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Sickness Coverage – Series 103.
Which insurance principle states that if a policy allows for greater compensation than the financial loss incurred, the insured may only receive benefits for the amount lost? - Answer: >>indemnity the principle of indemnity stipulates that. the insured can. only collect for the. amount of the loss even if the policy is written with greater benefit limits. When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is - Answer:
conditional the contract is formed on the basis that certain conditions are met. which of the following would provide an underwriter with information concerning an applicants health history? - Answer: >>The Medical Information Bureau An agents report and inspection report provide personal information. Medical exams. provide information on correct health. Only. the MIB will provide info about an applicants medical history what best describes the MIB - Answer: >>It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.
Sickness Coverage – Series 103.
an insurer receives a report regarding a potential insured thet includes the insureds financial status, hobbies, and habits. - Answer: >>inspection report how long must an insurer keep the receipt of. policy delivery to the policyowner if the delivery was by mail? - Answer: >>2. years When J. applied for a life insurance policy, the agent informed him that a medical exam would be required. The exam may be completed by - Answer: >>a paramedic or examining physician at the insurers expense. When Y applied for insurance and paid the initial premium on August 14, he was issued a conditional receipt. During the underwriting process, the insurance company found no reason to reject the risk or classify it other than as standard. Y was killed in an automobile accident on August 22, before the policy was issued. In this case, the insurance company will - Answer: >>issue the policy anyway and pay the face value to the beneficiary the. conditional receipt says that coverage will be effective either on the date of the application or the date of the medical exam, whichever occurs last, as long. as the applicant is found to be insurable as. a. standard risk and policy is issued exactly as applied for. all of the following are business uses of life insurance EXCEPT - Answer:
Funding against company's general financial loss
Sickness Coverage – Series 103.
part 2 of the app. contains questions regarding health history, part. 1 of the app. includes questions regarding correct coverage being applied for as well as any other insurance coverage will the same or other insurers. which of the following is not an example of a business use of life insurance? - Answer: >>workers compensation a prospective insured receives a conditional receipt but dies before the policy is issued. the insurer will - Answer: >>pay the policy proceeds only if it would have issued the policy the conditional receipt says. thee coverage will be effective. either on the date of the application or the date of the medical exam, whichever occurs last. which of the following is an example of liquidity in a life insurance contract? - Answer: >>the cash value available to the policy owner. liquidity in life insurance refers to the availability of cash to the insured. Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid - Answer: >>for 20 years. or until death, whichever occurs first.
Sickness Coverage – Series 103.
annually renewable term policies provide a level death benefit for a premium that
- Answer: >>increases annually annually renewable term polices provide a level death benefit for a premium that increases each year with age of the insured. the type of term insurance. that provides increasing death benefits as the insured ages is called - Answer: >>increasing term increasing term insurance provides an increase in the death benefit each year. If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this? - Answer:
jumping juvenile policy which life insurance policy would be considered interest sensitive - Answer: universal life as well as being a flexible premium policy, universal life is also an interest sensitive policy. which of the following best describes annually renewable term insurance? - Answer: >>it is level term insurance.
Sickness Coverage – Series 103.
the following statements best describes what will happen? - Answer: >>the insurer will pay the full death benefit. from the group policy to the beneficiary. the employee usually has 31 days to convert to an individual life policy. an insurer has a Level Term Insurance policy that is guaranteed renewable and also includes a re-entry provision. th re-entry provision would allow the insured to renew the policy and - Answer: >>pay a lower renewable premium by providing insurability. The death protection component of Universal Life Insurance is always - Answer:
annually renewable term a universal policy has two components: an insurance component and a cash account. the insurance component of a universal life policy is always annual renewable term insurance. which of the following is true concerning the accidental death rider? - Answer: it will pay double or triple the face amount pays 2 to 3 times the face amount If death is the result of an accident.
Sickness Coverage – Series 103.
An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries? - Answer: >>the surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive. the life insurance policy Clause that prevents an insurance company from denying payment of a death claim after a specific period of time is known as the - Answer: >>inconsolability clause if an insurer wishes to. contest any statements on an application, they must do so within the first two years. At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. this rider is called - Answer: >>guaranteed insurability allows the insured to increase the amount of insurance without proving evidence of. insurability. the paid up addition uses the dividend to - Answer: >>purchase a smaller amount of the same type of insurance as the original policy. what limits the amount that a policy owner may borrow from a whole life insurance policy? - Answer: >>cash value
Sickness Coverage – Series 103.
which of the following is TRUE regarding variable annuities - Answer: >>the annuitant assumes the. risks on. investments in a fixed annuity, which of the following is true regarding the guaranteed interest rate on the investment? - Answer: >>the annuitant will receive the higher of either the guaranteed minimum rate or current rate all other factors being equal, which of the following individuals would relieve the largest monthly check from a single premium straight immediate annuity? - Answer: >>a 60 year old man its based on the age and gender. shorter life expectancy = larger income installments which provision in annuity contracts allow the owner to surrender the annuity if interest rates drop to a. specified level? - Answer: >>Bail-out which of the following is NOT true regarding Equity Indexed Annuities - Answer:
they earn lower interest rates than fixed annuities in flexible premium. payment plan, the term. "flexible" refers to the - Answer: amount of premiums
Sickness Coverage – Series 103.
which of the following best. describes what the annuity period is - Answer:
the period of time during which accumulated money. is converted into income payments. people who are the most likely to have claims are also the most likely to seek insurance? - Answer: >>adverse selection most polices will pay accidental death benefits as long as the death is caused by the accident and occurs within - Answer: >>90 days a hospital indemnity will pay - Answer: >>a benefit for each day the insured in is a hospital. defined benefit plan - Answer: >>the employer specifies amount of benefits promised to the employee defined contribution plan - Answer: >>focuses on contributions rather than on the benefits they will pay out tax deductible - Answer: >>a qualified expense that may reduce the amount of income subject to taxation
Sickness Coverage – Series 103.
Part A: (Hospital Insurance) - Answer: >>financed through a portion of the payroll tax (FICA) *impatient hospital care *skilled nursing facility care *home health care *hospice care Part B: (medical insurance) - Answer: >>is financed from monthly premiums paid by insureds and from the general revenues of the federal government *doctor services *outpatient hospital services *home health visits *other medical and health services Part C: (medicare advantage) - Answer: >>allows people to receive all of their health care services through available provider organizations Part D: (prescription Drugs) - Answer: >>for prescription drug coverage
Sickness Coverage – Series 103.
Deductible - Answer: >>The portion of the loss that is to be paid by the insured before any claim benefits may be paid by the insurer. Medicaid - Answer: >>a. medical benefits program jointly administrated by the individual states and the federal government long-term care insurance - Answer: >>provide coverage for at least 12 months in a setting other than an acute care unit of a hospital advertising - Answer: >>the insurance company must retain all advertisements for at least 3 years from the date that the advertisement was first used skilled care - Answer: >>daily nursing and rehabilitative care provided by medical personnel home health care - Answer: >>provided by RN, licensed practical nurses, or hospice respite care - Answer: >>relief for a caregiver authorized insurer - Answer: >>insurer who has received a Certificate of Authority from the department of insurance to transact insurance in this state
Sickness Coverage – Series 103.
cease and desist order - Answer: >>specifies the practice. in violation and legally requires the person to stop committing. it if the commissioner decides to suspend or revoke a license it must - Answer:
be notified In writing
- is also able to request a hearing on the matter within 30 days of receiving the notice Rebating - Answer: >>Any inducement offered in the sale of insurance products that is not specified in the policy. coercion - Answer: >>use of force to get someone to obey Defamation - Answer: >>Act of harming or ruining another's reputation discrimination - Answer: >>no discrimination may be made on the basis of an individuals marital status, race, national origin, gender identity, sexual orientation. Fair Credit Reporting Act - Answer: >>A federal law that established procedures that consumer-reporting agencies must follow in order to ensure that records are confidential, accurate, relevant and properly used.
Sickness Coverage – Series 103.
Consumer Reports - Answer: >>Written and /or oral statements regarding a consumer's credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports, and other public sources. Investigative Consumer Report - Answer: >>Similar to consumer reports in that they also provide information on the consumer's character, reputation, and habits. Gramm-Leach-Bliley Act - Answer: >>requires financial institutions to ensure the security and confidentiality of customer data National Do Not Call Registry - Answer: >>-before 8am and after 9pm
- Federal Trade Commision
- established business relationships last 18 months from the date of the sale or transaction maximum amount of business that can be attributed to controlled business - Answer: >>25% Activity of Daily Living (ADL) - Answer: >>Personal daily care tasks, such as bathing, dressing, toileting, eating and transferring, continence
Sickness Coverage – Series 103.
Incontestability Clause - Answer: >>prevents an insurer from denying a claim due to statements in the application after the policy has been in force for 2 years Reinstatement Provision - Answer: >>allows a lapsed policy to be put back in force. The maximum time limit for reinstatement is usually 3 years after the policy has lapsed. Will be required to pay back all back premiums plus interest, and may be required to repay any outstanding loans and interest. All values will be restored! Entire Contract Provision - Answer: >>The policy and a copy of the application, along with any riders or amendments, constitute the entire contract. exclusions - Answer: >>types of risks the policy will not cover Suicide Provision - Answer: >>protects insurance companies against people using suicide for a quick payment of the death benefit
- Will pay death benefit after the 2 year period per capita - Answer: >>evenly distributes benefits among all named living beneficiaries
Sickness Coverage – Series 103.
Per Stirpes - Answer: >>distributes the benefit of a beneficiary who died before the insured to that beneficiary heirs. If no beneficiary is named in the insuring clause of a life policy, what happens to the benefit proceeds? - Answer: >>they go into the insured's estate Irrevocable Designation - Answer: >>may not be changed without the written consent of the beneficiary vested - Answer: >>significant to one's own profit or well-being revocable - Answer: >>a named beneficiary who you can change later if needed. Common Disaster Clause - Answer: >>if the insured and primary beneficiary die, It will be paid to the contingent beneficiary or to the insured's estate. (protects the contingent beneficiary) Spendthrift Clause - Answer: >>protects beneficiaries from the claims of their creditors
