Certificate Final Exam Prep

Question 1

Insurance agents must maintain records of the information collected from senior consumers used in making annuity recommendations for at least how many years after the insurance transaction is completed?

Answer 1

5 years

Question 2

Is including nonguaranteed elements in a policy illustration an unfair trade practice?

Answer 2

No

Question 3

How are disability income benefits taxed if premiums are paid by the employer?

Answer 3

Premiums are tax-deductible

Benefits are taxed as ordinary income

Question 4

How are disability income benefits taxed if premiums are paid by the employee?

Answer 4

Premiums are paid with after-tax dollars so they are not tax-deductible

Benefits are tax-free

Question 5

If an insured misstated his age on an application for health insurance, the insurance company has the right to

Answer 5

Adjust the benefit

Question 6

Anyone who commits an unfair trade practice with regard to HMOs can be fined as much as

Answer 6

$200,000

Question 7

An insurer that ceases use of a particular policy form must offer policyholders

Answer 7

Assistance in finding alternative coverage

Question 8

A securities license is required to sell what kinds of annuities?

Answer 8

Variable annuities

Question 9

Under the Time of Payment of Claims provision, health insurance claims must be paid

Answer 9

Within 60 days

Question 10

If an insured who is covered by a double indemnity accidental death rider gets injured in an accident but dies 120 days later, what will the beneficiary receive?

Why?

Answer 10

The face amount

Typically the death must occur within 90 days of the accident after which the death benefit reverts to the face amount

Question 11

In Florida, what is the required free-look period in individual long-term care policies?

Answer 11

30 days

Question 12

A policyholder can file a lawsuit for nonpayment of claims if it has not been paid within

Answer 12

60 days

Question 13

If a physician does not accept assignment, the maximum amount the physician can charge a Medicare beneficiary for a covered service is known as the

Answer 13

Limiting charge

Question 14

In order to sign up for Medicare Part D, Prescription Drug Coverage, the insured must be enrolled in which of the following?

Answer 14

Medicare Part A or in Parts A and B

Question 15

After being in force for 5 years, a life insurance policy was classified as a Modified Endowment Contract. When will the policy lose this classification?

Answer 15

Never

Question 16

Withdrawing funds from a traditional IRA prior to age 59 ½/ incurs an additional tax of

Answer 16

10%

Question 17

Florida’s Department of Financial Services is responsible for all of the following
EXCEPT
A. Depositing fines and penalties in a state insurance fund
B. Issuing cease and desist orders
C. Issuing or revoking licenses
D. Holding hearings regarding insurance matters

Answer 17

A. Depositing fines and penalties in a state insurance fund

It does collect fines and penalties but does not deposit them in a state insurance fund

Question 18

The replacing insurer must send a Comparative Information Form to applicants who request one within how many days of receiving the application?

Answer 18

10 days

Question 19

In Florida, written notice of a claim under a health insurance policy must be delivered within how many days of the loss?

Answer 19

20 days

Question 20

What is a primary difference between an HMO and a traditional insurance company?

Answer 20

The HMO provides both the financing and patient care for its members, while traditional companies provide the financing only

Question 21

What is the purpose of Medigap policies?

Answer 21

To cover expenses for Medicare deductibles and coinsurance

Question 22

What mandatory health provision states the specified number of days given to an insured to return the completed claim forms to the insurance company?

Answer 22

Proof of Loss

Question 23

What are the four factors the ACA allows to determine premium rates?

Answer 23

• Age
• Tobacco use
• Geographic area
• Family composition

Question 24

Under the waiver of premium provision, how long are premiums waived for a permanent and total disability?

Answer 24

For the duration of the disability

Question 25

How many days does the Florida Office of Insurance Regulation have to respond to an insurer filing a new policy form before it is automatically approved?

Answer 25

30 days

Question 26

Group policies issued in Florida must contain all of the following provisions
EXCEPT
A. Misstatement of age.
B. Replacement.
C. Incontestability.
D. Grace period.

Answer 26

B. Replacement

Question 27

At what point must the beneficiary have an insurable interest in the insured for life insurance policies?

Answer 27

At the time the policy is issued

Question 28

In insurance, an offer is usually made when

Answer 28

The application is submitted

The application is an offer to the insurance company to enter into a contract

Question 29

In Florida, which department determines that insurers are financially sound and remain solvent?

Answer 29

The Office of Insurance Regulation

The Office of Financial Regulation regulates only financial institutions

Question 30

In Florida, a policyholder must file a lawsuit for an unpaid loss within how many years of furnishing proof of loss to the insurance company?

Answer 30

The statute of limitations for unpaid losses in Florida is 3 years

Question 31

Expenses incurred during the examination of an insurance company are paid by the

Answer 31

Insurer being examined

Question 32

In the event an employee covered under a group health insurance policy dies. how long may a spouse receive coverage through COBRA?

Answer 32

36 months

Question 33

What Medicare Advantage Plan is offered through private insurance companies?
A. Private fee-for-service
B. Special needs
C. Medicare Part A
D. Point-of-service

Answer 33

A. Private fee-for-service

Question 34

Under the Fair Credit Reporting Act (FCRA), consumer reports are not allowed to report negative information about a person after how many years?

Answer 34

7 years

Question 35

All of the following apply to discount plans in Florida EXCEPT
A. They provide discounts for medical services through specific health care providers.
B. They are a type of insurance plans.
C. Members pay for all health care services.
D. The providers are not paid by the discount medical plan organization.

Answer 35

B. They are a type of insurance plans.

Question 36

An employee covered under a group health insurance policy is terminated while off work on a disability. What is the maximum period of time this employee may continue coverage under the group plan?

Answer 36

29 months

The usual 18 months plus an additional 11 months due to disability

Question 37

During a life insurance policy replacement, a producer must do all of the following EXCEPT
A. Send a written communication to existing insurers advising them of the proposed replacement.
B. Give the applicant copies of all replacement related communication.
C. Obtain a list of existing life insurance policies.
D. Provide a signed Notice Regarding Replacement to the applicant.

Answer 37

C. Obtain a list of existing life insurance policies.