Insurance Concepts and Terminology, Exams of Nursing

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NEBRASKA LIFE AND HEALTH EXAM 2024/2025 WITH 100% ACCURATE

SOLUTIONS

Which of the following best describes taxation during the accumulation period of an annuity? - Precise Answer ✔✔taxes are deferred Which of the following individuals will be eligible for coverage on the Health Insurance Marketplace? - Precise Answer ✔✔A permanent resident lawfully present in the U.S. In respect to the consideration clause, which of the following is consideration on the part of the insurer? - Precise Answer ✔✔Promising to pay in accordance with the contract terms The act that sets the standards for advice given by insurance producers regarding annuities is known as the Nebraska - Precise Answer ✔✔Protection in annuity transaction act Children's rider attached to whole life policies are usually issued as what type of insurance? - Precise Answer ✔✔term If a producer allows his license to lapse, within what maximum time period may the same license be reinstated? - Precise Answer ✔✔ 12 months

What is the advantage of having a qualified annuity? - Precise Answer ✔✔Favorable tax treatment When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contact is? - Precise Answer ✔✔conditional A policy with 31 day grace period Implies? - Precise Answer ✔✔The policy will not lapse for 31 days if the premium is not paid when due Employer health plans must provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months - Precise Answer ✔✔30 months What types of services may NOT be provided under the long term cares assisted living care? - Precise Answer ✔✔Visits by a registered nurse The authority granted to an agent through the agent's contract is referred to as - Precise Answer ✔✔Express Authority If an employer provides long-term group disability insurance for its employees, what percentage of monthly wages are lower-paid employees eligible to collect? a) 33 and 1/3%

b) 50% c) 66 and 2/3% d) 90% - Precise Answer ✔✔66 and 2/3% If an applicant for a health insurance policy is found to be a substandard risk, the insurance company is most likely to Require a yearly medical examination. Lower its insurability standards. Refuse to issue the policy. Charge an extra premium. - Precise Answer ✔✔Charge an extra premium. Which of the following statements concerning buy-sell agreements is true? Premiums paid are deductible as a business expense. Benefits received are considered income taxable. Buy-sell agreements pay in the event of a medical emergency. Buy-sell agreements are normally funded with a life insurance policy. - Precise Answer ✔✔Buy-sell agreements are normally funded with a life insurance policy.

A policyowner is reading a statement on the first page of his health insurance policy, which says "this is a limited policy." What is the name of this statement? Policy Limitation Notice Statute of Limitations Limited Benefit Statement Limited Policy Notice - Precise Answer ✔✔Limited Policy Notice How does the cost of a basic coverage benefit plan compare with the cost of a standard benefit plan? Equal It fluctuates more. Higher Lower - Precise Answer ✔✔Lower Variable Life insurance is based on what kind of premium? Graded Level fixed Increasing Decreasing - Precise Answer ✔✔Level fixed

An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated? Consideration Good faith Representation Adhesion - Precise Answer ✔✔Consideration All of the following would be different between qualified and nonqualified retirement plans EXCEPT Taxation of withdrawals Taxation of contributions IRS approval requirements Taxation on accumulation - Precise Answer ✔✔Taxation on accumulation An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would she be receiving benefits under an "own occupation" disability plan? 1 month She would not receive any benefits.

3 years 2 years - Precise Answer ✔✔2 years Under a pure life annuity, an income is payable by the company For as long as either the annuitant or a named beneficiary is alive. Only for the life of the annuitant. Until the principal and interest are exhausted. For a guaranteed period of time, whether or not the annuitant survives to the end of that period. - Precise Answer ✔✔Only for the life of the annuitant. Children's riders attached to whole life policies are usually issued as what type of insurance? Adjustable life Whole life Term Variable life - Precise Answer ✔✔term An employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called? 401(k) plan

Tax-sheltered account plan HR 10 plan Profit sharing plan - Precise Answer ✔✔Profit sharing plan Who bears all of the investment risk in a fixed annuity? The annuitant The insurance company The owner The beneficiary - Precise Answer ✔✔the insurance company A man works for Company A and his wife works for Company B. The spouses are covered by health plans through their respective companies that also cover the other spouse. If the husband files a claim, The insurance plans will split the coverage evenly. Both plans will pay the full amount of the claim. The insurance through his company is primary. The insurance through his wife's company is primary. - Precise Answer ✔✔the insurance through his company is primary What type of care is Respite care? Institutional care

24-hour care Relief for a major care giver Daily medical care, given by medical personnel - Precise Answer ✔✔relief for a major caregiver Which type of retirement account allows contributions to continue beyond age 70½ and does not force distributions to start at age 70½? Traditional IRA Roth IRA Flexible IRA Standard IRA - Precise Answer ✔✔roth ira In terms of Social Security, what is the name for the time period after the youngest child of a family turns 16 and before the surviving spouse may start receiving retirement benefits? Benefit reduction Accumulation period Blackout period Nonpayment interval - Precise Answer ✔✔blackout period A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called

Living need rider. Payor rider. Cost of living rider. Accelerated benefit rider. - Precise Answer ✔✔cost of living rider When must insurable interest exist in a life insurance policy? At the time of loss At the time of application At the time of policy delivery When there is a change of the beneficiary - Precise Answer ✔✔at the time of application Which of the following is NOT covered under Part B of a Medicare policy? Physician expenses Routine dental care Home health care Lab services - Precise Answer ✔✔Routine dental care All of the following are true regarding Key Employee Disability Income insurance EXCEPT

Premiums are not tax deductible for the employer. Benefits are taxable to the employer. The employer owns the policy. Benefits are paid to the employer to retrain a new person. - Precise Answer ✔✔Benefits are taxable to the employer Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts? Insurer's rights Coverage limitations Continuation provision Premium provision - Precise Answer ✔✔continuation provision A woman obtains health coverage through the Marketplace on October

1. Two weeks later she finds out that she is 3 months pregnant. Which of the following is true about coverage for pregnancy? Pregnancy may be covered with the insurer's special approval. Pregnancy will be covered immediately. Pregnancy will only be covered if additional premium is paid. Pregnancy will not be covered as a pre-existing condition. - Precise Answer ✔✔pregnancy will be covered immediately

All of the following statements are true of a Combination Dental Plan EXCEPT It covers diagnostic and preventive care on the usual, customary, and reasonable basis. It uses a fee schedule for other dental services. It is also known as the Superimposed Plan. It is basically a combination of a scheduled and nonscheduled dental plan. - Precise Answer ✔✔It is also known as the Superimposed Plan. A deferred annuity is surrendered prior to annuitization. Which of the following best describes the nonforfeiture value of the annuity? The surrender value should be equal to 100% of the premium paid, minus any prior withdrawals and surrender charges. A deferred annuity cannot be surrendered prior to annuitization. The owner must wait until the annuitization period begins to receive any payments. The surrender value will be based on current interest rates. The surrender value will not be more than 80% of the cash value in the annuity at the time of surrender. - Precise Answer ✔✔The surrender value should be equal to 100% of the premium paid, minus any prior withdrawals and surrender charges.

Which renewal option does NOT guarantee renewal and allows the insurance company to refuse renewal of a policy at any premium due date? Noncancellable Optionally renewable Conditionally renewable Guaranteed renewable - Precise Answer ✔✔optionally renewable What is the elimination period for Social Security disability benefits? 6 months 12 months 3 months 5 months - Precise Answer ✔✔5 months All of the following statements concerning workers compensation are correct EXCEPT Benefits include medical, disability income, and rehabilitation coverage. A worker receives benefits only if the work related injury was not his/her fault. Workers compensation laws are established by each state. All states have workers compensation. - Precise Answer ✔✔A worker receives benefits only if the work related injury was not his/her fault.

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back? The policy beneficiary takes over the loan payments. The policy is rendered null and void. The balance of the loan will be taken out of the death benefit. The policy beneficiary receives the full death benefit. - Precise Answer ✔✔The balance of the loan will be taken out of the death benefit. When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss. However, her agent did not notify the insurance company until 60 days after the loss. Which of the following statements correctly explains how this claim would be handled? The insurer may delay the payment of this claim for up to 6 months. The insurer may settle this claim for less than it otherwise would have had the notification been provided in a timely manner. The insurer may deny the claim since it was not notified within the required 20-day time frame. The insurer is considered to be notified since the notification to agent equals notification to the insurer. - Precise Answer ✔✔The insurer is considered to be notified since the notification to agent equals notification to the insurer.

At age 30, an applicant wants to start an insurance program, but realizing that his insurance needs will likely change, he wants a policy that can be modified to accommodate those changes as they occur. Which of the following policies would most likely fit his needs? - Precise Answer ✔✔Adjustable Life An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date? The date of policy delivery The date of issue The date of application The date of medical exam - Precise Answer ✔✔The date of medical exam When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she was 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision Because the misstatement occurred more than 2 years ago, it has no effect. Amounts payable under the policy will reflect the insured's correct age. The contract will be deemed void because of the misstatement of age.

The elimination period will be extended 6 months for each year of age misstatement. - Precise Answer ✔✔Amounts payable under the policy will reflect the insured's correct age. An annuitant dies before the effective date of a purchased annuity. Assuming that the annuitant's wife is the beneficiary, what will occur? The interest will continue to accumulate tax deferred. The interest will become immediately taxable. The premiums will increase. The premiums will decrease. - Precise Answer ✔✔The interest will continue to accumulate tax deferred. A long-term care insurance shopper's guide must be provided in the format developed by which of the following? Director Medical Information Bureau NAIC Office of Insurance Regulation - Precise Answer ✔✔NAIC The act that sets the standards for advice given by insurance producers regarding annuities is known as the Nebraska Procedures in Annuity Transaction Act

Advice in Annuity Transaction Act Protection in Annuity Transaction Act Standards in Annuity Transaction Act - Precise Answer ✔✔Protection in annuity transaction act When an employer offers to give an employee a wage increase in the amount of the premium on a new life insurance policy, this is called a(n) Key person policy. Fraternal association. Aleatory contract. Executive bonus. - Precise Answer ✔✔Executive Bonus Insurance that would pay for hiring a replacement for an important employee who becomes disabled is called Key employee disability insurance. Blanket disability insurance. Long-term disability. Business overhead expense disability insurance. - Precise Answer ✔✔Key employee disability insurance. In addition to any applicable denial, suspension, probation, or revocation of a license, a person who violates the Insurance Producers Licensing Act may receive a fine of up to

$1,000.

$2,000.

$3,000.

$5,000. - Precise Answer ✔✔1, Which policy component decreases in decreasing term insurance? Dividend Premium Face amount Cash value - Precise Answer ✔✔face amount Who can make a fully deductible contribution to a traditional IRA? Someone making contributions to an educational IRA A person whose contributions are funded by a return on investment An individual not covered by an employer-sponsored plan who has earned income Anybody: all IRA contributions are fully deductible regardless of income level - Precise Answer ✔✔An individual not covered by an employer-sponsored plan who has earned income What is the advantage of having a qualified annuity?

Receiving a lump-sum settlement tax free Higher dividends Favorable tax treatment No filing with the IRS - Precise Answer ✔✔Favorable tax treatment One of the differences between group underwriting and individual underwriting is that there is little or no medical information required regarding plan participants in groups of 25 or more. Fewer than 50. 50 or more. 100 or more. - Precise Answer ✔✔50 or more Which of the following programs is made up of 4 parts, where the first part is paid for by FICA, and the second part is financed by premiums and payroll taxes? Blue Cross Blue Shield Medicaid Medicare - Precise Answer ✔✔Medicare

Your client owns a Market Value Adjusted Annuity. In order to pay for a series of large, unexpected medical bills, he decides to surrender his policy prematurely. Which of the following will determine the penalty that the annuity owner will have to pay? Flat fee determined by an index of interest gains, combined with the amount of time the annuity would take to mature There are no penalties imposed for surrendering annuities prematurely. Guaranteed minimum interest rate stipulated in the contract Current interest rate at the time of surrender - Precise Answer ✔✔Current interest rate at the time of surrender Which two terms are associated directly with the way an annuity is funded? Immediate or deferred Renewable or convertible Single payment or periodic payments Increasing or decreasing - Precise Answer ✔✔single or Periodic Payments Upon policy delivery, the producer may be required to obtain any of the following EXCEPT Signed waiver of premium.

Statement of good health. Payment of premium. Delivery receipt. - Precise Answer ✔✔Signed waiver of premium. An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it? Variable Life Adjustable Life Graded Premium Life Limited-pay Life - Precise Answer ✔✔Limited-Pay life In a group policy, who is issued a certificate of insurance? The health care provider The insurance company The employer The individual insured - Precise Answer ✔✔the individual insured What is the maximum number of employees that a company can have before it is too large to be labeled as a "small employer"? 20

50 - Precise Answer ✔✔ 50 Which is TRUE about the cash surrender nonforfeiture option? After the cash surrender, the insured is covered for a grace period of 1 month. The policy remains active for some time after the policyholder opts for cash surrender. The policyholder receives the original cash value of the policy. Funds exceeding the premium paid are taxable as ordinary income. - Precise Answer ✔✔Funds exceeding the premium paid are taxable as ordinary income. When transacting business in this state an insurer formed under the laws of another country is known as a/an Domestic insurer. Foreign insurer. Admitted insurer. Alien insurer. - Precise Answer ✔✔Alien Insurer All of the following statements are true regarding installments for a fixed amount EXCEPT

Value of the account and future earnings will determine the time period for the benefits. This option pays a specific amount until the funds are exhausted. The annuitant may select how big the payments will be. The payments will stop when the annuitant dies. - Precise Answer ✔✔The payments will stop when the annuitant dies. The period of time immediately following a disability during which benefits are not payable is The grace period. The residual period. The elimination period. The probationary period. - Precise Answer ✔✔The elimination period If a settlement option is not chosen by the beneficiary or policyowner, which option will be used? Fixed period Fixed amount Lump sum Life income - Precise Answer ✔✔lump sum

Who would be the insured under a COLI policy? The employer Only key employees All employees Creditors - Precise Answer ✔✔All employees Who can provide skilled nursing care? Spouse Family Member Community volunteer Doctor - Precise Answer ✔✔Doctor The mode of premium payment Does not affect the amount of premium paid. Is defined as the frequency and the amount of the premium payment. Is the factor that determines the amount of dividends in a policy. Is the method used to compute the cash surrender value of the policy. - Precise Answer ✔✔Is defined as the frequency and the amount of the premium payment. Which of the following is TRUE regarding the annuity period?

It is also referred to as the accumulation period. It is the period of time during which the annuitant makes premium payments into the annuity. It may last for the lifetime of the annuitant. During this period of time the annuity payments grow interest tax deferred. - Precise Answer ✔✔It may last for the lifetime of the annuitant. When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy? It is increased when extra premiums are paid. It decreases over the term of the policy. It remains the same as the original policy, regardless of any differences in value. It is reduced to the amount of what the cash value would buy as a single premium. - Precise Answer ✔✔It is reduced to the amount of what the cash value would buy as a single premium. Which of the following best describes the aleatory nature of an insurance contract? Only one of the parties being legally bound by the contract Ambiguities are interpreted in favor of the insured

Policies are submitted to the insurer on a take-it-or-leave-it basis Exchange of unequal values - Precise Answer ✔✔Exchange of unequal values If an insured surrenders his life insurance policy, which statement is true regarding the cash value of the policy? It is not considered to be taxable. It is taxable only if it exceeds the amounts paid for premiums by 50%. It is automatically taxable. It is only taxable if the cash value exceeds the amount paid for premiums. - Precise Answer ✔✔It is only taxable if the cash value exceeds the amount paid for premiums. What is the benefit of choosing extended term as a nonforfeiture option? It can be converted to a fixed annuity. It has the highest amount of insurance protection. It matures at age 100. It allows for coverage to continue beyond maturity date. - Precise Answer ✔✔It has the highest amount of insurance protection. When health care insurers negotiate contracts with health care providers or physicians to provide health care services for subscribers at a favorable cost, it is called