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79 Cards in this Set
- Front
- Back
What type ofreinsurance contract between two insurers involves an automatic sharing of therisks assumed? |
Treaty Reinsurance |
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Mutual insurers paydividends to participating policyowners if the insurer has which of thefollowing? |
Divisible Surplus |
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For insurancepurposes, similar objects which are exposed to the same group of perils arereferred to as |
Homogeneous Exposure Units |
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Which of thefollowing can be defined as "the potential for loss"? |
Risk |
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When must insurableinterest exist for a life insurance contract to be valid? |
Inception of the Contract |
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The following are allelements of a valid contract EXCEPT |
Written Evidence |
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An insuranceapplication requires an applicant to make a full, accurate disclosure of the riskfactor involved. Using this criteria, an insurance policy is considered whattype of contract? |
Contract of utmost good faith |
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What is the insurerresponsible for when an agent is acting within the scope of authority grantedin the agency contract? |
Responsible for actsby the producer that are authority only |
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These are allaccurate statements regarding universal life insurance EXCEPT |
Policy loans are not permitted |
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When would evidenceof insurability be required for a person already covered with a variableuniversal life policy? |
The Death Benefit is Increased |
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What kind of lifeinsurance policy allows a policyowner the choice of investments along withflexible premium payments? |
Variable Universal Life |
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Which statementregarding universal life insurance is correct? |
Cash Value Accumulations have a guaranteed minimum interest rate |
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Which of the following combinations best describe a universallife insurance policy? |
A flexible premium deposit fund and monthly renewable monthly terminsurance policy |
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Which situation is an accelerated (living) benefit rider suitedfor? |
Insured expected to be confined to a nursing home for life |
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A life insurance policy provision that has the potential toreduce the death benefit is called the |
accelerated (living) benefit |
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Which life insurance policy option allows the policyowner tohave coverage equal to the net death benefit of the lapsed policy? |
Extended Term nonforfeiture option |
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In the event ofpremium default, which life insurance provision will use the cash value to keepthe policy in force? |
Automatic Premium Loan |
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Which statementregarding the certificate of insurance is accurate? |
Indicates evidence of an employees insurance coverage |
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Which of these is anaccurate statement regarding the fixed period settlement option on a lifeinsurance policy? |
A portion of the payments paid to thebeneficiary comes of the interest calculated on the proceeds of the policy |
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Which of these is NOTused as selection criteria in the underwriting process of a life insuranceapplication? |
National Origin |
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The interest creditedto the cash values of personally-owned non-qualified annuities is considered |
Tax Deferred |
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A single premiumdeferred annuity sometimes contains a bailout feature. Which statementregarding this feature is correct? |
If an interest rate fall below a specific level, the surrender charge iswaived |
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A life annuityfeature which provides benefit payments for a minimum number of years, no matterwhen the annuitant dies, is called |
Period Certain |
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A large corporationpurchases an accumulation annuity contract where all of the participatingemployees receive certificates of participation. What is this contract called? |
Group Deferral Annuity |
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An annuity'saccumulation period can usually |
Continue after the purchase payments stop |
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Which statement concerning a deferred annuity is correct? |
The owner can be the beneficiary, annuitant or neither |
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Which of thefollowing would most likely purchase an immediate annuity? |
Retiree having a lump sum to invest |
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A life annuity withperiod certain is characterized as |
Guaranteeing benefit payments for a statedminimum period of time |
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The contractualrights that allow the owner of a deferred annuity to surrender the cash valueseveral years before the annuity date are called |
Nonforfeiture options |
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Which of thefollowing is NOT a valid contract exchange? |
An annuity exchange for a life insurancepolicy |
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Which of these statementsabout traditional individual retirement accounts is accurate? |
10% penalty is applied to withdraws priorto 591/2 |
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A 55 year oldrecently received a $30,000 distribution from a previous employer's 401k plan,minus $6,000 for income tax withholding. Which federal taxes apply if none ofthe funds were rolled over? |
Income taxes plus a10% penalty tax on $30,000 |
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An individualparticipant personally received eligible rollover funds from a profit-sharingplan. What is the income tax withholding requirements for this transaction? |
20% is withheld for income taxes |
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A qualifiedprofit-sharing plan is designed to |
Distribute a portion of company earnings to its employees |
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In an individualretirement account (IRA), rollover contributions are |
Unlimited by Dollar amount |
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An employee requestedthat the balance of her 401(k) account be sent directly to her in one lump sum.Upon receipt of the distribution, she immediately had the funds rolled overinto an IRA. What is the tax consequence of the distribution sent to thisemployee? |
Distribution issubject to income tax withholding |
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Which of thefollowing statements BEST describes the HIPAA portability rules for anindividual who changes from one group medical plan to another? |
Reduces or Eliminates any pre-existingconditions excluded under the new plan |
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The health insurancepremiums paid for by each partner in a partnership is considered to be |
100% Tax deductible |
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Which parties aredirectly involved in a group accident and health insurance contract? |
Employer and Insurer |
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Bert’s spouse passedaway recently. Bert was covered under his spouse’s group family healthinsurance plan but now is covered under COBRA. How much of the active-employeecost may be passed on to Bert for continued coverage? |
Maximum of 102% |
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Inpatient psychiatriccare is covered under Part A Medicare for 190 days per |
Lifetime |
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Which of theseprocedures is NOT designed for ambulatory care centers? |
Inpatient Surgeries |
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Part A Medicareincludes coverage for all of the following services EXCEPT |
120 Days of skillednursing facility care |
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How are the premiumsfor an individually-owned disability income policy treated for tax purposes? |
No tax deduction |
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Prepaid dental plansdiffer from most other types of dental plans in what way? |
Closed panel ofdentist can only be used |
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Under HIPPA rules, amedical plan's pre-existing conditions exclusion may be reduced by |
Any period of priorcoverage |
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John has a criminal record in which he was convicted of a felony that involved dishonesty. Under Federal law, how would John be able to engage in insurance transactions? |
Given written consentby the state insurance regulatory agency |
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Security laws passedby Congress are enforced by which Federal agency? |
Securities andExchange Commission |
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A significantdifference between HIC's and private commercial accident and health insurers isthat |
HICs combine medicalcare delivery and funding in one organization |
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Alan is an enrolleeof a health maintenance organization (HMO) which uses a gatekeeper system. Ifthere ever comes a time when he needs emergency health services, what should hedo? |
Proceed to thenearest Emergency Room |
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Which type ofdeductible must be satisfied again for each illness or accident in a majormedical plan? |
Per-cause |
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A MET third-partyadministrator may NOT perform which of the following functions? |
Marketing of the Plan |
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A medical feeschedule shows the amount an insurer will pay for a given procedure. Thisamount is considered to be the |
Highest amountpayable |
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A group-ownedinsurance company that is formed to assume and spread the liability risks ofits members is known as a(n) |
Risk Retention Group |
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Under a key persondisability income policy, benefits will be received as |
Tax-free income to the business |
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Jill has a grouphealth plan with an employer that covers employees in more than one state.Which of the following is NOT affected by the state regulatory jurisdictionestablished for this plan? |
Continuation of Coverage Under COBRA |
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Once an HIC hasprovided coverage to enrollees for a period of 2 years, it shall hold an openenrollment period of not less than how many days, at least once during eachconsecutive 12-month period? |
30 Days |
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In regards to theAffordable Care Act (ACA), which of these is NOT a role of a health insuranceexchange? |
contact the employerif the employee stops coverage under a plan offered in exchange |
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Which of thefollowing describes the treatment service of a crown? |
Prosthodontist |
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Which of thefollowing is a syndicate established by a group of insurers to shareunderwriting duties? |
Lloyd's organization |
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Who does TRI-CAREprovide accident and health coverage to? |
Military Families |
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The benefit period ofMedicare Part A begins on the first day the insured |
Is admitted into a hospital |
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Who does a viaticalsettlement broker represent? |
The Viator |
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According to theAffordable Care Act (ACA), under what circumstances would lifetime limits andannual limits be permitted on a health plan or insurance policy? |
When coverages are notconsidered essential health benefits |
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Group dental insurerscan discourage adverse selection by |
Limiting the duration of Coverage |
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According to HIClaws, confidentiality of health information applies to |
Information supplied byboth the covered individual and the providers |
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Scott has a lifeinsurance policy in which the dividends are left with the insurance company.This particular policy may be paid up when the cash value plus accumulateddividends |
equal the net singlepremium for the same face amount at the insured's attained age |
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In what situationcould an insurance policy's coverage be modified? |
Applicant is asubstandard risk |
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Ken is age 65 and has2 years until he receives Social Security retirement income benefits. At hiscurrent age, which is true about Medicare Part A Hospital Insurance coverage? |
It is availablethrough application through social security |
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After the initialenrollment period for Medicare Part B has expired, when may an individualpurchase again? |
January through March ofeach year |
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Larry is about tofile an accident and health insurance claim. Which of the following would makeclaim handling more convenient for him? |
Assignment ofBenefits |
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Who regulates an insurer's claim settlement practices? |
State insuranceDepartments |
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A disability incomeinsurance policy was recently issued with a rating. What does this mean? |
Policy owner will becharged an additional premium |
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Under HIPAA, medicalplan late enrollees may be excluded for pre-existing conditions for a maximumof |
18 Months |
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Kelly purchases ahealth insurance policy issued on a conditionally renewable basis. Theinsurance company has a right to decline renewal of the policy |
Reasons Stated in the Contract |
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A producer workingfor an insurance company may be personally liable for |
acts performed which areprohibited in the agency contract |
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Which of thefollowing is a true statement regarding a Medicare Supplement policy purchasedduring the open enrollment period? |
The policy will beissued regardless of health |
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An insured, age 67,is covered under a disability income policy. What will the insurer require inorder for the insured to continue coverage? |
The insured must workfor a stated number of hours per week |
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An agreement isreached when an insurance contract is formed. Which of the following is NOTconsidered to be an element of an agreement? |
Equity |