Exam 14 Wrong Answers

Question 1

Which of the following is not covered under a long term care policy?

Answer 1

Acute care in a hospital

Question 2

What type of benefit helps pay for accidental injuries that are not severe enough to qualify as disabilities?

Answer 2

Medical Reimbursement Benefit

Question 3

The validity of coverage under a life insurance policy may not be contested, except for nonpayment of premium, after the policy has been in force for at least how many years?

Answer 3

2 years

Question 4

What is the maximum period than an insurer would pay benefits in accordance with an Additional Monthly Benefit rider?

Answer 4

1 year

Question 5

In order to minimize adverse selection, employer group dental plans may equine employees who enroll after they were initially eligible to participate to do all of the following except

Answer 5

Increase benefits for a period of 1 year

Question 6

The insured is also the policy owner of a whole life policy. What age must the insured attain in order to receive the policy’s face amount?

Answer 6

100

Question 7

What describes the specific information about a policy?

Answer 7

Policy summary

Question 8

Which of the following policies would be classified as a traditional level premium contract?

Answer 8

Straight Life

Question 9

Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?

Answer 9

Joint Life

Question 10

A licensee serving in the military is unable to fulfill her continuing education requirement. What would the licensee have to do to renew the license?

Answer 10

The licensee may submit a request to the department to have requirements and fees waived. The department will then determine if the request is permissible

Question 11

All of the following statements are true regarding tax-qualified annuities except

Answer 11

Employer contributions are not tax deductible

Question 12

A long term care insurance shopper’s guide must be provided in the format developed by which of the following?

Answer 12

NAIC

Question 13

All of the following are dividend options except

Answer 13

Fixed period installments

Question 14

All of the following are characteristics of a Major Medical Expense policy except

Answer 14

Low maximum limits

Question 15

Bob has sold his life insurance policy to a viatical settlement provider. How long does the provider now have to inform Bob’s insurer that his life policy has been viaticated?

Answer 15

20 days

Question 16

Health insurance policies providing maternity benefits must also provide coverage for postpartum inpatient hospital care. How much coverage must be provided for delivery by Ceasarean section?

Answer 16

At least 96 hours

Question 17

In insurance, an offer is usually made when

Answer 17

An applicant submits an application to the insured

Question 18

An insurer may provide commissions to an agent for the sale of a long term care policy only if the first year commission is not greater than what percentage of the first premium?

Answer 18

50%

Question 19

Which of the following are the main factors taken into account when calculating residual disability benefits?

Answer 19

Present earnings and earnings prior to disability

Question 20

The policy owner wants to make sure upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain age. Which settlement option should the policy owner choose?

Answer 20

Interest only option

Question 21

Which of the following statements concerning buy sell agreements is true?

Answer 21

Buy sell agreements are normally funded with a life insurance policy

Question 22

To avoid violations of unfair claims settlement regulations, insurers are required to acknowledge the receipt of a claim within how many days?

Answer 22

10 days

Question 23

What are the 2 types of Flexible Spending Accounts?

Answer 23

Health Care Accounts and Dependent Care Accounts

Question 24

Peril is most easily defined as

Answer 24

The cause of loss insured against

Question 25

Employer health plans must provide primary coverage for individuals with end stage renal disease before Medicare becomes primary for how many months?

Answer 25

30 months

Question 26

Which of the following groups seeking group health insurance would represent a bad risk for underwriters?

Answer 26

A group that changes insurance annually

Question 27

Which of the following features of the Indexed Whole Life policy is not fixed?

Answer 27

Cash value growth

Question 28

An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?

Answer 28

Guaranteed insurability option

Question 29

Which nonforfeiture option provides coverage for the longest period of time?

Answer 29

Reduced paid up

Question 30

A banker is ready to close on a customer’s loan. The bank is prepared to offer the loan but only if the customer purchases a life insurance policy from the bank in the amount of the loan. This is an example of

Answer 30

Coercion

Question 31

Under which nonforfeiture option does the company pay the surrender value and have no further obligations to the policy owner?

Answer 31

Cash surrender

Question 32

A business owner was trying to obtain a bank loan to fund the purchase of a new business facility, but the bank required proof of additional assets to secure the loan. The business owner then decided to use her $250,000 life insurance policy to secure the loan. Which provision makes this possible?

Answer 32

Collateral assignment