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Insurance License MI
| Question | Answer |
|---|---|
| What do limited health policies cover? | A specific accident or disease |
| If an applicant does not receive his or her insurance policy, who would be held responsible? | The agent |
| In forming an insurance contract, when does an acceptance usually occur? | When the insurer approves a prepaid application |
| What type of group health insurance is used to provide accident coverage on a group of persons that are participating in a particular activity, when the individual insureds are unknown, and are covered automatically? | Blanket |
| What are the common exclusions in most health insurance policies? | War, self-inflicted injuries, pre-existing conditions, elective cosmetic surgeries, injuries caused by participating in illegal activities, and workers compensation benefits |
| What is the term used for a written request for an insurer to issue an insurance contract based of the provided information? | Application |
| What is the capital sum in Accidental Death and Dismemberment (AD&D) coverage? | A percentage of the principal sum |
| What information are the members of the Medical Information Bureau required to report? | Adverse medical information about the applicants or insured |
| What entities make up the Medical Information Bureau? | Insurers |
| How can health insurance policies be delivered to the insured? | Personally delivered by the agent or mailed |
| What entity provides underwriters with information concerning an applicant's health history? | MIB - Medical Information Bureau |
| What type of health insurance plans cover all accidents and sicknesses that are not specifically excluded in the policy? | Comprehensive plans |
| During which stage in the insurance process do insurers evaluate information that identifies adverse selection risks? | Underwriting |
| In health insurance, what is considered sickness? | An illness that first arises while the policy is in force |
| In health insurance, the policy itself and the insurance application form what? | The entire contract |
| Whose responsibility is it to inform an applicant for health insurance about the insurer's information gathering practices? | The agent |
| When must the Outline of Coverage be provided to the insurer? | No later than policy delivery |
| What risk classification would require the highest premium for a health insurance policy? | Substandard |
| What is the purpose of the Outline of Coverage in health insurance? | To provide the insured full and fair disclosure about the policy issued |
| Whose responsibility is it to determine that all the questions on an insurance application are answered? | The agent's |
| What are the three types of risk rating classifications in health insurance? | Substandard, standard, and preferred |
| What type of hospital policy pays a fixed amount each day that the insured is in the hospital? | Indemnity |
| Who is responsible for paying the cost of a medical examination required in the process of underwriting? | Insurer |
| At what age do individuals qualify for Medicare? | Age sixty five |
| What is adverse selection? | People who are more likely to submit insurance claims are seeking insurance more often than preferred risks |
| If an agent makes a correction of the application for health insurance, who must initial the correct answer? | The applicant |
| Who must sign the health insurance application? | The policy owner, the insured (if different), and the agent |
| Health contracts are prepared by insurers and must be accepted by the insured on an 'as is' basis. This describes what aspect of a health insurance contract? | Contract of adhesion |
| In health insurance contracts, the insured is not legally bound to any particular action; however, the insured is obligated to pay for losses covered by the policy. What contract element does this describe? | Unilateral |
| During the application process for health insurance, a producer is trying to obtain creditable information about the applicant that would help underwriters determine if the risk is insurable. In what role is the producer acting? | Field underwriter |
| In medical expense contracts, what is the term that describes the payment method when the insured is responsible for paying the medical expenses, and then the insurer pays directly to the insured? | Reimbursement |
| What report is used to assess risk associated with a health insurance applicant's lifestyle and character? | Investigative Consumer Report |
| If an insurer decides to obtain medical information from different sources in order to determine the insurability of an applicant, who must be notified of the investigation? | The applicant |
| What characteristics would qualify an applicant for health insurance as a substandard risk? | Poor health history or a dangerous occupation or avocation |
| What type of health insurance would be most appropriate for a group of children in a summer camp? | Blanket |
| If an underwriter requires extensive information about the applicant's medical history, what report will best serve this purpose? | Attending Physician's Statement |
| What are the two types of expenses that are covered by health insurance? | Expenses related to health care, and expenses that compensate for loss of income |
| What is the term used for a condition for which the insured has received diagnosis, care, or treatment during a specific period of time prior to the health policy? | Pre-existing condition |
| In insurance, what is the term for cause of loss? | Peril |
| Who is a field underwriter? | Agent/Producer |
| What are the four elements of an insurance contract? | Agreement (offer and acceptance), consideration, competent parties, and legal purpose |
| What risk classification would typically qualify for lower premiums? | Preferred risk |
| Health insurance contracts are unilateral. What does that mean? | Only one party makes a legally enforceable promise |
| Under a credit disability policy, payments to the creditor will be made for the insurer until what point in time? | Until the period disability ends or until the debt is repaid |
| What is the entire contract in health insurance underwriting? | The application and the policy issued |
| When should an agent obtain a Statement of Good health from the insured? | When the premium was paid upon policy delivery and not at the time of application |
| In insurance, when is the offer usually made on a contract? | When the insurance application submitted |
| How is the information obtained for an investigative consumer report? | Through interviews with the applicant's associates, friends, and neighbors |
| Most health policies will pay the accidental death benefits if the death is cause by an accident and occurs within how may days? | Ninety days |
| What is a warranty in an insurance contract? | An absolutely true statement upon which the validity of the insurance contract is based |
| In group insurance, who is issued a certificate of insurance? | Individual insured |
| In group insurance, what is the name of the policy? | Master policy |
| A waiver of premium provision may be included with what type of health insurance policies? | Disability income |
| When are newborns covered in individual health insurance policies? | From the moment of birth |
| What type of health insurance would pay for hiring a replacement for an important employee who becomes disabled? | Key-person disability insurance |
| Who are the parties in a group health contract? | The employer and the insurer |
| What is the purpose of COBRA? | To allow continuation of health insurance coverage for terminated employees |
| If the insureds share in the cost of health insurance premium with the employer, this would be known as what type of health plan? | Contributory |
| What are the two types of Flexible Spending Accounts? | Health care accounts and dependent care accounts |
| Who chooses a primary care physician in an HMO plan? | The individual member |
| What is the primary purpose of disability income insurance? | To replace income lost due to a disability |
| How do insurers determine the cost for a group health policy? | The main variables are the ratio of men and women in the group, and the average age of the group |
| What is the purpose of a buy-sell agreement for health insurance policies? | To specify how the business will pass between owners when one of them dies or becomes disabled |
| What is the purpose of managed care health insurance plans? | To control health insurance claims expenses |
| What is the term for a period of time immediately following a disability during which benefits are not payable? | Elimination period |
| What percentage, if any, of the individual disability income policy benefits are taxed to the insured? | Benefits are not income taxable |
| What is the 'own occupation' disability? | Insured’s inability to perform duties of his or her current job or an occupation for which the insured is educated and trained |
| What is the time requirement for terminated employees to convert the group health coverage to an individual plan without evidence of insurability? | Thirty one days after termination of the employment |
| Under what type of care do insurers negotiate contracts with health care providers to allow subscribers have access to health care services at a favorable cost? | Preferred Provider Organization (PPO) |
| What is the main principal of an HMO plan? | Preventive care |
| What term is used to describe a situation when a medical caregiver contracts with a health organization to provide services to its members, but retains the right to treat patients who are not members? | Open panel |
| How are HMO territories typically divided? | Geographic areas |
| What is a presumptive disability provision? | Provision found in most disability income policies that specifies the conditions that will automatically qualify for full disability benefits |
| How many members must an association have to qualify for group insurance? | one hundred members |
| When a business receives benefits from its key person disability insurance, how are those benefits taxed? | The key person disability insurance benefits are received tax free |
| What does the amount of disability benefit that an insured can receive depend on? | The insured's income at the time of policy application |
| What is a fee-for-service health plan? | Under a fee-for-service plan, providers receive payments for each service provided |
| What is the main purpose of HIPPA regulations in group health plans? | To limit exclusions for pre-existing conditions |
| What the three types of basic medical expense insurance? | Hospital, surgical, and medical |
| With key person disability insurance, who pays the policy premiums? | The business (employer) |
| How can an HMO member see a specialist? | Referral by the primary care physician |
| Who determines the eligibility and contribution limits of an HRA? | The employer |
| Can an insured who belongs to a POS plan use and out-of-network physician? | Yes, but the co-pays and deductibles may be higher |
| If medical caregivers are contractually obligated to provide services only to members or subscribers of a specific health organization, what is the name for this type of arrangement? | Closed panel |
| After elimination period, a totally disabled insured qualified for benefits from a disability income policy that has a waiver of premium rider. What will happen to the premium that was paid into the policy during the elimination period? | Premium will be refunded |
| How can an AD&D policy be written? | As a rider to a health insurance policy, or as a separate policy |
| How do HMOs encourage members to get regular checkups? | To help catch health problems early when treatment has the greatest chance for success (i.e. preventive care) |
| In what type of health plans are providers paid for services in advances, regardless of the services provided? | Prepaid plans |
| To be eligible under HIPPA to convert group health coverage to an individual policy, the insured must apply for the individual plan within how many days of losing the group coverage? | Sixty three days |
| In order to be eligible for coverage by an HSA, an individual must also be covered by what type of health plan? | High Deductible Health Plan (HDHP) |
| Does group health insurance require medical examinations? | No, the underwriter evaluates the group as a whole, rather than each individual member |
| What types of injuries and services will be excluded from major medical coverage? | Injuries caused by war, intentionally self-inflicted injuries, injuries covered by worker compensation, regular dental/vision/hearing care, custodial care, and elective cosmetic surgery |
| What types of groups are eligible for group health insurance? | Employer-sponsored and association-sponsored groups |
| What are the tax implications for contributions to a Health Savings Account by the individual insured? | Contributions are tax deductible |
| What do individual insureds receive as proof of their group health coverage? | Certificate of Insurance |
| If a group health policy covers individuals that reside in more than one state, which state has the jurisdiction over the group policy? | The state in which the policy was delivered |
| What are the tax implications for employer contributions to Heath Reimbursement Accounts? | Employer contributions are tax deductible as business expenses |
| What is the role of the gatekeeper in an HMO plan? | To control costs for the services of specialists |
| What is the purpose of respite care in long-term care insurance? | To provide relief from a major caregiver (usually a family member) |
| If an employee covered under a health reimbursement account changes employers, what happens to the HRA? | It remains with the originating employer |
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iesha3692
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