Exam 2 Flashcards
(130 cards)
1
Q
Not covered under LTCs home health care
Attending physician
Endowment payout
A
Attending physician
2
Q
Policy lapses due to nonpayment of premium; how many days would policy be reinstated once premium paid
10
45
A
45
3
Q
Who bears all risk in fixed annuity
Ins company
Annuitant
A
Ins company
4
Q
Waiver of premium may be included with
Disability income
Hospital indemnity
A
Disability income
5
Q
All are correct re Medicare except
They are issued by private insurers
They cover cost of extended nursing home care
A
They cover cost of extended nursing home care
6
Q
Correct re taxation fo premiums in key person
Premiums are not tax deductible as biz expense
Premiums are tax deductible by key employee
A
Premiums are not tax deductible as bc expense
7
Q
When reduced paid up nonfortfeiture is chosen face amount
Is reduced to amount of what cash value would buy as single premiums
Decreases over term of policy
A
Reduced to amount of what cash value would buy as single premium
8
Q
Sole proprietor makes salary of 50000; medical expenses reached total of 75000; he may deduct re his medical expenses…
10000
50000
A
50000
9
Q
Rider added to life ins policy to pay part of death benefit to insured to cover expenses in nursing or convalescent home
Long term care
Payor benefit
A
Long term care
10
Q
Paid to beneficiary in event of insured’s accidental death
Capital sum
Principal sum
A
Principal sum
11
Q
If insured withdraws portion of face amount in form of accelerated benefits bc of terminal illness how will affect payable death benefit from policy
Death benefit will be smaller
Death benefit will be same as original face amount
A
Death benefit will be smaller
12
Q
No longer billed for medical expenses
Stop-loss limit
Waiver of premium
A
Stop loss limit
13
Q
waiting period waiver of premium rider
6 months
30 days
A
6 months
14
Q
Proposed insured makes premium payment on new ins policy; dies; insurer will pay death benefit to beneficiary if policy is approved
Conditional
Unilateral
A
Conditional
15
Q
How frequently policyowner required to pay premium
Mode
Schedule
A
Mode
16
Q
All regulate variable policies except
Guaranty association
Sec
A
Guaranty association
17
Q
Brain surgeon develops tremors in right arm… which disability policy definition of total disability
Own occupation less restrictive
Own occupation more restrictive
A
Own occupation less restrictive
18
Q
All true re qualified plan except
At distribution all amounts recd by employee are tax free
Employee and employer contributions are not counted as income to employee for income tax purposes
A
At distribution all amounts recd by employee are tax free
19
Q
Incorrect re medicaid
Federally administered program
Pays for hospital outpatient laboratory and X-ray
A
Federally administered program
20
Q
Hmo AND ppo
Pos
Fsa
A
Pos
21
Q
Terms directly associated with annuity funding
Single payment or period payments
Increasing or decreasing
A
Single payment or periodic payments
22
Q
Substandard risk aka
Rated
Elevated
A
Rated
23
Q
Joint life settlement pays benefits to two or more annuitants and
Begins upon death of first
Stops upon death of first
A
Stops upon death of first
24
Q
If contract provides est amount of income for two or more persons with income stopping upon first death of insured it is
Joint and survivor
Joint life annuity
A
Joint life annuity
25
Skilled nursing care
Spouse
Doctor
Doctor
26
When is misrepresentation fraud
If intentional and material
Never statements by applicant are only representations
If intentional and material
27
All correct re executive bonus except
Policy is owned by company
Any ins may be used
It is NOT owned by the company
28
Intermediate care
Occasional nursing or rehabilitative care
Intensive care
Occasional nursing or rehabilitative care
29
Allows to customize policy to provide additional amount of temporary insured CE on the insured or allows amounts of temporary ins to cover other family members
Term rider
Change of insured rider
Term rider
30
Applicant doesnt rec copay of new ins policy
Who fault
Agent
Insurer
Agent
31
Relation of earnings to ins provision allows ins company to limit insured’s benefits to average income over last
24 months
12 months
24 months
32
All true regarding convertibility EXCEPT
Upon conversion death benefit reduced by 50%
Based on attained age upon conversion
Upon conversion death benefit reduced by 50%
33
Purpose of target premium
Keep policy in force
Pay up policy faster
Keep policy in force
34
Which is NOT true re underwriting group health ins
Group is assessed individually for insurability
Everyone is covered regardless of medical history
Group is assessed individually for insurability
35
Replacing insured’s current health ins policy with new one
Old policy should stay in force until new policy is issued
Old policy must be cancelled before new one can be issued
Old policy should stay in force until new policy is issued
36
Conversion to individual whole life permitted without evidence of insurability within how many days of termination
31 days
30 days
31 days
37
Unfair claims settlement practices except
Suggesting negotiations in settling the claims
Failing to adopt and implement reasonable standards for settling claims
Suggesting negotiations in settling the claims
38
Re credit life ins responsible for reporting term of debt for insurer
Debtor
Creditor
Creditor
39
Inducement offered to insured in sale of ins policy
Rebating
Coercion
Rebating
40
Licensed agent recs criminal conviction
Department of insurance
Naic
Department of insurance
41
Small employer =
At least 2 not more than 50
Between 1 and 25
At least 2 and not more than 50
42
True re iinsurance amount in credit life policy
Creditor can only insure debtor for amount owed
Amount of coverage can be greater than the amount owed
Creditor can only insure debtor for amount owed
43
Under affordable care act cannot be underwritten based on
Health condition
Age
Health condition
44
Insured not legally bound to any particular action in the ins contract but insurer is legally obligated to pay losses covered by policy
Unilateral
Aleatory
Aleatory
45
Replacement situation all considered except
Exclusions
Assets
Assets
46
Which ins policy allows owner to pay more or less than planned premiums
Universal life
Variable whole life
Universal life
47
If insured withdraws portion of face amount in form of accelerated benefits
Death benefit will be smaller
Death benefit will Match original face amount
Death benefit will be smaller
48
Informed hernia repair. Ins plan covers 200 points of surgical expenses. Each point represents $10, so $2000 will be covered by ins plan. What system
Relative value
Conversion factor
Relative value
49
Purchasing permanent life ins policy face value of 25000; all he can afford; wants additional coverage to be available in future; whic option
Guaranteed insurability
Guaranteed renewable
Guaranteed insurability
50
Lapses nonpayment of premium automatically reinstated
45 days
30 days
45 days
51
Hra can be coupled with
Ira
High deductible plan
High deductible plan
52
If annuitant doses before annuitization
Either amount paid into plan or cash value whichever is greater
Cash value
Either amount paid into plan or cash value whichever is greater
53
Variable whole life =
Level fixed
Increasing
Level fixed
54
Nonforfeiture has highest amount of ins
Extended term
Conversion
Extended term
55
Not characteristic of hmo
Contracting with ins companies
Outpatient care
Contrasting with ins companies
56
Within how many days of investigative consumer report must be notified that report will be obtained
3 days
5
5 days
57
Individually owned disability income taxable
0
50
0%
58
Relation of earnings to insurance provision
24 months
6 months
24 months
59
Coinsurance and copayments main diff
Copayment is set dollar amount
Coinsurance is set dollar amount
Copayments is set dollar amount
60
Advantage of reinstating policy instea dod applying for new one
Original age is used for premium determination
Proof of insurability is not required
Original age is used for premium determination
61
Change insured under policy
Payor benefit rider
Substitute insured rider
Substitute insured rider
62
Elimination period refers to period between
First day of disability and day insured starts receiving benefits
Effective date of policy and date first premium is due
First day of disability and day insured starts receiving benefits
63
Offer is made when
Applicant submits app to insurer
App is approved and recs initial premium
Applicant submits app to insurer
64
Notice prior to suspending cert of authority
10
60
10
65
Minimum percentage of licenceees total volume
25%
50%
25%
66
Not required illustration sale of ins policy
Name of primary and secondary beneficiaries
Name of insurer
Name of primary and secondary beneficiaries
67
Termination of debt
60
30
60
68
Authorized insurer aka
Admitted
Certified
Admitted
69
Which entity can bind coverage
Federal ins board
Insurer
Insurer
70
Term for specific dollar amount paid by hmo member for service
Deductible
Copayment
Copayment
71
Annuitant dies while annuity is still in accumulation stage
Beneficiary will rec the greater of money paid into annuity or cash value
Owner’s estate will rec the money paid into the annuity
Beneficiary will rec the greater of money paid into annuity or cash value
72
Insured is not legally bound to any action but insurer is legally obligated to pay losses
Unilateral
Aleatory
Unilateral
73
Relation of earnings=
24 months
74
Pay more or less than planned premium
=
Universal life
75
No deductible=
Comprehensive
First dollar basis
First dollar basis
76
Provision prevents legal action against company for at least 60 days after proof is known
Legal actions
Proof of loss
Legal actions
77
Immediate cash value
Single premium
Continuous premiums
Single premium
78
Ty
Yy
79
Back injury; disabled for year;disability income benefit rider in place
Monthly premium waiver and monthly income
Payments for life
Monthly premium waiver and monthly income
80
Material misrepresentation
A statement by appliacant that would affect underwriting decision of ins company
Any misstatement made by an applicant for insurance
A statement by appliacant that would affect underwriting decision of ins company
81
Which is not correct re non qualified retirement plan
Employer can rec a current tax deduction for any contributions made to plan
Plan is legal method of accumulations money for retirement needs
Employer can rec a current tax deduction for any contributions made to plan
82
Fixed refers to all except
Death benefit
Equal annuity payments
Death benefits
83
Accidental bodily injury compared to acccidental
Broader in general
More limited in general
Broader in general
84
True re Medicare part b
Pays for physician services diagnostic test and physical therapy
Provided automatically to anyone who qualified for part a
Pays for physician services diagnostic test and physical therapy
85
Policy lapses and reinstated how any days
45
10
45
86
Policyowner wants to increase adjustable life policy.
Death benefit can be increased by providing evidence of insurability
Death benefit cannot be increased
Death benefit can be increased by providing evidence of insurability
87
Fails to pay premium due after grace period passes but policy remains in force
Automatic premium loan
Waiver of premium
Automatic premium loan
88
Interest earned on policy dividends
Taxable
Tax deductible
Taxable
89
Best describes free look provision
Allows insured to return policy within 10 days for full refund of premiums if dissatisfied for an reason
Allows for proposed insured to carefully look over policy before applying for it
Allows insured to return policy within 10 days for full refund of premiums if dissatisfied for an reason
90
Probationary period refers to
During which illness related disabilities are excluded from coverage
Between the 10th day of an illness related disability and the fist payment
During which illness related disabilities are excluded from coverage
91
Insuring clause does not specify
List of available doctors
Covered perils
List of available doctors
92
Annually renewable level dearth benefit that
Increase annually
Remain level
Increase annually
93
Covered unable to perform any job for which qualified
Any occupation less restrictive
Any occupation more restrictive
Any occupation more restrictive
94
Which is not enrollment period for Medicare part a
Automatic enrollment
Special enrollment
Automatic enrollment
95
An employee has group life leaves after 5 years.
She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving group plan
She will be covered under group plan but will have to pay an individual policy premium
She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving group plan
96
Offer usually made when
Applicant submits an application to insurerer
Insurer approves applications nd receives the initial premium
Applicant submits an application to insurerer
97
Main difference between stock company and mutual company
Ownership
Amount of benefits
Ownership
98
How much notice before suspension of certificate of authority
10 days
30 days
10 days
99
Nonresident agent
Agent who resides in another state but licensed in texas
Agent who does not earn commission pin texas
Agent who resides in another state but licensed in texas
100
Suspects arson is involved
30 days
10 days
30 days
101
True re Medicare supplement policies
Must be at least guaranteed renewable
Must contain a minimum of plans a and b
Must be at least guaranteed renewable
102
Termination of debt=
60
103
Nonforfeiture highest amount=
Extended term
104
Termination of debt=
60
105
Nonmember physician utilized under point of service plan
Member patient will have it pay all costs out of pocket
Attending physician will be paid a fee for service but member patient will have to pay higher coinsurance amount
Attending physician will be paid a fee for service but member patient will have to pay higher coinsurance amount
106
Re elimination period
Longer elimination lower cost of coverage
Longer elimination higher cost of coverage
Longer elimination lower cost of coverage
107
Extended term nonfortfeiture option cash value used to purchase term ins with what face amount
Same as original policy minus cash value
Equal to original policy for as long as cash values wil purchase
Equal to original policy for as long as cash values wil purchase
108
What is the max penalty fair credit reporting act noncompliance
1000
2500
2500
109
immediate cash value
Single premium
Level term
Single premium
110
May change which on guaranteed renewable health ins policy
Rates by class
Individual rates
Rates by class
111
Receives quarterly dividends. Instructed company to apply policy dividends to increase death benefit.
Paid up additions
Reduction of premiums
Paid up additions
112
Died by suicide one year after life ins policy was issued
Refund premiums paid
Pay nothing
Refund premiums paid
113
Cobra applies to employers with at least
20
50
20
114
Before death annuitant recd 125000 in monthly benefits from his 25000 straight life annuity. He was also insured under 50000 paid up whole life policy. How much will wife rec
50000
62500
50000 FACE AMOUNT
115
Specified dollar amount beyond which insured no longer participates in sharing
Stop loss limit
Corridor deductible
Stop loss
116
Protects consumers againasat circulation f inaccurate personal info
Fair credit reporting act
Consumer privacy act
Fair credit reporting act
117
Periodic additions to face amount at standard rates w/o proving insurability
Guaranteed insurability rider
Paid up additions option
Guaranteed insurability rider
118
Interest only settlement option
Beneficiary will only rec payments of interest earned on death benefit
Beneficiary must pay interest to the insurer
Beneficiary will only rec payments of interest earned on death benefit
119
True regarding installments for fixed period annuity settlement except
Life contingency option
Payments are not guaranteed for life
Life contingency option
120
Group health ins is characterized by all of the following except
Adverse selection
Master contract
Adverse selection
121
Annuity income payments scheduled to begin after 1 year since the annuity was purchased
Deferred
Fixed
Deferred
122
Person’s credit character reputation and habits
Consumer report
Consumer history
Consumer report
123
Social security def includes all except
Disability expected to last for ast least six months
Inability to engage in any gainful work
Disability resulting from a medically determinable mental impairment
Disability expected to last for at least six months
124
Employee terminates coverage under group ins policy
31 days
Obtain coverage under a new group plan
31 days
125
Advises client regarding benefits of her life ins policy in exchange for a fee
Agent
Counselor
Counselor
126
Most commonly used in credit life ins
Decreasing term
Whole life
Decreasing term
127
Arson =
30 days
128
Incontestability=
2 years
129
Aca/poverty level=
100-400%
130
Fraud being committed notify=
30 days
