Insurance

Question 1

A conversion provision of a life insurance contract allows the insured to do what?

Answer 1

Exchange a term insurance policy for a permanent insurance policy without evidence of insurability.

Question 2

What are defenses against negligence?

Answer 2

• Contributory negligence
• Comparative negligence
• Last clear chance rule
• Assumption of risk

Question 3

To receive benefits from a long-term care insurance policy, the insured must be chronically ill for how long?

Answer 3

90 days

And chronically ill is defined as being unable to perform the following ADLs… eating, bathing, dressing, transferring from bed to chair, using the toilet, and continence.

BED TOCHAIR

Question 4

What is Part D in auto coverage?

Answer 4

Damage to your auto coverage

Question 5

What is the Collateral Scource Rule?

Answer 5

Prevents the person who committed the tort from benefiting because of fortuitous circumstances.

The person who commits the tort:

1. Liable for full damages.
2. Is not entitled to a reduction of damages simply because the injured person has other sources of recovery, such as insurance.

Question 6

What policy provisions are required for a qualified long-term care policy?

Answer 6

• Must be guaranteed renewable and provide inflation protection
• Cannot provide cash value
• All dividends must reduce future premiums or increase future benefits
• All policies must include a non-forfiture option in the event the insured decides to surrender policy , this option includes the right to a shortened benefit.

Question 7

What is a Tort?

Answer 7

• Include all civil wrongs not based on contracts and are a broad residual classification of many private wrongs against another person or organization
• Torts occur independently of contractual obligations and can result from intentional acts or omissions, strict liability, imposed by law, or negligence.
• Torts are not considered criminal matters, but rather private civil wrongs.

Question 8

When converting a convertible term life insurance policy…what age is used in determining premiums?

Answer 8

The current age

Question 9

Long-term care insurance contracts must have what?

Answer 9

• Be guaranteed renewable or non-cancelable
• Have a 30 day free look and an expected loss ratio of 60%.
• If the policy is a replacement policy, the insurer must waive the time. Regarding pre-existing conditions.

Question 10

When a beneficiary receives the death benefit from a life insurance policy funded with a qualified plan, what is the taxable portion?

Answer 10

The taxable portion equals the cash surrender value minus any costs included in the participants income during the participants life

Question 11

Can I self employed person deduct premiums paid for qualified, long-term care insurance policies?

Answer 11

Yes

Question 12

The collateral source rule provides that damages assessed against a negligent party will not be reduced simply because the injured party has other sources of recovery available true or false

Answer 12

True

Question 13

What are Special Damages?

Answer 13

Special damages represent compensation for measurable losses, such as medical bills

Question 14

Key employee, disability, policies, pay, and benefits to who?

Answer 14

Can be either a key employee or the company whoever the beneficiary is

Question 15

For clients with high income is there a maximum that an insurance company will pay?

Answer 15

Yes

Question 16

When is the economic benefit rule triggered?

Answer 16

If there is an irrevocable, transfer of funds made on the executives behalf that provides a benefit to the executive

Question 17

When is constructive receipt triggered?

Answer 17

If there is an irrevocable, transfer of funds made on the executives behalf that provides a benefit to the executive

Question 18

What are the 6 ADLs of daily activities that trigger long term care policies?

Answer 18

Eating, bathing, dressing, transferring from bed to chair, using the toilet, and maintaining continence.

Question 19

Under coverage D of a home owners policy, if the home owner must live somewhere else but is not charged rent what is the insurance company liable for?

Answer 19

If the insured does not incur additional living expenses, when the dwelling is uninhabitable, the insured receives a benefit equal to the fair rental value of the property. The additional cost of meals is also covered.

Question 20

What is Unisured motorist protection?

Answer 20

It is Liability protection

Question 21

What is covered under other than collision under part D?

Answer 21

• Breakage of glass
• Loss caused by missiles, falling objects, fire, theft, larceny, explosion, earthquake, windstorm, hail, water, flood, malicious mischief or vandalism, riot, or civil commotion, and contact with birds or animals

Question 22

Is an employer allowed a current tax deduction for a Non-qualified deferred compensation plan?

Answer 22

• No
• Taxes deferred until the distribution of the compensation to the employee
• The deduction of the employer will follow the tax inclusion by the employee / executive who receives the deferred compensation
• Used by an employer as a form of golden handcuffs that helped to bind the employee to the company

Question 23

What organizations rate life insurance companies?

Answer 23

Fitch

Standard and Poors

Moodys

AM Best

Question 24

To receive Worker’s Compensation benefits, what two eligibility requirements must be met?

Answer 24

The disabled person must work in a covered occupation and the worker must have a job related accident or disease

Question 25

Medicare Supplement (Medigap) Insurance policies must be garuanteed what? Cannot exclude what? And what copayments and deductibles does it help cover?

Answer 25

Must be Garanteed renewable Cannot exclude pre-existing conditions Helps cover copayments and deductibles by Medicare Part A and B

Question 26

What is Restricted Stock?

Answer 26

* Comprised of corporate stock that is granted to the executive at a discounted price with the **restriction that it may not be sold or gifted until some future date**. * Allows voting rights when the stock is awarded **Dont over think it!**

Question 27

Under the contributory negligence rule can the injured party recover damages?

Answer 27

No you cannot recover damages for part of your own negligence that contributed to the injuries.

Question 28

What is the pairs and set option of loss settlement under a homeowners policy?

Answer 28

This option allows the insurer to repair or replace any part of a set or pair, or pay the insured the difference between the actual cash value (ACV) of the pair or set before and after the loss.

Question 29

Are the Premiums on long-term care insurance tax deductible?

Answer 29

Yes, Premiums paid by the individual are tax deductible as amedical expense for itemized deductions, subject to limitations based on age.

Question 30

What sort of nursing care does skilled does Medicare cover?

Answer 30

Skilled Max of 100 days, and only the first 20 days of care are covered at 100%

Question 31

Flood Insurance

Answer 31

Effective immediately if elected within the first 30 days of availability. Not mandatory, Mortgage lenders generally require Contentents coverage applies to household and personal property Deductibles may apply

Question 32

How many qualifications must be met under the 6 activities of daily living (ADLs, Bed To Chair) to qualify for long-term care?

Answer 32

2

Question 33

Is water damage from a bursting pipe covered under a standard homeowners policy?

Answer 33

Yes, but not mud slides or flooding.

Question 34

Can you still be covered by cobra if you voluntary resign from your job?

Answer 34

Yes

Question 35

In a Homeowners policy when personal property is located at another residence of the insured (vacation home) how much of that property is covered under the homewners policy?

Answer 35

Limited to the greater of $1,000 or 10% of the Coverage C insurance.