Tennessee Life and Health Insurance Exam Study Guide, Exams of Nursing

Download Tennessee Life and Health Insurance Exam Study Guide and more Exams Nursing in PDF only on Docsity! Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass C. 30 - CORRECT ANSWERS The Commissioner must provide a person subject to an investigation a copy of the complaint which initiated the investigation within _______ days of receiving the complaint. A. 14 B. 21 C. 30 D. 31 C. Business entity - CORRECT ANSWERS A corporation, association , partnership, limited liability company, limited liability partnership, or other legal entity is a : A. Limited lines producer B. Insurance producer C. Business entity D. Insurance broker B. 18 - CORRECT ANSWERS An individual applying for an insurance license in Tennessee must be no younger than what age? A. 16 B. 18 C. 21 D. 25 A. 5 - CORRECT ANSWERS The commissioner must notify an insurer within _____ days of determining that a producer is ineligible for appointment. A. 5 B. 7 C. 10 D. 15 Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass C. 30 - CORRECT ANSWERS Any change of address must be reported to the Commissioner within _____ days. A. 10 B. 21 C. 30 D. 31 B. 20 - CORRECT ANSWERS Candidates for an insurance producer's license in Tennessee must complete how many hours or prelicensing education per line of authority? A. 10 B. 20 C. 40 D. 80 B. 180 - CORRECT ANSWERS A temporary license issued to a representative of a licensed producer who dies or becomes disabled is valid for up to how many days? A. 120 B. 180 C. 240 D. 360 C. 24 - CORRECT ANSWERS A license is valid for _____ months unless revoked or suspended. A. 12 B. 18 C. 24 Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass B. Keep a complete record of all complaints received since an insurer's last examination date C. Illegally replace a life policy D. Filing with the Commissioner the policy and certificate for the sale of LTC insurance B. $300,000 - CORRECT ANSWERS The Tennessee Life and Health Guaranty Association will pay up to how much in death benefits for one life? A. $200,000 B. $300,000 C. $400,000 D. $500,000 B. Equivalent Level Death Benefit - CORRECT ANSWERS The average annual guaranteed death benefit over the life of the policy is the definition of: A. Cash dividend B. Equivalent Level Death Benefit C. Generic Name D. Life Insurance Net Payment Cost Index C. 20 - CORRECT ANSWERS For replacement life policies, the free look period must be at least _____ days. A. 7 B. 10 C. 20 D. 30 D. 60 - CORRECT ANSWERS Death benefits must be paid within _____ days after the insurer receives the proof of death. Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass A. 30 B. 31 C. 45 D. 60 A. 2 - CORRECT ANSWERS The insurer is not liable of the insured, whether sane or insane, commits suicide within the first _____ years the policy is in force. A. 2 B. 3 C. 4 D. 5 C. The Commissioner - CORRECT ANSWERS Who must approve a Buyer's guide before use? A. The Insurer B. The Insured C. The Commissioner D. The Annuitant C. A life insurance cost index reflecting dividends or an equivalent level Annual Dividend must disclose that it is based on the insurer's current dividend scale and is not guaranteed. - CORRECT ANSWERS Which of the following is true regarding general Life Insurance rules? A. Each insurer must maintain a file of all documents for a period of 5 years from the date of its last authorized use B. A reference to policy dividends can disclose that dividends are guaranteed C. A life insurance cost index reflecting dividends or an equivalent level Annual Dividend must disclose that it is based on the insurer's current dividend scale and is not guaranteed. D. A comparison of 2 or more life policies must not adjust for interest appropriately Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass B. 25 - CORRECT ANSWERS Replacement is a transaction in which new life insurance is to be purchased and the agent knows that existing life insurance will be pledged as collateral or subjected to borrowing for over _____% of the policy loan value. A. 20 B. 25 C. 30 D. 35 A. 3 - CORRECT ANSWERS A party may not take legal action to recover against an insurer more than how many years after a Proof of Loss is required to be provided? A. 3 B. 5 C. 7 D. 9 D. 31 - CORRECT ANSWERS Newborn coverage begins at birth and will continue for at least how many days? A. 7 B. 14 C. 21 D.31 B. A person whose Medicare Supplement benefits under an employee welfare benefit plan area still in effect - CORRECT ANSWERS Which of the following is not eligible for a Medicare Supplement Policy? A. A person whose enrollment ceases under circumstances that permit cessation of the individual's right to elect coverage. Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass Misrepresentation - CORRECT ANSWERS A false statement on the application that renders the contract void if material to acceptance of the ris Warranty - CORRECT ANSWERS A statement that is guaranteed to be true and coverage mat hinge on the truthfulness of that statement. Concealment - CORRECT ANSWERS When an applicant fails to make known material a fact. Fraud - CORRECT ANSWERS intentional misrepresentation, deceit, or concealment of material facts known by a person with the intention of causing injury to another Standard Risk - CORRECT ANSWERS The average risk based on the mortality table standards. Preferred Risk - CORRECT ANSWERS A lower than average risk based on extremely good health. Substandard Risk - CORRECT ANSWERS A higher than average risk based on underwriting standards. Refused/ Declined - CORRECT ANSWERS The refusal to issue coverage. Expected Mortality, Interest, and Expenses - CORRECT ANSWERS In establishing the rates to charge premium payers on life insurance, a company will use: Liquidity - CORRECT ANSWERS Provides immediate funds to pay for final expenses Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass Viatical Settlements - CORRECT ANSWERS Policy can be sold if insured is terminally ill and needs access to death benefit early Group - CORRECT ANSWERS Master policy issued to plan sponsor and typically written as annual renewable term. Makes up 40% of all insurance Individual - CORRECT ANSWERS Coverage on one named insured, may be of any classification or type, and the policy owner receives a policy and maintains control Permanent - CORRECT ANSWERS Premium higher than term when other factors equal, protection continues to age 100 or until surrendered, and provides cash accumulation Term - CORRECT ANSWERS Lowest premium outlay, temporary coverage for short term need , no cash value, and the benefit can be level, increasing or decreasing Participating - CORRECT ANSWERS Issued by mutual insurers; dividends considered return of excess premium and are not guaranteed; and policy owner has dividend options to choose from Non-participating - CORRECT ANSWERS Issued by stock insurers and do not pay policy dividends Fixed - CORRECT ANSWERS Specified amount of coverage, benefits and premium with no inflation protection. Cash value growth has a guarantee Variable - CORRECT ANSWERS Uses separate account to invest a portion of premiums; may help protect against inflation; and an Insurance license and FINRA registration required in order to sell Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass Endow - CORRECT ANSWERS The maturity date at which the cash value equals the face amount Face amount - CORRECT ANSWERS The amount of protection stated in a policy that is payable upon death of the insured; may also be called the limit of liability Cash value - CORRECT ANSWERS An accumulated value in whole life policies that is available for policy loans and at surrender Rider - CORRECT ANSWERS Added benefit attached to the policy for a small additional premium 1. Temporary 2. No cash/loan value 3. Pure protection 4. Low initial premium - CORRECT ANSWERS What are the characteristics of a term policy? B. A death benefit is payable but there is no cash value - CORRECT ANSWERS Which of the following best describes a term insurance policy? a) A death benefit is not payable but cash value is generated b) A death benefit is payable but there is no cash value c) Premiums based on $1,000 of insurance are higher overall than other types of policies d) A living insured receives the funds Level - CORRECT ANSWERS _________ Term - Both the premium and face amount remain level for the term of the contract Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass 3. Adjustable time period of coverage 4. Adjustable cash value growth - CORRECT ANSWERS Adjustable Life 1. Adjustable face amount - with insurability 2. Flexible premiums 3. Cash value earns interest at current rate with a guaranteed minimum (general account) 4. Monthly mortality charges are deducted (annual renewable term) 5. May borrow or withdraw cash without terminating contract 6. Two death benefit options: Option A - Level benefit; Option B - Increasing benefit - CORRECT ANSWERS Universal Life D. Any borrowing or partial withdrawal from the cash value account has the effect of terminating the policy - CORRECT ANSWERS All of the following are true of a Universal Life policy, EXCEPT: a) Adjustments to the face amount may be requested by the policyowner to reflect changes in need b) It adjusts to interest rate changes and allows the owner to make additional contributions that will increase the cash value or skip some premiums if the owner desires to do so c) The death benefit is in the form of one year renewable term, while the cash value account earns interest at the current rate d) Any borrowing or partial withdrawal from the cash value account has the effect of terminating the policy Fixed premium Variable cash and face values No guarantee of minimum cash value (separate account) FINRA registration required Owner assumes investment risk Guaranteed minimum face value (general account) Prospectus must be provided - CORRECT ANSWERS Variable life Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass 1. Combination of Variable and Universal 2. Flexible premiums and death benefits 3. Separate accounts show actual investment participation 4. Prospectus given to owner 5. FINRA registration and insurance license required - CORRECT ANSWERS Variable Universal Life (VUL) C. Variable Universal and Variable - CORRECT ANSWERS Which combination of life insurance products requires both a life and securities license to sell? a) Adjustable and Universal b) Universal and Fixed c) Variable Universal and Variable d) Fixed and Adjustable 1. Written on life of minor 2. Protect future insurability 3. "Jumping Juvenile" automatically increases in face amount at a specified age (usually age 21 or 25) - CORRECT ANSWERS Juvenile 1. Covers two or more lives 2. Death benefit paid upon first death 3. Premiums based upon joint age 4. Written on a Whole Life Policy - CORRECT ANSWERS Joint Life (first to die) 1. Written on two or more lives 2. Death benefit paid at last insured's death 3. Written on Whole Life policy Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass 4. Used to cover estate taxes 5. Rates lower than purchasing two separate policies - CORRECT ANSWERS Joint survivorship life (Last to Die) D. Joint Survivorship Life Policy - CORRECT ANSWERS Bill and Janet are both insured under a whole life policy that is designed to help cover federal estate taxes by paying upon the death of whichever of them is the last to die. The policy is a: a) Modified Whole Life Policy b) Joint Life Policy c) Graded Premium Policy d) Joint Survivorship Life Policy ◦ Total disability, waive premiums ◦ Cash value, dividends and protection continue as usual - CORRECT ANSWERS Waiver of Premium ◦ Premium waived if the premium payor becomes disabled or dies ◦ When added to juvenile policy, waiver is cancelled at age 21 to 25 ◦ Payor must qualify for the rider - CORRECT ANSWERS Wavier of Payors Premium (Payor Benefti) ◦ Premiums waived ◦ Insured receives a monthly income - CORRECT ANSWERS Waiver of premium/disability income ◦ Waives deduction of monthly cost and expenses associated with Universal Life - CORRECT ANSWERS Waiver of Cost of Insurance C. Waiver of Premium/Disability income rider - CORRECT ANSWERS Timothy is the insured/owner of a whole life policy and is concerned that in the event of Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass Collateral - CORRECT ANSWERS Temporary (Partial) Absolute - CORRECT ANSWERS Permanent (entire face amount) Free Look (Right to examine) - CORRECT ANSWERS Insured may return policy for a full refund, typically within 10 days of receipt of policy a) The provision can cancel and void the policy - CORRECT ANSWERS Which statement is false with respect to the Misstatement of Age or Sex provision? a) The provision can cancel and void the policy b) The Incontestability Clause does not influence the provision c) The provision allows the insurer, at time of claim, to adjust the benefits according to the amount the premiums would have been purchased at the correct age or sex d) Adjustments required due to misstatement of age are normally computed as a fraction with what was being paid, divided by what should have been paid Grace Period - CORRECT ANSWERS Time period after the premium due date before the policy lapses Automatic Premium Loan - CORRECT ANSWERS Enables insurer to borrower from cash value to cover premiums to prevent lapsing Reinstatement - CORRECT ANSWERS Allows the owner to bring the policy up to date if it has lapsed due to nonpayment (but not if it is surrendered for cash) c) The payment of back premiums, plus interest, and proof of insurability - CORRECT ANSWERS If a life insurance policy has not been surrendered for its cash value, then reinstatement requires: a) The payment of back premiums only Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass b) The payment of back premiums, plus interest only c) The payment of back premiums, plus interest, and proof of insurability d) The payment of at least a future annual premium 1. Outstanding loans will be deducted from the face amount, plus interest 2. Interest charged but unpaid is added to the loan 3. Failure to repay the loan or interest will not void the policy until it equals the cash value - CORRECT ANSWERS Cash Loans Policy Loan Rate Provisions - CORRECT ANSWERS 1. Loans with fixed rates have maximum fixed interest rate of 8% 2. Adjustable rate loans based on Moody's corporate bond yield average 3. Loan cannot exceed amount of cash value 4. Interest not paid on the due date is added to the total debt 1. Beneficiary can be changed at any time 2. Beneficiary has no rights in the policy - CORRECT ANSWERS Revocable Beneficiary 1. Once named as irrevocable, beneficiary cannot be changed unless they die or give written consent 2. Owner may need consent of beneficiary before exercising some owner's rights - CORRECT ANSWERS Irrevocable Primary Beneficiary - CORRECT ANSWERS First in line to receive benefits Contingent Beneficiary - CORRECT ANSWERS Receives proceeds if primary beneficiary dies before the insured Tennessee Life and Health Insurance Exam Study Guide 134Questions and Answers 100% Pass Tertiary Beneficiary - CORRECT ANSWERS Third in line to receive benefits if primary and contingent beneficiaries D. Class/trust - CORRECT ANSWERS Which of the following are potential beneficiary designations? a) Primary/Contingent b) Revocable/Irrevocable c) Absolute/Collateral d) Class/trust Common Disaster Clause - CORRECT ANSWERS When insured and primary die at the same time, it is assumed that the primary died first Spendthrift Clause - CORRECT ANSWERS A clause that prevents the debtors of a beneficiary from collecting the benefits before he/she receives them. B. The Spendthrift Clause - CORRECT ANSWERS The provision which protects the beneficiary against the claims of creditors of ay unpaid policy proceeds is: a) The Common Disaster Clause b) The Spendthrift Clause c) The Insuring Clause d) The Consideration Clause Fixed Period - CORRECT ANSWERS Guaranteed period of time Life Income Only - CORRECT ANSWERS Guaranteed for lifetime of recipient paid as an annuity Life Income Period Certain - CORRECT ANSWERS Guaranteed for life of recipient or specified period of time, whichever is longer