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PSI Life, Accident And Health Or Sickness Practice Exam Questions With 100% Correct And Verified Answers Upon the issuance of a conditional receipt for a renewal when the premium is paid AFTER the time granted by the insurer, what is the maximum amount of time for reinstatement of the policy? - Correct Answer-45 Days What does first dollar coverage mean? - Correct Answer-As soon as covered medical expenses are incurred, the policy begins to pay. Compared to basic hospital, medical and surgical policies, which type of insurance provides broader coverage, fewer gaps, higher individual benefits, and higher policy maximums? - Correct Answer-Major medical insurance Which of the following provides for the continuance of life insurance coverage on a juvenile in the event of the death or total disability
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Upon the issuance of a conditional receipt for a renewal when the premium is paid AFTER the time granted by the insurer, what is the maximum amount of time for reinstatement of the policy? - Correct Answer-45 Days What does first dollar coverage mean? - Correct Answer-As soon as covered medical expenses are incurred, the policy begins to pay. Compared to basic hospital, medical and surgical policies, which type of insurance provides broader coverage, fewer gaps, higher individual benefits, and higher policy maximums? - Correct Answer-Major medical insurance Which of the following provides for the continuance of life insurance coverage on a juvenile in the event of the death or total disability of the individual responsible for the payment of the premiums? - Correct Answer-Payor clause What specific new procedures does the USA Patriot Act require of insurance companies? - Correct Answer-Establish an anti-money laundering program. A group conversion option may be used in all the following instances EXCEPT: - Correct Answer-A life-changing event, such as marriage, divorce, or childbirth. Which of the following is true for a flexible premium annuity? - Correct Answer-The purchaser has the option to vary the amount of each premium payment falling between a minimum and maximum amount. When should a buy-sell agreement include a provision for the buy-out of an owner's business interest in the event of a disability? - Correct Answer-When there is a buy-sell agreement funded with life insurance to buyout the interest of a deceased owner or partner. Managed care plans increase efficiency by all of the following means EXCEPT: - Correct Answer-transferring the management of costs to the insureds. Which of the following amends the Social Security Act to make Medicare secondary to group health plans? - Correct Answer-TEFRA All of the following are tax qualified retirement plans EXCEPT: - Correct Answer-Section 529 Plan
Which policy type is backed by equity investments and allows the policyholder to adjust the death benefit? - Correct Answer-Variable universal life In which of the following must a beneficiary change request be filled in writing to the insurer and is made effective by the insurance company recording the change in its records? - Correct Answer-Recording method When will a policy pay on a UCR basis? - Correct Answer-When particular benefits are not listed on a payment schedule. All of the following can be used to qualify for Medicare Parts A and B EXCEPT: - Correct Answer-Financial Need Which of the following determines whether a person passes the financial test to qualify for Medicaid? - Correct Answer-State Law Which is an example of when an immediate annuity would be appropriate? - Correct Answer-Upon receipt of large insurance proceeds. Which type of coverage pays the operating costs of a small business when the owner becomes disabled? - Correct Answer-Business Overhead expense disability insurance Which of the following is considered the major advantage of HIPPA - Correct Answer- Portability Which of the following is a characteristic of Preferred Provider Organzations - Correct Answer-Prearranged costs for services rendered All of the following statements define preexisting conditions EXCEPT: - Correct Answer- Any chronic health condition that presents symptoms and which was unknown at the time of application. How are issues of ambiguity usually resolved because insurance contracts are contracts of adhesion? - Correct Answer-In favor of the insured because the insurance company drafts the language in the contract. In order to AVOID being classified as an MEC, a policy must pass which of the following? - Correct Answer-Seven-Pay test How do most disability policies handle the case of a recurrent disability occurring at least 90 days after the first claim? - Correct Answer-It must be handled as a new claim for a new period of disability, requiring a new elimination period. Why do equity-indexed life insurance policies have an increased premium? - Correct Answer-For increased amount of protection
Which type of receipt makes the insurer liable for the risk from the date of application, regardless of the applicant's insurability? - Correct Answer-Binding receipt What specific new procedures does the USA Patriot Act require of insurance companies? - Correct Answer-Establish an anti-money laundering program. In which of the following cases are premiums paid by a business NOT tax deductible - Correct Answer-Key person disability income insurance When would dependent children's benefits for Social Security disability payments be scaled back? - Correct Answer-When they cause the family benefit to exceed the maximum benefit amount. Which policy provision permits the policyowner to take a specified number of days to examine the contract, and allows for cancellation and a full refund if the policyowner rejects the terms or costs? - Correct Answer-Free Look Which is the major reason why long term health care insurance is becoming increasingly important? - Correct Answer- Which of the following provides for the continuance of life insurance coverage on a juvenile in the event of the death or total disability of the individual responsible for the payment of the premiums? - Correct Answer- What are two characteristics of Health Maintenance Organizations (HMOs)? - Correct Answer-Containing costs and early treatment Obtaining consumer information reports under false pretenses is prosecutable by which of the following? - Correct Answer-Fair Credit Reporting Act Which part of an insurance contract contains the promise to pay losses covered by the policy in exchange for the insured's premium and compliance with policy terms? - Correct Answer- What is the purpose of Stranger-originated life isnurance (STOLI)? - Correct Answer-the policy is originated primarily or solely for the purpose of resale Group AD&D policies may be deducted by whom and under which deduction category?
Which one of the following is particularly important for an insurance producer to explain to a client upon delivery of a life insurance policy? - Correct Answer-any exclusions Which of the following may be thought of as a time deductible rather a dollar deductible in a disability income policy because benefits are not payable during that time? - Correct Answer-elimination period All life insurance and health insurance contracts contain all of the following EXCEPT - Correct Answer-representations For an individual long-term care policy there is an annual dollar limit for tax deductions that is based on which of the following? - Correct Answer-age What procedure is used by an insurer to protect itself in the event a dispute arises and the applicant and the agent do not recall the changes that were made in a completed application? - Correct Answer-the applicant and possible the agent initial any changes made. Which type of annuity covers two or more annuitants and provides monthly income only until the first annuitant dies? - Correct Answer-joint life annuity Managed care plans increase effiiency by all of the following means except - Correct Answer- An insured and the beneficiary are both killed in a fatal accident. Which provision presumes the insured survived the beneficiary? - Correct Answer- When can the premiums of an individually owned health insurance policy be deducted from the individual's income tax? - Correct Answer- The life insurance policy will not truly effective until all of the following occur except: - Correct Answer-the agent has explained the policy to the client In which of the following types of contracts is only one party is legally required to do something after the insured has completed the act of paying the premium? - Correct Answer-Unilateral If the insurer wishes to share an applicant's HIV status, the applicant must be given full notice of all of the following EXCEPT: - Correct Answer-the treatment procedures that are covered by the policy Which of the following must be givben to the insurer within 20 days after occurence or commencement of any loss covered by the policy, or as soon thereafter as is reasonably possible? - Correct Answer-notice of claim
What is an impairment rider? - Correct Answer-It lists specific conditions in the contract that are excluded from the contract Which of the following, by definition, provideds benefits for expenses incurred as a result of in-hopsiptal medical treatment and surgery as well as certain outpatient expenses such as doctor's visits, laborator6y tests, and diagnositc services? - Correct Answer- What happens with the lifetime maximum benefit limit has been reached? - Correct Answer-The insured will pay all of the remaining medical costs for as long as the policy is in focus. What is the major reason that insurance regulators are often critical of dread disease insurance policies? - Correct Answer-Buyers often think they are getting broader coverage than they actually purchase States generally define a true "group" for insurance as requiring a mimmum of how many participants? - Correct Answer- Which of the following is an example of a hospital indeminity plan? - Correct Answer- pays a fixed amount per day to the insured for each day the insured is hospitalized Which of the following is true for a flexible premium annuity? - Correct Answer- Which problem was uinveral life insruance designed to address? - Correct Answer-low interest rates during periods of high inflation Why is relying solely on employer group life insurance generally considered inadequate for most individual's needs? - Correct Answer-it is financially insufficient to cover end of life expenses. What does it mean if a health policy is optionally renewable? - Correct Answer-insurer may elect not to renew for any reason only on the policy anniversary or premium due date. Replacement refers to which of the following? - Correct Answer-replacing an existing policy with a new one What is granted to the insured in the consideration clause? - Correct Answer-insurance coverage if premiums are paid Which of the following is covered by a dread disease policy? - Correct Answer- When should a buy-sell agreement include a provision for the buy-out of an owner's business interest in the event of a disability? - Correct Answer-
a consumer report used to determine eligibniltiy for insurance may include all of the following except: - Correct Answer- Why is rehabilitation considered worthy of federal help under workers' compensation? - Correct Answer-it reduces insurance losses and helps regain the worker's dignity Which is the difference between participating and non-=participating policies? - Correct Answer-Participating policies pay dividends while non-participating policies do not which of the following lists the three common types of permanent indivudal life insurance? - Correct Answer-variable life, whole life, universal life Which of the following policy loans is a provision in which an amount equal to the premimum is due subtracted from the cash value to pay the premium and prevent a lapse of the policy? - Correct Answer-Automatic premium loan Which of the following is characteristic of a nonqualified plan? - Correct Answer-plan does not meet federal guidelines for tax benefits Which of the following is common in an increasing term life policy? - Correct Answer-it begins with little or no insurance protection What is the order in which beneficiaries receive proceeds from a life insurance policy? - Correct Answer-succession of beneficiaries What is the return of premium rider? - Correct Answer-an increasing amount of term insurance that always equals the total of premiums paid up to the current point What is a MIB report? - Correct Answer- In noncontributory plans, which percentage of eligible members must participate? - Correct Answer- All of the folliowng are requirements to qualify for social security disability benefits except when - Correct Answer-unable to work in occupation in which the worker was trained or educated When the courts look at a contract to determine the intent of the parties which of the following is considered? - Correct Answer- Why is the accidental death benefit referred to as double indemnity? - Correct Answer-It provides twice the face value in the policy for death due to accident. How does the per capita rule apply to proceeds from a life insurance policy? - Correct Answer-the proceeds are divided equally among living primary beneficiaries
How long after being entitled to disability benefits will an indivudal be elible to receive medicare benefits? - Correct Answer-2 years In an adjustable life policy, all of the following are adjustable by the policy holder except: