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Mississippi Life and Health Final Exam
Questions And Answers
What kind of life insurance product covers children under their parent's policy?
Family Maintenance rider Term rider Family Income rider Payor benefit - ANSWER>>Term Rider
Under a trustee group life policy, who would be eligible for a certificate of coverage?
Corporation Employee Employer Labor union - ANSWER>>employee
A producer must report to the Commissioner of Insurance any administrative action or criminal charges taken against the producer within __ days of the final disposition of the matter.
10 15 20 30 - ANSWER>>
The return of all or part of the commission to the insured by an insurance producer as an inducement to purchase the insurance is known as
twisting
redlining rebating misrepresentation - ANSWER>>rebating
Insurance producer licenses normally must be renewed every
six months one year two years three years - ANSWER>>two years
Which of the following phrases refers to the fees charged by a healthcare professional?
Deductible Coinsurance Usual, customary, and reasonable expenses Hospital expense - ANSWER>>Usual, customary, and reasonable expenses
The situation in which a group of physicians are salaried employees and conduct business in an HMO facility is called a(n)
closed panel open panel co-op panel capitation panel - ANSWER>>closed panel
An accident policy will most likely pay a benefit for a(n)
self-inflicted injury critical illness on-the-job accident off-the-job accident - ANSWER>>off-the-job accident
Revocable beneficiary - ANSWER>>irrevocable beneficiary
K is the insured and P is the sole beneficiary on a life insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true?
-Proceeds will be paid to P's estate -Proceeds will be divided equally between K's and P's estate -Proceeds will be payable to K's estate if P dies within a specified time -The courts will decide who will receive death benefits - ANSWER>>Proceeds will be payable to K's estate if P dies within a specified time
Unfair discrimination is described as
failing to choose a specific policy type charging different rates for persons in the same class writing different policies for different individuals writing policies for only one company - ANSWER>>charging different rates for persons in the same class
An agent takes an individual Disability Income application, collects the appropriate premium, and issues the prospective insured a conditional receipt. The next step the insurance company will take is to
-issue the policy only when the initial premium check has cleared -determine if the applicant is insurable by investigating family health history -issue the policy on a standard basis -determine if the applicant is an acceptable risk by completing standard underwriting procedures - ANSWER>>determine if the applicant is an acceptable risk by completing standard underwriting procedures
Which premium schedule results in the lowest cost to the policy owner?
Semi-annual Monthly Quarterly Annual - ANSWER>>annual
The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is
the cost the health of the insured the amount of coverage being converted who will be beneficiary - ANSWER>>the cost
The Long-Term Care cost disclosure information MUST appear in bold print on the cover page of which of the following materials?
Policy application Declaration page Outline of coverage Rescission reporting form - ANSWER>>outline of coverage
Which of the following BEST describes a short-term medical expense policy?
Conditionally renewable Noncancellable Guaranteed renewable Nonrenewable - ANSWER>>nonrenewable
When an insurer issues a policy that refuses to cover certain risks, this is referred to as a(n)
elimination exclusion
interests of policyowners commissions of producers assets of insurance companies - ANSWER>>interests of policy owners
In a Life insurance contract, an insurance company's promise to pay stated benefits is called the
Insuring clause Consideration clause Entire Contract Owner's rights - ANSWER>>insuring clause
If an annuity is terminated prior to beginning of the income payment period, the contract owner receives
No refund of money The contract surrender value at that time All premiums paid up to the date of termination Reimbursement of all expenses deducted from the contract value - ANSWER>>the contract surrender value at that time
The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the
Insuring clause Contestable clause Consideration clause Free-look provision - ANSWER>>insuring clause
What is being delivered during a policy delivery?
A binding receipt to the proposed insured Insurance contract to the proposed insured
Application and initial premium to the insurer Policy summary sheet and disclosure material to the proposed insured - ANSWER>>insurance contract to the proposed insured
Qualified Long-Term Care policies may take into consideration an applicant's pre- existing conditions for a maximum of not more than __ month(s) prior to the effective date of coverage.
1 6 12 24 - ANSWER>>
From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?
Fair Credit Reporting Act Medical Information Bureau Part lll of the application Life Insurance Buyer's Guide - ANSWER>>Fair Credit Reporting Act
If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?
Primary beneficiary's estate Primary beneficiary's next of kin Insured's estate Insured's contingent beneficiary - ANSWER>>insured's contingent beneficiary
All of the following are considered to be typical characteristics describing the nature of an insurance contract EXCEPT
An unlicensed employee working for the same insurance agency A licensed producer A real estate producer An insured - ANSWER>>a licensed producer
Which statement about a whole life policy is correct?
Beneficiary may be changed only with the consent of the premium payor Death benefit can usually be adjusted Cash value may be borrowed against Premiums are flexible - ANSWER>>cash value may be borrowed against
Which of these statements concerning an individual Disability Income policy is TRUE?
Premiums are normally tax-deductible Age of the insured determines the amount of the benefits Normally includes an Elimination period Benefits are normally taxable - ANSWER>>normally includes an Elimination period
Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan?
Revocable assignment Beneficiary change Irrevocable assignment Collateral assignment - ANSWER>>collateral assignment
Who is NOT required to sign a life insurance application?
Adult insured Policyowner
Agent Beneficiary - ANSWER>>beneficiary
An insurer receives proof of loss for an acceptable medical expense claim under an Individual Health Insurance Policy. Under the Time of Payment of Claims provision, the insurer MUST pay the benefits
immediately within a maximum of three months within a reasonable amount of time at least monthly - ANSWER>>immediately
A producer must notify the Commissioner of Insurance within __ days of an address change.
15 30 45 60 - ANSWER>>
In Mississippi, how long can pre-existing conditions be excluded for in Long-Term Care policies?
6 months 12 months 18 months 24 months - ANSWER>>6 months
An annuity promises that, if the annuitant dies before receiving payments equal to the correct value, the payments will be continued to a beneficiary until an amount equal to the contract value has been paid. This type of annuity is called
An installment Refund annuity
Incontestable Entire Contract - ANSWER>>entire contract
Which of the following statements about the classification of applicants is INCORRECT?
-Substandard applicants are never declined by underwriters -Substandard applicants are occasionally declined by underwriters -Preferred risk applicants typically have better premium rates than standard risk applicants -An applicant can be classified as substandard risk because of a hazardous job - ANSWER>>Substandard applicants are never declined by underwriters
M becomes disabled and is unable to work for six months. M dies soon after from complications arising from this disability. M has a Disability Income policy that pays $2,000 a month. Which of the following statements BEST describes what is owed to her estate?
$2, A lump sum of six times the monthly benefit Nothing Earned, but unpaid benefits - ANSWER>>earned but unpaid benefits
According to the Time Limit of Certain Defenses provision in an Individual Health Insurance Policy, nonfraudulent misstatements first become incontestable
two years from the date of the policy was issued two years after collection of the initial premium two years from the date of the first claim two years from the date the policies was delivered - ANSWER>>two years from the date the policy was issued
M has a Major Medical insurance policy with a $200 flat deductible and an 80% Coinsurance clause. If M incurs a $2,200 claim for an eligible medical expense, how much will M receive in payment for this claim?
$2, $1, $1, $400 - ANSWER>>$1,
In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and
a Medical Information Report the initial premium forward it immediately to the insurer Attending Physician Statement - ANSWER>>the initial premium
A prospective insured completes and signs an application for health insurance but intentionally conceals information about a pre-existing heart condition. The company issues the policy. Two months later, the insured suffers a heart attack and submits a claim. While processing the claim, the company discovers the pre- existing condition. In this situation, the company will
continue coverage but request a corrected application deny coverage and increase premiums continue coverage but exclude the heart condition rescind the coverage and return the premiums - ANSWER>>continue coverage but exclude the heart condition
Premature IRA distributions are assessed a penalty tax of
Applicant's signature on application Beneficiary's signature A conditional receipt Attending Physician Statement (APS) - ANSWER>>applicant's signature on application
When an insurance application is taken by a producer, which of these statements is true?
The applicant should have an attorney present during the application process Any changes made on the application require the applicant's initials Any changes made on the application can later be initialed by the producer if the applicant is unavailable The producer has the discretion to ask or not to ask any of the questions listed on the application - ANSWER>>any changes made on the application requires the applicant's initials
An employee of 20 years recently retired at age 59 1/2. This employee's group life contract can be
converted to an individual permanent policy at an individual rate converted to an individual permanent policy at a group rate continued at an individual rate continued at a group rate - ANSWER>>converted to an individual permanent policy at an individual rate
Before holding a hearing regarding a producer's unfair or deceptive practice, the Commissioner of Insurance MUST give how many days notice?
10 30 45 60 - ANSWER>>
S filed a written Proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning
September 21 October 16 November 1 December 1 - ANSWER>>November 1
What is the Suicide provision designed to do?
decline an applicant who is contemplating suicide safeguard the insurer from an applicant who is contemplating suicide protect the insurer from ever paying a claim that results from suicide allows the insurer the option to pay a death benefit in the event of suicide - ANSWER>>safeguard the insurer from an applicant who is contemplating suicide
What type of renewability guarantees premium rates and renewability?
Optionally renewable Conditonally renewable Noncancellable Guaranteed renewable - ANSWER>>noncancellable
The provision that can be used to put an insurance policy back in force after it has lapsed due to nonpayment is called
Reinstatement Grace period Automatic premium loan Waiver of premium - ANSWER>>reinstatement
3 months 5 months 6 months 12 months - ANSWER>>5 months
A producer who fails to renew a license may reapply for a license without an examination at which of the following times?
Within two years after no renewal Within one year after no renewal Within three years after no renewal At anytime - ANSWER>>within one year after no renewal
An insurance producer's license may be suspended or revoked under which of the following circumstances?
The producer has been convicted of a misdemeanor within the past five years The producer unintentionally made a material misstatement on the license application The producer has misappropriated money held in a fiduciary capacity The producer has filed for personal bankruptcy within the last two years - ANSWER>>The producer has misappropriated money held in a fiduciary capacity
A producer who suggests that an insured surrender a life insurance policy in order to purchase a new policy would be subject to which of the following?
Mandatory provision Conversion provision Replacement provision Exchange provision - ANSWER>>replacement provision
An insurance company that wants to transact business in Mississippi MUST take which of the following action?
Obtain a certificate of authority Hire 10 employees Post a bond Headquarter itself in this state - ANSWER>>obtain a certificate of authority
An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?
Entire Contract clause MIB clause Insuring clause Consideration clause - ANSWER>>consideration clause
G is involved in an automobile accident as a result of driving while intoxicated and suffers numerous injuries. According to the Intoxicants and Narcotics exclusion in G's policy, who is responsible for paying the medical bills?
The reinsurer The insured The insurer The Guaranty Association - ANSWER>>the insured
Producers who write insurance primarily on themselves and their family are engaged in
