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Health and Life 2024 Chpt1 > Chapter 3 > Flashcards

Chapter 3 Flashcards

1
Q

What kind of life insurance policy issued by a mutual insurer provides a return of
divisible surplus?

A

✔️✔️-Participating life insurance policy

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2
Q

No one is allowed to act as a producer for any insurance company in Arkansas that:

A

✔️✔️-Is unauthorized to do business in Arkansas

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3
Q

What MUST a company do prior to conducting an HIV related test?

A

✔️✔️-Obtain a written consent from the proposed insured

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4
Q

Which approach predicts a persons earning potential and determines how much of that
amount would be devoted to dependents?

A

✔️✔️-Human life value
approach

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5
Q

If the annuity dies before the annuity start date:

A

✔️✔️-The premium paid
+ interest earned will be given to the beneficiary

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6
Q

If dividends are illustrated, the advertisement MUST state that the dividends are

A

✔️✔️-Not guaranteed

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7
Q

Intentional withholding of material facts that would affect an insurance policy’s validity is
called a:

A

✔️✔️-Concealment

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8
Q

Field underwriting performed by the producer involves

A

✔️✔️-Completing
the application and collecting initial premium

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9
Q

Which is correct regarding an individual applying for life and health insurance?

A

✔️✔️-The applicants medical history may be analyzed and reported

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10
Q

Life insurance policies will normally pay for losses arising from

A

✔️✔️-
Commercial aviation

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11
Q

Example of rebating:

A

✔️✔️-Offering a client something of value not
stated in the contract in exchange for their business

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12
Q

In an employer-sponsored contributory group Disability Income plan, the employer pays
60% of the premium and each employee pays 40% of the premium. Any income
benefits paid are taxed to the employee at:

A

✔️✔️-60% of the benefit

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13
Q

David submits a $500 claim for medical expenses. There is a past-due amount owed for
insurance premiums of $200. As a result, the insurer only pays $300 for the claim. This
deduction came as a result of which provision?

A

✔️✔️-Unpaid provision

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14
Q

Tyler purchased a disability policy with a waiver of premium rider on April 1. He is
disabled on May 1. On June 1, he receives proof of permanent and total disability, and
submits a claim. He begins receiving benefits on June 15. When are his premiums
waived?

A

✔️✔️-May 1

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15
Q

Sonya applied for a health insurance policy on April 1. Her agent submitted the
information to the insurance company on April 6. She paid the premium on May 15 with
the policy indicating the effective date being May 30. On which date would Sonya have
the coverage?

A

✔️✔️-May 30, the effective date

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16
Q

Ken is a producer who has obtained Consumer Information Reports under false
pretenses. Under the Fair Credit Reporting Act, what is the maximum penalty that may
be imposed on Ken?

A

✔️✔️-$5,000

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17
Q

According to the principle of Utmost Good Faith, the insured will answer questions on
the application to the best of their knowledge and pay the required premium, while the
insurer will deal fairly with the insured and it’s:

A

✔️✔️-Promises made

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18
Q

The purpose of the Coordination of Benefits provision in group accident and health
plans is to:

A

✔️✔️-Avoid overpayment of claims

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19
Q

Which of the following would be considered an underwriting duty of an agent?

A

✔️✔️-Completing all applications and collecting initial premiums

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20
Q

A medical provider that accepts Medicare Assignment must:

A

✔️✔️-
Accept payment based upon a defined Medicare schedule as payment in full

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21
Q

What is implied authority defined as?

A

✔️✔️-Authority that is not
specifically given to an agent in the agency contract, but that an agent can reasonably
assume to carry out his/her duties

22
Q

Which type of disability would be less than total impairment and equal to permanent
impairment?

A

✔️✔️-Permanent partial disability

23
Q

A nonparticipating company is sometimes called a(n):

A

✔️✔️-Stock
insurer

24
Q

When the principal gives the agent authority in writing, it’s referred to as:

A

✔️✔️-Express authority

25
Q

Claims payable to a Disability Income insured, even when the insured can continue to
work, are the result of a:

A

✔️✔️-Presumptive disability

26
Q

The IRS states that a taxpayer’s medical expenses that exceed 7.5% of their adjusted
gross income is tax deductible. Which of the following may be considered a medical
expense under this rule?

A

✔️✔️-Long Term Care Insurance premiums

27
Q

Which of the following decisions would a Health Savings Account (HSA) owner NOT be
able to make?

A

✔️✔️-The amount contributed by the employer

28
Q

How is a health provider reimbursed if they do NOT have an agreement in place with
the insurance company?

A

✔️✔️-A usual, customary, and reasonable fee

29
Q

With whom may a producer legally share commissions?

A

✔️✔️-Another
producer who is licensed in the same line of insurance

30
Q

According to the Health Insurance Portability and Accountability Act (HIPAA), when can
a group health policy renewal be denied?

A

✔️✔️-Participation or
contribution rules have been violated

31
Q

Which type of clause describes the following statement: “We have issued the policy in
consideration of the representations in your applications and payment of the first-term
premium.”:

A

✔️✔️-Consideration clause

32
Q

Part A Hospital expense coverage provided under Medicare is automatically made
available to each of the following EXCEPT:

A

✔️✔️-A 70-year old NOT
eligible for Social Security

33
Q

What type of policy would only provide coverage for specific types of illnesses (cancer,
stroke, etc)?

A

✔️✔️-Dread disease insurance

34
Q

An individual covered under a Blue Cross Blue Shield plan is called a(n):

A

✔️✔️-Subscriber

35
Q

Which of the following signatures is not required on an individual insurance application?

A

✔️✔️-Insurer

36
Q

Coming from an insurance point of view, which of the following is the main risk
associated with disability?

A

✔️✔️-Loss of income

37
Q

If a person is convicted of a crime stemming from a hearing, a fine up to $___________
per violation may be imposed:

A

✔️✔️-$1,000

38
Q

In contrast to a guaranteed renewable policy, a noncancellable policy:

A

✔️✔️-May never raise premiums

39
Q

Shirley has a Medigap policy, which is designed to pay costs associated with:

A

✔️✔️-Medicare Parts A and B

40
Q

What percentage of a participant’s income are group long-term disability benefit
amounts typically limited to?

A

✔️✔️-60%

41
Q

What is true about Medicaid?

A

✔️✔️-Funded by federal, state and local
taxes

42
Q

A group Disability Income plan that pays tax-free benefits to covered employees is
considered:

A

✔️✔️-Fully contributory

43
Q

Maria is a Preferred Provider Organization (PPO) subscriber and received care from an
out-of-network provider. Which of the following is the likely result?

A

✔️✔️-Care is covered

44
Q

The time limit for filing claim disputes is addressed in which provision of an accident and
health policy?

A

✔️✔️-Legal actions

45
Q

Key Person Disability Insurance pays benefits to the: - Correct Answer ✔️✔️-Employer
Benefits provided by a Medicare Supplement policy must NOT:

A

✔️✔️-
Duplicate Medicare benefits

46
Q

What is the purpose of a Disability Income Benefit?

A

✔️✔️-Provide
money for living expenses

47
Q

In Arkansas, inflation protection must be offered to applicants for a(n):

A

✔️✔️-Long-term care policy

48
Q

The authority granted to a licensed producer is provided via the: -

A

✔️✔️-
Law of Agency

49
Q

Continuous 24-hour care provided by licensed medical professionals under the direct
supervision of a physician is called:

A

✔️✔️-Skilled nursing care

50
Q

Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), a terminated
employee’s benefits must:

A

✔️✔️-Be the same and the premium cannot
exceed 102%

Health and Life 2024 Chpt1 (4 decks)

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