question

What are two components of a universal policy?

answer

Insurance and Cash Account

question

What are 3 details in the underwriting process for life insurance?

answer

Selection, classification, and rating of risks

question

What are two types of reserves?

answer

Premium and loss

question

When an insurer neglects to pay a legitimate claim that is covered under the terms of the policy, what has the insurer violated?

answer

Consideration

question

What is the binding force in a contract?

answer

Consideration

question

What is consideration on the part of the insured?

answer

The payment of premiums

question

What is a difference in the comparison between private and government insurers?

answer

Private insurers may be authorized to transact insurance by state insurance departments.

question

The following is an example of what type of authority: The agent accepts a premium payment after the end of the grace period.

answer

Apparent Authority

question

A Universal Life insurance policy has two types of interest rates that are called:

answer

Guaranteed and Current

question

What type of policy covers unusual risks that are NOT normally included under Accidental Death and Dismemberment coverage?

answer

Special Risk Policy

question

What is the term used to describe a person, other than a viator, that enters into or effectuates a viatical settlement contract?

answer

Viatical settlement Provider

question

True/False: Fixed annuities provide a minimum guaranteed rate of interest

answer

False

question

True/False: Fixed annuities provide a hedge against inflation

answer

True

question

True/False: Income Dependencey Period is considered and income period.

answer

False

question

The document that describes an insured's medical history, including diagnoses and treatments?

answer

Attending Physician's Statement

question

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

answer

5 Days

question

When an insured, upon the end of a term policy with guaranteed renewable option, may answer medical questions to prove insurability and qualify for a discounted premium rate is called:

answer

Re-Entry

question

To sign up for a medicare prescription drug plan, individuals must first be enrolled in which parts of medicare

answer

Medicare Part A or Parts A and B

question

An insured pays a small $100 premium every month, yet the insurer promises to pay a high percentage of all medical costs. What element of an insurance contract does this describe?

answer

Aleatory

question

What is NOT able to be changed in an adjustable life policy

answer

Type of investment

question

True/False: Regarding a deferred annuity, income payments begin within 1 year from the date of purchase.

answer

False

question

True/False: Presumptive disability plans offer full benefits for specified conditions

answer

True

question

True/False: An individual is terminated from his full-time job at the age of 67 is eligible for COBRA benefits.

answer

False

question

If withdrawn before age 65, non qualified distributions from an MSA are included in the employee's gross income and subject to a penalty tax of how much?

answer

15%

question

What is true regarding a term health policy?

answer

It is nonrenewable

question

Without creating a formal corporate insurance structure,what could a group of individuals form to help share their losses?

answer

Risk-sharing pool

question

Events or conditions that increase the chances of an insured loss occuring are referred to as:

answer

Hazards

question

Most HMO's operate through what type of system?

answer

A group enrollment system either at their place of employment or as a member of an association

question

If a life insurance policy is deemed to be a modified endowment contract, the policy loans:

answer

Will be taxed on a last-in-first out basis.

question

A great reason to purchase life insurance rather than an annuity is:

answer

to create an estate

question

Contracts that are prepared by one party ans submitted to the other party on the "Take it or Leave it" basis are classified as:

answer

Contracts of Adhesion

question

True/False: In regards to the 1035 exchange, A whole life insurance policy can be exchanged for a term insurance policy.

answer

False

question

What type of policy would be an example of a limited accident and health insurance policy?

answer

A Dread disease policy

question

The primary requirement in order to receive Medicaid benefits is based upon:

answer

Need

question

How often must domestic insurance companies be examined by the Chief Financial Officer in Florida?

answer

At least every 5 years

question

True/False: Medicare Part A services include outpatient Hospital Treatment.

answer

False

question

True/False: A deferred annuitiy has a payout within 1 year.

answer

False

question

Which component must increase in the increasing term insurance?

answer

Death Benefit

question

What is the purpose of establishing the target premium for a universal life policy?

answer

To keep the policy in force

question

True/False: A Payor Benefit Rider would cause the Death Benefit to increase.

answer

False

question

How does a payor Benefit rider pay?

answer

It only pays the premium if the payor is disabled or dies.

question

A peril is most easily defined as:

answer

The cause of loss insured against.

question

What is the name of the person who refers subscribers to specialists for necessary treatment, disapproves requests for procedures from subscribers that he/she feels is not medically necessary or advantageous?

answer

Gatekeeper

question

Susan owns an individual long-term care insurance plan and is able to deduct the premiums from her taxes. What income taxation will be imposed on the benefits she receives?

answer

None

question

The terms and conditions of a life insurance policy is found in the

answer

Policy clauses and provisions

question

True/False: If life insurance benefits for minors is placed in the hands of either a guardian or a trustee, the guardian may or may not be acountable for assets.

answer

True

question

True/False: Someone who works 400 hours per year would qualify for a Keogh Plan.

answer

False. A person must have worked at least 1000 per year.

question

True/False: A person is enrolled in Part A of Medicare and not Part B. Three months into coverage, he applies for a Medicare supplement policy. Can the insurer deny coverage?

answer

True Under the OBRA of 1990 Medicare supplement insurance may not be denied on the basis of an applicant's health status, claims experience, or medical condition during the first six months after a medicare beneficiary age 65 or older first enrolls in Part B of Medicare.

question

True/False: During a replacement of life insurance, a replacing insurer must obtain a list of all insurance policies that will be replaced.

answer

True

question

True/False: Concerning the taxation of a traditional IRA early distributions are always subject to penalty.

answer

False

question

True/False: Regarding Blue Cross and Blue Shield, they are considered insurance companies.

answer

False

question

A participant contributes mor than the maximum amount to her Roth IRA. What kind of tax penalty will he or she have to pay?

answer

6%

question

Which renewability provision allows an insurer to terminate a policy for any reason, and to increase the premiums for any class of insureds?

answer

Optionally Renewable

question

Under which condition would an employee's group medical benefits be exempt from income taxes?

answer

An employee's group medical benefits are generally exempt from taxation as income.

question

Bob owns an adjustable life policy. Sometime in the future he wants to increase the death benefit. Which statement would be correct regarding this change?

answer

The death benefit can be increased by providing evidence of insurability.

question

Who can make changes to the policy once its in effect?

answer

An executive officer of the insurer.

question

Social Security Supplement or Social Security Riders are used to supplement or replace benefits that might be payable under social security disability. In which of the following situations would these NOT provide for the payment of income benefits?

answer

When the amount payable under social seurity is more than the amount payable under the rider.

question

Which report will provide the underwriter with the information about a consumer's credit?

answer

Consumer Report

question

What are the three main differences between fixed and variable annuities?

answer

License Requirements Interest Rate Underlying Investment

question

If a person holds licenses to sell both life and property insurance, how many hours of life insurance continuing education will ther person need to complete every 2 years?

answer

12 hours.

question

If a parent would like to enroll a child over the ane of 5 into the Florida Healthy Kids Program, their family income must be under what percentage of the federal proverty level?

answer

200%

question

What type of insurance provider woule be considered a risk sharing arrangement?

answer

Recriprocal

question

True/False: Flying on a commercial airline required by your job is a factor in the underwriting process?

answer

False

question

What rider provides for a waiver of premium when the policy owner and the insured are NOT the same person?

answer

Payor benefit

question

A business wants to make sure that if a key employee becomes disabled, the business will be protected from any resulting loss. What kind of insurance will protect the business?

answer

Business Disability

question

What would NOT be a way to determine the interest rate in a Universal Life Policy?

answer

Some insurers base their interest rate on the estimated market conditions for the life of the policy.

question

What is the advantage of reinstating a policy instead of applying for a new one?

answer

The original age is used for premium determination.

question

What clause is said to be the "Heart of the Policy," containing the company's promise to pay?

answer

Insuring Clause

question

What is true regarding the agent's appointments?

answer

A person may hold several appointments at one time.

question

The rider that may be added to a disability income policy that allows for an increase in the benefit amount under certain conditions is called:

answer

Cost of Living (COLA)

question

An HSA holder who is 65 years old decides to use the money in the account for non-health expense. WHich of the following is true?

answer

he will have to pay tax.

question

A family's income need is greatest during which period?

answer

Family Income Dependency

question

What is the Family Dependency Period?

answer

The period when, should the insured die prematurely, the surviving spouse will have dependent children to support.

question

What is the unpaid premium provision?

answer

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.

question

What is the maximum penalty for habitual willful noncompliance with the fair credit reporting act?

answer

$2,500

question

Agents are required by law to maintain records of insurance transactions pertaining to premium payments for at least:

answer

3 years

question

An agent's appointment has been declined. Which of the following is true?

answer

State taxes may be refunded upon a written request.

question

True/False: HMO coverage is divided into geographic territories.

answer

True

question

True/False: Regarding insurable risks, insureds cannot be randomly selected.

answer

False. Selecting insureds randomly will help the insurer to have a fair proportion of good risks to poor risks.

question

True/False: Persons disabled before the age of 24 can qualify for social security benefits with only 6 work credits earned in the 3 years prior to the start of the disability.

answer

True

question

What is the most common time for error and omissions to occur in the part of an insurer?

answer

Policy Delivery & Sales interview

question

True/False: Replacing insurance policies for the purpose of making commissions is legal

answer

False. This is called Churning which is illegal.

question

What option allows the insured to periodically increase benefit levels without providing evidence of insurability?

answer

Guarantee of Insurability

question

True/False: Protection from the policyowner's creditions would be a benefit of a suvivorship life policy.

answer

False

question

True/False: Federal Deposit Insurance Corporation (FDIC) is is a government insurance program.

answer

False

question

An insured has medicare Part D Coverage. He has reached his initial benefit limit and must now pay 100% of his prescription drug costs. What is the term for this gap in coverage?

answer

Doughnut hole

question

What would be an example of a limited accident and healt insurance policy?

answer

A dread disease policy

question

True/False: Concerning the COBRA Act of 1985, It requires all employers, regardless of the number or age of employees to provide extended group health coverage.

answer

False

question

True/False: COBRA Act applies to only employers with 20 or more employees

answer

True

question

In a deferred annuity, how do the current and guaranteed interest rates work together?

answer

The owner will receive the guaranteed rate or the current rate, whichever is higher.

question

The insurer may suspect that a moral hazard exists if the policy holder:

answer

Was not honest about all aspects regarding his health on an application for insurance

question

When a replacement is involved, a replacing insurance company is responsible for all of the following EXCEPT:

answer

Provide a copy of the important notice regarding replacement of Life insurance to the applicant.

question

In comparison to consumer reports, what would describe a unique charasteristic of investigative consumer reports?

answer

The customer's associates, friends, and neighbors provide the report's data.

question

True/False: Regarding the characteristics of a group life insurance plan, there is a requirement to prove insurability on the part of the participants.

answer

False

question

When an insurer appoints an agent,

answer

The insurer is bound by the agent's acts.

question

When a homeowner purchases insurance on their home, what risk management technique are they practicing?

answer

Transfer

question

What is the initial period of time specified in a disability income policy that must pass, after the policy is in force, before a loss can be covered?

answer

Probationary Period

question

What is a Family Income policy?

answer

Provides monthly income upon the death of the insured while maintaining permanent coverage until the end of the income payments by combining decreasing term insurance and whole life insurance.

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