home health care
Which of the following programs is made up of 4 parts, where the first part is paid for by FICA, and the second part if financed by premiums and payroll taxes? A) Medicare B) Blue Cross C) Blue Shield D) Medicaid
A) Medicare
A policy with a 31-day grace period implies A) The policy remains in force without penalty for 31 days even though the premium due has not been paid. B) The policyholder has a 31-day free look. C) The policy lapses if premium is not paid 31 days before it is due. D) If something happens within 31 days the insurer does not pay.
A) The policy remains in force without penalty for 31 days even though the premium due has not been paid.
Which of the following is true regarding METs? A) They allow several small employers purchase less expensive insurance together. B) They make deals with local hospitals to provide low cost coverage to the needy. C) They provide insurance for larger corporations. D) They provide insurance companies with medical information on applicants.
A) They allow several small employers purchase less expensive insurance together.
In order to collect Social Security disability benefits, the claimant must be able to demonstrate that the disability will last at least A) For life. B) 12 months. C) 24 months. D) Until age 65.
B) 12 months.
What is the maximum amount of time that could pass before an insurer's financial stability would be examined? A) 4 years B) 5 years C) 10 years D) 15 years
B) 5 years
The First Street Church plans to sponsor a summer camp for the youth of their congregation. They would like to purchase insurance that would pay benefits should one of the youth get injured while participating in the camp activities. The type of policy they would likely need is a/an A) Limited Accident B) Blanket C) Limited Sickness D) Accidental Death and Dismemberment.
B) Blanket
Which of the following would describe a legal document which would dictate who can buy a deceased partner's share of a business and for what amount? A) Split dollar agreement B) Buy-sell agreement C) Profit and loss agreement D) Key person agreement
B) Buy-sell agreement
Prior to issuance of a Long-Term Care policy to an applicant age 80 or older, the insurer must obtain all of the following EXCEPT A) Copies of medical records B) Date of previous doctor visit. C) Report of a physical examination or assessment of functional capacity. D) Attending physician's report.
B) Date of previous doctor visit.
When must an IRA be completely distributed when a beneficiary is not named? A) Due date of the deceased owner's final tax return including extensions. B) December 31 of the year that contains the fifth anniversary of the owner's death. C) Due date of beneficiary's tax return including extensions. D) December 31 of the year following the year of the owner's death.
B) December 31 of the year that contains the fifth anniversary of the owner's death.
Which of the following is correct concerning the taxation of premiums in a key-person life insurance policy? A) Premiums are taxable to the employee. B) Premiums are not a tax deductible as a business expense. C) Premiums are tax deductible by the key employee. D) Premiums are tax deductible as a business expense.
B) Premiums are not a tax deductible as a business expense.
An employee quits her job where she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a Traditional IRA, how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer? A) $8,000, no tax consequence B) $8,000, tax on growth only C) $10,000, tax on growth only D) $10,000, no tax consequence
D) $10,000, no tax consequence
S is a sole business proprietor who owns a medical expense plan. What percentage of the cost of the plan may he deduct? A) 25% B) 50% C) 75% D) 100%
D) 100%
A temporary license is only good for A) 30 days. B) 60 days. C) 90 days. D) 180 days.
D) 180 days.
If authorized to write life and property and casualty insurance, how many hours of continuing education instruction are producers required to complete every 2 years? A) 10 B) 12 C) 14 D) 24
D) 24
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective? A) As of the policy delivery date B) As of the first of the month after the policy issue C) As of the policy issue date D) As of the application date
D) As of the application date
The provision that states that both the printed contract and a copy of the application form the contract between the policyowner and the insurer is called the A) Certificate of insurance B) Aleatory contract C) Master policy D) Entire contract
D) Entire Contract
Which of the following statements is correct concerning taxation of long-term care insurance? A) Benefits may be taxable as ordinary income. B) Premiums may be taxable as income. C) Premiums are not deductible in any case. D) Excessive benefits may be taxable.
D) Excessive benefits may be taxable.
Which of the following statements is CORRECT concerning the relationship between Medicare and HMOs? A) HMOs do not pay for services covered by Medicare. B) Medicare Advantage is Medicare provided by an approved HMO only. C) All HMOs and PPOs charge premiums beyond what is paid by Medicare. D) HMOs may pay for services not covered by Medicare.
D) HMOs may pay for services not covered by Medicare.
An association could buy group insurance for its members if it meets all of the following requirements EXCEPT A) Has a constitution and by-laws. B) Holds annual meetings. C) Is contributory. D) Has at least 50 members.
D) Has at least 50 members.
Annuities can be used to fund which of the following? A) Variable life insurance B) Group life insurance C) Estate creation D) Retirement plans
D) Retirement plans
When an employer offers to give an employee a wage increase in the amount of the premium on a new life insurance policy, this is called a(n) A) Executive bonus. B) Key person policy. C) Fraternal association. D) Aleatory contract.
A) Executive bonus.
What happens when a policy is surrendered for its cash value? A) The policy can be reinstated by paying back all policy loans and premiums. B) The policy can be converted to term coverage. C) Coverage ends and the policy cannot be reinstated. D) Coverage ends but the policy can be reinstated at any time.
C) Coverage ends and the policy cannot be reinstated.
Which of the following is NOT an example of a business use of Life Insurance? A) Executive Bonuses B) Key Person C) Workers Compensation D) Buy-selling Funding
C) Workers Compensation
Which of the following statements is TRUE concerning the Accidental Death Rider? A) It is also known as a triple indemnity rider. B) This rider is only available to insureds over the age of 65. C) It is only available in group insurance. D) It will pay double or triple the face amount.
D) It will pay double or triple the face amount.
A policyowner is reading a statement on the first page of his health insurance policy, which says "this is a limited policy". What is the name of this statement? A) Policy Limitation Notice B) Statute of Limitations C) Limited Benefit Statement D) Limited Policy Notice
D) Limited Policy Notice
All other factors being equal, which of the following individuals would receive the largest monthly check from a single premium straight life immediate annuity? A) A 60-year-old man B) A 60-year-old woman C) A 50-year-old man D) A 50-year-old woman
A) A 60-year-old man
What limits the amount that a policyowner may borrow from a whole life insurance policy? A) Cash value B) Premiums paid C) Amount stated in the policy D) Face amount
A) Cash value
The type of settlement option which pays throughout the lifetimes of two or more beneficiaries is called A) Joint and survivor. B) Fixed period. C) Fixed amount. D) Joint life.
A) Joint and survivor.
All of the following are true regarding a decreasing term policy EXCEPT A) The payable premium amount steadily declines throughout the duration of the contract. B) The death benefit is $0 at the end of the policy term. C) The contract pays only in the event of death during the term and there is no cash value. D) The face amount steadily declines throughout the duration of the contract.
A) The payable premium amount steadily declines throughout the duration of the contract
All of the following are true of key person insurance EXCEPT A) The plan is funded by permanent insurance only. B) There is no limitation on the number of key employee plans in force at any one time. C) The employer is the owner, payor and beneficiary of the policy. D) The key employee is the insured.
A) The plan is funded by permanent insurance only.
When would a 20-pay whole life policy endow? A) When the insured reaches age 100 B) At the insured's age 65 C) After 20 payments D) In 20 years
A) When the insured reaches age 100
In terms of Social Security, what is the name for the time period after the youngest child of a family turns 16 and before the surviving spouse may start receiving retirement benefits? A) Accumulation period B) Blackout period C) Nonpayment interval D) Benefit reduction
B) Blackout period
An annuity purchased with multiple payments that vary from year to year, and the benefit payments begin sometime after one year form the date of purchase is A) Single Premium Immediate Annuity B) Flexible Premium Deferred Annuity C) Flexible Premium Immediate Annuity D) Single Premium Deferred Annuity
B) Flexible Premium Deferred Annuity
Which of the following is true about the premium on the children's rider in a life insurance policy? A) It decreases when an adopted child is added to the policy. B) It remains the same no matter how many children are added to the policy. C) It decreases when the oldest child reaches the age of 21. D) It increases when a newborn baby is added to the policy.
B) It remains the same no matter how many children are added to the policy.
A married couple's retirement annuity pats them $250 per month. The husband dies and his wife continues to receive $125.50 per month for as long as she lives. When the wife dies, payments stop. What settlement option did they select? A) Straight Life B) Joint and Survivor C) Joint Annuity D) Cash Refund Annuity
B) Joint and Survivor
Which of the following is NOT the consideration in a policy? A) The promise to pay covered losses B) The application given to a prospective insured C) Something of value exchanged between parties D) The premium amount paid at the time of application
B) The application given to a prospective insured
Which of the following would NOT fall into the category of costs associated with death? A) Day to day expenses of maintaining the family B) The expense of a vacation for surviving family members C) Funeral expenses D) Final medical expenses of the insured
B) The expense of a vacation for surviving family members
An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT? A) The premium for individual coverage will be based upon the insured's attained age. B) The insured may choose to convert to term or permanent individual coverage. C) The insured would not need to prove insurability for a conversion policy. D) The insured may convert coverage to an individual policy within 31 days.
B) The insured may choose to convert to term or permanent individual coverage.
An individual policy was delivered to the policyowner by an agent in person. Which of the following is true? A) The delivery receipt must be kept on file for 3 years B) The receipt of delivery must contain the policy number and date of delivery. C) The agent must sign the delivery receipt. D) the policy is not considered delivered for 10 more days.
B) The receipt of delivery must contain the policy number and date of delivery.
In forming an insurance contract, when does acceptance usually occur? A) When an insured submits an application B) When an insurer's underwriter approves coverage C) When an insurer delivers the policy D) When an insurer receives an application
B) When an insurer's underwriter approves coverage
If an applicant for a life insurance policy is found to be a substandard risk, the insurance company is most likely to A) Lower its insurability standards. B) Refuse to issue the policy. C) Charge a higher premium. D) Require a yearly medical examination.
C) Charge a higher premium.
All of the following are features and requirements of the Living Needs Rider EXCEPT A) The remainder of the policy proceeds is payable to the beneficiary at the insured's death. B) It provides funds for medical and nursing home expenses to a terminally ill insured. C) Diagnosis must indicate that death is expected within 3 years. D) It is usually available at no additional charge.
C) Diagnosis must indicate that death is expected within 3 years.
Another name for a substandard risk classification is A) Declined. B) Elevated. C) Rated. D) Controlled.
C) Rated.
An individual applies for a life policy. Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. He has also been hospitalized for drug abuse, but does not remember this when applying for insurance. The insurer issues the policy and learns of his history one year later. What will probably happen? A) The insurer will sue the insured for committing fraud. B) Because the insured is currently not a drug user, his policy will not be affected. C) The policy will not be affected. D) The policy will be voided.
C) The policy will not be affected
Which of the following is a key distinction between variable whole life and variable universal life products? A) Variable whole life allows policy loans from the cash value. B) Variable universal life has a fixed premium. C) Variable whole life has a guaranteed death benefit. D) Variable universal life is regulated solely through FINRA.
C) Variable whole life has a guaranteed death benefit.
Which of the following statements is NOT true concerning insurable interest as it applies to life insurance? A) Business partners have an insurable interest in each other. B) A married person has an insurable interest in their spouse. C) An individual has an insurable interest in their own life. D) A debtor has an insurable interest in the life of a lender.
D) A debtor has an insurable interest in the life of a lender.
Under which of the following circumstances would an insurer pay accelerated benefits? A) A couple is nearing retirement and needs a steady stream of income. B) An insured is looking for a way to put her daughter through college. C) A couple wants to build a house and would like to make a larger down payment. D) An insured is diagnosed with cancer and needs help paying for her medical treatment.
D) An insured is diagnosed with cancer and needs help paying for her medical treatment
Which of the following is the basic source of information used by the company in the risk selection process? A) Agent's report B) Warranty C) Consumer report D) Application
D) Application
What happens when a policy is surrendered for its cash value? A) Coverage ends but the policy can be reinstated at any time. B) The policy can be reinstated by paying back all policy loans and premiums. C) The policy can be converted to term coverage. D) Coverage ends and the policy cannot be reinstated.
D) Coverage ends and the policy cannot be reinstated.
If a change needs to be made to the application for insurance, the agent may do all of the following EXCEPT A) Draw a line through the first answer, record the correct answer, and have the applicant initial the change. B) Note on the application the reason for the change. C) Destroy the application and complete a new one. D) Erase the incorrect answer and record the correct answer.
D) Erase the incorrect answer and record the correct answer.
Which of the following ultimately determines the interest rates paid to the owner of a fixed annuity? A) Investment performance of the company B) Investment performance of the insured C) Statewide predetermined annual interest rate D) Insurer's guaranteed minimum rate of interest
D) Insurer's guaranteed minimum rate of interest
Your client uses $50,000 in inheritance money to purchase a single premium immediate annuity. How soon can he begin receiving income payments? A) No sooner than 6 months from the time of purchase B) At age 65 C) After 2 years D) No later than 1 year from the time of purchase
D) No later than 1 year from the time of purchase
An individual buys a flexible premium deferred life annuity with 20 year period certain. What would his beneficiary receive if he died 5 years after beginning the annuity phase? A) Payments for 20 years B) Payments for life C) Nothing D) Payments for 15 years
D) Payments for 15 years
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then A) The benefit is subject to the exclusionary rule. B) IRS has no jurisdiction C) The benefit is received as taxable income. D) The benefit is received tax free.
D) The benefit is received tax free.
In a case where the primary beneficiary predeceases the insured, in the event of the insured's death, the death benefit proceeds will be paid to A) The insured's spouse. B) The policyowner. C) The insurance company. D) The contingent beneficiary.
D) The contingent beneficiary.
Which of the following is TRUE regarding the insurance amount in a credit life policy? A) The creditor may insure the debtor for an unlimited amount of coverage. B) Allowable amount of coverage is determined by the State Insurance Commissioner. C) The amount of coverage can be greater than the amount owed. D) The creditor can only insure the debtor for the amount owed.
D) The creditor can only insure the debtor for the amount owed.
What is the advantage of reinstating a policy instead of applying for a new one? A) Proof of insurability is not required. B) The face amount can be increased. C) The cash values have gained interest while the policy was lapsed. D) The original age is used for premium determination.
D) The original age is used for premium determination.
The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called A) Waiver of premium. B) Guaranteed insurability. C) Waiver of cost of insurance. D) Payor benefit.
Waiver of premium
When J. applied for a life insurance policy, the agent informed him that a medical exam would be required. The exam may be completed by A) A paramedic or examining physician at the insurer's expense. B) The agent. C) A physician of the applicant's choice and at his expense. D) A home office underwriter.
A) A paramedic or examining physician at the insurer's expense.
A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of her life insurance policy has been raised 7$ as a result. Which policy rider caused this change? A) Cost of Living Rider B) Value Adjustment Rider C) Return of Premium Rider D) Inflation Rider
A) Cost of Living Rider
What would be considered a disadvantage of owning a fixed annuity? A) Decrease in purchasing power of the benefit in times of inflation B) Investment risks being carried by the annuity owners C) Interest rate dependence on stock performance D) Guaranteed minimum interest rate
A) Decrease in purchasing power of the benefit in times of inflation
What nonforfeiture option has the highest amount of insurance protection? A) Extended Term B) Conversion C) Decreasing Term D) Reduced Paid-up
A) Extended Term
When a fixed annuity owner pays a monthly annuity premium to the insurance company, where is this money placed? A) The insurance company's general account B) Forwarded to an investor C) Each contract's separate account D) The annuity owner's account
A) The insurance company's general account
Which of the following methods of calculating the amount of life insurance needed takes into account the insured's wages, years until retirement, and inflation? A) Lump-sum approach B) Human life value approach (HLVA) C) Needs approach D) Blackout approach
B) Human life value approach (HLVA)
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
Which of the following is correct regarding credit life insurance? A) It has maximum term of 20 years. B) It insures the life of a debtor. C) It is purchased on an installment basis. D) It insures the life of a creditor.
B) It insures the life of a debtor.
An underwriter is reviewing the medical questions in the application and needs further information due to a medical situation the applicant had in the past. What will the underwriter require? A) Sworn health affidavit from the applicant B) Statement of Continued Good Health C) Attending Physician Statement D) A complete medical record
C) Attending Physician Statement
If an agent fails to obtain the applicant's signature on the application, the agent must A) Sign the application, stating it was by the agent. B) Send the application to the insurer with a note explaining the absence of signature. C) Return the application to the applicant for a signature. D) Sign the application for the applicant.
C) Return the application to the applicant for a signature.
Which is NOT true about beneficiary designations? A) The policy does not have to have a beneficiary named in order to be valid. B) Trusts can be valid beneficiaries. C) The beneficiary must have insurable interest in the insured. D) The beneficiary may be a natural person.
C) The beneficiary must have insurable interest in the insured.
A life insurance policy has a legal purpose if both of which of the following elements exist? A) Offer & Counteroffer B) Policyowners & Named Beneficiaries C) Insurable Interest & Consent D) Underwriting & Reciprocity
C) Insurable Interest & Consent
Which of the following statements regarding HIV testing for life insurance purposes is NOT true? A) The testing practices must meet the criteria of the U.S. Department of Health and Human Services B) HIV testing is regulated at the state level C) Insurers are barred from requesting HIV testing D) Positive test results will be forwarded to the state's Department of Health if a physician is not selected by the applicant
C) Insurer's are barred from requesting HIV testing
An insured has Medicare Part D coverage. Upon reaching the initial benefit limit, what percentage of the prescription drug cost is the insured responsible for paying? A) 15% B) 16% C) 23% D) 25%
D) 25%
The risk management technique that is used to prevent a specific loss by not exposing oneself to the activity is called A) Avoidance B) Transfer C) Reduction D) Sharing
A) Avoidance
Which of the following statements regarding conditional receipts is true? A) They are temporary insuring agreements. B) They guarantee the insurer will approve the application. C) They purchase temporary insurance, up to 6 months. D) They become part of the policy.
A) They are temporary insuring agreements.
Under a credit disability policy, until what point will payments to the creditor be made for the insured? A) Until the disability ends or the debt is satisfied, whichever is sooner B) Only for 6 months after the onset of a disability C) Until the insurer cancels the policy D) Until age 65.
A) Until the disability ends or the debt is satisfied, whichever is sooner
What is the purpose of a conditional receipt? A) It is given only to applicants who fully prepay the premium. B) It is intended to provide coverage on a date prior to the policy issue. C) It guarantees that a policy will be issued in the amount applied for. D) It serves as proof that the applicant has been determined insurable.
B) It is intended to provide coverage on a date prior to the policy issue.
An insured has a major medical policy with a $500 deductible and a coinsurance clause of 80/20. If he incurs medical expenses of $4,000, the insurer would pay A) $3,500 B) $2,500 C) $2,800 D) $3,200
C) $2,800
Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to A) 3 years. B) 5 years. C) 10 years. D) 12 years.
C) 10 years.
An insured was involved in an accident and could not perform her current job 3 years. If the insured could reasonable perform another job utilizing similar skills after 1 month, for how long would the insured be receiving benefits under an "own occupation" disability plan? A) The insured would not receive any benefits. B) 3 years C) 2 years D) 1 month
C) 2 years
The Patient Protection and Affordable Care Act mandates that insurers provide coverage for adult children of the insured up to the age of A) 19 B) 21 C) 26 D) 30
C) 26
What is the duration of the free-look period for Medicare supplement policies? A) 10 days B) 15 days C) 30 days D) 60 days
C) 30 days
Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within A) 30 days of a loss B) 60 days of a loss C) 90 days of a loss D) 20 days of a loss
C) 90 days of a loss
Which of the following features of the Indexed Whole Life policy is NOT fixed? A) Death benefit B) Policy period C) Cash value growth D) Premium
C) Cash value growth
Which of the following includes information regarding a person's credit, character, reputation, and habits? A) Insurability report B) Agent's report C) Consumer report D) Consumer history
C) Consumer report
If an employee terminates her employment, which of the following provisions would all her to continue health coverage under an individual policy, if requested within 31 days? A) Grace period B) Renewability C) Conversion D) Replacement
C) Conversion
All of the following are dividend options EXCEPT A) Reduction of premium. B) Paid-up additions. C) Fixed-period installments. D) Accumulated at interest
C) Fixed-period installments.
Which of the following is a feature of a single premium immediate annuity? A) Income payments start at age 65. B) It is also referred to as a deferred annuity. C) Income payments start within one year. D) It is purchased through periodic payments.
C) Income payments start within one year.
Most agents try to collect the initial premium for submission with the application. When an agent collects the initial premium from the applicant, the agent should issue the applicant a A) Backdated receipt. B) Warranty. C) Premium receipt. D) Statement of good health.
C) Premium receipt.
An underwriter may reject an application for health insurance if the rejection is based upon which of the following? A) Blindness B) Genetic characteristics (Such as sickle cell) C) Prescription usage D) Sexual preference
C) Prescription usage
At what age may an individual make withdrawals from an HSA for nonhealth purposes without being penalized? A) 55 B) 59 1/2 C) 62 D) 65
D) 65
The free-look provision allows for which of the following? A) Immediate coverage when the application is submitted B) A guarantee that the policy will not lapse if the premium is overdue C) A guarantee that the policy will be issued D) A right to return the policy for a full premium refund
D) A right to return the policy for a full premium refund