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Life License-Test#1

Part 2

QuestionAnswer
31. which of the following is not an acceptable risk to the underwriting dpt of an insurer? all are acceptable risks: sub-standard, preferred, standard
32. choose best beneficiary designation for following case: children are to receive equal shares of benefit, if any children die before insured does, the insured wishes that remaining children receive deceased child's share equally divided among them per capita-def
33. according to terms of suicide clause found in a life insurance policy, if an insured commits suicide 6 months after policy is issued, what will the insurer do? refund all premiums paid; this is how suicide provision works
34. which of following is true about a service provider as it relates to health insurance? payments made directly to the provider; payments are made to provider to provide services
35. if a service provider is paid a fixed monthly fee in an HMO, what is it called? capitation; def
36. if the premium on an individual health insurance policy is paid annually, semi-annually, or quarterly what is the minimum grace period required? 30 or 31 days;
37. if Commissioner issues a Notice of Seizure for documents and the individual fails to send those documents what is the penalty? 1 year in jail and/or $1000 fine; this is true, but does not directly answers the question
38. which two are Activities of Daily Living? eating and dressing; under a typical Long-Term Care contract, there are 6 of these activities that will trigger care and benefits payments. These two and other four are: mobility, toiletry, bathing, and transferring
39. the class beneficiary designation which means that the beneficiaries will receive equal shares of the death benefit divided among the surviving members of the class is: per capita; def; per stirpes refers to sharing the beneficiary's share of an estate among that beneficiary's children
40. which of the following is a description of a Life and Disability Analyst? a person licensed to advise clients about life and disability insurance for a fee; def
41. the clause that protects the proceeds of a life insurance policy from attachment by creditors after the death of the insured is: spendthrift trust clause; this will guard the proceeds from creditors until after the time the beneficiary receives them
42. a beneficiary wants to receive $2000 per month until the principal and interest are exhausted. which settlement option should be chosen? fixed amount option; key word is "exhausted"-this option emphasizes the dollar amt per installment as opposed to length of time installments are to be paid
43. COBRA (Consolidated Omnibus Budget Reconciliation Act) applies to employers with at least: 20 employees; COBRA is a federal law that requires employers with 20 or more employees to provide for the continuation of the employer's group health insurance benefits at group rates to former employees and their families for a period of time
44. an agent who replaces and existing life insurance contract must do all of the following EXCEPT: submit a copy of the replacement notice to the existing insurer; must do-submit copy of replacement notice to applicant, replacing insurer, and obtain a signed statement form applicant as to whether insurance is to be replaced
45. the Federal Act that is designed to protect group plan participants, establish pension equality, and mandates strict reporting and disclosure requirements is: ERISA - Employee Retirement Income Security Act
46. how is the Insurance Commissioner selected? elected by the people
47. The SEC (Securities Exchange Commission) is involved in the regulation of: Variable life policies; since Variable Life policies provides a return on investment linked to an underlying portfolio of securities, the SEC is involved in the regulation
48. which is most expensive LTC policy? 14 day elimination period, 5 year benefit period; this choice has the shortest elimination period in proportion to the benefit period
49. any attempt by an existing insurer or their agent to dissuade a policy owner from replacing an existing life insurance or annuity contract is known as: conservation; this normally occurs when a policy is in danger of, or in the process of, lapsing
50. unless the applicant indicates otherwise during the right-to-return period in an individual annuity, the premium for a variable annuity would be invested only in: fixed income investments and money market funds; during this period, the premium needs to be in a safe investment that will not fluctuate in value
51. which of the following would be considered a morale risk? the insured drives too fast; morale risk involves carelessness or irresponsibity
52. subject to the restrictions of the CA Insurance Code, any person capable of making a contract may be considered: an insurer; question wording is from the insurance code section describing insurers
53. in which of the following plans are claim forms typically completed and submitted by the participant? indemnity; PPO (preferred provider organizations), Point of Service, and HMO (Health Maintenance Organizations) are all orgs that complete the claim forms
54. regarding life insurance coverage for a company, the one responsible for obtaining the coverage, maintaining the policy, and paying the permium is: the master policy holder (employer); what they do
Joe receives a large bonus at work and decides to purchase an annuity with it. His monthly income payments form the annuity will begin following month. What did he purchased? A single premium immediate annuity; this type of annuity begins payments after a single premium paid, payments begin month after purchase
56. the policy provision which comes into effect when the insured and primary beneficiary die in a simultaneous (common) accident with no evidence as to who died first is: common disaster provision; this in a life insurance policy is designed to determine order of deaths when insured and beneficiary die in same accident. Otherwise, proceeds are payable to the insured's estate
57. in order to deal with the financial consequences of the death of a senior sales manager, a corporation could purchase: key person insurance; this insurance is on essential employees with benefits payable to the business. Amongst the many advantages of key person insurance is that it enhances the ability of the business to continue operations
58. an insurance company pays claims after a self-insured, specified limit has been reached. this is an example of: stop-loss coverage; this is a provision that states that when the maximum amt of a claim is reached, the insured will no longer be required to share the cost with the insurer
59. an individual with a low income and high insurance needs should buy: term insurance; this is best when the purchase of pure insurance is needed. it has the lowest cost to benefit ratio
60. which of following is a type of single deductible for all family members that, when satisfied, overrides any remaining family members' individual deductibles? family deductible; def
Created by: jennyhqs2