Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
L&H Study Deck
| Question | Answer |
|---|---|
| What is insurable interest in life insurance? | A lawful interest in the continued life of the insured. |
| When must life insurance insurable interest exist? | At policy inception, not necessarily at death. |
| What is a beneficiary? | The person or entity designated to receive policy proceeds. |
| What is the death benefit? | Amount payable to a beneficiary upon the insured's covered death. |
| What is a premium? | Payment required to maintain insurance coverage. |
| What is underwriting? | Evaluation and classification of an applicant's risk. |
| What is adverse selection? | Higher-risk individuals are more likely to seek insurance. |
| What is a representation? | An applicant's statement believed true to the best of their knowledge. |
| What is concealment? | Withholding material information relevant to underwriting. |
| What is a material misrepresentation? | A false statement that could affect the insurer's decision. |
| What is a conditional receipt? | A receipt potentially providing coverage subject to stated conditions. |
| What is field underwriting? | A producer's initial evaluation and collection of applicant information. |
| Who generally signs a life insurance application? | Applicant or policyowner, proposed insured, and producer as required. |
| What is a policyowner? | The person with contractual rights under an insurance policy. |
| What is a unilateral insurance contract? | Only the insurer makes a legally enforceable promise to perform. |
| What is a contract of adhesion? | A contract drafted by one party, generally the insurer. |
| What is an aleatory contract? | Exchange of unequal values depending on an uncertain event. |
| What is consideration in insurance? | Premium and application statements exchanged for insurer's promise. |
| What is a term life policy? | Life coverage for a specified period, generally without cash value. |
| What happens when level term expires? | Coverage ends unless renewed or converted as permitted. |
| What is renewable term insurance? | Term insurance renewable without new evidence of insurability. |
| What is convertible term insurance? | Term insurance convertible to permanent coverage without new evidence of insurability. |
| What is decreasing term insurance? | Term coverage with a death benefit that declines over time. |
| What is whole life insurance? | Permanent life insurance with guaranteed cash value and death benefit under contract terms. |
| What is straight life insurance? | Whole life with premiums generally payable throughout the insured's life. |
| What is limited-pay whole life? | Permanent coverage paid up after a specified premium-paying period. |
| What is single-premium whole life? | Permanent life insurance funded by one lump-sum premium. |
| What is universal life insurance? | Flexible-premium permanent insurance with adjustable elements and cash value. |
| What is variable life insurance? | Permanent life insurance with values linked to separate-account investments. |
| Who bears investment risk in variable life? | The policyowner. |
| What is a separate account? | An account holding investment assets distinct from the insurer's general account. |
| What is joint life insurance? | Covers two lives and generally pays on the first death. |
| What is survivorship life insurance? | Covers two lives and pays after the second death. |
| What is key person life insurance? | Coverage a business owns on a vital employee or owner. |
| Who is beneficiary of key person insurance? | Generally the business. |
| What is a buy-sell agreement? | Arrangement for transfer of business ownership upon a triggering event. |
| What is an entity-purchase buy-sell plan? | The business agrees to purchase a departing owner's interest. |
| What is a cross-purchase buy-sell plan? | Business owners agree to purchase each other's interests. |
| What is cash value? | Savings component available under certain permanent life policies. |
| What is a policy loan? | Borrowing against eligible life policy cash value. |
| How do unpaid policy loans affect death benefits? | Outstanding loan balance and interest generally reduce proceeds. |
| What is a nonforfeiture option? | A choice preserving value when a cash-value policy is surrendered or lapses. |
| What are three common life nonforfeiture options? | Cash surrender, reduced paid-up, and extended term. |
| What does cash surrender provide? | Available surrender value paid to the policyowner. |
| What is reduced paid-up insurance? | Lower permanent death benefit with no further premiums. |
| What is extended term insurance? | Cash value buys term coverage for a limited period. |
| What is a dividend in participating life insurance? | A potential return of excess premium; not guaranteed. |
| What is a paid-up additions dividend option? | Dividends purchase additional paid-up life insurance. |
| What is the accumulation-at-interest dividend option? | Insurer retains dividends and credits interest. |
| What is an automatic premium loan provision? | Uses available cash value to pay overdue premiums through a loan. |
| What is the waiver of premium rider? | Waives premiums upon qualifying disability under rider terms. |
| What is an accidental death benefit rider? | Additional death benefit for qualifying accidental death. |
| What is a guaranteed insurability rider? | Right to purchase additional coverage at specified times without new medical evidence. |
| What is an accelerated death benefit? | Early access to part of the death benefit upon qualifying conditions. |
| What is a revocable beneficiary? | A beneficiary designation the owner can change without beneficiary consent. |
| What is an irrevocable beneficiary? | A beneficiary whose consent is generally needed for changes affecting their rights. |
| What is a primary beneficiary? | First in line to receive proceeds. |
| What is a contingent beneficiary? | Receives proceeds if the primary beneficiary cannot. |
| What is a spendthrift clause? | Restricts a beneficiary's ability to transfer or pledge policy proceeds. |
| What is an annuity primarily designed to address? | Risk of outliving one's assets. |
| What is the accumulation phase of an annuity? | Period when funds are paid in and grow before payout. |
| What is annuitization? | Converting accumulated value into periodic income payments. |
| What is an immediate annuity? | An annuity beginning income payments soon after purchase. |
| What is a deferred annuity? | An annuity whose income payments begin at a later date. |
| What is a fixed annuity? | An annuity with insurer-declared or guaranteed interest and contract benefits. |
| What is a variable annuity? | An annuity with values or payouts tied to investment performance. |
| What is an indexed annuity? | An annuity crediting interest partly based on an external index formula. |
| What is a life-only annuity payout? | Income for the annuitant's lifetime, with no guaranteed survivor payout. |
| What is a life with period certain annuity? | Lifetime income with payments guaranteed for a minimum period. |
| What is a joint and survivor annuity? | Income continuing as specified while either annuitant survives. |
| What is a surrender charge? | Fee for withdrawing or terminating certain contracts early. |
| What is a modified endowment contract (MEC)? | Life policy failing the federal seven-pay test. |
| What is the seven-pay test? | Federal test comparing premiums paid with the permitted seven-pay limit. |
| How are MEC loans generally taxed? | Gains are distributed first and may be taxable. |
| What is health insurance coinsurance? | Insured's percentage share of covered expenses after deductible. |
| What is a deductible? | Amount paid by insured before specified benefits begin. |
| What is a copayment? | Fixed amount paid by insured for a covered service. |
| What is an out-of-pocket maximum? | Cap on specified covered cost sharing during a plan period. |
| What is a stop-loss limit in major medical? | Threshold after which covered cost sharing is reduced or eliminated. |
| If covered costs after deductible are $1,000 with 20% coinsurance, insured pays? | $200, assuming no other limits or copays. |
| What is an elimination period? | Waiting period before disability benefits become payable. |
| What is a benefit period? | Maximum duration benefits are payable for a covered disability. |
| What is total disability? | Disability meeting the policy's definition of inability to work. |
| What is residual disability? | Partial loss of earnings due to disability under policy terms. |
| What is presumptive disability? | Disability automatically qualifying from specified severe losses. |
| What is own-occupation disability coverage? | Disability defined by inability to perform one's own occupation. |
| What is any-occupation disability coverage? | Disability defined by inability to work in any suitable occupation. |
| What is disability income insurance? | Coverage replacing part of income during qualifying disability. |
| What is business overhead expense insurance? | Pays covered business operating expenses during owner's disability. |
| What is disability buy-sell insurance? | Funds a business ownership purchase following a qualifying disability. |
| What is a probationary period in health insurance? | Initial time before coverage for certain conditions becomes effective. |
| What is a preexisting condition? | Health condition existing before coverage, as defined by applicable law or policy. |
| What is a guaranteed renewable policy? | Insurer must renew if premiums paid but may change rates by class. |
| What is a noncancelable policy? | Insurer cannot cancel or raise premiums while conditions are met. |
| What is a conditionally renewable policy? | Renewal guaranteed unless specified contractual conditions occur. |
| What is an optionally renewable policy? | Insurer may choose whether to renew at policy anniversary. |
| What is an HMO? | Health Maintenance Organization using a managed provider network. |
| What is a PPO? | Preferred Provider Organization offering network discounts and some out-of-network coverage. |
| What is a POS plan? | Point-of-service plan combining managed care and out-of-network options. |
| What is a primary care physician (PCP)? | Provider coordinating routine care and referrals in some plans. |
| What is a health savings account (HSA)? | Tax-advantaged account for qualified medical expenses with eligibility rules. |
| What is a flexible spending arrangement (FSA)? | Employer-based arrangement for eligible expenses, subject to plan rules. |
| What is a health reimbursement arrangement (HRA)? | Employer-funded reimbursement of qualifying medical expenses. |
| What is Medicare Part A? | Primarily hospital insurance. |
| What is Medicare Part B? | Primarily medical insurance for physician and outpatient services. |
| What is Medicare Part C? | Medicare Advantage coverage through approved private plans. |
| What is Medicare Part D? | Prescription drug coverage. |
| What is Medigap? | Private supplemental coverage for certain Original Medicare cost sharing. |
| What is Medicaid? | Joint federal-state health coverage program for eligible people. |
| What is long-term care insurance? | Coverage for qualifying extended care and assistance with daily living. |
| What are activities of daily living (ADLs)? | Basic self-care activities such as bathing, dressing, and eating. |
| What is custodial care? | Assistance with daily living rather than skilled medical treatment. |
| What is skilled nursing care? | Medical or nursing services requiring licensed professional skills. |
| What is dental insurance's basic service category? | Commonly includes fillings and routine extractions. |
| What is dental insurance's preventive category? | Commonly includes exams, cleanings, and preventive care. |
| What is a coordination-of-benefits provision? | Rules determining payment when multiple health plans cover a claim. |
| What is subrogation? | Insurer's right to pursue recovery from a responsible third party. |
| What is the purpose of a life insurance replacement notice? | Informs applicant about potential consequences of replacing existing coverage. |
| What is twisting? | Misleading a policyholder to induce replacement of insurance. |
| What is rebating? | Offering unauthorized inducements not specified in the insurance contract. |
| What is misrepresentation in insurance sales? | Making false or misleading statements about a policy or insurer. |
| What is unfair discrimination in insurance? | Improperly treating similar risks differently in violation of law. |
| What does the Minnesota Commissioner of Commerce oversee? | State insurance regulation and enforcement. |
| How many prelicensing hours per line does the 2022 MN guide specify? | 20 hours per line of authority. |
| How many CE credits does the 2022 MN guide require per licensing period? | 24 credit hours. |
| How many of those CE credits must cover ethics? | At least 3 hours. |
| How long is the standard MN producer renewal period in the 2022 guide? | 24 months after the initial term. |
| When is MN producer license renewal due under the 2022 guide? | Last day of producer's birth month in the renewal year. |
| How soon must MN licensees report a name or address change per the guide? | Within 10 days. |
| How long may the MN Commissioner extend CE compliance for good cause? | Up to 90 days. |
| If a CE waiver or extension is denied, how long to complete CE per the guide? | 30 days. |
| How many initial training hours does MN require before selling LTC per the guide? | At least 8 hours. |
| How many ongoing LTC training hours are required per the guide? | At least 4 hours every 24 months. |
| How far back may a MN life policy be dated per the 2022 guide? | No more than 6 months before the original application. |
| What is the MN life insurance grace period per the 2022 guide? | One month for premiums after the first. |
| What is the MN new life policy free-look period per the 2022 guide? | 10 days. |
| What is the MN replacement life policy free-look period per the 2022 guide? | 30 days. |
| How quickly must a MN insurer return premiums after a valid life free-look cancellation? | Within 10 days after receiving notice and returned policy. |
| How long is the MN life policy reinstatement period per the 2022 guide? | 3 years. |
| When does a MN life policy become incontestable under the 2022 guide? | After 2 years in force, except nonpayment of premium. |
| What is the MN individual health policy free-look period per the 2022 guide? | 10 days after delivery. |
| What is the MN LTC policy free-look period per the 2022 guide? | 30 days after delivery. |
| What is the purpose of Minnesota's life and health guaranty association? | Protects eligible policyholders if a member insurer becomes insolvent, within limits. |
| What is the difference between life and health insurance? | Life covers death or survival-related benefits; health covers medical or disability risks. |
| What is group life insurance? | Life coverage issued under a master contract for an eligible group. |
| What is a group life conversion privilege? | Right to convert eligible group coverage to individual insurance under specified conditions. |
| What is credit life insurance? | Life coverage intended to pay covered debt if borrower dies. |
| What is credit disability insurance? | Coverage paying covered debt installments during qualifying disability. |
| What is a rider? | An endorsement modifying policy terms or benefits. |
| What is a policy exclusion? | A circumstance or risk not covered by the policy. |
| What is a waiting period? | Time that must pass before specified coverage or benefits apply. |
| What is a waiver of premium provision? | Suspension of required premiums when specified conditions are met. |
| What is a recurrent disability provision? | Specifies when a repeat disability is treated as continuation of prior claim. |
| What is the difference between morbidity and mortality? | Morbidity measures illness; mortality measures death. |
| What is a peril in insurance? | A cause of loss. |
| What is a moral hazard? | Deliberate dishonesty increasing the risk of loss. |
| What is a morale hazard? | Carelessness or indifference increasing the risk of loss. |
| What is a physical hazard? | Tangible condition increasing the likelihood of loss. |
| What is indemnity? | Restoring a covered financial loss within contract limits. |
| What is risk pooling? | Spreading losses among many insureds with similar exposures. |
| What is the law of large numbers? | Larger similar groups allow more reliable prediction of aggregate losses. |
| What is a claim? | Request for payment or benefits under an insurance contract. |
| What is a grace period? | Extra time to pay a premium while coverage remains in force under policy terms. |
| What is an incontestability clause? | Limits insurer's ability to contest a policy after a stated period. |
| What is a free-look provision? | Period allowing policy return for a refund under specified conditions. |
| What is an annuity beneficiary? | Person designated to receive applicable death or remaining benefits. |
| What is the difference between immediate and deferred annuities? | Immediate starts payouts soon; deferred begins later. |
| What is the difference between fixed and variable annuities? | Fixed uses insurer guarantees; variable depends on investment results. |
| What is Medicare Supplement insurance designed to cover? | Certain deductibles, copayments, and coinsurance in Original Medicare. |
| What is a health insurance waiting period? | A delay before specified benefits or coverage become effective. |
| What is a health policy's entire contract provision? | Policy, attached application, and included documents constitute the contract. |
| What is a notice-of-claim provision? | Specifies when and how an insured must notify insurer of a claim. |
| What is a proof-of-loss provision? | Specifies documentation required to establish a covered claim. |
| What is a legal-actions provision? | Sets time limits for filing suit under a policy, subject to law. |
| What is an insuring clause? | Insurer's promise describing covered risks and benefits. |
| What is the consideration clause? | Identifies premium and other consideration supporting the contract. |
| What is the difference between HMO and PPO coverage? | HMO emphasizes managed network care; PPO generally allows more provider flexibility. |
| What is an annuity's surrender period? | Period during which withdrawals may trigger surrender charges. |
| What is a long-term care elimination period? | Time eligible care must occur before benefits begin. |
| What is a life insurance settlement option? | Method used to distribute policy proceeds to beneficiaries. |
| What is the interest-only settlement option? | Insurer retains principal and pays interest to beneficiary. |
| What is the fixed-period settlement option? | Proceeds paid in installments for a specified duration. |
| What is the fixed-amount settlement option? | Proceeds paid in chosen installment amounts until exhausted. |
| What is a life-income settlement option? | Proceeds converted to income for beneficiary's lifetime. |
Created by:
FarmersTNS
Popular Insurance sets