Partial preview of the text
Download CALIFORNIA LIFE ACCIDENT AND HEALTH EXAM PRATICE QUESTIONS AND ANSWERS (LATEST 2024 – 2025 and more Exams Health sciences in PDF only on Docsity!
CALIFORNIA LIFE ACCIDENT AND HEALTH EXAM PRATICE QUESTIONS AND
ANSWERS (LATEST 2024 – 2025) RATED A+
JOHN IS THE AGENT FOR ABC INSURANCE AND JANE IS THE INSURED. WHO IS THE PRINCIPAL IN THIS
AGENCY RELATIONSHIP?
A
ABC INSURANCE
B
JOHN
C
JANE
D
NONE – CORRECT ANSWER: A
ABC INSURANCE
A(N) ________ INSURER IS AUTHORIZED TO WRITE INSURANCE POLICIES IN A PARTICULAR STATE.
A
DOMESTIC
B
NON-ADMITTED
C
FOREIGN
D
ADMITTED - CORRECT ANSWER: D
ADMITTED
WHICH OF THE FOLLOWING IS CLASSIFIED AS AN INSURANCE BROKER?
A
A PERSON WHO PLACES COVERAGE FOR HIS/HER OWN INSURANCE
B
A PERSON WHO NEGOTIATES INSURANCE CONTRACTS ON BEHALF OF AN INSURED
C
A PERSON IN THE HOME OFFICE WHO DOES NOT SOLICIT OUTSIDE OF THE OFFICE
D
AN EMPLOYEE WHO NEGOTIATES INSURANCE CONTRACTS FOR HIS/HER EMPLOYER - B
A PERSON WHO NEGOTIATES INSURANCE CONTRACTS ON BEHALF OF AN INSURED
THE INSURANCE CONTRACT IS SAID TO BE A CONTRACT OF UTMOST GOOD FAITH, BECAUSE:
A
CONCEALMENT OF KNOWN FACTS ON THE PART OF THE INSURED WILL VOID THE CONTRACT
B
THE INSURER HAS DRAWN UP THE CONTRACT AND, THEREFORE, THERE IS NO INTENT TO DECEIVE
C
EACH PARTY IS ENTITLED TO RELY UPON THE REPRESENTATIONS OF THE OTHER THAT THERE IS
NOTHING CONCEALED OR DISHONEST
D
THE INSURED MUST WARRANT THAT HIS/HER REPRESENTATIONS ARE TRUE - CORRECT ANSWER: C
EACH PARTY IS ENTITLED TO RELY UPON THE REPRESENTATIONS OF THE OTHER THAT THERE IS
NOTHING CONCEALED OR DISHONEST
WHICH OF THE FOLLOWING BEST DESCRIBES A CONTRACT OF INDEMNITY UNDER INSURANCE?
A
THE INSURED IS RESTORED TO THE SAME FINANCIAL CONDITION AS PRIOR TO THE LOSS, WITH NO
INTENT OF LOSS OR GAIN
B
THE INSURED INDEMNIFIES THE INSURER FOR ANY EXPENSES IN ADJUSTING THE LOSS
C
THE INSURED SUSTAINS A LOSS AS A RESULT OF THE LOSS - CORRECT ANSWER: A
THE INSURED IS RESTORED TO THE SAME FINANCIAL CONDITION AS PRIOR TO THE LOSS, WITH NO
INTENT OF LOSS OR GAIN
THE INSURED IS RESTORED TO A FINANCIAL CONDITION AS GOOD AS, OR BETTER THAN, THE
INSURED WAS BEFORE THE LOSS
___________ INSURANCE IS USED TO PROVIDE COVERAGE WHEN INSURANCE IS NOT AVAILABLE FROM AN
ADMITTED CARRIER.
A
FACULTATIVE
B
DOMESTIC
C
ALIEN
D
SURPLUS - CORRECT ANSWER: D
SURPLUS
WHICH OF THE FOLLOWING RISKS IS PROTECTED BY INSURANCE?
A
CERTAIN RISK
B
SPECULATIVE RISK
C
PURE RISK
D
INVOLUNTARY RISK - CORRECT ANSWER: C
PURE RISK
A GOOD EXAMPLE OF RISK REDUCTION MIGHT BE:
A
WHEN ONE TAKES ACTION TO MINIMIZE THE SEVERITY OF A POTENTIAL LOSS
B
THE ELIMINATION OF THE EXPOSURE TO A SPECIFIC RISK
C
THE TRANSFER OF THE RISK TO AN INSURANCE COMPANY
D
INSURING ONLY THOSE RISKS THAT THREATEN THE FINANCIAL STABILITY OF THE INSURED -
CORRECT ANSWER: A
WHEN ONE TAKES ACTION TO MINIMIZE THE SEVERITY OF A POTENTIAL LOSS
AN INSURER THAT IS AUTHORIZED TO DO BUSINESS IN A PARTICULAR STATE IS SAID TO BE:
A
NON-ADMITTED
B
ADMITTED
C
DOMESTIC
D
FOREIGN - CORRECT ANSWER: B
ADMITTED
WHICH INSURER'S OWNER RECEIVES TAXABLE CORPORATE DIVIDENDS AS A RETURN OF PROFIT?
A
MUTUAL
B
RECIPROCAL
C
STOCK
D
FRATERNAL - CORRECT ANSWER: C
STOCK
IN INSURANCE, WHEN THE NUMBER OF SIMILAR UNITS INCREASE, THE PREDICTABILITY OF THE LOSS
IMPROVES:
A
BECAUSE OF THE SIMILARITY OF UNITS IN LARGE QUANTITIES
B
ACCORDING TO THE LAW OF LARGE NUMBERS
C
BECAUSE OF ACCUMULATED EXPERIENCE
D
ACCORDING TO THE LAW OF AVERAGES - CORRECT ANSWER: B
ACCORDING TO THE LAW OF LARGE NUMBERS
A CONTRACT WHEREBY ONLY ONE PARTY IS BOUND TO FUTURE PERFORMANCE, IS SAID TO BE:
A
A UNILATERAL CONTRACT
B
A BILATERAL CONTRACT
C
A CONDITIONAL CONTRACT
D
AN ALEATORY CONTRACT - CORRECT ANSWER: A
A UNILATERAL CONTRACT
THE CALIFORNIA FINANCIAL INFORMATION PRIVACY ACT IS SOMETIMES KNOWN AS:
A
CAL-GLBA
B
CA-FIPA
C
CA-HIPAA
D
CA-FCRA - CORRECT ANSWER: A
CAL-GLBA
IN CALIFORNIA, ANY PERSON THAT MANUFACTURES AND SELLS INSURANCE COVERAGE BY WAY OF
INSURANCE POLICIES OR CONTRACTS MAY BE AN:
A
INSURED
B
INSURER
C
AGENCY
D
AGENT - CORRECT ANSWER: B
INSURER
IN THE INSURANCE WORLD, A POTENTIAL FOR A LOSS IS SAID TO BE:
A
A RISK
B
A PERIL
C
A HAZARD
D
AN INSURABLE INTEREST - CORRECT ANSWER: A
A RISK
AN INSURANCE PLAN OWNED BY AN EMPLOYER, CREDITOR OR ASSOCIATION, PROVIDING COVERAGE
FOR THE EMPLOYEES, DEBTORS, OR MEMBERS, REFERS TO WHICH OF THE FOLLOWING?
A
ORDINARY LIFE INSURANCE
B
GROUP LIFE INSURANCE
C
INDUSTRIAL LIFE INSURANCE
D
INDIVIDUAL LIFE INSURANCE - CORRECT ANSWER: B
GROUP LIFE INSURANCE
A PERSONALIZED COMPUTER-GENERATED ILLUSTRATION DETAILING PREMIUMS, CASH VALUES,
INTEREST RATES, AND SURRENDER VALUES IS CALLED __________.
A
A POLICY SUMMARY
B
SALES LITERATURE
C
AN ADVERTISEMENT
D
A HYPOTHETICAL - CORRECT ANSWER: A
A POLICY SUMMARY
A PRODUCER SUBMITS A COMPLETED APPLICATION TO THE INSURER ALONG WITH THE PREMIUM
CHECK AFTER GIVING THE APPLICANT A CONDITIONAL RECEIPT. IF THE APPLICANT COMPLETES THE
REQUIRED MEDICAL EXAM, BUT DIES PRIOR TO THE INSURER ISSUING A POLICY AS APPLIED FOR,
WHAT IS THE INSURER'S RESPONSIBILITY?
A
TO PAY THE CLAIM IN FULL SINCE THE CONDITIONS OF THE RECEIPT WERE FULLY SATISFIED
B
TO REFUND PREMIUMS PAID LESS COSTS ASSOCIATED WITH ANY MEDICAL EXAMS
C
TO KEEP THE PREMIUM AND REJECT THE CLAIM
D
TO REFUND ANY AND ALL PREMIUMS PAID - CORRECT ANSWER: A
TO PAY THE CLAIM IN FULL SINCE THE CONDITIONS OF THE RECEIPT WERE FULLY SATISFIED
IN A REPLACEMENT TRANSACTION, ALL OF THE FOLLOWING ARE INSURER DUTIES AND
RESPONSIBILITIES, EXCEPT:
A
MAINTAIN COPIES OF THE INFORMATION PROVIDED BY THE PRODUCER
B
ABIDE BY THE STATE REQUIRED HOLDING PERIOD FOR ALL REPLACEMENT DOCUMENTATION
C
NOTIFY THE EXISTING INSURER
D
CONTACT THE CLIENT TO ASSURE THAT THEY UNDERSTAND THE TRANSACTION - CORRECT ANSWER:
D
CONTACT THE CLIENT TO ASSURE THAT THEY UNDERSTAND THE TRANSACTION
THE MORTALITY RATE IS BASED ON MORTALITY TABLES WHICH SHOW LIFE EXPECTANCY AND THE
DEATH RATE PER _______ PEOPLE LIVING IN THE U.S.
A
1,
B
C
10,
D
100,000 - CORRECT ANSWER: A
1,
WHICH OF THE FOLLOWING IS INCLUDED IN PART I OF A LIFE INSURANCE APPLICATION?
A
FAMILY HEALTH HISTORY
B
HOSPITALIZATIONS AND SURGERIES
C
PRESENT HEALTH
D
NAME AND OCCUPATION - CORRECT ANSWER: D
NAME AND OCCUPATION
BUYING LIFE INSURANCE SO THAT THE DEATH BENEFIT WILL BE AVAILABLE FOR PAYING ESTATE
TAXES DUE UPON THE DEATH OF THE INSURED IS KNOWN AS:
A
SURVIVOR PROTECTION
B
ESTATE CREATION
C
ESTATE CONSERVATION
D
PRENEED PLANNING - CORRECT ANSWER: C
ESTATE CONSERVATION
MONEY ACCUMULATED IN A PERMANENT POLICY THAT THE POLICYOWNER MAY BORROW VIA A
POLICY LOAN OR RECEIVE IF THE POLICY IS SURRENDERED, REFERS TO:
A
SAVINGS ACCOUNT
B
ACCUMULATED AT INTEREST ACCOUNT
C
DEFERRED SAVINGS ACCOUNT
D
THE CASH VALUE - CORRECT ANSWER: D
THE CASH VALUE
SEAN HAS A HOME WITH A MORTGAGE. HE NEEDS LIFE INSURANCE TO PROTECT HIS FAMILY BUT
ALSO WANTS TO LEAVE THEM WITHOUT A MORTGAGE PAYMENT IF HE DIES. IDEALLY WHICH OF THE
FOLLOWING RIDERS SHOULD HE ACQUIRE?
A
FAMILY RIDER
B
INCREASING TERM RIDER
C
DECREASING TERM RIDER
D
LEVEL TERM RIDER - CORRECT ANSWER: C
DECREASING TERM RIDER
AN INSURED OWNS A $50,000 PERMANENT LIFE POLICY THAT SHE PURCHASED 4 YEARS AGO THAT
HAS A DISABILITY WAIVER OF PREMIUM. THE INSURED BECOMES DISABLED AND PAYS PREMIUMS
DURING THE WAITING PERIOD UNTIL THE WAIVER BEGINS. ONCE THE WAIVER BEGINS, WHAT
HAPPENS TO THE PREMIUMS SHE PAID DURING THE WAITING PERIOD?
A
THE INSURER REFUNDS IT
B
IT IS ADDED TO THE POLICY'S CASH VALUES
C
IT IS HELD IN ESCROW UNTIL THE DISABILITY IS OVER THEN REFUNDED
D
IT IS KEPT BY THE INSURER AS PART OF THE COST OF PROVIDING THE BENEFIT - CORRECT ANSWER:
A
THE INSURER REFUNDS IT
WHOLE LIFE IS ALSO KNOWN AS ________ PROTECTION.
A
TEMPORARY
B
PERMANENT
C
ABSOLUTE
D
PERIODIC - CORRECT ANSWER: B
PERMANENT
ALL OF THE FOLLOWING POLICIES END WHEN AN INSURED DIES, EXCEPT:
A
JOINT SURVIVORSHIP
B
JOINT LIFE
C
VARIABLE UNIVERSAL LIFE
D
JUVENILE LIFE - CORRECT ANSWER: A
JOINT SURVIVORSHIP
A MARRIED COUPLE PURCHASES A $250,000 JOINT LIFE POLICY. WHEN THE OLDER OF THE TWO
DIES, WHAT IS THE AMOUNT PAYABLE TO THE SURVIVOR?
A
$250,
B
ZERO
C
$500,
D
$125,000 - CORRECT ANSWER: A
$250,
THE OWNER OF A VARIABLE LIFE POLICY MAY ALLOCATE THE PREMIUM INTO A SUB-ACCOUNT
WHICH IS OWNED BY THE INSURER, THIS SUB-ACCOUNT IS A PART OF WHAT IS ALSO KNOWN AS THE:
A
SIDE FUND
B
ACCUMULATION ACCOUNT
C
ALLOCATION ACCOUNT
D
SEPARATE ACCOUNT - CORRECT ANSWER: D
SEPARATE ACCOUNT
WHICH TYPE OF TERM PROTECTION HAS AN INCREASING FACE VALUE AS THE INSURED GETS OLDER?
A
LEVEL TERM
B
RENEWABLE TERM
C
INCREASING TERM
D
CONVERTIBLE TERM - CORRECT ANSWER: C
INCREASING TERM
LEVEL, DECREASING AND INCREASING TERM REFER TO WHICH POLICY FEATURE?
A
CASH VALUE
B
DEATH BENEFIT
C
PREMIUM
D
RENEWABLE AND CONVERTIBLE - CORRECT ANSWER: B
DEATH BENEFIT
BERT IS THE OWNER AND INSURED OF A TRADITIONAL WHOLE LIFE INSURANCE POLICY HE
PURCHASED 20 YEARS AGO. HE HAS NEVER MISSED A PREMIUM PAYMENT. HE WOULD LIKE TO BUY A
NEW CAR BUT HIS BANK ACCOUNT IS RUNNING LOW. HOW CAN HE OBTAIN THE NECESSARY FUNDS
WHILE STILL MAINTAINING COVERAGE?
A
REDUCE THE POLICY'S FACE AMOUNT WHICH WILL REDUCE HIS PREMIUM PAYMENT
B
SURRENDER PART OF THE POLICY AND FOR THE BALANCE TAKE A POLICY LOAN
C
SURRENDER THE POLICY BACK TO THE INSURER
D
TAKE A POLICY LOAN FROM THE INSURER - CORRECT ANSWER: D
TAKE A POLICY LOAN FROM THE INSURER
WHICH OF THE FOLLOWING IS TRUE OF A TERM RIDER WHEN ATTACHED TO A PERMANENT LIFE
POLICY?
A
IT ALLOWS THE POLICY TO ACHIEVE PAID UP STATUS AT THE END OF THE TERM
B
IT CAN PROVIDE ADDITIONAL TEMPORARY COVERAGE ON THE INSURED OR ON OTHER MEMBERS OF
THE FAMILY
C
IT ONLY PAYS OUT A DEATH BENEFIT IN CASES OF ACCIDENTAL DEATH
D
IT ALWAYS IS IN THE AMOUNT OF THE BASE POLICY - CORRECT ANSWER: B
IT CAN PROVIDE ADDITIONAL TEMPORARY COVERAGE ON THE INSURED OR ON OTHER MEMBERS OF
THE FAMILY
WHICH TYPE OF RIDER PAYS OUT A CAPITAL SUM IN CASE AN INSURED LOSES A LIMB OR THEIR
EYESIGHT?
A
ACCIDENTAL DEATH
B
RETURN OF PREMIUM
C
DISABILITY BENEFIT
D
ACCIDENTAL DEATH AND DISMEMBERMENT - CORRECT ANSWER: D
ACCIDENTAL DEATH AND DISMEMBERMENT
IF A POLICYOWNER HAS A WHOLE LIFE INSURANCE POLICY WITH A DISABILITY WAIVER OF PREMIUM
RIDER, WHEN DOES THE RIDER BENEFIT START IF A QUALIFYING DISABILITY SHOULD OCCUR?
A
TYPICALLY 6 MONTHS AFTER THE DISABILITY OCCURS
B
IMMEDIATELY
C
AFTER THE DOCTOR CERTIFIES THE DISABILITY
D
ONE YEAR AFTER THE CLAIM FORMS ARE RECEIVED BY THE INSURER - CORRECT ANSWER: A
TYPICALLY 6 MONTHS AFTER THE DISABILITY OCCURS
TERM LIFE INSURANCE IS DESIGNED TO PROVIDE COVERAGE FOR ___________.
A
FOR ONE YEAR
B
TO AGE 65
C
AN ENTIRE LIFETIME
D
A SPECIFIED PERIOD OF TIME - CORRECT ANSWER: D
A SPECIFIED PERIOD OF TIME
WHICH OF THE FOLLOWING IS A TRUE CHARACTERISTIC OF A VARIABLE UNIVERSAL LIFE POLICY?
A
THE POLICY REQUIRES ONLY A LIFE LICENSE TO SELL
B
THE INSURER BEARS ALL RISKS IN ACCUMULATING CASH VALUE
C
AS LONG AS THERE IS SUFFICIENT CASH VALUE TO COVER POLICY EXPENSES WHEN DUE, THE
INSURED IS NOT REQUIRED TO PAY THE PLANNED PREMIUM
D
THE POLICY HAS A FIXED PREMIUM SCHEDULE - CORRECT ANSWER: C
AS LONG AS THERE IS SUFFICIENT CASH VALUE TO COVER POLICY EXPENSES WHEN DUE, THE
INSURED IS NOT REQUIRED TO PAY THE PLANNED PREMIUM
FOR WHICH OF THE FOLLOWING REASONS MAY AN INSURED RETURN THE POLICY FOR A FULL
REFUND WITHIN THE FREE LOOK PERIOD?
A
DEATH OF THE AGENT
B
INCREASE IN PREMIUM
C
ANY REASON
D
DECLINE IN FINANCIAL RATING OF THE INSURANCE COMPANY - CORRECT ANSWER: C
ANY REASON
ON A VARIABLE UNIVERSAL LIFE POLICY WHAT IS THE DIFFERENCE BETWEEN THE CASH VALUE AND
THE CASH SURRENDER VALUES?
A
THE SURRENDER CHARGE
B
THE INVESTMENT PERFORMANCE
C
THE AMOUNT OF ANY OUTSTANDING POLICY LOAN
D
THE INTEREST EARNED - CORRECT ANSWER: A
THE SURRENDER CHARGE
___________ IN A POLICY ALLOW THE OWNER TO NAME THE BENEFICIARY, CHOOSE A DIVIDEND OPTION
OR SETTLEMENT OPTION, OR BORROW AGAINST THE CONTRACT.
A
INSURING CLAUSE
B
CONSIDERATION CLAUSE
C
INCONTESTABLE CLAUSE
D
OWNERSHIP PROVISION - CORRECT ANSWER: D
OWNERSHIP PROVISION
WHICH OF THE FOLLOWING STATES THE OBLIGATION OF THE INSURER AND THE RISK THAT IS
CONSIDERED IN A LIFE INSURANCE POLICY?
A
CONSIDERATION CLAUSE
B
INSURING CLAUSE
C
ENTIRE CONTRACT CLAUSE
D
EXCLUSIONS PROVISION - CORRECT ANSWER: B
INSURING CLAUSE
AFTER A LIFE INSURANCE POLICY HAS BEEN IN FORCE FOR MORE THAN _____ YEARS THE POLICY IS
CONSIDERED INCONTESTABLE.
A 1 B 3 C 4 D
2 - CORRECT ANSWER: D
IN ORDER TO MAKE SURE THAT A CREDITOR OF THE INSURED IS NOT PAID MORE THAN THE
OUTSTANDING LOAN AT TIME OF CLAIM, THE POLICYOWNER SHOULD:
A
INDICATE THE PERCENTAGE OF THE FACE AMOUNT THE CREDITOR WILL RECEIVE
B
SPECIFY A DOLLAR AMOUNT THE CREDITOR SHOULD RECEIVE AT TIME OF CLAIM
C
PURCHASE A DECREASING BENEFIT POLICY THAT MATCHES THE LOAN REPAYMENT SCHEDULE
D
NAME THE CREDITOR AS A PRIMARY BENEFICIARY - CORRECT ANSWER: C
PURCHASE A DECREASING BENEFIT POLICY THAT MATCHES THE LOAN REPAYMENT SCHEDULE
AN INSURED FORGETS TO PAY HIS INSURANCE PREMIUM. INSTEAD OF THE POLICY LAPSING, THE
PREMIUM IS PAID BY THE COMPANY. THIS WOULD SUGGEST THAT A __________ POLICY WAS
PURCHASED.
A
WHOLE LIFE
B
DECREASING TERM
C
RENEWABLE TERM
D
LEVEL TERM - CORRECT ANSWER: A
WHOLE LIFE
THE ___________ DECIDES WHICH DIVIDEND OPTION IS IN EFFECT AND CAN CHANGE THEIR ELECTION
AT ANY TIME.
A
BENEFICIARY
B
POLICYOWNER
C
BOARD OF DIRECTORS
D
INSURER - CORRECT ANSWER: B
POLICYOWNER
AN AUNT AND UNCLE PURCHASE A LIFE INSURANCE POLICY ON THEIR NIECE, FOR WHOM THEY ARE
THE LEGAL GUARDIANS. BOTH GUARDIANS PERISH IN AN ACCIDENT SOME TIME LATER. WHO
RECEIVES THE DEATH BENEFIT?
A
THE PRIMARY BENEFICIARY
B
NO CLAIM IS PAID OUT
C
THE CONTINGENT BENEFICIARY
D
THE NIECE'S ESTATE - CORRECT ANSWER: B
NO CLAIM IS PAID OUT
ALL OF THE FOLLOWING ARE EXAMPLES OF AN ABSOLUTE ASSIGNMENT, EXCEPT:
A
A BUSINESS PERMITS THE CHANGE OF OWNERSHIP OF A COMPANY OWNED POLICY OVER TO A
RETIRING EXECUTIVE
B
USING A LIFE INSURANCE POLICY AS COLLATERAL FOR A LOAN
C
A COURT ORDERS THE EXISTING POLICYOWNER TO CHANGE IT TO THEIR EX-SPOUSE
D
A GRANDPARENT SIGNS OVER OWNERSHIP OF A JUVENILE POLICY TO THEIR GRANDCHILD WHO IS
NOW REACHED AGE OF MAJORITY - CORRECT ANSWER: B
USING A LIFE INSURANCE POLICY AS COLLATERAL FOR A LOAN
A LIFE INSURANCE POLICYOWNER RECEIVES AN ANNUAL DIVIDEND. ONE OPTION FOR THIS DIVIDEND
IS TO USE IT TO OFFSET THE ANNUAL OBLIGATION TO THE INSURER. WHAT IS THIS OPTION CALLED?
A
CASH
B
PREMIUM REDUCTION
C
PAID UP ADDITIONS
D
CASH SURRENDER - CORRECT ANSWER: B
PREMIUM REDUCTION
WHICH OF THE FOLLOWING BENEFICIARY DESIGNATIONS PREVENTS A POLICYOWNER FROM
ASSIGNING THE POLICY, TAKING A POLICY LOAN, OR SURRENDERING THE POLICY WITHOUT THE
BENEFICIARIES CONSENT?
A
INCONTESTABLE
B
IRREVOCABLE
C
CLASS
D
NAMED - CORRECT ANSWER: B
IRREVOCABLE
THE BANK MAY REQUIRE ITS BORROWERS TO HAVE A LIFE INSURANCE POLICY TO SECURE A LOAN IN
THE EVENT OF THE BORROWER'S DEATH. WHICH PROVISION GIVES THE BANK PROPORTIONAL
PROTECTION BUT NOT CONTROL OF THE POLICY?
A
COLLATERAL ASSIGNMENT
B
CONSIDERATION CLAUSE
C
POLICY LOAN PROVISION
D
ENTIRE CONTRACT CLAUSE - CORRECT ANSWER: A
COLLATERAL ASSIGNMENT
IF AN APPLICANT FOR LIFE INSURANCE MISSTATES HIS AGE ON THE APPLICATION, WHAT WOULD BE
THE CONSEQUENCE IF/WHEN IT IS DISCOVERED?
A
THE POLICY WILL BE VOIDED
B
DEATH BENEFIT WILL BE WHAT THE PREMIUM PAID WOULD HAVE PURCHASED AT ISSUANCE AT THE
CORRECT AGE
C
REAL AGE DIVIDED BY ACTUAL AGE, MULTIPLIED BY DEATH BENEFIT
D
PREMIUMS REFUNDED WITH INTEREST, NO DEATH BENEFIT PAID - CORRECT ANSWER: B
DEATH BENEFIT WILL BE WHAT THE PREMIUM PAID WOULD HAVE PURCHASED AT ISSUANCE AT THE
CORRECT AGE
__________ OPTIONS ALLOW FOR THE DISTRIBUTION OF THE LIFE INSURANCE DEATH BENEFIT, OR
ENDOWMENT CONTRACT FACE AMOUNT AT MATURITY, TO THE NAMED BENEFICIARY OR CONTRACT
OWNER, AS THE SITUATION WARRANTS.
A
DIVIDEND
B
SETTLEMENT
C
NONFORFEITURE
D
ACCUMULATION - CORRECT ANSWER: B
SETTLEMENT
INSTEAD OF WAITING TO RECEIVE HER PAYMENTS OVER TIME JEANNE DECIDES TO OBTAIN THE
GREATEST AMOUNT OF MONEY OUT OF HER ANNUITY IMMEDIATELY. WHICH OPTION DID SHE
CHOOSE?
A
STRAIGHT LIFE OPTION (LIFE INCOME)
B
LIFE INCOME PERIOD CERTAIN
C
LUMP SUM
D
LIFE INCOME WITH REFUND - CORRECT ANSWER: C
LUMP SUM
A LUMP SUM OF MONEY IS PLACED INTO AN ACCOUNT FROM WHICH THE ANNUITANT WILL DRAW
PERIODIC BENEFITS BEGINNING MORE THAN A YEAR FROM THE DATE OF PURCHASE. THIS
DESCRIBES A:
A
FLEXIBLE PREMIUM DEFERRED ANNUITY
B
FLEXIBLE PREMIUM IMMEDIATE ANNUITY
C
SINGLE PREMIUM DEFERRED ANNUITY
D
SINGLE PREMIUM IMMEDIATE ANNUITY - CORRECT ANSWER: C
SINGLE PREMIUM DEFERRED ANNUITY
GENERALLY, WHICH OF THE FOLLOWING ANNUITIES IS NOT DESIGNED TO GUARANTEE THE
PRINCIPAL VALUE OF THE POLICY IN STABLE INTEREST RATE ENVIRONMENTS?
A
FIXED
B
MARKET VALUE ADJUSTMENT
C
INDEXED
D
VARIABLE - CORRECT ANSWER: D
VARIABLE
UNDER AN ANNUITY WITH A JOINT LIFE PAYMENT OPTION, WHAT WILL THE SURVIVOR RECEIVE
UPON THE DEATH OF THE FIRST ANNUITANT?
A
THE UNDISTRIBUTED BALANCE
B
NOTHING
C
THE SAME AMOUNT THEY WERE RECEIVING TOGETHER
D
THE REMAINING PERIOD CERTAIN - CORRECT ANSWER: B
NOTHING
ANNUITIES MAY BE FUNDED WITH EITHER A LUMP SUM OR ON EITHER A ______ OR A ______ BASIS.
A
PERIODIC, FLEXIBLE
B
LIFE, PERIODIC
C
PERMANENT, TEMPORARY
D
GUARANTEED, DISCRETIONARY - CORRECT ANSWER: A
PERIODIC, FLEXIBLE
WHICH PRODUCT, OFFERED BY INSURERS IS SPECIFICALLY DESIGNED TO ALLOW AN INDIVIDUAL'S
SAVINGS TO BE DISTRIBUTED TO HIM/HER PERIODICALLY OVER HIS/HER ENTIRE LIFE, REGARDLESS
OF HOW LONG HE/SHE LIVES?
A
ANNUITIES
B
PARTICIPATING WHOLE LIFE
C
UNIVERSAL LIFE INSURANCE
D
VARIABLE LIFE INSURANCE - CORRECT ANSWER: A
ANNUITIES
A(N)__________ PLAN IS WHEN BUSINESS PARTNERS BUY LIFE INSURANCE POLICIES ON ONE ANOTHER.
A
CROSS PURCHASE
B
ENTITY
C
PARTNERSHIP
D
INDUSTRIAL - CORRECT ANSWER: A
CROSS PURCHASE
A GRANDPARENT PURCHASES A LIFE INSURANCE POLICY ON A GRANDDAUGHTER THIS IS AN
EXAMPLE OF _________.
A
TWO PARTY OWNERSHIP
B
KEY PERSON INSURANCE
C
WEALTH TRANSFER
D
THIRD-PARTY OWNERSHIP - CORRECT ANSWER: D
THIRD-PARTY OWNERSHIP
ALL ARE TRUE REGARDING FUNDING OF SOCIAL SECURITY, EXCEPT:
A
THE EMPLOYER WITHHOLDS THE EMPLOYEE'S TAX AND REMITS IT WITH THE EMPLOYER'S PORTION
B
ACTUARIAL VALUE OF CONTRIBUTIONS IS RELATED TO ACTUARIAL VALUE OF BENEFITS
C
THE FUNDS ARE KEPT IN A TRUST FUND AND INVESTED IN GOVERNMENT SECURITIES
D
SELF-EMPLOYED INDIVIDUALS PAY BOTH THE EMPLOYER AND EMPLOYEE AMOUNTS - CORRECT
ANSWER: B
ACTUARIAL VALUE OF CONTRIBUTIONS IS RELATED TO ACTUARIAL VALUE OF BENEFITS
WHICH OF THE FOLLOWING IS NOT AN EXAMPLE OF THIRD-PARTY OWNERSHIP?
A
A BUSINESS OWNER BUYING A LIFE POLICY ON HIS OWN LIFE
B
A KEY EMPLOYEE POLICY
C
A POLICY USED TO FUND A BUY-SELL AGREEMENT
D
A PARENT PURCHASING A POLICY ON THE LIFE OF HIS OR HER CHILD - CORRECT ANSWER: A
A BUSINESS OWNER BUYING A LIFE POLICY ON HIS OWN LIFE
SOCIAL SECURITY BENEFITS PROVIDED ARE:
A
RETIREMENT, SURVIVORS, AND FICA
B
RETIREMENT, DISABILITY, AND UNEMPLOYMENT
C
RETIREMENT, DEATH, AND SURVIVOR
D
RETIREMENT, DEATH, AND DEPENDENT CARE - CORRECT ANSWER: C
RETIREMENT, DEATH, AND SURVIVOR
IF, AS THE RESULT OF AN INJURY OR ILLNESS, THE INSURED IS DEEMED TO BE TERMINAL (I.E.,
EXPECTED TO DIE WITHIN 1 OR 2 YEARS), WHAT RIDER ADDED TO A LIFE INSURANCE POLICY
WOULD ADVANCE A PORTION OF THE FACE VALUE?
A
ACCELERATED BENEFIT (LIVING NEED)
B
DISABILITY RIDER
C
RETURN OF CASH VALUE RIDER
D
VIATICAL RIDER - CORRECT ANSWER: A
ACCELERATED BENEFIT (LIVING NEED)
IF FUNDS ARE PREMATURELY WITHDRAWN FROM A MODIFIED ENDOWMENT CONTRACT (MEC) THEY
ARE SUBJECT TO A _____% PENALTY ON ANY GAINS.
A
B
C
D
15 - CORRECT ANSWER: B
IN THE EVENT THAT AN INSURED RECEIVES A PERIODIC BENEFIT AS THE RESULT OF EXERCISING THE
ACCELERATED DEATH BENEFIT RIDER, WHAT INFORMATION MUST THE INSURER PROVIDE TO THE
INSURED?
A
THE AMOUNT OF TAXABLE INCOME THAT THEY WILL BE REPORTING TO THE IRS
B
THE LIFE EXPECTANCY OF THE INSURED ON A SEMI-ANNUAL BASIS
C
VERIFICATION AND UPDATE OF THE POLICY OWNERSHIP AND BENEFICIARY DESIGNATIONS
D
THE AMOUNT OF THE ACCELERATED PAYMENT, THE REMAINING DEATH BENEFIT AND CASH VALUES
- CORRECT ANSWER: D
THE AMOUNT OF THE ACCELERATED PAYMENT, THE REMAINING DEATH BENEFIT AND CASH VALUES
IF AN ANNUITANT WITHDRAWS FUNDS FROM THEIR ANNUITY PRIOR TO AGE 59 1/2 WHAT IS THE
TAX CONSEQUENCE?
A
TAX AND 10% PENALTY TAX ON THE WITHDRAWAL THAT REPRESENTS EARNINGS
B
TAX ON THE TAX DEFERRED PORTION OF THE WITHDRAWAL ALONG WITH A 15% TAX PENALTY
C
TAX ON COST BASIS AND 10% TAX PENALTY ON THE TAX DEFERRED PORTION OF THE WITHDRAWAL
D
TAX ON THE ENTIRE WITHDRAWAL PLUS A 10% TAX PENALTY - CORRECT ANSWER: A
TAX AND 10% PENALTY TAX ON THE WITHDRAWAL THAT REPRESENTS EARNINGS
DISTRIBUTIONS FROM A MODIFIED ENDOWMENT CONTRACT (MEC) MADE ON OR AFTER AGE _____
ARE NOT SUBJECT TO ANY TAX PENALTIES.
A
B
C
59 1/
D
70 ½ - CORRECT ANSWER: C
59 1/
IF A POLICYOWNER OF A LIFE INSURANCE POLICY ACCIDENTLY PAYS IN PREMIUMS IN EXCESS OF THE
MEC GUIDELINES, THE INSURER CAN REFUND THE EXCESS WITHIN ______ DAYS OF THE END OF THE
CONTRACT YEAR.
A
B
C
D
45 - CORRECT ANSWER: C
ERISA SETS MINIMUM STANDARDS FOR PENSION PLANS PRIMARILY IN THE ______ INDUSTRY.
A
PRIVATE
B
PUBLIC
C
PUBLIC AND PRIVATE
D
QUASI-GOVERNMENT - CORRECT ANSWER: A
PRIVATE
UNLESS AN EXCEPTION APPLIES, LIFE INSURANCE PROCEEDS ARE INCOME TAXABLE IN WHICH OF
THE FOLLOWING CIRCUMSTANCES?
A
WHEN A TRANSFER OF OWNERSHIP TAKES PLACE WHILE THE INSURED WAS ALIVE
B
IF A TRANSFER OF OWNERSHIP OCCURS AFTER THE INSURED DIES
C
WHEN A POLICY IS USED FOR COLLATERAL FOR A BANK LOAN
D
WHEN THERE IS A CHANGE OF BENEFICIARY FROM A NON-POLICYOWNER TO THE POLICYOWNER -
CORRECT ANSWER: A
WHEN A TRANSFER OF OWNERSHIP TAKES PLACE WHILE THE INSURED WAS ALIVE
WITHDRAWALS FROM A NON-QUALIFIED ANNUITY PRIOR TO ANNUITIZATION ARE TAXED ON A
___________ BASIS.
A
LAST-IN, FIRST OUT (LIFO)
B
FIRST-IN, FIRST OUT (FIFO)
C
AVERAGE COST BASIS (ACB)
D
FIRST IN, LAST OUT (FILO) - CORRECT ANSWER: A
LAST-IN, FIRST OUT (LIFO)
IF LIFE INSURANCE PROCEEDS ARE PAID TO THE DECEASED'S ESTATE THEY MAY BE SUBJECT TO
________ TAXES.
A
STATE INCOME
B
FEDERAL INCOME
C
FEDERAL ESTATE
D
PROBATE - CORRECT ANSWER: C
FEDERAL ESTATE
WHICH OF THE FOLLOWING ARE INCLUDED IN PART II OF A HEALTH INSURANCE APPLICATION?
A
ADDRESS
B
OCCUPATION
C
PRESENT HEALTH AND MEDICAL BACKGROUND OF APPLICANT AND FAMILY
D
MARITAL STATUS - CORRECT ANSWER: C
PRESENT HEALTH AND MEDICAL BACKGROUND OF APPLICANT AND FAMILY
ALL OF THE FOLLOWING ARE A PROHIBITED FORM OF ADVERTISING, EXCEPT:
A
AN ADVERTISEMENT THAT USES THE WORDS 'ONLY', 'JUST', 'MERELY', 'MINIMUM', OR SIMILAR
WORDS TO IMPLY A MINIMAL IMPOSITION OF RESTRICTIONS AND REDUCTIONS
B
STATING THAT 'WE HAVE BEEN IN BUSINESS FOR OVER 50 YEARS, FOR MORE INFORMATION
CONTACT A LOCAL AGENT.'
C
ADVERTISEMENTS FOR MEDICARE SUPPLEMENTS CONTAINING INFORMATION THAT CREATE UNDO
ANXIETY IN THE MINDS OF THE INSUREDS
D
WHEN AN INSURER EXCLUDES COVERAGE FOR PREEXISTING CONDITIONS, AN ADVERTISEMENT OF
THE POLICY THAT IMPLIES - CORRECT ANSWER: B
STATING THAT 'WE HAVE BEEN IN BUSINESS FOR OVER 50 YEARS, FOR MORE INFORMATION
CONTACT A LOCAL AGENT.'
THAT THE APPLICANT'S MEDICAL CONDITION OR HISTORY WILL NOT AFFECT ELIGIBILITY OR
PAYMENT
TIMOTHY OWNS AN INDIVIDUAL A&H POLICY, AND IN THE EVENT OF AN ACCIDENT, HE IS REQUIRED
TO PROVE ONLY THAT THE INJURY ITSELF IS UNFORESEEN AND UNINTENDED. TIM'S POLICY IS BASED
ON WHICH OF THE FOLLOWING DEFINITIONS OF ACCIDENT?
A
ACCIDENTAL DISMEMBERMENT
B
ACCIDENTAL BODILY INJURY
C
ACCIDENTAL DEATH
D
ACCIDENTAL MEANS - CORRECT ANSWER: B
ACCIDENTAL BODILY INJURY
WHICH OF THE FOLLOWING HAS PRIMARY RESPONSIBILITY FOR ENSURING THAT THE APPLICATION
IS FILLED OUT COMPLETELY?
A
PRODUCER
B
HOME OFFICE UNDERWRITER
C
INSURER
D
ACTUARY - CORRECT ANSWER: A
PRODUCER
IN THE EVENT A POLICY IS DELIVERED BY AN AGENT TO THE INSURED, AND THE PREMIUM PAYMENT
IS TO BE COLLECTED AT THE TIME OF THIS DELIVERY, NORMALLY WHAT ELSE MUST THE AGENT
OBTAIN TO MAKE THE DELIVERY COMPLETE?
A
POSTAGE AND HANDLING FEES
B
AN AFFIDAVIT FROM THE APPLICANT
C
A STATEMENT OF GOOD HEALTH
D
ADDITIONAL PAYMENT REFLECTING LOST INTEREST - CORRECT ANSWER: C
A STATEMENT OF GOOD HEALTH
THIS IS THE ONLY ACCIDENT AND HEALTH INSURANCE POLICY THAT PAYS OUT A LUMP-SUM
BENEFIT UPON THE DEATH OF THE INSURED IN CERTAIN SITUATIONS.
A
MEDICAL EXPENSE
B
LONG-TERM CARE
C
ACCIDENTAL DEATH
D
DISABILITY INCOME - CORRECT ANSWER: C
ACCIDENTAL DEATH
THE INSURER'S UNDERWRITER MAY FIND INFORMATION ABOUT AN APPLICANT'S MORAL
CHARACTER, HOBBIES, WORK AND GENERAL REPUTATION FROM A:
A
MEDICAL EXAMINATION
B
ATTENDING PHYSICIAN STATEMENT
C
AGENT'S REPORT
D
CONSUMER INVESTIGATIVE REPORT - CORRECT ANSWER: D
CONSUMER INVESTIGATIVE REPORT
INFORMATION ABOUT AN APPLICANT'S WORK BEHAVIOR OR CHARACTER GATHERED FROM
NEIGHBORS OR CO-WORKERS WOULD BE INCLUDED ON AN?
A
MIB
B
APS
C
AGENT'S REPORT
D
INSPECTION REPORT - CORRECT ANSWER: D
INSPECTION REPORT
WHICH OF THE FOLLOWING TYPES OF LIMITED POLICIES WOULD A COMMON CARRIER PURCHASE TO
PROVIDE MEDICAL AND SURGICAL BENEFITS IN EXCESS OF ANY PRIMARY COVERAGE?
A
ACCIDENTAL DEATH AND DISMEMBERMENT
B
SHORT TERM MEDICAL EXPENSE
C
BLANKET PLAN
D
HOSPITAL INDEMNITY - CORRECT ANSWER: C
BLANKET PLAN
WHICH IS NOT CONSIDERED ONE OF THE BASIC BENEFITS REQUIRED OF ALL HMOS?
A
PRE-PAID ROUTINE MEDICAL EXAMS
B
LONG-TERM CARE
C
LABORATORY AND X-RAY SERVICES
D
ANNUAL OPEN ENROLLMENT FOR GROUP PLANS - CORRECT ANSWER: B
LONG-TERM CARE
ACCIDENTAL DEATH AND DISMEMBERMENT PROVIDES THAT THE FACE AMOUNT, OR PRINCIPAL
SUM, WILL BE PAID IF THE INSURED DIES DUE TO AN ACCIDENT WITHIN HOW MANY DAYS FROM THE
DATE OF THE ACCIDENT?
A
B
C
D
180 - CORRECT ANSWER: B
WHICH MAJOR MEDICAL PLAN DEDUCTIBLE WILL RESULT IN THE LOWEST PREMIUM?
A
$1,
B
$1,
C
$2,
D
$2,500 - CORRECT ANSWER: D
$2,
HMOS ARE ESTABLISHED AS EITHER ________, WHICH MEANS THE DOCTOR CAN WORK WITH ANYONE,
INCLUDING HMO MEMBERS, OR ________, WHICH MEANS THE DOCTOR CAN ONLY WORK WITH HMO
MEMBERS.
A
OPEN GROUP, SPECIFIED GROUP
B
STAFF MODEL, GROUP MODEL
C
OPEN PANEL, CLOSED PANEL
D
VARIABLE GROUP, FIXED GROUP - CORRECT ANSWER: C
OPEN PANEL, CLOSED PANEL
WHAT IS THE NAME GIVEN TO CAUSES OR CONDITIONS LISTED IN THE POLICY THAT ARE NOT
COVERED AND FOR WHICH NO BENEFITS ARE PAYABLE?
A
PROBATIONARY PERIODS
B
WAITING PERIODS
C
ELIMINATION PERIODS
D
EXCLUSIONS - CORRECT ANSWER: D
EXCLUSIONS
WHICH POLICY UTILIZES A CORRIDOR DEDUCTIBLE AFTER BASIC MEDICAL EXPENSE COVERAGE
BENEFITS HAVE BEEN EXHAUSTED AND BEFORE MAJOR MEDICAL BENEFITS BEGIN?
A
HOSPITAL EXPENSE
B
COMPREHENSIVE MAJOR MEDICAL
C
SUPPLEMENTARY MAJOR MEDICAL
D
SURGICAL EXPENSE - CORRECT ANSWER: C
SUPPLEMENTARY MAJOR MEDICAL
WHEN PAYMENT UNDER A MEDICAL EXPENSE POLICY IS BASED ON THE AVERAGE FEE CHARGED BY
ALL DOCTORS IN A GIVEN GEOGRAPHICAL AREA, AND THE BALANCE OF ANY OVERCHARGES OR COSTS
OF ANY DISALLOWED SERVICES ARE THE INSURED'S RESPONSIBILITY, THE PAYMENT IS KNOWN AS:
A
SCHEDULED PAYMENT
B
CASH PAYMENT
C
BLANKET PAYMENT
D
USUAL, CUSTOMARY, REASONABLE (UCR) PAYMENT - CORRECT ANSWER: D
USUAL, CUSTOMARY, REASONABLE (UCR) PAYMENT
CONCERNING PPOS, WHICH IS A TRUE STATEMENT?
A
PPOS ARE TYPICALLY NOT FOR PROFIT
B
THE INSURED MAY ONLY UTILIZE PROVIDERS CONTRACTED WITH THE INSURER
C
THE INSURED HAS A FINANCIAL INCENTIVE TO USE PROVIDERS WHO HAVE AGREED TO
PREDETERMINED REIMBURSEMENTS FOR MEDICAL SERVICES RENDERED
D
PPOS PROVIDE ALL SERVICES AT ONE LOCATION - CORRECT ANSWER: C
THE INSURED HAS A FINANCIAL INCENTIVE TO USE PROVIDERS WHO HAVE AGREED TO
PREDETERMINED REIMBURSEMENTS FOR MEDICAL SERVICES RENDERED
A FACILITY WHERE OUTPATIENT SURGERY IS PERFORMED FOR THOSE PATIENTS THAT REQUIRE
GENERAL ANESTHESIA BUT ARE NOT REQUIRED TO STAY OVERNIGHT IS CALLED A(N):
A
SKILLED NURSING FACILITY
B
URGENT CARE CENTER
C
HOME HEALTH CARE CENTER
D
SURGICENTER - CORRECT ANSWER: D
SURGICENTER
PENELOPE RECEIVED BENEFITS FROM HER DISABILITY POLICY AND WENT BACK TO WORK. AFTER 30
DAYS SHE FOUND SHE WAS NOT ABLE TO WORK AND BEGAN TO IMMEDIATELY RECEIVE HER
DISABILITY PAYMENTS. WHICH OF FOLLOWING PROVISIONS MADE THIS POSSIBLE?
A
RECURRENT DISABILITY PROVISION
B
SECOND INJURY PROVISION
C
RESIDUAL DISABILITY PROVISION
D
PRESUMPTIVE DISABILITY PROVISION - CORRECT ANSWER: A
RECURRENT DISABILITY PROVISION
WHAT TYPE OF DISABILITY INCOME INSURANCE PROVIDES FUNDS TO COVER BUSINESS EXPENSES
WHEN THE BUSINESS OWNER BECOMES DISABLED?
A
KEY EMPLOYEE
B
REDUCING TERM
C
BUSINESS OVERHEAD EXPENSE
D
BUY-SELL - CORRECT ANSWER: C
BUSINESS OVERHEAD EXPENSE
THE TYPE OF DISABILITY COVERAGE PURCHASED BY A SMALL BUSINESS OWNER, TO COVER ONGOING
OVERHEAD IN THE EVENT OF THE OWNER BECOMING DISABLED, WOULD BE CALLED:
A
KEY EMPLOYEE INSURANCE
B
BUY-SELL AGREEMENT
C
DISABILITY REDUCING TERM
D
BUSINESS OVERHEAD EXPENSE - CORRECT ANSWER: D
BUSINESS OVERHEAD EXPENSE
TO REDUCE ITS EXPOSURE TO CLAIMS FROM A SUBSTANDARD DISABILITY RISK, AN INSURER MAY
TAKE ALL OF THE FOLLOWING ACTIONS, EXCEPT:
A
REDUCE THE AMOUNT OF BENEFIT
B
REMOVE ALL OF THE EXCLUSION RIDERS
C
CHARGE ADDITIONAL PREMIUM
D
INCREASE THE ELIMINATION PERIOD - CORRECT ANSWER: B
REMOVE ALL OF THE EXCLUSION RIDERS
24 - HOUR CARE COVERAGE IN CALIFORNIA IS TRANSACTED BY:
A
ONLY A LICENSED ACCIDENT & HEALTH AGENT
B
ONLY A LICENSED PROPERTY & CASUALTY AGENT
C
ANY LICENSED AGENT
D
ANY LICENSED LIFE INSURANCE AGENT - CORRECT ANSWER: A
ONLY A LICENSED ACCIDENT & HEALTH AGENT
RESIDUAL DISABILITY INCOME PAYS FUNDS TO THE INSURED, TO MAKE UP FOR WHAT THE INSURED
WOULD HAVE EARNED AFTER RETURNING TO WORK, AND WHILE RECOVERING FROM ___________.
A
LONG-TERM DISABILITY
B
SHORT-TERM DISABILITY
C
PARTIAL DISABILITY
D
TOTAL DISABILITY - CORRECT ANSWER: D
TOTAL DISABILITY
WHICH OF THE FOLLOWING IS NEEDED TO QUALIFY FOR A SOCIAL SECURITY DISABILITY BENEFIT?
A
HAVE LESS THAN $1,000 IN ASSETS
B
FULFILL A 4-MONTH WAITING PERIOD, AND HAVE PAID INTO SOCIAL SECURITY
C
BE AGE 60, WIDOWED, AND HAVE ONE DEPENDENT
D
BE EITHER CURRENTLY OR FULLY INSURED - CORRECT ANSWER: D
BE EITHER CURRENTLY OR FULLY INSURED
A SHORT-TERM DISABILITY POLICY GENERALLY IS FOR A DISABILITY LASTING FOR:
A
2 WEEKS
B
3 - 5 YEARS
C
NOT MORE THAN 2 YEARS
D
2 - 3 YEARS - CORRECT ANSWER: C
NOT MORE THAN 2 YEARS
WHICH RIDER WOULD ELIMINATE COVERAGE FOR A PREEXISTING CONDITION?
A
NONE OF THESE
B
IMPAIRMENT RIDER
C
RETURN OF PREMIUM RIDER
D
LIFETIME BENEFIT RIDER - CORRECT ANSWER: B
IMPAIRMENT RIDER
IN A MEDICARE SUPPLEMENT REPLACEMENT SALE, IF THE ORIGINAL POLICY HAS BEEN IN FORCE FOR
LESS THAN ______ MONTHS, THE REPLACING INSURER SHALL WAIVE ANY TIME PERIODS APPLICABLE
TO PREEXISTING CONDITIONS TO THE EXTENT THAT THEY HAVE ALREADY BEEN SATISFIED UNDER
THE ORIGINAL POLICY.
A
B
C
D
6 - CORRECT ANSWER: D
A MEDICARE BENEFICIARY MAY ENROLL IN A MEDICARE ADVANTAGE PLAN WHEN THEY ARE FIRST
ELIGIBLE FOR MEDICARE OR DURING THE _____________ PERIOD, WHERE A PERSON MAY CHANGE TO
ANOTHER MEDICARE ADVANTAGE PLAN OR SWITCH FROM ORIGINAL MEDICARE TO A MEDICARE
ADVANTAGE PLAN.
A
SPECIAL ENROLLMENT
B
MEDICARE OPEN-ENROLLMENT
C
ANNUAL ELECTION
D
GENERAL ENROLLMENT - CORRECT ANSWER: C
ANNUAL ELECTION
ALL INSURERS, BROKERS, AGENTS AND OTHERS ENGAGED IN THE BUSINESS OF INSURANCE OWE A
CONSUMER ALL OF THE FOLLOWING DUTIES, EXCEPT:
A
GOOD FAITH
B
BEST PRICES
C
FAIR DEALING
D
HONESTY - CORRECT ANSWER: B
BEST PRICES
WHICH OF THE FOLLOWING TYPES OF COVERAGE PROVIDES CUSTODIAL CARE OUTSIDE THE HOME
FOR INDIVIDUALS NOT REQUIRING CONFINEMENT?
A
RESPITE CARE
B
HOSPICE CARE
C
ADULT DAY CARE
D
HOME HEALTH CARE - CORRECT ANSWER: C
ADULT DAY CARE
IN A LONG-TERM CARE POLICY TRANSACTION, WHEN MUST THE OUTLINE OF COVERAGE BE
PROVIDED TO THE APPLICANT?
A
AT THE TIME OF PREMIUM COLLECTION
B
AT THE TIME OF DELIVERY
C
AT THE TIME OF ISSUANCE
D
AT THE TIME OF INITIAL SOLICITATION AND PRIOR TO THE APPLICATION - CORRECT ANSWER: D
AT THE TIME OF INITIAL SOLICITATION AND PRIOR TO THE APPLICATION
A LISTING OF PRESCRIPTION DRUGS THAT ARE COVERED UNDER MEDICARE PART D ARE PLACED
INTO DIFFERENT TIERS, WHICH ARE CATEGORIZED BASED ON COST AND MUST INCLUDE AT LEAST
_____ DRUGS IN EACH TREATMENT CATEGORY, BUT IS NOT REQUIRED TO INCLUDE ALL DRUGS.
A 2 B 4 C 5 D
3 - CORRECT ANSWER: A
FAVORABLE TAX TREATMENT IS GIVEN TO LONG-TERM CARE CONTRACTS THAT EXPECT PERSONS TO
BE FUNCTIONALLY UNABLE TO CARE FOR THEMSELVES FOR A PERIOD OF ______ DAYS DUE TO THE
LOSS OF 2 FUNCTIONS OF ACTIVITIES OF DAILY LIVING (ADLS), AND NEEDING SUBSTANTIAL
ASSISTANCE FROM ANOTHER PERSON.
A
B
C
D
90 - CORRECT ANSWER: D
WHICH OF THE FOLLOWING WILL COVER THE COST OF INPATIENT BLOOD TRANSFUSIONS:
A
MEDICARE PART D
B
MEDICARE PART B
C
MEDICARE PART A
D
LONG-TERM CARE - CORRECT ANSWER: C
MEDICARE PART A
A MEDICARE SUPPLEMENT POLICY MUST INCLUDE, AS A CORE BENEFIT, MEDICARE PART B
COINSURANCE IN THE AMOUNT OF _______.
A
15%
B
25%
C
20%
D
10% - CORRECT ANSWER: C
20%
MEDICARE PART A ENROLLMENT IS MANDATORY FOR ALL CITIZENS AND LEGAL RESIDENTS AT AGE:
A
B
C
59 1/2
D
62 - CORRECT ANSWER: B
IN ORDER TO PURCHASE A MEDICARE SUPPLEMENT, AN ELIGIBLE INDIVIDUAL USUALLY MUST HAVE
MEDICARE PARTS __________.
A
A AND D
B
A AND C
C
A AND B
D
B AND C - CORRECT ANSWER: C
A AND B
FAILURE TO ENROLL IN MEDICARE PART B, WHEN REQUIRED, MAY RESULT IN A LIFETIME
CUMULATIVE PREMIUM PENALTY OF _____% FOR EACH 12 MONTH PERIOD A BENEFICIARY WAS NOT
ENROLLED IN PART B.
A
B
C
D
5 - CORRECT ANSWER: A
