Practice Exam Missed Questions
What is the period of coverage for events such as death or divorce under COBRA? a) 36 months b) 60 days c) 31 days d) 12 months
A
Under the Accidental Death and Dismemberment (AD&D) coverage, what type of benefit will be paid to the beneficiary in the event of the insured's accidental death? a) Refund of premiums b) Principal sum c) Capital sum d) Double the amount of the death benefit
B
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the a) Juvenile rider b) Payor rider c) Other-insured rider d) Change of insured rider
C
Which of the following types of insurers is owned by stockholders? a) Reciprocal b) Fraternal c) Stock d) Mutual
C
An insurance producer just sold an insurance policy to his sister. What kind of business is this? a) Illegal b) Internal c) Personal d) Controlled
D
A producer is helping a married couple determine the financial needs of their children in the event one or both of them should die prematurely. This is a personal use of the insurance known as a) Survivor protection b) Life planning c) Survivorship insurance d) Juvenile protection
A
A prospective insured receives a conditional receipt but dies before the policy is issued. The insurer will a) Pay the policy only if it would have issued the policy b) Pay the policy proceeds up to an established limit c) Not pay the policy proceeds under any circumstance d) Automatically pay the policy proceeds
A
All of the following statements about Medicare supplement insurance policies are correct EXCEPT a) The cover the cost of extended nursing home care b) They cover Medicare deductibles and copayments c) The supplement Medicare benefits d) They are issued by private insurers
A
All of the following would be excluded from the regulation on life insurance solicitation EXCEPT a) A term life policy b) A credit life policy c) A group life policy d) An annuity
A
Concerning group Medical and Dental insurance, which of the following statements is INCORRECT a) Employee benefits are tax deductible the year in which they were received b) Benefits received by the employer are free from federal income tax c) Premiums paid by the employer are deductible as a business expense d) Employee paid premiums may be deducted if certain conditions are met
A
Existing insurers must provide policyowners within a policy summary for the existing life insurance within how many days of receiving the written communication and replacement? a) 10 b) 20 c) 31 d) 5
A
How long is an open enrollment period for Medicare supplement policies? a) 6 months b) 1 year c) 30 days d) 90 days
A
Social Security Supplement (SIS) or Social Security Riders would provide for the payment of income benefits in each of the situations EXCEPT a) When the amount payable under Social Security is more than the amount payable under the rider a) When used to replace or supplement benefits payable under other social insurance programs c) When the insured is eligible for Social Security benefits but before the benefits begin d) If the insured has been denied coverage under Social Security
A
Under an extended term nonforfeiture option, the policy cash value is converted to a) The same face amount as in the whole life policy b) The face amount equal to the cash value c) A lower face amount than the whole life policy d) A higher face value than the whole life policy
A
What is purpose of a conditional receipt? a) It is intended to provide coverage on a date prior to the policy issue b) It guarantees that a policy will be issued in the amount applied for c) It serves as proof that the applicant has been determined insurable d) It is given only to applicants who fully prepay the premium
A
Which of the following is NOT a feature of a guaranteed renewable provision? a) The insurer can increase the policy premium on an individual basis b) The insured has a unilateral right to renew the policy for the life of the contract c) Coverage is not renewable beyond the insured's age 65 d) The insured's benefits cannot be reduced
A
Which of the following is considered a presumptive disability under a disability income policy? a) Loss of two limbs b) Loss of one eye c) Loss of hearing in one ear d) Loss of one hand or one foot
A
Which of the following must an insurer obtain in order to transact insurance within a given state? a) Certificate of authority b) Producer's certificate c) Business entity license d) Insurer's license
A
Which of the following statements is NOT correct regarding Medicare? a) Medicare Advantage must be provided through HMOs b) Medicare Advantage may include prescription drug coverage at no cost c) Medicare Part A provides hospital care d) Medicare Part B provides physician services
A
Which of the following statements regarding the Change of Beneficiaries Provision is false? a) The policyowner has the right to change the beneficiaries in any case b) A policyowner can change beneficiaries without the consent of the former revocable beneficiary c) The policyowner cannot change the beneficiaries if he has chosen an irrevocable beneficiary, unless the policyowner has the permission of the irrevocable beneficiary d) All policies that allow a death benefit must at least provide the option of a change of beneficiary provision
A
Within how many days of requesting an investigation consumer report must an insurer notify the consumer in writing that the report will be obtained? a) 3 days b) 5 days c) 10 days d) 14 days
A
A Universal Life Insurance policy is best described as a/an a) Flexible Premium Variable Life policy b) Annually Renewable Term policy with a cash value account c) Variable Life with a cash value account D) A whole Life policy with two premiums; target and minimum
B
A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of their life insurance policy has been raised by 7% as a result. Which policy rider caused this change? a) Inflation Rider b) Cost of Living Rider c) Value Adjustment Rider d) Return of Premium Rider
B
A woman obtains health coverage through the Marketplace on October 1. Two weeks later she finds out she is 3 months pregnant. Which of the following is true about coverage for pregnancy? a) Pregnancy may be covered with the insurer's special approval b) Pregnancy will be covered immediately c) Pregnancy will only be covered if additional premium is paid d) Pregnancy will not be covered as a pre-existing condition
B
All of the following are correct about the required provisions of a health insurance policy EXCEPT a) The entire contract clause means the signed application, policy, endorsements, and attachments constitute the entire contract b) A reinstatement provides immediate coverage for an illness c) Proof-of-loss forms must be sent to the insured within 15 days of notice of claim d) A grace period of 31 days is found in an annual pay policy
B
An individual has been diagnosed with Alzheimer's 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) The entire living benefit is considered taxable income b) A portion of the benefit up to a limit is tax free; the rest is taxable income c) Principal is tax free, but interest is taxed d) The entire benefit will be received tax free
B
An insured is covered by a disability income policy that contains an accidental means clause. The insured exits a bus by jumping down the steps and breaks an ankle. What coverage will apply? a) Coverage will apply, but will be reduced by 50% b) No coverage will apply, since the injury could have been foreseen c) No coverage will apply, since disability income policies cover sickness only d) Coverage will apply since the break was accidental
B
An insured is covered under 2 group health plans - under his own and his spouse's. He had suffered a loss of $2,000. After the insured paid the total of $500 in deductible and coinsurance, the primary insurer covered $1,500 of medical expenses. What amount, if any, would be paid by the secondary insurer? a) $0 b) $500 c) $1,000 d) $2,000
B
An insured receives an annual life insurance dividend check. What term best describes this arrangement? a) Accumulated interest b) Cash option c) Reduction of premium d) Annual Dividend Provision
B
An insured submitted a notice of claim to the insurer, but never received claims forms. He later submits proof of loss, and explains the nature and extent of loss in a hand-written letter to the insurer. Which of the following would be true? a) The insured must submit proof of loss to the Department of Insurance b) The insured was in compliance with the policy requirements regarding claims c) The claim most likely will not be paid since the official claims form was not submitted d) The insurer will be fined for not providing the claims forms
B
An insured who has an Accidental Death and Dismemberment policy loses her left arm in an accident. What type of benefit will she most likely receive from this policy? a) The principal amount in monthly installments b) The capital amount in a lump sum c) The principal amount in a lump sum d) The capital amount in monthly installments
B
An outline of coverage must be given to the applicant for long-term care policy no later than a) 10 days upon request b) The time of initial solicitation c) The delivery of the policy d) 5 days after the initial solicitation
B
For a retirement plan to be qualified, it must be designed for the benefit of a) IRS b) Employees c) Key employee d) Employer
B
For how long are insurers required to maintain records pertaining to life insurance solicitation? a) 2 years b) 3 years c) 4 years d) 5 years
B
How soon from moving from one state to another must a nonresident producer file a change of address from with the Commissioner of Georgia? a) 10 days b) 30 days c) 60 days d) 90 days
B
In replacement, an existing insurer must provide policyowners with a policy summary for existing life insurance within how many days of receiving the written communication and replacement a) 3 b) 10 c) 31 d) 60
B
Insurers must keep files of all advertisements used in Georgia for the minimum of how many years? a) 2 years b) 4 years c) 5 years d) 7 years
B
Qualifications for soliciting, selling, or negotiating a long-term care partnership policy includes all of the following EXCEPT a) Completing the ongoing 4-hour training every 24 months b) Obtaining a partnership policy license from the Commissioner c) Being appointed d) Completing an initial 8-hour training
B
The limits of a health reimbursement account are set by a) Federal regulation b) The employer c) State statutes d) The insurer
B
To sell variable life insurance policies, an agent must receive all of the following EXCEPT a) A life insurance license b) SEC regulation c) FINRA registration d) A securities license
B
Under the uniform required provisions, proof of loss under a health insurance policy normally should be filled within a) 60 days of a loss b) 90 days of a loss c) 20 days of a loss d) 30 days of a loss
B
Under which condition would an employee's group medical benefits be exempt from income taxes? a) When the premiums and other unreimbursed medical expenses exceed 10% of the employees adjusted gross income b) An employee's group medical benefits are generally exempt from taxation as income c) An employee's group medical benefits are never exempt from taxation as income d) When the premiums and other unreimbursed medical exceed 5% of the employee's adjusted gross income
B
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT a) Delivery receipt b) Signed waiver of premium c) Statement of good health d) Payment of premium
B
What claim is pending, an insurance company may require a) An independent examination only once every 45 days b) An independent examination as often as reasonably required c) The insured to be examined only within the first 30 days d) The insured to be examined only once annually
B
What type of insurance would be used for a Return of Premium rider? a) Annually Renewable Term b) Increasing Term c) Level Term d) Decreasing Term
B
Which of the following best describes the "first-dollar" coverage principal in basic medical insurance? a) Deductibles and coinsurance are taxed first b) The insured is not required to pay a deductible c) The insured must first pay a deductible d) The insurer covers the first claim on the policy
B
Which of the following describes taxation of individual disability income insurance premiums and benefits? a) Premiums are tax deductible, and benefits are taxable b) Premiums are not tax deductible, and benefits are not taxable c) Premiums are not tax deductible, but benefits are taxable d) Premiums are tax deductible, but benefits are not taxable
B
Which of the following is NOT true regarding Basic Surgical Expense coverage? a) It is commonly written in conjunction with Hospital Expense policies b) Coverage is unlimited c) There is no deductible d) Contracts include a surgical schedule
B
Which of the following is an eligibility requirement for all Social Security Disability Income benefits? a) Be at least age 50 b) Have attained fully insured status c) Be disabled for at least 1 year d) Have permanent kidney failure
B
Which of the following is correct regarding the taxation of group medical expense premiums and benefits? a) Premiums are tax deductible and benefits are taxed b) Premiums are tax deductible and benefits are not taxed c) Premiums are not tax deductible and benefits are taxed d) Premiums are not tax deductible and benefits are not taxed
B
Which of the following statements is NOT true concerning Medicaid? a) It intends to provide medical assistance for certain categories of people who are needy b) It consists of 3 parts: Part A: Hospitalization, Part B: doctors services, Part C: Disability income c) It is a state funded program d) It is funded by the state and federal taxes
B
Which of the following will NOT be considered unfair discrimination by insurers? a) Assigning different risk classifications to applicants based on gender identity b) Discriminating in benefits and coverages based on the insured's habits and lifestyle c) Charging applicants with similar histories different premiums based on their ethnicity d) Cancelling individual coverage based on the insured's marital status
B
All of the following are true about group disability income insurance EXCEPT a) The waiting period starts at the onset of the injury or sickness b) The longer the waiting period, the less the premium c) Coverage applies to both on and off the job d) Benefits are usually short term
C
An insured is involved in an accident that renders him permanently deaf, although he does not sustain any other major injuries. The insured is still able to perform his current job. To what extent will he receive Presumptive Disability benefits? a) Full benefit for 2 years b) No benefits c) Full benefits d) Partial benefits
C
As defined by the Georgia Insurance Code, all of the following entities may have an insurable interest in the insured EXCEPT a) Charitable institutin b) A corporation in which the insured holds a larger percentage of shares c) Insurer d) Trustee
C
As it pertains to group health insurance, COBRA stipulates that a) Terminated employees must be allowed to convert their group coverage to individual policies b) Group coverage must be extended for terminated employees up to a certain period of time at the employer's expense c) Group coverage must be extended for terminated employees up to a certain period of time at the former employee's expense d) Retiring employees must be allowed to convert their group coverage to individual policies
C
For how long is an insurance company allowed to defer policy loan requests a) 30 days b) 60 days c) 6 months d) 1 year
C
How often must the Commissioner of Insurance examine health maintenance organizations (HMOs) authorized to do business in this state? a) Annually b) Every 2 years c) Every 3 years d) Every 5 years
C
If an individual licensed as an agent was employed by the Commissioner as a bona fide full-time employee, upon termination of employment, the individual may reinstate their license within how many days? a) 15 days b) 30 days c) 90 days d) 180 days
C
In order for an insurer's certificate of authority to remain in effect, the insurer must maintain a surplus equal to how much of paid-in capital stock? a) 30% b) 40% c) 50% d) 100%
C
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. The company is guilty of a) Unfair claim practice b) Rebating c) Misrepresentation d) Concealment
C
The annual contribution limit of a Dependent Care Flexible Spending Account is set by a) The insurer b) The insured c) The IRS d) The employer
C
The purpose of managed care health insurance is to a) Give the insured an unlimited choice of providers b) Coordinate benefits c) Control health insurance claims expenses d) Provide for the continuation of coverage when an employee leaves the plan
C
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? a) Point-based medical b) Conversion factor c) Relative value d) Basic surgical
C
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
Which nonforfeiture option has the highest amount of insurance protection? a) Decreasing Term b) Reduced Paid-up c) Extended Term c) Conversion
C
Which of the Following is True about a class designation? a) It is not allowed b) It determines the succession of beneficiaries c) Beneficiaries are not identified by name d) Beneficiaries must be part of the insured's immediate family
C
Which of the following definitions would make it easier to qualify for total disability benefits? a) More liberal "any occupation" b) More strict "own occupation" c) More liberal "own occupation" d) More strict "any occupation"
C
Which of the following policies would have an IRS required corridor gap between the cash value and the death benefit? a) Equity Indexed Universal Life b) Variable Universal Life c) Universal Life - Option A d) Universal Life - Option B
C
Which of the following riders would NOT increase the premium for a policy a) Waiver of premium b) Multiple indemnity rider c) Impairment rider d) Payor benefit rider
C
Which of the following statements regarding Business Overhead Expense policies is NOT true? a) Any benefits received are taxable to the business b) Leased equipment expenses are covered by the plan c) Benefits are usually limited to six month d) Premium paid for BOE are tex-deductible
C
Which provision stipulates that misstatements made in health insurance applications may not be used to deny a claim after the policy has been in force for 2 years? a) Grace period b) No benefits c) Full benefits d) Partial benefits
C
Who might receive dividends from a mutual insurer? a) Stockholders b) Agents c) Policyholders d) Subscribers
C
A willful violation of an agents fiduciary responsibility that involved funds exceeding $1,000 will be considered a) A minor violation b) Subject to imprisonment c) A misdemeanor d) A felony
D
At what age may an individual make withdrawals from an HSA for non-health purposes without being penalized? a) 55 b) 59 1/2 c) 62 d) 65
D
Authorized insurance companies are examined by the commissioner at least once every a) Year b) 2 years c) 3 years d) 5 years
D
Children's riders attached to whole life policies are usually issued as what type of insurance? a) Variable life b) Adjustable life c) Whole life d) Term
D
Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability a) Recurrent disability b) Partial disability c) Income replacement d) Residual disability
D
If a dental plan is integrated, it is combined with what type of plan? a) Secondary dental b) Supplemental c) Life d) Medical
D
If a policy includes a free-look period of at least 10 days, the Buyer's Guide may be delivered to the applicant no later than a) Upon issuance of the policy b) Within 30 days after the first premium payment was collect c) Prior to filling out an application for insurance d) With the policy
D
In forming an insurance contract, when does acceptance usually occur? a) When the insurer delivers the policy b) When the insurer receives an application c) When an insured submits an application d) When an insured's underwriter approves
D
In which of following situation would Social Security Disability benefits NOT cease? a) The individual reaches age 65 The individual dies c) The individual has undergone therapy and is no longer disabled d) The individuals son get a part-time job to help support the family
D
Other than for a qualified life event, when can a change be made in benefits for a Flexible Spending Account (FSA) a) At any time as necessary b) Within 3 months of the cause of the change c) No changes can be made one the policy is issued d) During the open enrollment period
D
Regarding Medicare SELECT policies, what are restricted network provisions? a) The determine who can be insured b) The determine premium rates c) They help avoid adverse selection d) They condition the payment of benefits
D
The Patient Protection and Affordable Care Act includes all of the following provisions EXCEPT a) Right to appeal b) No lifetime dollar limits c) Coverage for preventative benefits d) Individual tax deduction for premiums paid
D
The paid-up addition option uses the dividend a) To purchase a one-year term insurance in the amount of the cash value b)) To reduce the next year's premium c) To accumulate additional savings for retirement d) To purchase a smaller amount of the same type of insurance as the original policy
D
Traditional IRA contributions are tax deductible based on which of the following? a) How long the plan has been in force b) Owner's age c) IRA limit d) Owner's income
D
Under the Affordable Care Act, what percentage of preventative care must be covered without cost sharing? a) 25% b) 50% c) 80% d) 100%
D
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report a) Are entitled to obtain a copy of the report from the party who ordered it b) Must be advised that a copy of the report is available to anyone who requests it c) May sue the reporting agency in order to get inaccurate data corrected d) Must be informed of the source of the report
D
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) A statement from the Insured's employer showing that the insured was unable to work b) An estimate of the total amount of medical and hospital expense for the loss c) A complete physicians statement d) A statement that is sufficiently clear to identity the insured and the nature of the claim
D
Using a class designation for beneficiaries means a) Not naming beneficiaries b) Naming an estate as the beneficiary c) Naming each beneficiary by name d) Naming beneficiaries as a group
D
What is a definition of a unilateral contract a) Two or more parties go into a contract understanding there may be an unequal exchange of value b) One author: the company wrote the contract; the insured must accept it as written c) If one party makes a condition, the other party can counteroffer d) One-sided: only one party makes an enforceable promise
D
What is another name for interest-sensitive whole life insurance? a) Variable life s) Term life c) Adjustable life d) Current assumption life
D
What is the purpose of establishing the target premium for a Universal Life policy? a) To accumulate cash value faster b) T pay up the policy faster c) To cover all policy expenses d) To keep the policy in force
D
Which nonforfeiture option provides coverage from the longest period of time? a) Extended term b) Paid-up option c) Accumulated at interest d) Reduced paid-up
D
Which of the following best describes a misrepresentation? a) Making a deceptive or untrue statement about a person engaged in the insurance business b) Making a maliciously critical statement that is intended to injure another person c) Discriminating among individuals of the same insuring class d) Issuing sales material with exaggerated statements about policy benefits
D
Which of the following best describes the tax advantage of a qualified retirement plan? a) Distributions prior to age 59 1/2 are tax deductible b) Employer contributions are tax deductible, as long s employee earning are considered taxable income c) Employer contributions are taxed as income to the employee d) The earnings in a qualifies plan accumulate tax deferred
D
Which of the following entities has the authority to make changes to an insurance policy? a) Department of Insurance b) Broker c) Producer d) Insurer's executive officer
D
Which statement accurately describes the Change of Beneficiary provision? a) Spouses are automatically irrevocable beneficiaries, with the exception of divorce or death b) Beneficiaries can only be changed in the event of divorce, death, or severe psychiatric disorders c) Changing beneficiaries requires the consent of the original beneficiary d) Any policy that has a death benefit must also have a Change of Beneficiary provision
D
Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client? a) Interest-sensitive whole life b) Life annuity with period certain c) Increasing term d) Limited pay whole life
D
