study guide state exam
A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges which fall within the standard range of fees normally charged for a specific procedure by a doctor of similar training and experience in that geographic area is known as
Usual, customary and reasonable.
If an agent does not notify the insurer of an address change, what is the maximum penalty that can be imposed for a one-time offense?
$250
In all health care plans under the Affordable Care Act (ACA), how many essential benefit categories are there?
10
An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?
10 days
What is the minimum age that a person can obtain a life insurance license?
18
continuing education requirement must be met every
2 years
If a parent would like to enroll a child over the age of 5 into the Florida Healthy Kids program, their family income must be under a certain percentage of the federal poverty level. What percentage?
200%
In order to maintain an insurance license, an agent will need to satisfy Florida's continuing education requirement of
24 hours of continuing education in every 2-year period.
A corporation can be considered a "small group employer" if it has at least one and a maximum of how many employees?
50
Ray has an individual major medical policy that requires a coinsurance payment. Ray very rarely visits his physician and would prefer to pay the lowest premium possible. Which coinsurance arrangement would be best for Ray?
50/50
Benefit periods for individual short-term disability policies will usually continue from
6 months to 2 years.
In order to maintain coverage under COBRA, how soon from termination of employment must an employee exercise extension of benefits?
60 days
Unreimbursed medical expenses paid for the insured may be claimed as deductions if the expenses exceed what percentage of the adjusted gross income?
7.5%
A hospital indemnity policy will pay
A benefit for each day the insured is in a hospital.
Which of the following would be required to be licensed as an insurance producer?
A salaried employee who advertises and solicits insurance
What is a material misrepresentation?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
Which of the following would NOT be a violation of state insurance regulations?
Agent C uses her license to write only business other than controlled.
Long-term care policies MUST cover
Alzheimer's disease
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
An unfair trade practice.
At what point must an Outline of Coverage be delivered?
At the time of application or upon delivery of the policy
The premium charged for exercising the Guaranteed Insurability Rider is based upon the insured's
Attained age
An insurance contract must contain all of the following to be considered legally binding EXCEPT
Beneficiary's consent.
The First Steret 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
Blanket
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?
By law, the new, individual policy must provide the same benefits as the group insurance policy
How are state Insurance Guaranty Associations funded?
By their members - authorized insurers
HMOs that contract with outside physicians to provide health care service to their subscribers compensate those providers on a
Capitation basis
Which of the following must an insurer obtain in order to transact insurance within a given state?
Certificate of authority
When applying for an individual life insurance policy, an applicant states that he went to the doctor for nausea, but fails to mention that he was also having severe chest pains. This is an example of
Concealment
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?
Consideration
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?
Consideration
vWhich of the following is NOT a characteristic or a service of an HMO plan?
Contracting with insurance companies
Which of the following is NOT an exclusion in medical expense insurance policies?
Coverage for dependents
A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as
Critical illness.
Group disability income insurance premiums paid by the employer are
Deductible by the employer as an ordinary business expense
Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of
Defamation
Which of the following terms describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance?
Defamation
Under which of the following employer-provided plans are the benefits taxable to an employee in proportion to the amount of premium paid by the employer?
Disability Income
The requirement that agents not commingle insurance monies with their own funds is known as
Fiduciary responsibility.
Which of the following was designed to ensure continued access to affordable health insurance coverage for employees of small employers, their dependents, and other qualified beneficiaries not currently protected by COBRA?
Florida Health Insurance Coverage Continuation Act
Which of the following government health programs provides health insurance coverage to children who do not have access to adequate health care services?
Florida Healthy Kids
Which one of the following is an eligibility requirement for Social Security disability income benefits?
Fully insured status
The agent in charge of an agency must hold which of the following licenses?
General lines
As it pertains to group health insurance, COBRA stipulates that
Group coverage must be extended for terminated employees up to a certain period of time at the former employee's expense.
All of the following would be legal activities for an HMO to engage in EXCEPT
Health insurance solicitation.
Which of the following types of LTC is NOT provided in an institutional setting?
Home health care
In which of the following locations would skilled care most likely be provided?
In an institutional setting
Which of the following entities must approve all Medicare supplement advertisements?
Insurance Commissioner or Director
The Medical Information Bureau (MIB) was created to protect
Insurance companies from adverse selection by high risk persons.
Who must pay for the cost of a medical examination required in the process of underwriting?
Insurer
When a child reaches the limiting age of a health insurance policy of the insured parent, and has an intellectual or physical disability, the insurer may require proof that the child
Is incapable of self-sustaining employment because of the disability. Is chiefly dependent upon the policyholder for support and maintenance.
In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost
Is not covered.
Which of the following is NOT true regarding a Certificate of Authority?
It is issued to group insurance participants.
The Florida Employee Health Care Access Act serves which of the following purposes?
It regulates group health insurance provisions provided by insurers or HMOs to small employers
What type of health insurance policy provides an employer with funds to train a replacement if a valued employee becomes disabled?
Key Person Disability
Which of the following programs expands individual public assistance programs for people with insufficient income and resources?
Medicaid
Which of the following is NOT covered under Plan A in Medigap insurance
Medicare Part A deductible
Which of the following statements is correct?
Medicare will cover nursing home care if it is part of the treatment for a covered illness.
In a long-term care policy, pre-existing condition limitations
Must appear as a separate paragraph and be clearly labeled
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?
Mutual
A long-term care insurance shopper's guide must be provided in the format developed by which of the following?
NAIC(the National Association of Insurance Commissioners)
For which of the following reasons may an insurer terminate a small employer health insurance policy?
Nonpayment of premium
An applicant is discussing his options for Medicare supplement coverage with his agent. The applicant is 65 years old and has just enrolled in Medicare Part A and Part B. What is the insurance company obligated to do?
Offer the supplement policy on a guaranteed issue basis
An insured pays her Major Medical Insurance premium annually on March 1. Last March she forgot to mail her premium to the company. On March 19, she had an accident and broke her leg. The insurance company would
Pay The Claim
Which of the following describes taxation of individual disability income insurance premiums and benefits?
Premiums are not tax deductible, and benefits are not taxable.
Certain conditions, such as dismemberment or total and permanent blindness, will automatically qualify the insured for full disability benefits. Which disability policy provision does this describe?
Presumptive disability
A long-term care shopper's guide must be presented at what point?
Prior to the time of application
All of the following are true regarding rebates EXCEPT
Rebates are allowed if it's in the best interest of the client.
An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of
Rebating
Which of the following is NOT specifically prohibited by state law as an unfair trade practice?
Reducing the premiums paid by employers for group insurance based on loss experience
What method do insurers use to protect themselves against catastrophic losses?
Reinsurance
An insured wants to name her husband as the beneficiary of her health policy. She also wishes to retain all of the rights of ownership. The insured should have her husband named as what type of beneficiary?
Revocable
An insurance agent X has been found guilty of a felony and was sentenced to 3 years in prison. What would be the appropriate plan of action?
Send a written notification to the department of insurance
An insured has endured multiple surgeries and hospitalizations for an illness during the last few months. Her insurer no longer bills her for medical expenses. Which of the following allows for that?
Stop-loss limit
Which of the following terms describes the specified dollar amount beyond which the insured no longer participates in the sharing of expenses?
Stop-loss limit
Which of the following groups would most likely be covered under a blanket accident policy?
Students at a public school
Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to
The Insured
Which of the following would provide an underwriter with information concerning an applicant's health history?
The Medical Information Bureau
An employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?
The PPO will pay reduced benefits.
If an agent is in the military, which of the following is true?
The agent cannot sell a policy to another active military person who is of a lower rank.
Which of the following is true about the requirements regarding HIV exams?
The applicant must give prior informed written consent.
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?
The capital amount in a lump sum
In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?
The customer's associates, friends, and neighbors provide the report's data.
The period of time immediately following a disability during which benefits are not payable is
The elimination period.
Which statement accurately describes group disability income insurance?
The extent of benefits is determined by the insured's income
Which statement accurately describes group disability income insurance?
The extent of benefits is determined by the insured's income.
In a group policy, who is issued a certificate of insurance?
The individual insured
Insured Z's health insurance policy year begins in January. His policy contains a carry-over provision. In November, he has a small claim which is less than his deductible. Which of the following is true?
The insured may carry over the amount of this year's expenses to next year, which will help satisfy next year's deductible.
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?
The insured was in compliance with the policy requirements regarding claims.
An insurance advertisement exaggerates the benefits of an insurance policy, due to human error at the insurer's advertising agency. Who will the Department of Insurance hold responsible for the exaggeration?
The insurer
When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss. However, her agent did not notify the insurance company until 60 days after the loss. Which of the following statements correctly explains how this claim would be handled?
The insurer is considered to be notified since the notification to agent equals notification to the insurer.
Which of the following entities is responsible for agent licensing and administrative supervision?
The office of insurance regulations
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?
The policy will not be affected.
On a health insurance application, a signature is required from all of the following individuals EXCEPT
The spouse of the policyowner.
Which of the following statements is most correct concerning the changing of an irrevocable beneficiary?
They can be changed only with the written consent of that beneficiary.
When an insurer issues an individual health insurance policy that is guaranteed renewable, the insurer agrees
To renew the policy until the insured has reached age 65.
When an HMO knowingly makes any misleading representations, incomplete or fraudulent comparisons for the purpose of inducing any person to lapse, forfeit, terminate, surrender or convert any insurance policy or contract with another insurance company or HMO, they are in violation of the unfair trade practice of
Twisting
Under what circumstances can an agent's appointment be transferred to another person?
Under no circumstances
If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?
Unilateral
How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company?
Within 90 days or as soon as reasonably possible, but not to exceed 1 year
To comply with Fair Credit Reporting Act, when must a producer notify an applicant that a credit report may be requested?
at the time of applicatin
What phase begins after a new policy is delivered?
free look period
In which of the following locations would skilled care most likely be provided?
in an institutional setting
A guaranteed renewable disability insurance policy
is renewable at the insured's option to a specified age
When may an insurer require an insured to provide genetic information?
never
How many pairs of glasses in a 12-month period will a vision expense insurance plan cover?
one
The Florida Health Insurance Coverage Continuation Act requires insurers that sell health plans to small employers to offer in those plans a right to elect to continue coverage, without providing evidence of insurability, to employees who lose their coverage and are unable to replace it. The premium rate for this coverage may NOT exceed
115%
How long must an insurer retain an advertisement for its long-term care policies?
3 years
In the event a policy lapses due to nonpayment of premium, within how many days would the policy be automatically reinstated once the outstanding premium is paid?
45 days
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be
Authorized
Which of the following statements about occupational vs. nonoccupational coverage is TRUE?
Disability insurance can be written as occupational or nonoccupational.
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 days
Once the person meets the stringent requirements for disability benefits under Social Security, how long is the waiting period before any benefits will be paid?
5 months
What is the statute of limitation on lawsuits for health insurance policies?
5 years
Which of the following is true regarding the agent's appointments?
A person may hold several appointments at one time.
What is reinsurance?
An agreement between a ceding insurer an assuming insurer
Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner?
Payment of Claims
With respect to the Consideration Clause, which of the following would be considered consideration on the part of the applicant for insurance?
Payment of premium
What type of care is Respite care?
Relief for a major care giver
In the event of a loss, business overhead insurance will pay for
Rent
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?
Residual disability
