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Exam Answers
Questions I got wrong
| Question | Answer |
|---|---|
| Which of the following determines the length of time that benefits will be received under the Fixed-Amount settlement option? | Size of each installment |
| Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member? | Family term rider |
| If a claim is made on a policy during the grace period, an insurer is allowed to deduct the overall premium and to charge interest. What is the maximum allowed interest rate? | 8% |
| Which is NOT true about beneficiary designations? | The beneficiary must have insurable interest in the insured. |
| An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries? | The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive. |
| When an insurer terminates an agents appointment, the insurer must do all of the following EXCEPT | Provide a 30-Day advance notice to the Commissioner |
| All small employer group health plans, in order to comply with the requirements of the Florida Employee Health Care Access Act, must be issued on what basis? | Guaranteed Issue |
| All of the Following must be presented on a small group health insurance identification card EXCEPT | The Insured's Address |
| What provision in an insurance policy extends coverage beyond the premium due date? | Grace period |
| Most HMOS operate through what type of system? | A group enrollment system either at their place of employment or as a member of an association |
| What type of insurance would be used for a Return of Premium rider? | Increasing Term |
| Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early? | Paid-up options |
| An insured will be allowed to reactivate her lapsed life insurance policy if action is taken within a certain period of time, and proof of insurability is provided. Which policy provision allows this? | Reinstatement provision |
| insured had his wife as the beneficiary of his life insurance policy. so that she had income for life after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking in2 acct all EXCEPT | The insured's age at death. |
| What required provision protects against unintentional lapse of the policy? | Grace period |
| All advertisements are the responsibility of the | Insurer |
| Which of the following is an example of a producer's fiduciary duty? | The trust that a client places in the producer in regard to handling premiums |
| In life policies issued in this state, insurers are permitted to charge interest during the policy grace period for the number of days elapsing before the premium is paid. What is the maximum interest rate? | 8% |
| All of the following are dividend options EXCEPT | Fixed-period installments. |
| At what point must an outline of coverage be delivered | At the time of application or upon delivery of the policy |
| An insured receives an annual life insurance dividend check. What term best describes this arrangement? | Cash option |
| All of the following information about a customer must be used in determining annuity suitability EXCEPT | Beneficiary's Age |
| An insured purchased a life policy in 2010 and died in 2020. The insurance company discovers at that time that the insured had misstated information about her insurance history on the application. What will the insurer do? | Pay the death benefit |
| An insured had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an auto accident, and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do? | Pay a reduced death benefit |
| In order for a debtor group to qualify for group life insurance, what should be the minimum number of participants joining the plan every year? | 100 |
| Which of the following explains the policyowner's right to change beneficiaries, choose options, and receive proceeds of a policy? | Owner's Rights |
| The policyowner pays for her life insurance annually. Until now, she has collected a nontaxable dividend check each year. She has decided that she would rather use the dividends to help pay for her next premium. What option would allow her to do this? | Reduction of premium |
| Under an extended term nonforfeiture option, the policy cash value is converted to | The same face amount as in the whole life policy. |
| When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy? | It is reduced to the amount of what the cash value would buy as a single premium. |
| Which of the following best describes fixed-period settlement option? | Both the principal and interest will be liquidated over a selected period of time. |
| A policyowner who is also the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of ownership. The policyowner should have her husband named as the | Revocable beneficiary. |
| The Office of Insurance Regulation is responsible for all of the following insurer activities EXCEPT | Issue of securities |
| All of the following are required provisions in all individual health insurance policies delivered in this state EXCEPT | Misstatement of Age |
| An insurer hires a representative to advertise its company at a local convention. The representative lies about the details of some of the policies, in an attempt to secure more business for the company. Who is responsible for the representatives claims? | The Insurer |
| How are state Insurance Guaranty Associations funded? | By their members - authorized insurers |
| Which document helps ensure that full and fair disclosure is provided to the recipient of a policy? | Outline of coverage |
| An agent is ready to deliver a policy to an applicant but has yet received payment. Upon delivery, the agent collects the applicant's premium check, answers any questions the applicant many have, and then leaves. What did he forget to do? | Ask her to sign a statement of good health |
| Which of the following is NOT a feature of a noncancellable policy? | The insurer may terminate the contract only at renewal for certain conditions |
| Which health insurance provision describes the insured's right to cancel coverage? | Renewal provision |
| An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits at least 30 days. This indicates that his policy is written with a 30-day | Elimination period |
| When does the initial enrollment period for Medicare Part B begin? | 3 months before the insured's 65th birthday |
| If a person is disabled at age 27 and meets Social Security's definition of total disability, how many work credits must he/she have earned to receive benefits? | 12 credits |
| Annually renewable term policies provide a level death benefit for a premium that | Increases annually |
| Items stipulated in the contract that the insurer will not provide coverage for are found in the | Exclusions |
| What type of premium do both Universal Life and Variable Universal Life policies have? | Flexible |
| Which of the following entities has the authority to make changes to an insurance policy? | Insurers executive officer |
| A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is a known as | Critical Illness |
| Which of the following riders would NOT increase the premium for a policyowner? | Impairment rider |
| Which is TRUE about the cash surrender nonforfeiture option? | Funds exceeding the premium paid are taxable as ordinary income |
| What kind of policy allows withdrawals or partial surrenders | Universal Life |
| Which of the following entities has the authority to make changes to an insurance policy? | Insurer's executive officer |
| A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then | The benefit is received tax free |
| A guaranteed renewable health insurance policy allows the | Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class |
| Under which of the following organizations are the practicing providers compensated on a fee-for-service basis? | PPO |
| What is an important feature of a dental expense insurance plan that is NOT typically found in a medical expense insurance plan? | Diagnostic and preventive care |
| Occasional visits by which of the following medical professionals will NOT be covered under LTC's home health care? | Attending physician |
| Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium? | Automatic Premium loan |
| Bethany studies in England for a semester. While she is there, she is involved in a train accident that leaves her disabled. If Bethany owns a general disability policy, what will be the extent of benefits that she receives? | None |
| All of the statements concerning dividends are true EXCEPT | Dividend amounts are guaranteed in the policy |
| Which of the following statements about occupational vs. nonoccupational coverage is TRUE? | Disability insurance can be written as occupational or non occupational |
| The paid-up addition option uses the dividend | To purchase a smaller amount of the same type of insurance as the original policy |
| Under straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive | Nothing; the payments will cease |
| Which of the following statements pertaining to Medicare Part A is correct? | Individuals who have ALS automatically qualify for Medicare Part A, regardless of age |
| If a contact provides a set amount of income for two or more persons with the income stopping upon the first death of the insured, it is called a | Joint Life Annuity |
| In which Medicare supplemental policies are the core benefits found? | All plans |
| Which of the following is correct concerning the taxation of premiums in a key person life insurance policy? | Premiums are not tax deductible as a business expense |
| Under a pure life annuity, an income is payable by the company | Only for the life of the annuitant |
| Which of the following is an eligibility requirement for Social Security income benefits? | Fully insured status |
| Under which installments option does the annuitant select the amount of each payment, and the insurer determines how long they will pay the benefits? | Fixed Amount |
| Which of the following will vary the length of the grace period in health insurance policies? | The mode of the premium payment |
| Your client is planning to retire. She has accumulated $100,000 in a retirement annuity, and now wants to select the benefit option that will pay the largest monthly amount for as long as she lives. As her agent, you should recommend, | Straight Life |
| What form of the annuity settlement options provides payments to an annuitant for the rest of the annuitant’s life and ceases at the annuitant’s death? | Pure Life |
| Which provision states that the insurance company must pay Medical Expense claims immediately? | Time of Payment Claims |
| How soon following the occurrence of a covered loss must an insured submit written proof of such loss to the insurance company? | Within 90 days or as soon as reasonably possible, but not to exceed 1 year |
| An insured receives an annual life insurance dividend check. What term describes this arrangement? | Cash Option |
| Which of the following is not true of the Disability Buy-Sell coverage? | Benefits are considered taxable income to the business |
| An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 and not 43 as stated on the application. What will the company do? | Pay a reduced Benefit |
Created by:
Hayley92