Chapter Eleven Quiz

Question 1

Which renewal option does not guarantee and allows the insurance company to refuse renewal of a policy at any premium due date?

Answer 1

Optionally renewable

Question 2

The provision that provides for the sharing of expenses between the insured and the insurance company is:

Answer 2

Coinsurance

Question 3

Who is involved in completing the agents report?

Answer 3

Only the agent

Question 4

Health insurance underwriting is the best defined as:

Answer 4

Selection, classification, and rating of risks

Question 5

What type of group rating do the Blue Cross and Blue Shield organizations use as a factor in developing the rates to be charged?

Answer 5

Experience rating

Question 6

A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as:

Answer 6

Critical illness

Question 7

A producer is acting in what capacity when he or she is trying to obtain credible information about an applicant for health insurance?

Answer 7

Field underwriter

Question 8

On a health insurance application, a signature is required from all of the following individuals:

Answer 8

• The agent
• The policyowner
• The proposed insured

Question 9

An applicant for health insurance has not had a medical claim in 5 years. He exercises daily and does not smoke or drink. What classification do you assume the applicant would receive from his insurer?

Answer 9

Preferred

Question 10

In group insurance, what is the policy called?

Answer 10

Master policy

Question 11

All of the following are true regarding copayments:

Answer 11

• They are arrangements between the insured and the insurer
• The insured pays a specific amount for a claim, regardless of the actual cost of the service
• They are typically due at the time of receiving the service

Question 12

The factor added to the net premium to cover the costs of the insurer in obtaining and maintaining the business is called:

Answer 12

Expenses