State Insurance Simulator
Beth is a surgeon who has an own-occupation disability income policy. She was injured six months ago and has been unable to return to her practice. Her monthly benefit from the policy is $15,000. During this time, Beth has been working part-time at a local boutique and receives $2,000 monthly. What is her ongoing monthly benefit while she is unable to perform her surgical duties?
$15,000
Larry has a Major Medical Expense policy for his family with a $1,000 per family/per year deductible and an 80/20 coinsurance provision. If Larry's family files four claims of $400, $800, $100, and $700 in one year, how much will the insurance company pay?
$800
first time home buyers are able to withdraw up to how much from their qualified IRA without incurring the 10% early withdraw penalty
10,000
Mary is the sole preproetot of her business and has a family plan. she would like to deduct the premiums from her taxes. what percentage of her premiums are tax deductible
100%
what minimum percentage of all eligible employees must participate in a group life insurance plan if the premiums are completely paid for by the employer
100%
indiviudals seeking social security disability income benefits must have a disability that will eventually lead to death, or be expected to last at least
12 months
a nonparticipating whole life insurance policy was surrendered for its $200,000 cash value. the total premiums paid had totaled $16,000. what were the federal income tax consequences to the policy owner
16,000 was received tax free and 4,000 as ordinary income
group disability (accident and health ) policies must allow an insured continuation privileges for up to ___ months
18
an intermediary must complete___ credit hours of continuing education for each licensing period
24 hours
A single-life annuity only has ONE
Annuitant
Jonas is covered with disability insurance through his employer. The employer pays 75% of the premium, while Jonas pays the other 25%. What is Jonas' tax liability for any benefits paid from the disability plan?
Taxes must be paid on 75% of the benefits recieved
which of the following combinations best describes a universal life insurance policy
a flexible premium deposit and a monthly renewable term insurance policy
short term group disability income benefits are
a percentage of weekly earnings up to to a stated maximum
which of the following best describes a point of service plan
a plan which combines indemnity plan feathers with those of an HMO
Kevin has an existing life insurance policy and assigns it to another insurer for a new contract. How would this transaction be treated for tax purposes?
a section 1035 exchange
A material change in a modified endowment contract (MEC) results in
a seven pay test, adjust for cash value applies again
A life insurance policy provision that has the ability to reduce the death benefit is called the
accelerated (living) benefit
a prepaid dental plan has an agreement in place with a network of dentists which
accepts an established amount as payment in full for the dental services redered
Mike recently lost sight in both eyes. He has a policy that pays a lump sum benefit for this injury. What type of insurance does Mike have?
accidental death and disbursement
an insured is covered under a group long-term disability policy. under thus type of policy the definition of disability based on any occupation typically applies
after two years of disability
An individual who purchases a modified life insurance policy expects
an improvement in future income
under the affordable care act, all of these are considered one of the 10 essential health benefits except
annual cat scans
which is an accurate description of the premium in a graded premium life insurance policy
annual increases in premium for a stated number of years then remains level
according to hippo regulations which of the following may reduce a medical plans pre-existing conditions exclusion
any period of coverage
under federal law which of the following actions may result in a producer becoming imprisoned
embezzling funds form an insurer
the intermediart licensing process exists to demonstrate to the commissione that an applicant meets specific criteria. which of the following is not one of these criteria
applicant has no prior bankrupcies
in order for an intermediary yo conduce insurance transactions, the intermediary must be
appointed by an insurer
Traditional Individual Retirement Account (IRA) distributions must start by
april 1st of the following year the participant attains age 70 1/2
in a qualified retirement plan, the yearly contributions to an employee account
are restricted maximum by the IRS
how may an insurance company classify an accidental death benefit on a life policy
as an optional policy rider
Julie is in need of assistance with one or two activities of daily living. She may be eligible for a(n)
assisted living facility
which of the following is a requirement for becoming an intermediary
be trustworthy and competent
when using the needs approach for life insurance plannign a lump sum may be created to provide for all of the following except
employee benefits
Christopher is issued an insurance policy that contains an attached agreement which alters the terms of the policy. The attached agreement is called?
endorsement
the benefit period of medicare part A begins on the first dat the insured
enters a hospital
when detemining the accumulation value of a deffered annuity the total is calculated by taking the premiums paid plus interest earned minus
expenses and withdrawals
which statement concerning a decreasing life policy is accurate
face amount decreases over the policy period
which tax is normally associated with an individuals death
federal estate tax
health care costs can be better controlled by utilizing peadmission testing. preadmission testing can reduced
length of hospitalization
how much is normally paid to a policy owner in a life (vaitical) settlement
less than the death benefit
what is another term used for pure life annuity
life income
an intermediary must hold which of the following license to sell variable life insurance policies
life, variable and securities license
which of these is not relevent when determining the amount of personal life insurance needed
local unemployment rates
tim is confiend to a nursing home but doesn't have a terminal illness. which life insurance rider is designed to help pay for this type of expense
long-term care benefit rider
which of the following is not required to be stated on a life insurance policy sold in wisconsin
premiums must be paid by the insured
which of the following outlines the authority given to the producer on behalf of the insurer
producer contract
what is considered the purpose of the wisconsin insurance security fund
protects consumers from insolvent insurers
the automatic premium loan provision can be accurately described as
provision that provides a loan policy to pay any premiums by the end of the grace period
what type of risk involves the potential for loss with no possibility for gain
pure risk
what is normally the consequence for not obtaining permission certification prior to receiving inpatient medical care
reduction of benefits
which of the following is not included as a hospice benefit under a major medical plan
rehabilitation
An insurer has a contractual agreement which transfers a portion of its risk exposure to another insurer. What type of contractual arrangement is this?
reinsurance contract
which of the following is not a basic underwriting action for accident and health insurance
removing uniform policy provisions
T is coverd by an accidental death and disbursement (AD&D) policy that contains an irrevocable beneficiary. What action will the insurance company take if T requests a change in beneficiary.
request of the change will be refusded
which of the following can be defined as the potential foe loss
risk
third-party administration has become fairly common in accident and health insurance side to growth of
self-funding of benefits
sylvis purchased an annuity for 100,000 from the proceeds of an inheritance no further payments are permitted and the income stream begins in 15 years. this contract is
single premium deferred annuity
if hospital expenses are covered under a disability (accident and health) policy the policy is required to cover
skilled nursing care
medicare part A covers which type of care
skilled nursing facility care
if replacement was involved in the sale of a life insurance policy, and intermediary must provide a replacement notice no later than
the application date
All parts of the Medicare program (except for public information and enrollment) are administered by which federal agency?
the centers for medicare and medicaid services
Access to premium tax credits and reduced cost sharing is made available ONLY if the consumer purchases health coverage in
the health insurance exchange
what would be considered an advantage of purchasing term life insurance
the initial premium is lower compared to an equivalent amount of whole life insurance
who must sign a rider attached to a health insurance policy in order for it to be valid
the insurer and the producer
who may determine coverage under a cancable health insurance policy
the insurer or the insured
Dan has a major medical expense policy with a $200 deductible and an 80/20 coinsurance provision. He incurs covered medical expenses of $100 in November and $400 in January. Under the carryover provision, what will the insurer pay?
240
How many days notice does the affordable care act require insurers to give before resigning coverage
30
kate refived a group accident and health termination notice. how many days does she have to apply for a converted policy
31
what is that face amount of a $50,000 graded death benefit life insurance policy when the policy is issued
50,000 but increases over time
an insurer may excluded preexisting conditions on a medicare supplement policy for up to __ months after policy issue
6
disability (accident and health) must policies cover lead poisoning screenings for children under ___ years of age
6
disability (accident and health) policies must cover lead poisoing screening for children under
6
How long do most states allow an insurance company to delay the payment of a cash surrender under the Delayed Payment provision?
6 months
how long can an insurer legally defer paying the cash value of a surrendered life insurance policy
6 months
which of the co-annuits listed below would receive the largest monthly benefit payment in a joint and 100% survivor annuity
71 - 73
an intermediary cannot sell ling-term care insurance unless that person has successfully completed an approved education course of
8 hours
According to ERISA regulations, a summary plan description must be provided to a new plan member within ___ days of the members eligibility date
90
which of these is not an advantage of term life insurance
A cash benefit will be provided if the insured is alive at the end of the policy period
if a disability income policy contains a cost of living adjustment rider, benefits must typically be increased
at least once per year when benefits begin
a policy owner pays the first annual premium life insurance policy and dies one month after the policy effective date. which of these statements is normally true
beneficiary receives 50,000 income tax free
which of the following statements best describes a double indemnity provision in travel accident insurance
benefits are doubled under certain circumstances stated in the policy
Pat is covered by a disability income insurance policy that covers disabilities arising from a work-related illness or injury. The amount of his disability income payments for an on-the-job injury may be reduced by
benefits paid under workers compensation
who normally pays the premiums for group credit life insurance
borrower
which of the following is not a condition that must be met for an accidental death benefit to be paid
cause of death must be from a job-related injury
An employee welfare plan exempt from ERISA regulations would be
church plans
which of these is not true statement of the war exclusion
civil insurrections aapply
what must be given to a life insurance applicant when the agent receives an application and the initial premium
conditional recipt
Jill has a group health plan with an employer that covers employees in more than one state. Which of the following is NOT affected by the state regulatory jurisdiction established for this plan?
continuation of coverage under COBRA
A statement must be signed by the ___ for any illustrations used in the sale of a life insurance policy
intermediary
an insurance application requires an applicant to make a full, accurate disclosure of the risk factor involved. using this criteria, an insurance policy is considered what type o contract
contract of utmost good faith
which of the following does not involve a life settlement transaction
converting term life to whole life insurance
Al surrenders his life insurance policy for its cash value. The total of the premiums paid into the policy minus total dividends received in cash or used to offset premiums is referred to as the
cost basis
Jerry has an indemnity plan which covers dental expenses. Typically, these type of plans
cover preventive care once every six months
what does the rehabilitation benefit cover in a disability income policy
covers the approved cost of the rehabilitation necessary to help a disabled turn to work
the main purpose of an annuity is to
create a stream of income
in what way is a life insurance policy affected by an accelerated benefit payment
decreases the death benefit
the amount of a covered loss to be paid by the insured before a major medical expense policy begins to pay is called the
deductible amount
which annuity allows a contributions to an IRA
deferred
which of these is typically required as a major treatment in an indeminiy dental plan
dentures
if a life insurance applicant is shown future premiums are to be paid out of non-guaranteed values, the illustration is used in the sales presentation must
disclose that the premium payments may need to be resumed depending on actual results
A qualified profit sharing plan is designed to
distribute a portion of company earnings to its employees
disability income policies provide protection for which of the following
economic death
how long does one premium payment cover a single premium whole life policy
fill life of the policy
An inrermediary is meeting with a client to determine whether an annuity will be suitable to purchase. Which of the following topics needs to be discussed with the client
financial status of the client
An annuitant is paid $495 per month until the contract value is exhausted at some undetermined date in the future. what type of payout is this
fixed amount
which life insurance settlement option pays a stated monthly benefit until both principal and interest are exausted
fixed amount installment option
Which of these is not a factor during the insurance underwriting process
former occupation
An insured may be required to sign which document at policy delivery to ensure there has not been any adverse medical conditions since the time of the application?
good health statement
which of the following statements is not true concerning the relationship between group health insurance plans and medicare
group health coverage is not available for workers over the age of 65
what is an insurer contract that idividuals by relationship to a specific organization
group insurance
in wisconsin any intermediary who sells a life insurance policy using misrepresentation
has committed an illegal act
For insurance purposes, similar objects which are exposed to the same group of perils are referred to as
homogeneous exposure units
a family counseling benefit is typically offered under which of these coverages
hospice care
which of the following is not true of a preferred provider plan
hospitals can only initiate preferred provider plans
with life insurance, the needs approach is used primarily in determining
how much life insurance a client should apply for
an intermediary has his license revoked because of failuer to pay the required license fees. how soon after the revocation may he apply for reinstatement
immediately
the medical information bureau consists of memers from which group
insurance companies
which of the following is not a valid reason for insurer to cancel an insurance policy midterm
insured change in marital status
which statement is not true regarding a cash value loan against a life insurance policy
interest payments made by policy owner are deductible
under which circumstance would an insurer be legally protected against
intermediarty and policy wonder acted together to defraud the insurer
In what way are insurance policies said to be aleatory?
involves the potential for the unequal exchange of value
When a policy loan is requested by a policyowner and it requires the consent of the beneficiary, what kind of beneficiary designation is this?
irrevocable beneficiary
an applicant for accidnet and health insurance has a risk factor that is similar to a majority of the insurers other applicants. what will be the likely outcome of this applicant
issued with a standard premium
the insurance coverage is a variable life insurance policy may vary based on the value of
its underlying investments
after the initial enrollment period for medicare part B has expired when may an individual purchase again
janurary through march of each year
A life insurance beneficiary died after receiving only six payments under the policy life income settlement option. What happens with the remaining balance of the death proceeds
kept by the insurance company
the death proceeds of a credit life insurance policy are typically paid to
lender
a life policy spendthrift clause would have no effect if the beneficiary is paid the proceeds as a
lump-sum payment
which of these policies is considered to be a comprehensive health policy
major medical policy
AN employer that offers retirement plan (as opposed to a non-qualified plan) to its employees its eligible to
make tax-deductible contributions to the plan
a trustee-to turstee of rollover funds is a qualified plans allows a participant to avoid
mandatory income tax withholding on the amount transferred
the pre-existing conditions exclusion under a small employer health plan
mat be partially or fully satisfied by having credible coverage with a previous employer
An insurance applicant has made a false statement on the application that will affect the insurers decision on whether to issue the policy. This false statement is considered to be
material misrepresentation
Karen is considering replacing her individual accident and health insurance policy with another individual policy. She has had issues in the past with her gall bladder that would be considered a pre-existing condition. How will a pre-existing conditions exclusion affect Karen's new insurance contract?
may reduce her benefits
field underwriting by a producer
may result in the disclosure of hazardous activities of the applicant
according to the affordable care act (ACA) the proprotion of premiums revenues spent on clinical services and quality improvements is called
medical loss ratio
which individual would be best suited for medicare supplement insurance
medicare enrollee
what is the eligibility requirement for medicare part B
must be eligible for medicare part A
which of the following does not meet the requirements of skilled nurnsig care
must be provided exclusively in a hospital
Tim is covered by an accident and health insurance policy that may not be changed in any way by the insurer up to a stated age, as long as the premiums are paid. What type of policy is this?
noncancleable
what is the proper procedure for an intermediary to change his/her mailing address
notify the commissioners office in writing within 30 days
Long term care policies normally cover expenses associated with
nursing homes
Who typically makes the purchase payments in an individual annuity?
owner
mark is covered by a policy that uses the regular occupation (own-icc) definition of total disability. Using this definition will he be considered disabled if unable to
perform the substantial and material duties of his regular occupation
under long term- care inflation rider, the benefit levels
periodically increase without proof of insurability
an intermediary sold life insurance policy but did not provide the applicant with a basic illustration. in this situation the insurer is required to provide the applicant with a policy summary no later than the
policy delivery date
If an insured dies during the grace period wtihout having paid the premium, how much will the insurer pay
policy face amount minus any premiums due
All of these statement s are true regarding a policy owners ability to return a disability (accident & health) policy except
policy owner may return the policy for a full refund at anytime
The standard provisions of an accident and health insurance policy require that the
policy, endorsements, and attached papers constitute the entire contract
the beneficiary of a life insurance policy is normally selected by whom
policyowner
which of the following guidelines does not apply under the pregnancy provision of civil rights act
post-termination extensions of medical benefits must apply equally to pregnancy
what topical changes at the re-enty option date found in some term life policies
premium
Kelly purchases a health insurance policy issued on a conditionally renewable basis. The insurance company has a right to refuse renewal of the policy for
specific reasons stated in then contract
Illustrations used in the sale of a life insurance policy must
state both the guaranteed and non-guaranteed elements
an insurer will typically asses and back-end a loan on a deferred annuity that is cancelled during the early contract years.what is the back end lead reffered to as
surrender charge
qualified long term care premiums are treated for tax purposes as
tax-deductible to the extent they exceed 7 1/2% AGI
How are monthly life annuity benefit payments treated under a tax sheltered annuity (TSA)?
taxed as ordinary income in the year received
when the testing for (HIV) wisconsin law requires a consent form
that discloses who mat receive a copy of the results
the surrender charge on may deferred annuity contracts are waived then the
the annuitant dies or becomes disabled
joe is a life insurance policy owner who has failed to pay interest on his policy loan. what will result from this nonpayment
the loan amount is increased to reflect the amount of interest due
who is normally considered to be the owner of a 403b tax sheltered annuity
the participating employee
how is collateral assignment used in a life insurance contract
transfers specific ownership rights to a creditor
how do birthing centers reduce medical costs
using certified nurse midwives
an insurance company can be liable for a producers unauthorized acts
when the agency contract is unclear concerning the authority given
under what circumstance does an accident and health insurer have the right tot request an autopsy
when the claim exceeds an amount specified in the policy
when does the producer give a premium receipt for a life insurance application
when the initial premium has been paid with the application
Pete is covered by an employer-provided group health insurance plan, which covers employees in multiple states. This plan is governed by the laws of which state? A. Where the certificate of coverage was mailed to B. Where most of the employees reside C. Where the master contract was issued D. Where the insurer's home office is located
where the master contract was issued
according to federal fraud and false statement regulation what is required for a prohibited person to transact insurance business in this state
written consent form the state insurance regulatory agency
the following are all elements of a valid contract except
written evidence
medicare supplement insurance that provides a prevenative medical care benefit will often cover
yearly examinations
