Final Online Exam

Question 1

A partial surrender is allowed in which of the following policies?

(A.) Universal life
(B.) Decreasing term life
(C.) Adjustable whole life
(D.) Limited whole life

Answer 1

(A.) Universal life

Question 2

In what year was the Florida office of financial regulation (OFR) created ?

Answer 2

2003

The OFR was created in 2003 as a result of the cabinet reorganization act of 2002

Question 3

Disability income plans which require that the insurer can never change or alter Premium rates are usually considered what?

Answer 3

Non-cancelable

A. Non-cancelable policy cannot be canceled nor can its premium rates be increased under any circumstances

Question 4

Which of the following is a requirement for any change in an insurance application?

(A.) Change must be initialed by applicant
(B.) Change must be initialed by agent
(C.) Change must be approved by insurer
(D.) Change must be notarized

Answer 4

(A.) Change must be initialed by applicant

Question 5

Craig submits a $500 claim for medical expenses. With a past due premium of $100 the insurer pays $400. Which of the uniform optional provisions covers the situation?

• payment of claims
• unpaid premium
• legal actions
• time of payment of claims

Answer 5

Unpaid premiums

If there is an unpaid premium at the time, a claim becomes payable the amount the premium is to be deducted from the sum payable to the insured or beneficiary.

Question 6

Which of these is not a characteristic of accelerated death benefit option?

A. The benefit can be offered as a writer at a specific extra cost or maybe at no cost
B. The face amount and policy premium are not affected by payment
C. Before payment of the benefit is made, specific conditions must exist such as suffering from a terminal illness
D. There may be a dollar limit on the maximum benefit

Answer 6

A. The benefit can be offered as a writer at a specific extra cost or maybe at no cost

Accelerated death benefit options are offered with no increase in premium.

Question 7

Which of the following does maximum benefits refer to?

A. Upper limit percentage of what the insurance company will pay for coinsurance
B. Upper limits of what the insured will pay an out-of-pocket expenses
C. Upper limits of what an insurance company will pay for any particular claim
D. Upper limit of the total lifetime benefits the insurance company will pay

Answer 7

D. Upper limit of the total lifetime benefits the insurance company will pay

Question 8

How are contributions made to a Roth IRA handled for tax tax purposes?

Answer 8

Not tax deductible

Question 9

All the following are eligibility requirements for association group life insurance except….

A. Contributory plans require minimum of 25 participants
B. Must have been organized for some reason other than to obtain group insurance
C. Group must hold regular meetings at least on an annual basis
D. Group must have been in existence for 2 years

Answer 9

A. Contributory plans require minimum of 25 participants

Contributory association plans must have at least 100 participants. All members must participate in non-contributory plans.

Question 10

A policy owner may exercise. Which of these dividend options that uses the dividend to pay all or part of the next premium do?

A. Extended term option
B. Cash dividend option
C. Reduction of premium dividend option
D. Paid up option

Answer 10

C. Reduction of premium dividend option

The reduction of premium dividend option allows a policy owner to use the dividend to pay all our part of the premium due policy.

Question 11

Which statement concerning the entire contract provision in an individual accident and health insurance policy is true?

A. The agent has the authority to change the policy under certain conditions
B the agent can wave policy provisions and change the policy with insurers consent
C. The agent has the authority to waive the policies provisions under certain conditions
D. The agent doesn’t have authority to change the policy or if it’s provisions

Answer 11

D. The agent doesn’t have authority to change the policy or if it’s provisions

Question 12

Which of these would limit a company’s liability to provide insurance coverage?

A. Waiver
B. Exclusion
C. Rider
D. Provision

Answer 12

B. Exclusion

Question 13

What is the primary feature of a viatical settlement?

A. Reduced death benefit payment
B. Lower premiums
C. Longer contestable period
D. No interest on policy loans

Answer 13

A. Reduced death benefit payment

Question 14

Under a non-qualified and annuity interest is taxed after the what?

A. Distribution of payments
B. Death of annuitant
C. Exclusion ratio has been calculated
D. Deposits have been made

Answer 14

C. Exclusion ratio has been calculated

The taxable and non-taxable portions of annuity payments are determined by the exclusion ratio.

Question 15

The department of financial services serves as the receiver of any insurer placed into what?

A. Bankruptcy
B. Foreclosure
C. Indebtedness
D. Receivership

Answer 15

D. Receivership

The department of financial services also serves as the receiver of any insurer placed into receivership in Florida. The division of rehabilitation and liquidation plans, coordinates and directs the receivership processes on behalf of the department.

Question 16

Which of these factors help determine an insured’s life insurance premium?

A. Insured’s salary
B. Place of residence
C. Marital status
D. Avocation /hobby

Answer 16

D. Avocation /hobby

Question 17

When must a health insurer provide a proof of loss form?

A. Within 15 days of receipt of the notice of loss
B. Within 10 days of receipt of notice of loss
C. Within 10 days of actual loss
D. Within 15 days of actual loss

Answer 17

A. Within 15 days of receipt of the notice of loss

Question 18

Joe has a life insurance policy that has a face amount of $300,000. After a number of years the policy’s cash value accumulates to $50,000 and the face amount becomes $350,000. What kind of policy is this?

A. Universal life policy
B. Increased term life policy
C. Non-participating policy
D. Modified whole life policy

Answer 18

A. Universal life policy

Question 19

The IRS allows a taxpayer to deduct medical expenses that exceed 7.5% of their adjusted gross income. Which of the following is considered a tax deductible medical expense under this rule?

A. Correct disease insurance premiums
B. Long-term care insurance premiums
C. Individual disability income insurance premiums
D. Travel accidental insurance premiums

Answer 19

B. Long-term care insurance premiums

Tax qualified long-term care premiums are considered a medical expense. If a taxpayer’s medical expenses exceed 7.5% of their adjusted gross income, long-term care premiums are tax deductible.

Question 20

Why do pre-death distributions from a modified endowment contract (MEC) receive different texts treatment than other life insurance policies?

A. The MEC has tax deductible premiums
B. The MEC is considered an illegal product
C. Let me see. Does not accumulate cash value
D. The MEC tends to be an investment vehicle

Answer 20

D. The MEC tends to be an investment vehicle

Question 21

Loans obtained by policyowner against the cash value of a life insurance policy….

A. Would be subject to a federal estate tax
B. Are limited by face amounts of the policy
C. Are treated as taxable income
D. Would not be treated as taxable income

Answer 21

D. Would not be treated as taxable income

Question 22

Omar is covered by a disability income policy. He is hurt while performing an occupation more hazardous than the occupation listed in his policy. The policy’s change of occupation provision will have what effect?

A. Decrease the premiums
B. Increase the benefit level
C. Reduce the benefit level
D. Increase the premiums

Answer 22

C. Reduce the benefit level

Question 23

All of the following are examples of a business continuation plan except…

A. Stock redemption plan
B. Cross purchase agreement
C. Key person insurance
D. Deferred compensation

Answer 23

D. Deferred compensation

Question 24

When a qualified plan starts making payments to its recipient, which portion of the distributions is taxable?

A. Principal
B. Contributions made by employee
C. Gains
D. Contributions made by employer

Answer 24

C. Gains

Question 25

The suicide clause of a life insurance policy states that if an insured commits suicide within a stated. From the policy’s inception, the insurer will only be liable for a return of premiums paid…..

A. Minus indebtedness and without interest
B. During the last 6 months
C. Minus indebtedness and with interest
D. During the last 12 months

Answer 25

A. Minus indebtedness and without interest

Question 26

Group life policies in Florida are required to contain a conversion privilege that allows for conversion…..

A. To an individual policy at any time
B. To an individual policy for a stated period of time
C. With evidence of insurability
D. Only if the premiums are paid by the employer

Answer 26

B. To an individual policy for a stated period of time

Question 27

Which of the following protects a policy owner from misrepresentation caused by an innocent mistake?

A. Incontestable clause
B. Reinstatement clause
C. Non forfeiture clause
D. Entire contract clause

Answer 27

A. Incontestable clause

Question 28

How does one qualify as a fully insured individual under social security disability coverage?

A. Individuals currently employed
B. Individuals expected to be disabled for 5 months
C. Individual has been credited with the appropriate number of quarters of coverage
D. Individual is currently covered under Medicaid

Answer 28

C. Individual has been credited with the appropriate number of quarters of coverage

Question 29

A provision that allows a policy owner to withdraw a policy’s Cash value interest fee is a(n)…..

A. Grace period
B. Waiver of premium
C. Automatic premium loan
D. Partial surrender

Answer 29

D. Partial surrender

Question 30

One of the most important considerations when replacing health insurance would be the _____________

A. Cost
B. Occupation of the insured
C. Exclusions on a new policy
D. Age of the insured

Answer 30

C. Exclusions on a new policy

Question 31

According to the principal of almost good faith, then shared will answer questions on the application of the best of their knowledge and pay the required premium while the insurer will deal fairly with the insured and it’s _________

A. Legal reserve
B. Issuance of the policy
C. Promises made
D. Underwriting

Answer 31

C. Promises made

Question 32

The federal employees benefit program consist of two types of health plans for federal civilian employees. The two plans are fee for service and __________

A. Prepaid
B. Facility
C. Ambulatory
D. Blanket

Answer 32

A. Prepaid

This may also be known as health maintenance organizations

Question 33

The 30 granted to a license producer is provided via the _________

A. Written contract
B. Principal capacity
C. Law of agency
D. Producers apparent authority

Answer 33

C. Law of agency

According to the law of agency, the producer/ agent represents the principal/ insurer and is granted actual implied and appearance authority to act on behalf of the insurer. The law of agency makes the principal responsible for these acts of the agent.

Question 34

The difference between pre-certification and concurrent review is that the pre-certification _______

A. Cost less to the patient
B. Is considered a cost containment measure?
C. Occurs before the treatment is provided
D. Cost more to the patient

Answer 34

C. Occurs before the treatment is provided

Question 35

A health insurance policy where the insurer has the right to terminate the policy for reasons other than the insured’s health is called__________

A. Limited renewal
B. Guaranteed renewal
C. Conditionally cancelable
D. Conditionally renewable

Answer 35

D. Conditionally renewable

Question 36

Part A hospital expense coverage provided under Medicare is automatically made available to each of the following except______

A. A 70-year-old not eligible for social security
B. A. 55-year-old suffering from kidney failure
C. A 50-year-old individual who has qualified for SSDI in the last 24 months
D. A 65-year-old retiree

Answer 36

A. A 70-year-old not eligible for social security

Question 37

Asset protection can be provided by a long-term care partnership policy if the policy holder qualifies for what?

A. Medicaid
B. Disability
C. Social security
D. Medicare part C

Answer 37

A. Medicaid

Question 38

Which of the following would disqualify companies retirement plan from receiving favorable tax treatment?

A. Contains investing schedule
B. Contributions are applied with no regard to income
C. It is temporary
D. Formed for the sole benefit of the employees and their beneficiaries

Answer 38

C. It is temporary

Question 39

Under an individual disability policy in Florida, what is the minimum schedule of time in which claims must be made to an insured?

A. Daily
B. Annually
C. Weekly
D. Monthly

Answer 39

D. Monthly