Exam 2 Flashcards
Not covered under LTCs home health care
Attending physician
Endowment payout
Attending physician
Policy lapses due to nonpayment of premium; how many days would policy be reinstated once premium paid
10
45
45
Who bears all risk in fixed annuity
Ins company
Annuitant
Ins company
Waiver of premium may be included with
Disability income
Hospital indemnity
Disability income
All are correct re Medicare except
They are issued by private insurers
They cover cost of extended nursing home care
They cover cost of extended nursing home care
Correct re taxation fo premiums in key person
Premiums are not tax deductible as biz expense
Premiums are tax deductible by key employee
Premiums are not tax deductible as bc expense
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
Reduced to amount of what cash value would buy as single premium
Sole proprietor makes salary of 50000; medical expenses reached total of 75000; he may deduct re his medical expenses…
10000
50000
50000
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
Long term care
Paid to beneficiary in event of insured’s accidental death
Capital sum
Principal sum
Principal sum
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
Death benefit will be smaller
No longer billed for medical expenses
Stop-loss limit
Waiver of premium
Stop loss limit
waiting period waiver of premium rider
6 months
30 days
6 months
Proposed insured makes premium payment on new ins policy; dies; insurer will pay death benefit to beneficiary if policy is approved
Conditional
Unilateral
Conditional
How frequently policyowner required to pay premium
Mode
Schedule
Mode
All regulate variable policies except
Guaranty association
Sec
Guaranty association
Brain surgeon develops tremors in right arm… which disability policy definition of total disability
Own occupation less restrictive
Own occupation more restrictive
Own occupation less restrictive
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
At distribution all amounts recd by employee are tax free
Incorrect re medicaid
Federally administered program
Pays for hospital outpatient laboratory and X-ray
Federally administered program
Hmo AND ppo
Pos
Fsa
Pos
Terms directly associated with annuity funding
Single payment or period payments
Increasing or decreasing
Single payment or periodic payments
Substandard risk aka
Rated
Elevated
Rated
Joint life settlement pays benefits to two or more annuitants and
Begins upon death of first
Stops upon death of first
Stops upon death of first
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
Joint life annuity
Skilled nursing care
Spouse
Doctor
Doctor
When is misrepresentation fraud
If intentional and material
Never statements by applicant are only representations
If intentional and material
All correct re executive bonus except
Policy is owned by company
Any ins may be used
It is NOT owned by the company
Intermediate care
Occasional nursing or rehabilitative care
Intensive care
Occasional nursing or rehabilitative care
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
Applicant doesnt rec copay of new ins policy
Who fault
Agent
Insurer
Agent
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
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%
Purpose of target premium
Keep policy in force
Pay up policy faster
Keep policy in force
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
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
Conversion to individual whole life permitted without evidence of insurability within how many days of termination
31 days
30 days
31 days
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
Re credit life ins responsible for reporting term of debt for insurer
Debtor
Creditor
Creditor
Inducement offered to insured in sale of ins policy
Rebating
Coercion
Rebating
Licensed agent recs criminal conviction
Department of insurance
Naic
Department of insurance
Small employer =
At least 2 not more than 50
Between 1 and 25
At least 2 and not more than 50
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
Under affordable care act cannot be underwritten based on
Health condition
Age
Health condition
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
Replacement situation all considered except
Exclusions
Assets
Assets
Which ins policy allows owner to pay more or less than planned premiums
Universal life
Variable whole life
Universal life
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
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
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
Lapses nonpayment of premium automatically reinstated
45 days
30 days
45 days
Hra can be coupled with
Ira
High deductible plan
High deductible plan
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
Variable whole life =
Level fixed
Increasing
Level fixed
Nonforfeiture has highest amount of ins
Extended term
Conversion
Extended term
Not characteristic of hmo
Contracting with ins companies
Outpatient care
Contrasting with ins companies
Within how many days of investigative consumer report must be notified that report will be obtained
3 days
5
5 days
Individually owned disability income taxable
0
50
0%
Relation of earnings to insurance provision
24 months
6 months
24 months
Coinsurance and copayments main diff
Copayment is set dollar amount
Coinsurance is set dollar amount
Copayments is set dollar amount
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
Change insured under policy
Payor benefit rider
Substitute insured rider
Substitute insured rider
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
Offer is made when
Applicant submits app to insurer
App is approved and recs initial premium
Applicant submits app to insurer
Notice prior to suspending cert of authority
10
60
10
Minimum percentage of licenceees total volume
25%
50%
25%
Not required illustration sale of ins policy
Name of primary and secondary beneficiaries
Name of insurer
Name of primary and secondary beneficiaries
Termination of debt
60
30
60
Authorized insurer aka
Admitted
Certified
Admitted
Which entity can bind coverage
Federal ins board
Insurer
Insurer
Term for specific dollar amount paid by hmo member for service
Deductible
Copayment
Copayment
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
Insured is not legally bound to any action but insurer is legally obligated to pay losses
Unilateral
Aleatory
Unilateral
Relation of earnings=
24 months
Pay more or less than planned premium
Universal life
No deductible=
Comprehensive
First dollar basis
First dollar basis
Provision prevents legal action against company for at least 60 days after proof is known
Legal actions
Proof of loss
Legal actions
Immediate cash value
Single premium
Continuous premiums
Single premium
Ty
Yy
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
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
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
Fixed refers to all except
Death benefit
Equal annuity payments
Death benefits
Accidental bodily injury compared to acccidental
Broader in general
More limited in general
Broader in general
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
Policy lapses and reinstated how any days
45
10
45
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
Fails to pay premium due after grace period passes but policy remains in force
Automatic premium loan
Waiver of premium
Automatic premium loan
Interest earned on policy dividends
Taxable
Tax deductible
Taxable
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
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
Insuring clause does not specify
List of available doctors
Covered perils
List of available doctors
Annually renewable level dearth benefit that
Increase annually
Remain level
Increase annually
Covered unable to perform any job for which qualified
Any occupation less restrictive
Any occupation more restrictive
Any occupation more restrictive
Which is not enrollment period for Medicare part a
Automatic enrollment
Special enrollment
Automatic enrollment
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
Offer usually made when
Applicant submits an application to insurerer
Insurer approves applications nd receives the initial premium
Applicant submits an application to insurerer
Main difference between stock company and mutual company
Ownership
Amount of benefits
Ownership
How much notice before suspension of certificate of authority
10 days
30 days
10 days
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
Suspects arson is involved
30 days
10 days
30 days
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
Termination of debt=
60
Nonforfeiture highest amount=
Extended term
Termination of debt=
60
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
Re elimination period
Longer elimination lower cost of coverage
Longer elimination higher cost of coverage
Longer elimination lower cost of coverage
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
What is the max penalty fair credit reporting act noncompliance
1000
2500
2500
immediate cash value
Single premium
Level term
Single premium
May change which on guaranteed renewable health ins policy
Rates by class
Individual rates
Rates by class
Receives quarterly dividends. Instructed company to apply policy dividends to increase death benefit.
Paid up additions
Reduction of premiums
Paid up additions
Died by suicide one year after life ins policy was issued
Refund premiums paid
Pay nothing
Refund premiums paid
Cobra applies to employers with at least
20
50
20
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
Specified dollar amount beyond which insured no longer participates in sharing
Stop loss limit
Corridor deductible
Stop loss
Protects consumers againasat circulation f inaccurate personal info
Fair credit reporting act
Consumer privacy act
Fair credit reporting act
Periodic additions to face amount at standard rates w/o proving insurability
Guaranteed insurability rider
Paid up additions option
Guaranteed insurability rider
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
True regarding installments for fixed period annuity settlement except
Life contingency option
Payments are not guaranteed for life
Life contingency option
Group health ins is characterized by all of the following except
Adverse selection
Master contract
Adverse selection
Annuity income payments scheduled to begin after 1 year since the annuity was purchased
Deferred
Fixed
Deferred
Person’s credit character reputation and habits
Consumer report
Consumer history
Consumer report
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
Employee terminates coverage under group ins policy
31 days
Obtain coverage under a new group plan
31 days
Advises client regarding benefits of her life ins policy in exchange for a fee
Agent
Counselor
Counselor
Most commonly used in credit life ins
Decreasing term
Whole life
Decreasing term
Arson =
30 days
Incontestability=
2 years
Aca/poverty level=
100-400%
Fraud being committed notify=
30 days
