Exam 9 Wrong Answers Flashcards
A policy owner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision?
Automatic premium loan
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued?
Adjust the claim benefit to reflect the insured’s true age
For an individual who is eligible for Medicare at age 65, and who is still employed and covered under the employer’s plan, which of the following is true?
The employer plan is primary coverage and Medicare is secondary coverage
To avoid violations of unfair claims settlement regulations, insurers are required to acknowledge the receipt of a claim within how many days?
10 days
A long term care shopper’s guide must be presented at what point?
Prior to the time of application
What is the main purpose of a Retained Asset Account?
To serve as a temporary storage of funds for the beneficiary
Which universal Life option has gradually increasing cash value and a level death benefit?
Option A
In a replacement situation, all of the following must be considered except
Assets
Which of the following is true about the requirements regarding HIV exams?
The applicant must give prior informed written consent
Which nonforfeiture option has the highest amount of insurance protection?
Extended Term
A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as…
Critical Illness
A 70-year old individual who bought a Part B Medicare policy 2 months ago just began kidney dialysis treatments this week. The individual is now applying for Medicare supplement policy, which would begin in 8 months. Which of the following could the insurer do to avoid paying for the dialysis?
Declare a pre existing condition
Which of the following is not true of Disability Buy-Sell coverage?
Benefits are considered taxable income to the business
All of the following are characteristics of group life insurance except…
Premiums are determined by the age, sex and occupation of each individual certificate holder
Which of the following is true regarding a term health policy?
It is nonrenewable
Which of the following is not a feature of a guaranteed renewable provision?
The insurer can increase the policy premium on an individual basis
When the policy premium wasn’t submitted with the application, what should the agent obtain from the insured upon policy delivery?
A statement of good health
An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This indicates that his policy is written with a 30-day…
Elimination period
Which of the following is true regarding Continuing Education required for those holding a Pennsylvania producer license?
24 hours each licensing period
Which is not true regarding an insured who is considered to be a standard risk?
The insured may have to pay slightly higher premiums
Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policy owner?
Payment of claims
Which of the following will vary the length of the grace period in health insurance policies?
The mode of the premium payment
What is the benefit of choosing extended term as a nonforfeiture option?
It has the highest amount of insurance protection
Which of the following is an eligibility requirement for all Social Security Disability Income benefits?
Have attained fully insured status
Which of the following is an example of a limited pay life policy?
Life Paid up at Age 65
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy’s cash value, which is currently $20,000. What would be the face amount of the new term policy?
$50,000
In a long term care policy, preexisting condition limitations…
Must appear as a separate paragraph and be clearly labeled
A couple owns a life insurance policy with a Children’s Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?
Proof of insurability is not required
What documentation grants express authority to an agent?
Agent’s contract with the principal
A Universal Life Insurance policy is best described as a/an
Annually Renewable Term policy with a cash value account
Where would the underwriter find relevant information not presented by the applicant but communicated by the producer?
Application
What happens if a deferred annuity is surrendered before the annuitization period?
The owner will receive the surrender value of the annuity
Which of the following is true regarding the annuity period?
It may last for the lifetime of the annuitant
Prior to license renewal, all insurance producers must successfully complete a minimum of…
24 credit hours of CE
Lietuya Insurance Company issued 150 viatical settlement contracts but does not hold the proper certifications to legitimately conduct business. Which of the following terms best describes Lietuya’s business practices?
Fraudulent viatical settlement act
All other factors being equal, the least expensive first year premium payment is found in…
Annually Renewable Term
What is the purpose of the rehabilitation benefit disability insurance?
To cover the expenses of retraining the insured to return to work
A producer licensed in Pennsylvania must notify the Insurance Department of any change of address in his or her residence or business address within how many days?
30
An insured is scheduled to have two cavities filled. He knows in advance what benefits will be paid for the procedure. Which clause is responsible for the advanced notification?
Prior authorization
Medicare Part A services do not include which of the following?
Outpatient hospital treatment
What type of insurance would be used for a Return of Premium rider?
Increasing term
Other than for a qualified life event, when can a change be made in benefits for a Flexible Spending Account (FSA)?
During the open enrollment period
Under an extended term nonforfeiture option; the cash value is converted to
The same face amount as in the whole life policy
What is the civil penalty for violating a cease and desist order of the Commissioner?
$10,000
