Simulator 11-35
Which of the following protects a policyowner from a misrepresentation caused by an innocent mistake?
Incontestable clause
The principle of insurable interest, in regards to a life insurance contract, is accurately described in which statement?
Insurable interest can be based on the love and affection of individuals related by blood or law
All of the following are core benefits of Medicare Supplement Plan A EXCEPT
Deductible payments for the first 60 days of hospitalization under Medicare hospitalization insurance
Advertising regulations exist in order to
Demonstrate full and truthful disclosures to the public
In group health care, what is the purpose of the coordination of benefits provision?
Determines what is paid by the primary and secondary insurers in the event of a claim
A beneficiary has just received a claim payment for a life insurance policy. Which of the following is TRUE regarding the federal income tax liability owed?
No federal income tax is owed on life insurance proceeds
What is the tax liability for employer contributions in Health Savings Accounts (HSA's)?
No tax payment needed
What does the Ohio Life and Health Insurance Guaranty Association provide?
Protection to insureds from financially insolvent insurers
What is the primary reason for buying an annuity?
Provide future economic security
Which of these is NOT a legal reason for an HIC to release a subscriber's confidential health information?
public interest
An annuity is primarily used to provide
retirement income
A life insurance policyowner does NOT have the right to
revoke an absolute assignment
The statement which best describes the relationship between the premiums of a whole life policy and the premium payment period is
The shorter the payment period, the higher the premium
A policyowner can receive a percentage payment of the death benefits prior to death by using what kind of contract?
Viatical settlement agreement
When are group disability benefits considered to be tax-free to the insured?
When the recipient pays the premiums
A disability income policy can prevent an insured from earning a higher income than if he/she were working by utilizing
benefit limits
A provision that allows a policyowner to temporarily give up ownership rights to secure a loan is called a(n)
collateral assignment
Ownership of a life insurance policy may be temporarily transferred with a(n)
collateral assignment
Life insurance policies will normally pay for losses arising from
commercial aviation
Which of the following is required for the renewal of an agent's insurance license?
continuing education
An example of a presumptive disability would be
deafness
Key Person Disability Insurance pays benefits to the
employer
Level premium permanent insurance accumulates a reserve that will eventually
equal the face amount of the policy
Replacement can be BEST described as
exchanging a new policy for one already in force
Which of these would limit a company's liability to provide insurance coverage?
exclusion
When the principal gives the agent authority in writing, it's referred to as
express authority
A health care provider claim may be settled using which of the following payment methods?
fee for service
Premium mode is a term used to describe the
frequency of the premium payment
Premium mode is a term used to describe the
frequency of the premium payment
When a qualified plan starts making payments to its recipient, which portion of the distributions is taxable?
gains
An indemnity plan
provides the insured a specific dollar amount for services
Sole proprietors are permitted tax deductions for health costs paid from their earnings in the amount of
100% of costs
Frank is shopping for a disability income policy. Which of the following would have the HIGHEST premium?
14 day waiting period / 10 year benefit period
A life insurance policy sold in Ohio can be cancelled for nonfraudulent misstatements for up to
2 years
An insurer may deny health insurance claims based on misstatements in the application for how long from the policy's date of issue?
2 years
An agent must report to the superintendent any administrative action or criminal charges taken against the agent within _____ days of the final disposition of the matter.
30
A Roth IRA owner must be at least what age in order to make tax-free withdrawals?
59 1/2 and owned account for a minimum of 5 years
Within how many days must a Traditional IRA be rolled over to another IRA in order to avoid tax consequences?
60
HIPAA considers which of the following as "individually identifiable health information"?
A person's health claim information
Which of these is considered to be a Living Benefit option in a life insurance policy?
Accelerated death benefit
Which of the following is considered to be an alternative to a life settlement?
Accelerated death benefit rider
Which of the following is considered to be an alternative to a life settlement?
Accelerated death benefit rider
Under a disability income policy, which provision would be payable if the cause of an injury is unexpected and accidental?
Accidental bodily injury provision
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
Accumulation at Interest Option
What is the nonforfeiture value of an annuity before annuitization?
All premiums paid, plus interest, minus any withdrawals and surrender charges
What amount will be paid under a policy where the insured misstated his/her age?
An amount the premium would have purchased at the correct age
Which of the following is considered to be the period when the accumulated value in an annuity is paid out?
Annuitization phase
Which of the following is considered to be the period when the accumulated value in an annuity is paid out?
Annuitization phase
An insurance company advertises an accident and health insurance product in a local Ohio newspaper and refers to dollar amount benefits. This insurer must also disclose which of the following in the advertisement?
Any applicable benefit reduction
An insurance company advertises an accident and health insurance product in a local Ohio newspaper and refers to dollar amount benefits. This insurer must also disclose which of the following in the advertisement?
Any applicable benefit reduction
The coverage, conditions, and limitations in the master policy of a group contract can be found in which document?
Certificate of coverage and benefits
In which of the following processes will the insurer oversee the insured's hospital stay to confirm everything is going according to schedule and that the insured will be released as planned?
Concurrent review
Which type of clause describes the following statement: "We have issued the policy in consideration of the representations in your applications and payment of the first-term premium".
Consideration clause
Which disability policy provision would address any concerns of the value of the benefits decreasing over time?
Cost of living benefit
Which of the following is an annuity that is linked to a market-related index?
Equity indexed annuity
Purchasing a life insurance policy in order to avoid the forced sale of assets upon death is called
Estate conservation
One of the most important considerations when replacing health insurance would be the
Exclusions on a new policy
A spouse and child can be added to the primary insured's coverage as what kind of rider?
Family term
Which of these riders will pay a death benefit if the insured's spouse dies?
Family term insurance rider
A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability, is called a(n)
Guaranteed insurability rider
Which type of coverage pays an amount per day for hospitalization directly to the insured regardless of the insured's other health insurance?
Hospital indemnity
Which of the following types of deductibles would apply a single deductible to both medical and dental insurance coverage?
Integrated deductible
Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
Interest only
Which settlement option involves having the proceeds remain with the insurer and earnings paid on a monthly basis to the beneficiary?
Interest only
Without a Section 125 Plan in place, what would happen to an employee's payroll contribution to an HSA?
It would be considered taxable income to the employee
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?
Life Income
Low frequency diseases can be exclusively covered by what kind of health insurance policies?
Limited policies
Which of these factors would an insurer consider when determining whether to accept a group life plan?
average age
The purpose of Medicare Supplement Insurance is to address gaps in Medicare coverage, which can include
Medicare in-hospital deductible
What would be an expense factor in an insurance program?
Mortality costs
What makes an insurance policy a unilateral contract?
Only the insurer is legally bound
Which clause defines total disability as being unable to perform the major duties of the insured's regular occupation?
Own occupation clause
What is an insurer required to do when faced with an error made under the Misstatement of Age provision?
Pay age-corrected benefits
What is an insurance policy's grace period?
Period of time after the premium is due but the policy remains in force
Which situation accurately describes a reduced paid-up nonforfeiture option?
Policy has a decreased face amount
Which situation accurately describes a reduced paid-up nonforfeiture option?
Policy has a decreased face amount
Which of the following would evidence ownership in a participating health insurance contract?
Policy ownership
An annuitant dies during the distribution period. What kind of annuity will return to a beneficiary the difference between the annuity value and the income payments already made?
Refund annuity
ABC Insurance Company transfers part of their risk to XYZ Insurance Company. This situation is called
Reinsurance
Which of these will have the highest monthly payout upon annuitization?
Straight life
A Renewable Term Life insurance policy can be renewed
at a predetermined date or age, regardless of the insured's health
Bill the producer is collecting the initial premium on a health policy. Which of the following statements is true?
The contract is not in force without the initial premium being paid
What is a corridor in relation to a Universal Life insurance policy?
The gap between the total death benefit and the policy's cash value
What will the beneficiary receive if an annuitant dies during the accumulation period?
The greater of the accumulated cash value or the total premium paid
In which of the following situations would the insurer be liable for a loss?
The insured suffered an injury as an innocent bystander during a bank robbery
When a preferred provider organization (PPO) insured goes out-of-network, which of the following actions occur?
The insurer will pay a reduced amount
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following statements is true?
The policy may be paid up early by using policy dividends
Which of the following pertains to the analysis of an applicant's personal information and determining whether insurance should be issued or declined?
Underwriting
A life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called
Universal Life
Long-Term Care policies or certificates issued in Ohio are required to have
a nonforfeiture value
Group dental plans will frequently place a limit on annual benefits in order to minimize
adverse selection
Loss of income insurance provides
an individual the means to replace wages
Fixed period settlement options are considered to be a form of a(n)
annuity
Credit Accident and Health plans are designed to
help pay off existing loans during periods of disability
Which of the following is NOT taken into consideration when determining eligibility for Medicare benefits?
income
A proposed insured for a health insurance policy was treated for heart disease within the past year. When applying for health insurance, the heart disease treatment
indicates a preexisting condition
Which of the following is present when an applicant stands to lose value if the insured dies?
insurable interest
Ambiguities in an insurance policy are always resolved in favor of the
insured
An accident and health policy that provides reimbursement benefits makes them payable to the
insured
A non-admitted insurer
is not afforded protection by the guaranty fund
How do insurers predict the increase of individual risks?
law of large numbers
Which type of annuity stops all payments upon the death of the annuitant?
life annuity
A dread disease policy is considered to be a type of
limited health insurance policy
A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a(n)
limited pay policy
A life insurance policy that has premiums fully paid up within a stated time period is called
limited payment insurance
The premium for a Modified whole life policy is
lower than the typical whole life policy during the first few years and then higher than typical for the remainder
The focus of major medical insurance is providing coverage for
medical and hospitalization expenses
The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period from the policy's inception, the insurer will only be liable for a return of premiums paid
minus indebtedness and without interest
A nonparticipating policy will
not pay dividends
How are premiums paid by the insured for personally owned disability income insurance treated for tax purposes?
not tax deductible
Suitability is
obtaining information from the applicant to determine whether an insurance or annuity product is appropriate
A clause that allows an insurer the right to terminate coverage at any anniversary date is called a(n)
optional renewability clause
What kind of life insurance policy issued by a mutual insurer provides a return of divisible surplus?
participating life insurance policy
States that have "no loss no gain" laws require a replacing policy to
pay for ongoing claims under the policy it replaces
Advertisements for accident and health policies that ONLY cover a stated illness MUST display a statement that the
policy is limited
All Health Benefit Plans issued after January 1, 2014 must provide
preventative health services
Continuous 24-hour care provided by licensed medical professionals under the direct supervision of a physician is called
skilled nursing care
Typically, Long-Term Disability benefits are coordinated with which benefit plan?
social security
Proceeds from a life insurance policy are protected from the beneficiary's creditors by which clause?
spendthrift trust clause
Respite care is able to provide
temporary relief to the patient's primary caregiver
This MANDATORY health policy provision states that the policy, including endorsements and attached papers, constitutes
the entire insurance contract between the parties
If the beneficiary dies from the same accident as the insured individual, the insurer will proceed as if
the insured outlived the beneficiary
When a health policy is reinstated, insured losses are covered immediately if
the losses result from accidental injuries
If an insured dies during the grace period with no premiums paid
the policy would be payable, minus the premium amount
If the annuitant dies before the annuity start date,
the premiums paid plus interest earned will be given to the beneficiary
Under a contract of adhesion,
the terms must be accepted or rejected in full