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Terms in this set (120)#101. Survivorship life (also referred to as "second-to-die" or "last survivor" policy) is much the same as joint life in that it insures two or more lives for a premium that is based on a joint age. a) #102. Annually renewable term policies provide a level death benefit for a premium that increases each year with the age of the insured. c) #104. Small employer means an employer who employed an average of at least two but not more than 50 employees on business days during the preceding calendar year and who employs at least two employees on the first day of the plan year. c) #105. The face of the term policy would be the same as the face amount provided under the whole life policy. c) #106. The consideration clause requires the insurer to promise to pay in accordance to the terms stated in the contract. c) #107. If a level term product is renewed at the end of the term period the premium will be based upon the attained age of the insured. c) #108. Group insurance can often provide coverage for employees in more than one state. The state in which the coverage was delivered would have jurisdiction. a)
#150. A policy that has an "any occupation" provision will only provide benefits when the insured is unable to perform any of the duties of the occupation for which they are suited by reason of education, training, or experience. b) #149. Apparent authority (also known as perceived authority) is the appearance or the assumption of authority based on the actions, words, or deeds of the principal or because of circumstances the principal created. d) #146. Straight Life policies charge a level annual premium throughout the insured's lifetime and provide a level, guaranteed death benefit.
b) #145. Under a joint settlement option, payments would stop at the first death, but under the joint and survivor, payment would continue until both recipients die. Usually, the surviving beneficiary receives 1/2 or 2/3 of the amount received when both beneficiaries were alive. d) #144. Medicare will cover nursing home care if it is part of the treatment for a covered injury or illness, but care needed because of aging is not covered by Medicare or Medicare supplements. Medicare and Medicare supplements pay for skilled nursing care, but the coverage is limited. Medicaid does pay for nursing home care, but it provides coverage only for those that qualify with low income and low assets. a) #143. The amount available to the policyowner for a loan is the policy's cash value. If there are any outstanding loans, that amount will be reduced by the amount of the unpaid loans and interest. a) #140. In a replacement situation the agent must be careful to compare the benefits, limitations and exclusions found in the current and the proposed replacement policy. c) #138. Insurers who meet the state's financial requirements and are approved to transact business in the state are considered authorized or admitted into the state as a legal insurer. c) #137. Excess Charge is the difference between the Medicare approved amount for a service or supply and the actual charge. b) #136. Retention is a planned assumption of risk, or acceptance of responsibility for the loss by an insured through the use of deductibles, copayments, or self-insurance. c) #134. Personal uses of life insurance include survivor protection, estate creation and conservation, cash accumulation, and liquidity. A buy-sell agreement is for business uses of life insurance. b) #133. This mandatory provision requires that no legal action to collect benefits may be started sooner than 60 days after the proof of loss is filed with the insurer. This gives the insurer time to evaluate the claim. d) #132. The return of premium optional nonforfeiture type benefit is offered by most insurers writing long term care policies. In the event the insured dies or the policy is lapsed, the insurer will return a certain percentage of the premiums paid. a) #131. According to the law of large numbers, the larger a group becomes, the easier it is to predict losses. Insurers use this law in order to predict certain types of losses and set appropriate premiums. d) #130. A producer may only accept a commission for a Medicare supplement policy only if the first year commission doesn't exceed 200% of the commission for the second year. Commissions taken from renewals of the supplemental policy must be the same as the second year, and received for at least 5 years. d) #129. The premium mode is the manner or frequency that the policyowner pays the policy premium. a) #128. The Medical Information Bureau receives information that an applicant provides in insurance applications and issues it in a coded format to insurers who request these reports. MIB information alone cannot be used to justify declining a risk, but it is helpful in providing insurers with information. a) #127. During the withdrawal, the interest earned on the withdrawn cash value may be subject to taxation. d) #126. Under the Uniform Required Provisions, proof of loss under a health insurance policy normally should be filed within 90 days of a loss. a) #125. "Community rated" is a rating method that uses the same rate structure for all insureds, regardless of their past or potential experience. d) #124. Funds in a qualified plan accumulate on a tax-deferred basis; however, at distribution any amount received by the employee will be treated as ordinary income for tax purposes. b) #123. A blanket policy covers members of a particular group when they are participating in a particular activity. Such groups include students, campers, passengers on a common carrier, or sports teams. Often the covered individual's name is not known because individuals come and go. Unlike group health insurance the individuals are automatically covered, and they do not receive a certificate of insurance. a) #122. The Seven-pay Test determines whether an insurance policy is "over-funded" or if it's a Modified Endowment Contract. In other words, the cumulative premiums paid during the first seven years of a policy must not exceed the total amount of net level premiums that would be required to pay the policy up using guaranteed mortality costs and interest. d) #121. There is no individual underwriting for group life insurance. b) #120. If an insured misstates his or her age upon policy application, the optional misstatement of age provision will change the payable benefit to that which would have been purchased at the insured's actual age. c) #118. The Insurance Code requires that each policy must include, "Written notice of claim must be given to the insurer within 20 days after the occurrence or commencement of any loss covered by the policy, or as soon thereafter as is reasonably possible". a) #117. Optionally renewable policies allow the insurer to cancel a policy for any reason whatsoever. Policies can only be cancelled by class on the policy anniversary or premium due date (renewal date). If the insurer elects to renew coverage, it can also increase the policy premium.
d) #116. Health insurance is a generic term, encompassing several types of insurance contracts, which, though related, are designed to protect against different risks. It provides coverage for expenses related to health care, loss of income, and disability income. a) #115. Dividends are not considered to be income for tax purposes, since they are the return of unused premiums. The interest earned on the dividends, however, is subject to taxation as ordinary income. a) #114. Whether or not an insured can deduct individual long-term care insurance premiums from his/her taxes, the benefits are received income tax-free. a) #113. The parties to a contract must be capable of entering into a contract in the eyes of the law. Generally, this requires that both parties be of legal age, mentally competent to understand the contract, and not under the influence of drugs or alcohol. a) #112. Only an executive officer of the company, not an agent, has authority to make any changes to the policy. The insurer must have the insured's written agreement to the change. b) #109. There are 3 types of enrollment periods for Medicare Part A: initial enrollment period, general enrollment period and special enrollment period. c) #108. Group insurance can often provide coverage for employees in more than one state. The state in which the coverage was delivered would have jurisdiction. a) #107. If a level term product is renewed at the end of the term period, the premium will be based upon the attained age of the insured. c) #106. The consideration clause requires the insurer to promise to pay in accordance to the terms stated in the contract. c) #105. The face of the term policy would be the same as the face amount provided under the whole life policy. c) #100. A qualified retirement plan is approved by the IRS, which then gives both the employer and employee benefits such as deductible contributions and tax-deferred growth. a) #99. If the payor (usually a parent or guardian) becomes disabled for at least 6 months or dies, the insurer will waive the premiums until the minor reaches a certain age, such as 21. b) #98. A Certificate of Authority is required in order to transact insurance. c) #97. The insured must notify the insurer of a newly born dependent, and if additional payment is required, pay within 31 days. c) #95. Consumer reports include written and/or oral information regarding a consumer's credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports, and other public sources. b) #94. Subscribers are people in whose name the contract is issued. They would be responsible for making premium payments. d) #90. Before issuing a replacement policy, the insurer must furnish the applicant with a notice regarding replacement, which must be signed by both the applicant and the agent. c) #89. Variable products are governed in part by the Securities and Exchange Commission; therefore, agents selling variable life policies must also secure a securities license. d) #88. Smoking or not smoking is a rating factor. b) #87. The Payment of Claims provision states that the claims must be paid to the policyowner, unless the death proceeds need to be paid to a beneficiary. a) #86. With a conditional receipt, insurance coverage is effective as of the date of the receipt, so long as the application is approved. They become part of the policy. #85. A notice of information practices must include the type of information that may be collected, the type and source of investigative techniques that may be used, that information may be disclosed to other parties, and a description of the rights of the party being investigated. Insurers are not required to disclose any of the actual information to the applicant. b) #84. In an aleatory contract, unequal amounts are exchanged between payments and benefits. In this instance, the insured receives a large benefit for a small price. d) #83. The three ratings classifications that denote the risk level of insureds are standard, substandard, and preferred. This classification system helps insurers to decide if an insured should pay a higher premium. b) #82. Most group disability income is nonoccupational coverage, covering insureds only off the job. The employer carries workers compensation for on the job injuries or sickness. c) #81. Under the Uniform Simultaneous Death Law, Common Disaster provision, the law will assume that the primary beneficiary dies first in a common disaster as long as the beneficiary dies within this specified period of time following the death of the insured (usually 30 days). This provides that the proceeds will be paid to either the contingent beneficiary or the insured's estate, if no contingent beneficiary is designated. a) #80. A small employer employs an average of at least 2 but not more than 50 employees on business days during the preceding calendar year and who employs at least two employees on the first day of the plan year. a) #79. A universal policy has two components: an insurance component and a cash account. The insurance component (or the death protection) of a universal life policy is always annual renewable term insurance. c) #78. Short-term disability is defined as a disability lasting not more than 2 years. b) #77. Custodial care, respite care, home health care, and adult day care are all coverages used to reduce the necessity of admission into a care facility. Skilled care is almost always provided in an institutional setting. c) #76. If an insured withdraws a portion of the death benefit by the use of this rider, the benefit payable at death will be reduced by that amount, plus the amount of earnings lost by the insurance company in interest income. b) #75. When dental coverage is covered under the benefits of a major medical plan, the dental coverage and medical coverage would be an integrated plan. Any deductible amount can be met by either dental or medical expenses. c) #74. Workers who have paid FICA taxes automatically qualify for Medicare Part A at age 65. Part A has been prepaid through the FICA taxes. Workers who qualify for Part A are also eligible for Part B; however, it requires that a monthly premium is withheld from Social Security benefits. b) #73. Unlike term insurance, permanent insurance provides lifetime death protection and a savings or cash value option. c) #72. Employer group health insurance generally requires that to be eligible for coverage an employee must be a full time employee, working in a covered classification, and must be actively at work. a) #71. Insurers are responsible for implementing a supervisory system for agent recommendations. The system must have written procedures for agents to follow and methods of periodic review for individual agents. Although insurers are responsible for such a system, they may contract the supervisory role to a third party. c) #70. Pre-existing conditions can no longer be excluded from coverage by individual or group medical expense policies. All the other examples are exclusions from coverage. d) #69. Insurers may exclude or limits coverage on any person if evidence of insurability is not sufficient. d) #68. If a premium is past due and the insurer owes claim payment, the amount of the premium will be deducted from the amount of the claim. For example, if a claim is worth $500 and the premium costs $200, the insured would receive the net total of $300 from his insurer. d) #67. The policyowner has the flexibility to increase the amount of premium going into the policy and to later decrease it again. In fact, the policyowner may even skip paying a premium and the policy will not lapse as long as there is sufficient cash value at the time to compensate for the nonpayment of premium. d) #66. The "accumulation period" is the period of time over which the annuity owner makes payments (premiums) into an annuity. This is the period of time during which the payments earn interest and grow tax deferred (which would be the case in a deferred annuity). d) #65. If an employer provides short-term disability benefits for its employees, the elimination period can be nonexistent, and the benefits can last as long as two years. The benefit typically spans 70-80% of the insured's income. a) #64. Term policies do not develop cash values. All the other statements are true. b) #63. Under the "installments for a fixed period" option, the annuitant selects the time period for the benefits, and the insurer determines how much each payment will be. This option pays for a specific period of time only, and there are no life contingencies. d) #62. Guaranteed renewable provision has all the same features that the noncancellable provision does, with the exception that the insurer can increase the policy premium on the policy anniversary date. However, the premiums can only be increased on a class basis, not on an individual policy. a) #60. The following taxation rules apply to contributions made to traditional IRA plans: tax-deductible contributions for the year of the contribution (based on the person's income); contributions must be made in "cash" in order to be tax deductible; excess contributions are taxed at 6% per year as long as the excess amounts remain in the IRA; and tax-deferred earnings are not taxed until withdrawn. d) #58. Under the Fair Credit Reporting Act, if an insurance policy is declined or modified because of information contained in a consumer report, the consumer must be advised and provided with the name and address of the reporting agency. a) #57. A long-term care policy may provide coverage for home health care, adult day care, hospice care or respite care. Acute care d) #56. Records must be kept available and open to inspection by the Commission, at any business time during the 3 years immediately following the completed transaction. d) #54. The two types of consideration on the part of an insurance applicant are payment of premiums and representations on the application. d) #52. Medicare Supplement Insurance policies may not duplicate benefits provided by Medicare. b) #49. There are 10 essential benefit categories under the ACA. b) #48. Conversion provisions are required by law. It allows terminated employees to convert their group health coverage to individual insurance without evidence of insurability, within a specified amount of time, and for eligible reasons. c) #47. The Commission will notify the applicant at least 10 calendar days' notice in writing, of the time and place of the hearing. b) #45. The principal grants authority to an agent through the agent's contract. d)
#44. Liquidity in life insurance refers to availability of cash to the insured through cash values. d) #43. If an annuitant dies before annuitization, the beneficiary will receive either the amount paid into the plan or the cash value of the plan, whichever is greater. d) #42. Issuing or circulating any sales material that is false or misleading would be considered misrepresentation and is illegal. d) #40. Qualified plans must have a vesting requirement. d) #38. A beneficiary is the person or interest to whom the policy proceeds will be paid upon the death of the insured. Beneficiaries do not have to have an insurable interest in the policyholder. c) #37. Annual check-ups are covered as routine dental procedures on dental expense insurance. a) #36. The purpose of regulating life and annuity marketing practices is to establish for insurers and agents minimum standards of conduct and guidelines to assure that advertisements, solicitations, replacements, conservation efforts, and sales of life insurance and annuities are not untrue, deceptive, or misleading. d) #35. "Viatical settlement provider" means a person, other than a viator, that enters into or effectuates (makes effective) a viatical settlement contract. d) #31. The advantages of an HMO or PPO for a Medicare recipient may be that there are no claims forms required, almost any medical problem is covered for a set fee so health care costs can be budgeted, and the HMO or PPO may pay for services not usually covered by Medicare or Medicare supplement policies, such as prescriptions, eye exams, hearing aids, or dental care. a) #29. Home health care is given in the home, but skilled nursing, intermediate, and custodial care may all be provided in an institutional setting. b) #28. The policy loan option is found only in policies that contain cash value. d) #27. Universal Life products allow the partial withdrawal, or surrender, of the policy cash value. d) #26. There are three basic types of term policies: level, increasing and decreasing. Regardless of the type of term insurance purchased, the premium is often level throughout the term of the policy. Only the amount of the death benefit may change. c) #25. A variable universal life insurance policy combines a flexible premium with a cash component that is invested for potentially great returns. d) #24. Every licensed agent convicted of a felony and/or any administrative action taken against the agent in another jurisdiction or by another governmental agency in this Commonwealth must report all the facts and circumstances to the Commission within 30 days. d) #23. Social Security disability benefits are paid to claimants whose disability is expected to last at least 12 months or lead to death. d) #22. Optional policy provisions can be changed by an insurer, as long as the changes do not adversely affect the policyholder. d) #21. Medicaid is a "needs" tested program administered by the states to provide assistance to persons who are not able to provide for themselves. b) #20. When an individual becomes a member of the HMO, he or she will choose a primary care physician. Once chosen, the primary care physician will be regularly compensated for being responsible for the care of that member. b) #19. Workers Compensation provides employees with medical, income, death, and rehabilitation benefits in the event of work-related injury. Workers Compensation #18. The Fair Credit Reporting Act regulates what information may be collected and how the information may be used. Consumer Reports include written and/or oral information regarding a consumer's credit, character, reputation, and habits collected by a reporting agency from employment records, credit reports, and other public sources. Ancestry is not a relevant factor assessed in these reports. a) #17. Since annuities are a popular means to provide retirement income, they are often used to fund qualified retirement plans. d) #15. There are many legitimate need-based expenses that can be paid by life insurance proceeds, from groceries to retirement income. Vacation travel expenses are most likely to be considered a luxury and not a need. d) #13. All general health policy advertisements must be maintained by the insurer on file for either 4 years or until the next scheduled report on examination, whichever is longer. Note that long-term care policies have different record-keeping requirements. a) #11. A policyowner may return a policy for any reason during the free-look period and receive a full refund. b) #10. A Medicare supplement policy cannot exclude or limit benefits for loss incurred more than 6 months before the effective date of the policy. A Medicare supplement policy can not duplicate benefits provided by Medicare. a) #9. Insurance companies promise guaranteed minimums on the fixed annuities (2.5% in this scenario). This means that if the investments draw less than that, the company will have to pay 2.5% anyway. If the investments earn over 2.5%, the company will pay that excess. b) #8. The insurer sets premium rates based upon underwriting considerations. a) #6. Under the concurrent review process, the insurance company will monitor the insured's hospital stay to make sure that everything is proceeding according to schedule and that the insured will be released from the hospital as planned. d) #4. Permitting individuals of the same class to be charged a different rate for the same insurance is the unfair trade practice of discrimination. a) #3. Hospice care, which includes respite care, and hospital care are included in Medicare Part A. b) Sets with similar termsMissed Questions59 terms Tommylikethegun92 GA Life/Health Ins Exam Questions36 terms zengurrl Group 1 Exam81 terms J20_Nguyen Missed Questions 251 terms Tommylikethegun92 Other sets by this creatorTEST REVIEW30 terms akiya_clark4 Module 6: Riots14 terms akiya_clark4 Module 522 terms akiya_clark4 Module 418 terms akiya_clark4 Verified questions
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Applications to an insurer must include all of the following information EXCEPT Quizlet
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