question

An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?

answer

Consideration clause

question

An insured pays premiums on an annual basis for an individual health insurance policy. What is the MINIMUM number of days for the Grace Period provision?

answer

31

question

Which of these circumstances is a Business Disability Buy-Sell policy designed to help in the sale of a business?

answer

Business owner becoming disabled

question

The Notice of Claims provision requires a policyowner to

answer

notify an insurer of a claim within a specified time

question

Under which of the following circumstances do the benefits under COBRA continuation coverage expire?

answer

All group health plans are eliminated by the employer

question

Which of the following statements describes what an Accident and Health policyowner may NOT do?

answer

Adjust the premium payments

question

According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?

answer

Monthly

question

Which statement is TRUE regarding a group accident ; health policy issued to an employer?

answer

The employer is the policyowner and each employee receives a certificate of coverage

question

What should an insured do if the insurer does not send claims forms within the time period set forth in a health policy's Claims Forms provision?

answer

Submit the claim in any form

question

Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?

answer

Entire Contract

question

Many small business owners worry how their business would survive financially if the owner becomes disabled. The policy which BEST addresses this concern is

answer

Business Overhead Expense

question

T is covered by two health insurance plans: a group plan through his employer and his spouse's plan as a dependent. When T submits a claim, his employer's plan is considered what type of carrier under the Model Group Coordination of Benefits provision?

answer

Primary carrier

question

When an employee is required to pay a portion of the premium for an employer/employee group health plan, the employee is covered under which of the following plans?

answer

Contributory

question

Which of the following statements is correct regarding an employer/employee group health plan?

answer

the employer receives a master policy and the employees receive certificates

question

What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy?

answer

Premiums may increase at time of renewal

question

J, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J's ages as stated on the application five years ago was found to be understated by ten years. Which of the following actions will the insurance company take?

answer

The insurer will adjust the benefit to what the premiums paid would have purchased at the time the insured's actual age

question

Which of the following statements BEST describes how a policy that uses the "accidental bodily injury" definition of an accident differs from one that used the "accidental means" definition?

answer

Less restrictive

question

M's insurance company denied a reinstatement application for her lapsed health insurance policy. The company did not notify M of this denial. How many days from the reinstatement application date does the insurance company have to notify M of the denial before the policy will be automatically placed back in force?

answer

45 days

question

With Optionally Renewable Health policies, the insurer may

answer

review the policy annually and determine whether or not to renew it

question

Which of the following BEST describes a short-term medical expense policy?

answer

Nonrenewable

question

If an insurance company issues a Disability Income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best describes this policy is called

answer

noncancellable

question

Which of the following statements BEST describes what the Legal Actions provision of an Accident and Health policy requires?

answer

An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed

question

A Disability Income policyowner recently submitted a claim for a chronic neck problem that has now resulted in total disability. The orginal neck injury occurred before the application. How will the insurer handle this claim?

answer

Claim will be paid and coverage will remain in force

question

The provision in a Group Health policy that allows the insurer to postpone coverage for aa covered illness 30 days after the policy's effective date is referred to as the

answer

Waiting Period

question

Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy?

answer

Premiums are waived after the insured has been totally disabled for a specified time period

question

R had received full disability income benefits for 6 months. when he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?

answer

Residual Disability

question

M becomes disabled and is unable to work for six months. M dies soon after from complications arising from his disability. M has a Disability Income policy that pays $2,000 a month. Which of the following statements BEST describes what is owed to her estate?

answer

earned, but unpaid benefits

question

K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would cover her loss of income?

answer

Disability Income

question

Which of the following is the MOST important factor when deciding how much Disability Income coverage an applicant should purchase?

answer

Applicant's monthly income

question

An individual Disability Income insurance applicant may be required to submit all of the following EXCEPT

answer

spouse's occupation

question

A Disability Income policyowner suffers a disability which was due to the same cause as a previous disability. Both disabilities occurred within a five-month period. The insurer may cover the second disability without a new elimination period under the

answer

Recurrent Disability provision

question

A medical care provider which typically delivers health services at its own local medical facility is known as a

answer

Health Maintenance Organization

question

Which type of provider is known for stressing preventative medical care?

answer

Health Maintenance Organizations (HMO's)

question

The individual who provides general medical care for a patient as well as the referral for specialized care is known as a

answer

Primary Care Physician

question

M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for?

answer

Determined by the terms of the policy

question

Medicare is intended for all of the following groups EXCEPT

answer

Those enrolled as a full-time student

question

Which of the following statements BEST defines usual, customary, and reasonable (UCR) charges?

answer

The maximum amount considered eligible for reimbursement by an insurance company under a health plan

question

Which of the following situations does a Critical Illness plan cover?

answer

Leukemia

question

Which of the following statements BEST describes dental care indemnity coverage?

answer

Services are reimbursed after insurer receives the invoice

question

Major Medical policies typically

answer

contain a deductible and coinsurance

question

The first portion of a covered Major Medical insurance expense that the insured is required to pay is called the

answer

initial deductible

question

Which of the following statements BEST describes the intent of a Coinsurance clause in a Major Medical policy?

answer

Discourages overutilization of the insurance coverage

question

Which of these is considered a true statement regarding Medicaid?

answer

Funded by both states and federal governments

question

T was treated for an ailment 2 moths prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards. How will the insurer likely consider this condition?

answer

Insurer will likely treat as a pre-existing condition which may not be covered for one year

question

The individual most likely to buy a Medicare Supplement policy would be a(n)

answer

68-year old male covered by Medicare

question

N has a Major Medical policy that only pays a portion of N's medical expenses. N is responsible for paying the remaining balance. This provision is known as

answer

Coinsurance

question

Which of the following statements is true about most Blue Cross/Blue Shield organizations?

answer

They are nonprofit organizations

question

In Major Medical Expense policies, what is the intent of a Stop Loss provision?

answer

Limits an insured's out-of-pocket medical expenses

question

Which of the following statements about Health Reimbursement Arrangements (HRA) is CORRECT?

answer

If the employee paid for qualified medical expenses, the reimbursements may be tax-free

question

Deductibles are used in health policies to lower

answer

overuse of medical services

question

Which of the following phrases refers to the fees charged by a healthcare professional?

answer

Usual, customary, and reasonable expenses

question

Basic Hospital and Surgical policy benefits are

answer

lower than the actual expenses incurred

question

A characteristic of Preferred Provider Organizations (PPOs) would be:

answer

Discounted fees for the patient

question

All of the following statements about Major Medical benefits are true EXCEPT

answer

Benefits have no maximum limit

question

Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for a Disability Income policy?

answer

Issue the policy with an altered Time of Payment of Claims provision

question

Which of the following are NOT managed care organizations?

answer

Medical Information Bureau (MIB)

question

Which of the following BEST describes how pre-admission certificates are used?

answer

Used to prevent nonessential medical costs

question

An example of unfair discrimination would be

answer

offering different terms of coverage for different policyowners having the same risk classification

question

Which of the following is NOT required in the Outline of Coverage for a health insurance policy?

answer

Projection of the policy's future

question

A person insured under a health policy is required to give the insurance company a Notice of Claim within how many days after a covered loss?

answer

Twenty

question

How many hours of continuing education must a newly licensed agent complete every two years?

answer

24

question

What do Dread Disease policies cover?

answer

A specific disease or illness

question

Within how many days after policy delivery can a Medicare Supplement policy be returned for 100% premium refund?

answer

30

question

A mutual insurance company and a stock insurance company have one main difference between them. What is this major contrast?

answer

Stock company is owned by its shareholders. Mutual company is owned by its policyholders.

question

What type of insurance company is domiciled in England, but conducts business in Florida?

answer

Alien

question

What is the required minimum percentage of employee participation for a noncontributory group health insurance plan according to Florida Law?

answer

0%

question

Which of the following professional organizations has its code of ethics incorporated into Florida law?

answer

National Association of Insurance and Financial Advisors (NAIFA)

question

According to Florida law, which of the following statements accurately describes an admitted mail order insurance company?

answer

It may solicit insurance business by mail without the assistance of a licensed agent

question

An example of an unfair trade practice is

answer

an agent making a material misrepresentation to the insured

question

In Florida, the underwriting and issuance of a master group health policy requires that all employees

answer

are eligible to participate, regardless of their individual health history

question

Within how many days must a licensee notify the Department of Financial Services of a change in address?

answer

30

question

All of the following are eligibility requirements for an association group EXCEPT

answer

Contributory plans require a minimum of 25 participants

question

Which two entities regulate variable annuities?

answer

Department of Financial Services; and Securities Exchange Commission

question

All of the following are Nonforfeiture Options EXCEPT

answer

Automatic Premium Loan Option

question

During the application process, the agent's primary responsibility is to

answer

the insurance company

question

In Florida, what is the maximum percentage of controlled business an agent may produce?

answer

50%

question

Association Plans that are designed to provide health benefits to their members are regulated by the state because

answer

they are insured by an authorized insurer

question

What percentage of eligible persons must a policy cover in a noncontributory group?

answer

100%

question

All of the following will result in the suspension of an agent's license EXCEPT

answer

acting with fiduciary responsibility

question

According to Florida law, when must an agent deliver the Outline of Coverage to a Medicare Supplement applicant?

answer

At the same time of application

question

Which entity approves the insurance policy forms used in Florida?

answer

Office of Insurance Regulation (OIR)

question

All of the following entries are classified under the four principal areas of Florida insurance law EXCEPT

answer

An agent's commission

question

Which of the following is NOT an unfair claim settlement practice?

answer

Needing written documentation of claim details

question

A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan's termination?

answer

31 days

question

What do families pay that are covered by the Florida Healthy Kids Corporation?

answer

A portion of the premium

question

In Florida, deceptive advertising is considered to be

answer

a form of misrepresentation

question

Who is a mutual insurance company owned by?

answer

Its policyholders

question

A stock life insurance company that issues both participating and nonparticipating policies is doing business on

answer

a mixed plan

question

During the course of an insurance transaction, if an agent makes a false or incomplete statement, he/she could be found guilty of

answer

misrepresentation

question

Employers with less than ____ employees are affected by Florida's Health Insurance Coverage Continuation Act (Mini COBRA).

answer

20

question

An agent's license can be suspended or revoked by

answer

writing primarily controlled business

question

Insurance companies that are organized in countries outside the United States are referred to as

answer

alien

question

In Florida, an element of an insurance transaction would be

answer

issuing an insurance contract

question

Florida requires that an insurance agent must complete ___ hours of continuing education of the subject of law and ethics every two years.

answer

5

question

An example of sliding would be

answer

charging for an additional product without the applicant's consent

question

In Florida, when agents recommend changes be made for existing coverage, the agent must follow established procedures. The name of this rule is called the

answer

Florida Replacement Rule

question

In Florida, which of the following is considered an Unfair Trade Practice?

answer

Coercion

question

Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?

answer

Misrepresentation

question

Which of the following is NOT considered rebating?

answer

Sharing commission with an agent licensed in the same line of business

question

J is an agent who has induced through misrepresentation to surrender an existing insurance policy. What is J guilty of?

answer

Twisting

question

Which type of insurance company allows their policyowners to elect a governing body?

answer

Mutual

question

A stock insurance company

answer

is owned exclusively by its shareholders

question

An example of rebating would be

answer

offering a client something of value not stated in the contract in exchange for their business

question

Which of the following is an example of an Unfair Trade Practice?

answer

Coercion

question

Upon reaching the limiting age, a handicapped child can extend their health insurance coverage as a dependent

answer

only if the child is incapable of employment and chiefly dependent on the policyowner

question

An incomplete health insurance application submitted to an insurer will result in which of these actions?

answer

application will be returned to the writing procedure

question

Consumer reports requested by an underwriter during the application process of a health insurance policy can be used to determine

answer

probability of making timely premium payments

question

All of these are considered sources of underwriting information about an applicant EXCEPT

answer

Rating Services

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