Exam Simulator 1 Flashcards
A life insurance policy would be considered a wagering contract WITHOUT:
Insurable interest
Which of the following features of a group Term Life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability?
Conversion privileges
Basic Medical Expense insurance:
Has lower benefits limits than Major Medical insurance
If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of?
Insured
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission
What is required in the Florida Employee Health Care Access Act?
Small group benefit plans are to be issued on a “guarantee-issue” basis
Which of the following situations are NOT subject to Florida life insurance laws?
Insurance companies’ day-to-day operations
Which Long Term Care insurance statement is true?
Pre-existing conditions must be covered after the coverage has been in force for six months
According to Florida law, when must an agent deliver the Outline of Coverage to a Medicare supplement applicant?
At the time of application
All of the following statements regrading group health insurance os true:
Premiums are usually determined by the claims experience of the group, A master contract is issued for the group, and Group health insurance premiums are typically lower than individual health insurance premiums
An individual has a Major Medical policy with a $5,00 deductible and an 80/20 Coinsurance clause. How much will the INSURED have to pay if a total of $15,000 in covered medical expenses are incurred?
$7,000
In Florida, most life insurance policies have a contestability period of
2 years
Which of the following statements BEST defines usual, customary, and reasonable (UCR) changes?
The maximum amount considered eligible for reimbursement by an insurance company under a health plan
Periodic health claim payments MUST be made at least:
Monthly
The Federal income tax treatment of employee-provided group Medical Expense insurance can be accurately described as:
Employee’s premiums paid by the employer is tax-deductible to the employer as a business expenditure
Which of the following acts is an agent NOT authorized to do on behalf of an insurer?
Accept premiums for policyholders
Complete insurance applications
Authorize claim payments
Ask Health related questions
- Authorize claim payments *
A life insurance application must be signed by all of these Except:
The policyowner
The agent
The insured(if an adult)
Beneficiary
- Beneficiary *
A Business Disability Buyout plan policy is designed:
To pay benefits to the Corporation or other shareholders
The waiting period for pre-existing conditions under a Medicare Supplement policy may NOT go beyond
6 months
P completed an application for a $10,000 life policy, but does not give the producer the initial premium. P’s coverage becomes effective when:
P receives the policy and pays the premium
Which of the following combinations plans is designed to protect an insured from an unpaid mortgage balance upon premature death?
Joint Life
How long does the coverage normally on a limited-pay life policy?
Age 100
Under the USA PATRIOT ACT, insurers are required to report receipt of cash payments in excess of
$10,000
Which of the following is not requires in the Outline of coverage for health insurance policy?
Projection of the policy future costs
Taking receipt of premiums and holding them for the insurance company is an example of:
Fiduciary Responsibility
Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling?
Variable Life
Which mode of payment is NOT used by health insurance policies?
Monthly premium
Annual premium
Single premium
Semi-annual premium
- Single premium *
What is the MINIMUM number of activities of Daily Living (ADL) an insured must be unable to perform to qualify for Long Term Care benefits?
2
Which of the following is the reimbursement of benefits for the treatment of a beneficiary ‘s injuries caused by a third party?
Subrogation
The minimum age at which a person can sign a life insurance application
15 years
Qis severely injured in an automobile accident and become totally disabled. How many months must Q be disabled before being able to apply for Social Security benefits?
5 months
If a retiree on Medicare required five hospital stays in one year, which policy would provide the best insurance for excess hospital expenses?
Medicare Supplement
A Student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following?
Aviation exclusion
T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. Five years later, T commits suicide. How much will the insurer pay?
$50,000
Which of these terms accurately defines an underwriter’s assessment of information on life insurance application?
Risk classification
noncontributory employee group life insurance must:
All eligible employees must be covered; No evidence of insurability required; Must have conversion rights
Insurers/agents must, in Florida, offer and issue all small employer health plans on a
Guaranteed-issue
In Florida, when agents recommend changes be made for existing coverage, the agent must follow established procedures. The name of this rule is called the
Florida Replacement rule
According to the Time Payment of Claims provision, the insurer mist pay Disability Income benefits no less frequently than which of the following options?
Monthly
Which type of renewability best describes a Disability Income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class?
Guaranteed Renewable
A variable whole Life policy
A minimum guaranteed Death benefit is provided
The provision in a health insurance policy that suspends premiums being paid to the insurer while the insured is disabled is called
Wavier of Premium
What is the initial requirement for an insured to become eligible for benefit under the waiver of premium provision?
Insured must be under a physician’s care
Which of the following does Social security NOT provide benefits for?
Survivorship
Dismemberment
Disability
Retirement
- Dismemberment *
Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?
Incontestable
An employee of 20 years recently retired at the age 59 1/2. This employee’s group life contract can be
Converted to an individual permanent policy at an individual rate
An insurance company may NOT reject a prospective insured’s life application on the basis of which of the following factors?
Gender
Which type of policy would pay an employee’s salary if the employer was injured in a bicycle accident and out of work for six weeks?
Business Overhead Expense
Which action could result in a hearing being ordered by the Department of Financial Services
Performing insurance transactions without a license
T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?
Request of the change will be refused
When a policyowner cash surrenders a Universal Life insurance policy in it’s early years, this may be considered a red flag for an
Anti-Money Laundering violation
D was actively serving in the Marines when he was killed in an automobile accident while on leave. His $100,000 whole life policy contains a War Exclusion clause. How much will D’s beneficiary receive?
The full face amount
From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?
Fair Credit Reporting Act
Which of these is NOT considered to be a right given to a policyowner?
Modify a provision in the insurance contract
Which of the following statements is CORRECT regrading the tax treatment of a lump-sum payment paid to a life insurance policy’s primary beneficiary?
All proceeds are income tax free in the year they are received
A disability elimination period is best described as a:
Time deductible
The provision that can be used to put an insurance policy back in force after it has lapsed due to nonpayment is called:
Reinstatement
Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?
Entire Contract
If an agent would like to sell Variable annuites, which state examination must the agent pass?
Life and Variable contract
J is agent who has induced and insured through misrepresentation to surrender an existing insurance policy. What is J guilty of?
Twisting
The coordination of benefits (COB) provision exists in order to
Avoid duplication of benefits payments
Which of these factors do NOT play role in the underwriting of a life insurance policy?
Marital Status
Which type of life insurance beneficiary requires his/her consent when a change of beneficiary attempted by the policyowner?
Irrevocable beneficiary
All of the following are eligibility requirements for an association group
Group must have been in existence for two years; group must hold regular meetings at least on an annual basis; at least 100 members must participate if the premium is contributory; must have been organized for some reason other than to obtain group insurance
Which product would best serve a retired individual looking to invest a lump-sum of money through an insurance company?
Annuity
Which of the following provisions is NOt required in HMO contracts/ certificates?
Seven day grace period
R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?
Residual Disability
Basic Hospital and Surgical policy benefits are
Lower than the actual expenses incurred
Employers with less than 20 employees are affected by Florida’s health coverage continuation act (MiNi Cobra)
20 employees
