Life and Health Insurance Exam Questions and Answers, Exams of Life Sciences

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________ is/are not considered material to the policy issuance. - Correct Answer Age and/or gender are not considered material to the policy issuance. One of your clients just reinstated his health insurance plane. When is coverage effective for sickness and accident? - Correct Answer 10 days for sickness, and immediately for accidental injuries Jay receives an annual disability benefit of $10,000. His employer contributed 75% of the premium. How much of Jay's benefit is subject to income tax? - Correct Answer Jay is covered under a contributory plan in which the employer is contributing 75% of premium, so 75% of the $10,000 benefit ($7,500) is subject to income tax Reciprocal agreements, as defined in the Georgia Insurance Code, refers to: - Correct Answer Agreement between the Insurance Commissioner and regulators of other states in order to facilitate licensing of nonresident adjusters in Georgia and other states Burt named Liz as his beneficiary; however, he did not choose a Settlement Option. At the time of his death, who determines the option to be used to receive the benefits? - Correct Answer If the owner of the policy does not select a Settlement Option while alive, then the beneficiary may choose an option at the time of claim. 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. - Correct Answer Collateral Assignment Similar to life insurance, this party has all rights in the annuity contract. This party is referred to as the: - Correct Answer Owner Which of the following causes of death is covered by an Accidental Death & Dismemberment policy? - Correct Answer Commercial airline crash Which of the following statements regarding certificated of authority is correct? - Correct Answer If an insurance company refuses to be examined by the Commissioner, its certificate of authority may be suspended or revoked

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. - Correct Answer 6 Which of the following is the correct number of days in the grace period for each premium mode? - Correct Answer 7 days for weekly, 10 days for monthly, and 31 for all others Mandatory uniform provisions found in health insurance policies are designed to protect the: - Correct Answer Insured All of the following are considered by definition to be examples of transacting insurance in the state of Georgia, except: - Correct Answer Adjusting a claim in Georgia Which provision is a Mandatory Uniform Provision? - Correct Answer Legal Actions All of the following statements regarding producer appointments are true, except: - Correct Answer Certificates of authority for subagents must be renewed biennially (should read annually) Albert owns a printing business in which he, at times, prints counterfeit money. One day while processing counterfeit bills, his arm is severely damaged. His insurance will: - Correct Answer Not cover the claim since he was involved in an illegal act at the time of injury An LTC insurer must provide notice of an upcoming premium rate schedule increase to all policyholders at least ____ days prior to the implementation of the increase. - Correct Answer 45 Which provision is an Optional Uniform Provision? - Correct Answer Misstatement of Age Which of the following is a requirement that all licensees must meet? - Correct Answer Notify the commissioner within 30 days of any change in business and residence address Which of the following statements regarding the suspension of Harry's insurance agent license accurately describes a reason for his suspension? - Correct Answer He was default on a debt

Which of the following statements accurately describes the requirements for insurance advertising established by the Georgia insurance code? - Correct Answer Advertisements must disclose the source of any statistical information used The Life and Health Insurance Guaranty Association: - Correct Answer Protects resident policyowners and beneficiaries in case the insurer becomes insolvent In Georgia, how many hours of CE does a recently licenses agent need to complete during each biennium? - Correct Answer 24 What is the maximum duration a temporary license may be valid for? - Correct Answer 15 months Timothy is the insured/owner of a universal life insurance policy and is concerned that in the event of disability, the policy might lapse. Which rider would keep the policy from lapsing if he became disabled? - Correct Answer Waiver of Cost of Insurance Alice finds she no longer is able to pay premiums on her $50,000 Whole Life Policy, but needs that amount of protection for her family. Which Nonforfeiture Option provides this protection? - Correct Answer Extended Term The widow or widower's Social Security blackout period lasts until a surviving, non- remarried spouse reaches age _____. - Correct Answer 60 Which policy utilizes a Corridor Deductible after Basic Medical Expense Coverage benefits have been exhausted and before Major Medical benefits begin? - Correct Answer Supplementary Major Medical All of the following are traits of a Fixed Annuity, except: - Correct Answer The actual rate of interest credited will be based on the state-published interest rate index K has a $50,000 traditional whole life policy in force with $25,000 of cash values. Her outstanding loan and loan interest total $5,000. If K surrenders the policy, K will receive: - Correct Answer $20,000 (Any outstanding loans will be deducted from the Face Amt at the time of claims or from the cash values upon surrender along with any interest due)

Residual Disability Income pays funds to have the insured, to make up for what the insured would have earned after returning to work, and while recovering from ______. - Correct Answer Total Disability Which of the following has primary responsibility for ensuring that the application is filled out completely? - Correct Answer Producer Notice of Claim is required within _____ days of loss. - Correct Answer 20 (under the Notice of Claims Provision, a Mandatory Uniform Provision) Which of the following statement accurately describes the requirements for insurance advertising established by the Georgia insurance code? - Correct Answer Advertisements must disclose the source of any statistical information used A specified period that must elapse before new coverage is effective for nonaccidental losses is known as which of the following? - Correct Answer Probationary Period A surgical procedure with a high level of difficulty is assigned a value and benefits for all other procedures are paid based on a percentage of that value. The benefits are determined using a: - Correct Answer Relative Value Scale Which provision is an Optional Uniform Provision? - Correct Answer Relation of Earning to Insurance Al states have adopted the Uniform Individual Accident and Sickness Policy Provision Law. If an insurer changes any of these provisions, they must make sure it does not: - Correct Answer alter the minimum requirements of any provision In Georgia, how many hours of CE does a recently licensed agent need to complete during each biennium? - Correct Answer 24 Which provision states that the insurance company must pay claims immediately? - Correct Answer Time of Payment of Claims An insured should receive necessary claim forms within _____ days after notice of claim. - Correct Answer 15 (according to the Claims Forms Provision, a mandatory uniform provision)

One of your clients just reinstated his health insurance plan. when is coverage effective for sickness and accident? - Correct Answer 10 days for sickness, and immediately for accidental injuries Which settlement option pays for specified period, regardless of who may receive the payments? - Correct Answer Fixed Period Which of the following disability policies would be considered a deductible business expense? - Correct Answer A business overhead expense policy To be eligible for Social Security disability the insured worker must be: - Correct Answer fully insured Which of the following is true regarding group short term disability benefits? - Correct Answer Characterized by maximum benefits for short periods, not lasting longer than 2 years. The elimination period may be waived for accidents and as short as 7 days for sickness. When the employer pays some or all of the cost of health insurance for its employees, the annual amount of each employee's claims is _______________________. - Correct Answer Not taxable to the employee (Benefits are always non-taxable to the employee, regardless of who pays the premium) Every Long Teem Care policy must provide a ____ - day free look period from the date the policy is delivered. - Correct Answer 30 Which Act was implemented in order to protect consumers from questionable Medicare Supplement Policy marketing practices? - Correct Answer NAIC Model Law (requires all Medicare Supplement policies to be standardized) Which of the following Medicare Supplement policies have Core Benefits? - Correct Answer Plans A through N How long is the free look period for a Medicare Supplement policy? - Correct Answer 30 Victor, age 59, calculated last year's gross income to be $100,000. When reviewing the cost of his various personal insurance policies, he found that his disability income policy annual premium was $3,500, his long-term care insurance annual premium was $4,000,

and the total annual cost of his individual Medical insurance premiums and out-of-pocket medical expenses came to $5,500. Based on this information, he could deduct ______ from his taxable income for that year. - Correct Answer Zero (disability insurance premiums are not deductible) Which of the following scenarios will trigger an income tax due? - Correct Answer Interest earned on dividend left on deposit with the insurer The life insurance policy cost basis consists of: - Correct Answer the premiums paid in Generally, children receive Social Security Survivor Benefits until age ________. - Correct Answer 18 All of the following are Payment Options available upon annuitization except: - Correct Answer Interest Only If X has a life insurance policy that is no longer wanted or needed and is considering selling their policy, how much might X receive if the premiums are $10,000 annually, the cash value is $200,000, and the face amount is $1,000,000? - Correct Answer (Life Settlement) More than $200,000 but less than $1,000, In life insurance, the Buyer's Guide is not required to be provided earlier than at the time of policy: - Correct Answer Application The Insuring Clause under an individual A&H policy would contain all the following except:

• Correct Answer premium or rate calculations (would include the length of the policy period, the name of the insured and insurer, and what perils are covered) Which of the following allows reimbursement benefits to be paid directly to medical providers? - Correct Answer Assignment of Benefits After a life insurance policy has been in force for 5 years the insured dies. During the claims process, the insurer discovers that the insured did not disclose material health information that had it known, would have caused the application to be rejected. What can the insurer do at this point in time? - Correct Answer The insurer must pay out the death benefit of the policy to the named beneficiary (2 years rule)

Concerning COBRA, which of the following is correct? - Correct Answer Applies to employers with 20 or more employees A partial withdrawal is permitted on which of the following policies? - Correct Answer Universal Life Which of the following individuals is required to hold an insurance license? - Correct Answer A public adjuster Which type of insurance license may be granted by the Commissioner for a period of 3 to 12 months? - Correct Answer Probationary A temporary license may be issued to an applicant to continue to service existing insurance policies or to wrap up an agent's business affairs due to the inability to act as an agent for all the following reasons, except: - Correct Answer Failure to complete continuing education requirements (Death, Disability, Service in the armed forces - all reason) Proof of loss is required within _____ days of loss. - Correct Answer 90 What is the difference between a probationary license, a temporary insurance license, and a limited insurance license? - Correct Answer A temporary license does not grant the licensee the power to sell new policies (A temporary license allows a designated individual to maintain the existing business and service existing clients in cases where another producer dies, becomes disabled, and to his military service, or is in training to be a licensed agent. A probationary license may be part of a disciplinary action and it is granted for a period of between 3 and 12 months. A temporary license is granted for a period of 6 months, and may be renewed for up to 15 months. Limited licenses do not allow an individual to sell major lines of insurance. Limited lines include such things as credit insurance and portable electronics insurance.) At a minimum, transaction records must: - Correct Answer Be kept for 5 years after the date of the transaction or the contract term is completed (law requires this 5 year retention period) Advertisements must: - Correct Answer Inform prospective buyers of the issuing insurer's full name when advertising a specific policy

Georgia Long-Term Care Partnership (LTCP) policies: - Correct Answer May only be sold by agents who have completed 8 hours of initial LTC training Which of the following is FALSE about the Automatic Premium Loan Provision (APL)? - Correct Answer For it to be included in the policy, there is an additional charge. (no charge for having this provision in a cash value policy) H is employed by a company that provides group life insurance. How much of the employer-paid premiums for H's $150,000 coverage, if any, is going to be reported as taxable income to H? - Correct Answer The premium paid for $100,000 (All employer premiums for amounts about $50,000 are reported as taxable income to the employee The nonforfeiture option that provides coverage for the longest period of time is: - Correct Answer Reduced Paid Up (Extended term provides the most amount of coverage for the least amount of time, whereas reduced paid up provides the least amount of coverage for the longest period of time) If overdue premiums are not paid by the end of the grace period, a traditional whole life policy will automatically: - Correct Answer Become extended term (automatic option) If the policyowner unintentionally pays premiums in excess of the MEC guidelines, the excess premium can be refunded by the insurer within 60 days after the _____. - Correct Answer end of the contract year Concerning the Paid-Up Additions Dividend Option, all of the following are true, except: - Correct Answer Eventually, no more premiums will be due on the policy. What is the result of an insured not receiving a claim form within the time period allotted after submitting a notice of claim? - Correct Answer The insured can submit written proof of the loss The Minimum Benefit Standards under a qualified LTC policy include all of the following, except: - Correct Answer Every LTC policy must be issued as noncancelable (must contain a renewal provision - guaranteed renewable but not noncancelable) Sylvia was the insured and owner of a policy that named her husband as the beneficiary. Upon her husband's death, she decided to change the beneficiary designation to her best friend since she has no close living relatives. The insurance company will: - Correct

Answer Accept the beneficiary change (A beneficiary is not required to have insurable interest in the insured) Jamie has a $200,000 permanent policy and cannot continue making the premium payments. She still, however, wants the peace of mind of being covered for the same $200,000 in death benefit although it may be for an abbreviated period of time. The Nonforfeiture Option Jamie should choose is: - Correct Answer Extended Term After enrolling in Medicare and purchasing a supplement, Rachel withdrew $2,000 from her HSA. She used $600 to pay her Medicare Supplement premium, $200 for out-of- pocket medical expenses, and the remaining $1,200 on a trip to celebrate her retirement. When preparing her taxes for the year, she discovered that: - Correct Answer $1,200 was subject to income tax (no 20% charge because she is at least 65 years of age) The rules for holding an insurance counselor's license require that all licensees: - Correct Answer Must notify the Commissioner within 30 days of any change in business address The Legal Actions provision preserves the insured's right to bring suit against his/her own insurer, but the insured must wait at least ____ days after filing a proof of loss before pursuing this action. - Correct Answer 60 All of the following statements regarding the advertising of insurance policies are accurate, except: - Correct Answer Annual open enrollment periods must be described as 'limited' or 'special' in company advertising Which of the following statements regarding the temporary insurance license is not correct? - Correct Answer A temporary license is only granted when an agent dies, becomes disabled, or serves in the military (should read entered active military service) The Commissioner may impose which of the following penalties on any person who violates a cease and desist order following a hearing? - Correct Answer A fine up to $10,000 per violation Optional uniform provisions found in health insurance policies are designed to protect the:

• Correct Answer Insurer Universal Life is similar to Whole Life in all of the following ways, except: - Correct Answer The timing and amount of premium is flexible (WL doe snot offer this)

Generally, an individual is eligible to enroll in Medicare at age: - Correct Answer 65 K needs funds and needs to maintain the life insurance she has at the time. Which of the following should K do with her traditional whole life policy? - Correct Answer Take out a policy loan Which of the following would not be considered a policy replacement? - Correct Answer An existing convertible term policy is converted from term to whole life. The Social Security Death Benefit is payable to the ______. - Correct Answer surviving spouse When Peter, an independent contractor, purchased his own medical and dental insurance, he discovered that: - Correct Answer Self-employed persons may deduct up to 100% of the cost of health insurance for themselves and their dependents