Chapter 15 – Health Insurance Flashcards
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Assume a health insurance contract states that it will pay $350 a month to the insured, should she become total disabled? Which term must aptly define this kind of contract?
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Valued
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HMOs are known for stressing
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Preventing medicine and early treatment
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Which of the following organization would make reimbursement payments directly to the insured individual for covered medical expenditures?
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Commercial Insurer
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Marty just received his first social security disability payment from this, we can assume
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His disability is expected to least 12 months
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Which of the following statements pertaining to health maintenance organizations is CORRECT?
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An insurance company may sponsor an HMO or assist an HMO by providing contractual services
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The waiting period before qualifying for social security disability benefits is how many months?
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5 months
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Which of the following individuals would probably qualify for social security disability benefits?
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John who experiences serious early onset Alzheimer's and is unable to remember how to get to work.
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Which of the following statements pertaining to Medicaid is not correct?
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It limits financial assistance to persons age 65 or over who are need of medical services they cannot afford
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Jerry is injured while working under state workers compensation laws, we can assume that?
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Jerry will probably receive workers compensation benefits on a monthly or weekly basis.
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The miscellaneous expense benefits in a basic hospital expense policy normally will cover?
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Drugs and medicine administered in the hospital
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Clarence is to enter the hospital for a thyroidectomy. His basic medical expense policy includes a relative value schedule for surgical expense. The schedule lists 55 units for a thyroidectomy and a conversion factor of $8. How much will the policy pay?
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$440
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Which of the following statements about deductible provisions in medical insurance policies is not correct?
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They are most common in basic medical expense policies.
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When a medical expense policy pays benefits on a fixed-rate basis, it pays?
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A flat amount per day for hospital room and board.
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Wilbur's basic medical expense policy limiys the miscellaneous expense benefits to 20 times the $90 daily room and board benefits. During his recent hospital stay, miscellaneous expenses totaled $2,100. How much, if any of this amount will Wilbur have to pay?
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$300
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Assume an insurer will issue a maximum monthly disability income benefit of $5,000. Provided the total of such benefits payable by all companies does not exceed 60% of the insured's regular monthly income. Ted earns $4,500 per month and has no existing disability income policy. The maximum monthly disability income benefit this insurer would issue to Ted is?
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$2,700
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Which of the following is not a basis for occupational suitability when determining total disability?
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Job Interest
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Which of the following statements about elimination periods in disability income policies is not correct?
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Benefits are not payable during an elimination period but are paid retroactively to the beginning of the period if the insured remains disable throughout the period.
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Which of the following riders provides for changes In the benefit payable based on changes in the consumer prices index (CPI)
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Cost-of-living adjustment rider
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Benefit periods for individual short-term disability policies typically vary from?
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6 months to 2 years
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Which of the following statements about waiver of premium in health insurance policies is not correct
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It normally applies to both medical expense and disability income policies.
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Which of the following terms relates to disability income insurance?
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Residual amount benefit
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Which definition of total disability is more favorable to the insured?
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\"own Occupation\" is more favorable
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Sidney has a monthly benefit of $2,500 for total disability under a residual disability income policy. If Sidney suffers a 40% los of his predisability income, how much will his benefit be?
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$1,000
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What is the initial period of time specified in a disability income policy that must pass, after a policy is in force, before a loss due to sickness can be covered?
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Probationary period
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The amount payable as a death benefit in an accidental death and dismemberment policy is known as the?
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Principal Sum
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Theodore received a $15,000 cash benefit from his $50,000 accidental death and dismemberment policy for the accidental loss of the eye. The amount he received could be identified as the policy's?
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Capital Sum
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Which of the following examples pertaining to accidental death and dismemberment insurance is correct?
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Linda has a $40,000 AD-n-D policy that pays triple indemnity. If she should be killed in a train wreck, her beneficiary would receive $120,000.
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Agnes purchases a round trip travel accident policy at the airport before leaving on a business trip. Her policy would be which type of insurance?
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Limited risk
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which of the following statements pertaining to medicare is correct?
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medicare part A, is automatically provided when a qualified individual applies for social security benefits.
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under medicare part B, the participant must pay all of the following except?
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a per benefit deductible
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which of the following statements about medicare part B is not correct?
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it is a compulsory program
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for how many days of skilled nursing facility care will medicare pay benefits?
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100
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which of the following statements concerning workers compensation is not correct?
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a workers receiver benefits only if the work related injury was not her fault.
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the core policy (plan-A) developed by the NAIC as a standard medicare supplement policy includes all the following except?
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the medicare part A deductible
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which of the following is a serious condition from which a patient can fully recover with proper medical attention?
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acute illness
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skilled nursing care differs from intermediate care in which of the following ways?
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it must be available 24 hours a day while intermediate care is daily but not 24-hour care
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all of the following conditions are typically covered in a long-term insurance policy except?
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alcohol dependency
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which of the following statements about long-term care insurance policies is not correct?
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premiums for a long-term care policy are based solely on the insureds age,health,and the type of benefits provided.
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a company may change the wording of a uniform policy provision in its health insurance policies only if the?
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modified provision is not less favorable to the insured
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children of the insured are eligible for health insurance coverage until they attain age 19, or if they remain in school full time till age?
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23
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which of the following statements pertaining to the grace period and reinstatement provision in health insurance policies is not correct?
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under a health policys reinstatement terms, insured losses from accidental injuries and sickness are covered immediately after reinstatement.
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which of the following is the usual grace period for a semiannual premium policy
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31-days
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dianna, the beneficiary under her husband AD-n-D policy submits an accidental death claim on may 1, 2010 following his death . however the company denies the claim on the basis that death was due to natural causes. she decides to talk to her attorney what is the earliest date for taking legal action against the insurer?
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july 1, 2010 (two months)
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Which is not a required uniform provision in individual health insurance?
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Change of occupation
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Under the misstatement of age provision in a health insurance policy, what can a company do if it discovers that an insured gave a wrong age at the time of application?
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Adjust the benefits
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The conformity with state statutes provision in a health insurance policy stipulates that any policy provision that is in conflict with the statutes of the state where the insured resides is?
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Automatically amended to conform to the minimum requirements of the state's statutes
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Which section of a health insurance policy specifies the conditions, times, and circumstances under which the insures is not covered by the policy?
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Exclusions
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Which kind of health insurance policy assures renewability up to a specific age of the insured, although the company reserves the right to change the premium rate on a class basis?
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Guaranteed renewable
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According to the notice of claims provision in a health insurance policy, a claimant normally must notify the insurance company of loss within how many days after the loss occurs?
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20 days
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Which of the following types of health insurance policies prevents the company from changing the premium rate or modifying the coverage in any way?
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Noncancellable
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Susan is covered under her employer-sponsored disability group plan. The premium is $150 a month. Susan pays $10 and the employer pays $40. Assuming Susan were to become disabled and receive monthly disability benefits of $700 from the plan, how much, if any, of the monthly benefit would be taxable income?
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$560
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Assume the following individuals are issued health insurance policies with varying renewability provisions. All other factors being equal, who would pay the highest premium?
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Jack-noncancellable
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Which of the following is the purpose of medical cost management?
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To control health claims expenses
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Which is not a primary risk factor in underwriting individual health insurance policies?
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Geographical location
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Which of the following statements most aptly describes health insurance benefits?
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The greater the benefits, the higher the premium
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Which of the following would probably NOT be considered in underwriting a health insurance risk?
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Martial status
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All of the following factors would affect a health insurance policy's premium rate except?
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Residential address of the insured.
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Rick, who has no health insurance, experienced $3000 in medical expenses this year. Assuming his adjusted gross income was $29,000, how much of those medical expenses can he deduct from his income taxes, if any?
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$825
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What kind of table reflects the average number of disabilities due to sickness or accidents at various ages?
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morbidity
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What is the effects of an impairment rider attached to a health insurance policy?
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To exclude from coverage losses resulting from specified conditions
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Which of the following statements about group health insurance is CORRECT?
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Group health plans provide more extensive benefits that individual health plans.
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Which type of group health coverage typically does NOT contain a conversion privilege?
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Accidental death and dismemberment
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Which of the following can an individual include as qualifying expenses for purposes of determining a medical tax deduction?
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Premium contributions paid by the individual to a group medical expense plan.
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An individual purchased group credit accident and health insurance to cover a car loan. Following an accident, the individual was disabled for eight months. Which of the following benefits were paid under the policy?
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An amount equal to eight months of the loan payment to the insured's creditor
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Dan is a participant in his company's group health plan. One of the plan's provisions specifies that, in the event he is eligible for benefits under another policy, his group plan will serve as the primary plan. What is this provision called?
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Coordination of benefits provision.
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A vacation cruise line that wants group health coverage for its passengers would purchase what kind of insurance?
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Blanket health insurance
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The purpose of cobra requirements concerns?
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Continuation of health insurance
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Sally is covered by her employer's noncontributory group disability income plan, the premium for which is $50 a month. If she were to become disabled and receive $1000 a month, how much of each benefit payment would be taxable income to her?
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$1,000
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which of the following statements regarding group disability income plans is not correct?
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Employees covered under both a short term and long term plan collect benefits from each simultaneously
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Which of the following statements about cobra is correct?
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The premium for continued group medical coverage may be up to 102% of the premium that would otherwise be charged.
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All of the following are methods of keeping premium costs to a minimum in a health policy EXCEPT?
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Waiving the right to receive benefits
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Fred owns a small hardware store and is covered under a business overhead expense policy. If he becomes disabled, he can expect all the following expenses to be covered EXCEPT
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His salary
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Which of the following characteristics is associated with disability buy-out plans?
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The option to elect a lump-sum payment
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What is the income tax consequence if Marie's employer pays for her group disability income coverage?
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The employer can deduct the premium payments
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With regard to health insurance policies, which of the following statements is CORRECT?
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A disability policy with a -month elimination period is less expensive than one with a 60-day elimination period, all other factors being equal.
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The general powers and duties of the Office of Insurance Regulation include all of the following EXCEPT to
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To enact statutes to govern the insurance industry
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The major areas of regulation by the Office of Insurance Regulation include which of the following?
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Policing against unauthorized insurance activities
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All of the following are reasons the insurance industry is subject to government regulation EXCEPT?
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The need to monitor the premium payment practices of the public
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What two authorities can impose penalties for violation of state insurance laws?
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Chief financial officer and the courts.
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A fraternal life insurance organization can operate as any of the following EXCEPT
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Charitable Trust
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An insurance company cant be which of the following?
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Domestic and alien
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In insurance regulatory language, which of the following property identifies a \"foreign\" insurance company?
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Insurance company whose home office is in another state
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The definition of transacting insurance includes all of the following EXCEPT
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Underwriting a contract of insurance
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Of the following terms, which best describes that of replacing existing life insurance with a new life insurance policy based upon incomplete or incorrect representation?
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Twisting
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All of the following activities could result in the suspension of an agent's license EXCEPT
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Selling any replacement policy that causes an insured to lapse an existing policy
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which of the following would be considered an unfair claim practice?
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Misrepresenting insurance policy provisions affecting a loss
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All of the following activities violate the Florida insurance code except
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Dividing commission on a life insurance policy with another agent who is licensed and appointed to sell the same line of insurance
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Violation of the controlled business statute occurs if an agent sells most of his or her business to
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Employees of a business owned by his or her father
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Sliding consists of all of the following activities except?
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Recommending that a client take cash value from a policy to make other investment
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Which of the following statements is correct about the department of financial services right to examine an agent's records?
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An examination can be conducted at any time to discover any unfair trade practices.
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Which of the following penalties imposed upon an agent by the Chief Financial Officer does NOT match the offense?
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Violation of a cease-and desist order can result in a fine of no more that $2,500
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Which of the following activities is not a violation of the insurance code?
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Writing as much noncontrolled insurance business as controlled business.
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All of the following are characteristics of a mutual insurance company EXCEPT
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Management elects the board of directors.
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Transacting insurance business does NOT include which of the following activities?
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Negotiating an agency contract with an insurance company
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If an agent changes her residence address, she must notify the department of financial services within
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60 days
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Which of the following is correct about the replacement rule?
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Instructions regarding the rule are available from appointed life insurers.
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Which of the following is not considered to be an element of replacement?
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An existing policy is subjected to a loan of 10 percent of its value.
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In which of the following ways is a beneficiary protected from the creditors of the deceased insured?
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If the policy is made payable to a named beneficiary, then the creditors can make no claim on the proceeds.
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All of the following statements are correct about policy loan interest rates except?
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Policy loan interest rates were set by the offices of insurance regulation in 1993 and may not be changed
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Which of the following applies when an insured wishes to convert industrial insurance policies for an ordinary policy?
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It is possible to convert $3,000 or more of industrial insurance
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In a typical family policy, coverage on the children is usually provided by which of the following?
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Term life
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All of the following groups are eligible for group life insurance EXCEPT
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Social clubs
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Which of the following is the correct number of lives required in Florida for a group life insurance policy?
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No minimum
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Which of the following is not required when a group life insurance policy is cancelled?
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The insurance company must request that the policy owner notify the group members
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A trusteeship group insurance policy
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Insures employees of two or more employers
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Which of the following is a requirement of a participating life insurance policy?
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Pays individuals to policyholders
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All of the following apply under the Federal ERISA law except
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The Florida law on retirement plans supersedes ERISA
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Variable life insurance policies involve all of the following except?
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A traditional approach to term life insurance
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All of the following apply to a universal life insurance policy except?
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There are no restrictions on it as far as receiving favorable tax treatment
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Which of the following statements applies to the right of a surviving spouse under a group insurance policy?
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Conversion privileges extend to the spouse but not to the children
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Which of the following rules would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?
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Replacement Rule
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During what period is a new policyowner entitled to review a policy and return it for a full refund?
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Within 14 days after deliver of the policy
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All of the following statements about life insurance benefits are correct except?
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Benefits payable to the insured's estate are protected from the insured's creditors
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All of the following are correct about the policy loan interest rate except
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there are no restrictions or limitations on policy loan interest rates
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All of the following statements are correct about the law for conversion (change of plan) except
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The maximum amount of face value that can be converted is $2,000
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All of the following are correct about a family plan policy except
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Only children living when the policy is issued are covered
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Which of the following statements is correct about life insurance?
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It Is written with a master policy for members of qualified groups
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Under group life insurance, which of the following statements is correct
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If cancelled, the members be notified
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All of the following are eligible groups under Florida law except
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Groups established to buy insurance
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All of the following statements are correct about group life insurance except
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Certificate holders need not be notified if the policy expires
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All of the following statements are correct about a participating policy except
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Dividends are not considered in comparison to nonparticipating policies
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An insurance policy dividend can be all of the following except
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Paid by a nonparticipating policy
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Which of the hollowing applies to retirement plans in florida?
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Federal ERISA regulation override Florida law
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Which of the following is a requirement that a professional association must meet to obtain group insurance?
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It must have been in existence for at least 2 years
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All of the following statements about a participating policy are correct except
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Policy dividends paid in cash are taxable
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