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152 Cards in this Set
- Front
- Back
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The reason for a business having a Business Overhead Expense Disability Plan is to cover the cost of providing group disability insurance to the employees fixed business expenses the owner's loss of income all business-related expenses and salaries |
fixed business expenses |
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Which type of provider is known for stressing preventative medical care? Multiple Employer Welfare Arrangements (MEWA) Major medical provider Health Maintenance Organizations (HMO's) Preferred Provider Organizations (PPO's) |
Health Maintenance Organizations (HMO's) |
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Which of the following health insurance policy provisions specifies the health care services a policy will cover? Insuring clause Usual, Customary, and Reasonable clause Consideration clause Benefit clause |
Insuring clause |
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The policy provision that entitles the insurer to establish conditions the insured must meet while a claim is pending is Grace Period Physical Examination and Autopsy Entire Contract Time Limit on Certain Defenses |
Time Limit on Certain Defenses |
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Which of the following statements describes what an Accident and Health policyowner may NOT do? File a covered claim Assign ownership Cancel the coverage Adjust the premium payments |
Adjust the premium payments |
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Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for a Disability Income policy? Issue the policy with a diabetes exclusion Issue the policy with an altered Time of Payment of Claims provision Issue the policy with a rating Decline the applicant |
Issue the policy with an altered Time of Payment of Claims provision |
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The option that provides an additional death benefit for a limited amount of time at the lowest possible cost is called a(n) Term rider Accidental Death and Dismemberment rider (AD&D) Family rider Annuity |
Accidental Death and Dismemberment rider (AD&D) |
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F needs life insurance that provides coverage for only a limited amount of time with a death benefit that changes regularly according to a schedule. What kind of policy is needed? Level term policy Whole life policy Limited-pay policy Decreasing term policy |
Decreasing term policy |
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Q would like to purchase $100,000 of permanent protection on his wife and $50,000 of Term coverage on himself under the same policy. What kind of policy should Q purchase? Joint policy Joint survivor policy Whole life policy with other insured rider Whole life policy with a Guaranteed Insurability option |
Whole life policy with other insured rider |
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Disability policies do NOT normally pay for disabilities arising from which of the following? Accidents War Negligence Sickness |
War |
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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 |
Normally includes an Elimination period` |
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Which health policy clause specifies the amount of benefits to be paid? Insuring Consideration Free-look Payment mode |
Insuring |
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All of the following are Nonforfeiture Options EXCEPT Cash Surrender Option Extended Term Option Reduced Paid-Up Option Automatic Premium Loan Option |
Automatic Premium Loan Option |
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Which of the following is NOT a consequence for placing business with an unauthorized insurer? Third degree felony First degree misdemeanor Insurance license revoked Responsible for unpaid claims |
First degree misdemeanor |
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Under Florida law, which of the following provisions is NOT required in a Medicare Supplement policy? Suitability form Guaranteed issue Free-look period of 30 days Limitation on pre-existing conditions for up to 12 months |
Limitation on pre-existing conditions for up to 12 months |
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Florida requires that coverage for newborns begins “from the moment of birth” and continues for 31 days 6 months 12 months 18 months |
18 months |
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When replacing or exchanging an annuity, the agent must disclose to the annuitant the commissions to be paid as a result of the transaction the possible tax ramifications as a result of the transaction the insurer's A.M. Best rating proof of appointment by the agent |
the possible tax ramifications as a result of the transaction |
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How can an agent-in-charge have more than one location? Only if the locations are in Florida By keeping all locations within a close proximity An agent-in-charge can only have one location Only if the agent-in-charge is present when insurance activity occurs |
Only if the agent-in-charge is present when insurance activity occurs |
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Which of the following acts is an agent NOT authorized to do on behalf of an insurer? Accept premiums from policyowners Complete insurance applications Authorize claim payments Ask health related questions |
Authorize claim payments |
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Convincing a prospective insured to buy an insurance policy based on exaggerations is called rebating intimidation twisting misrepresentation |
misrepresentation |
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Which of the following is NOT considered rebating? Sharing commissions with an agent licensed in the same line of business Returning premium to a client as an inducement for purchasing a policy Giving something of value to an insured in exchange for their business Offering special dividends |
Sharing commissions with an agent licensed in the same line of business |
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T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as fiduciary responsibility reasonable trust ethical behavior legal competence |
fiduciary responsibility |
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Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency? National Association of Insurance Commissioners (NAIC) Florida Life and Health Insurance Guaranty Association Department of Financial Services Office of Insurance Regulation |
Florida Life and Health Insurance Guaranty Association |
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A level premium indicates the premium is fixed for a period stated in the contract, then becomes variable the premium can only be changed with the consent of the insurer the premium stays level until the policy's renewal date the premium is fixed for the entire duration of the contract |
the premium is fixed for the entire duration of the contract |
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All of these are considered sources of underwriting information about an applicant EXCEPT Inspection Report Credit Report Rating Services Medical Information Bureau |
Rating Services |
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On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take? Collect initial premium Collect initial premium along with a signed health statement Explain to the applicant the policy is no longer in effect due to change in health condition Collect initial premium and leave a binding receipt |
Collect initial premium along with a signed health statement |
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Which of the following is an important underwriting principle of group life insurance? Physical examinations are required Everyone must be covered in the group Employer must pay for the entire premium The group must be formed for the purpose of getting affordable insurance |
Everyone must be covered in the group |
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What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability? Entire contract Owner's rights Nonforfeiture options Conversion |
Conversion |
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M has an insurance policy that also has an outstanding policy loan at the time of M's death. The insurer will deduct the outstanding loan balance from the cash value estate of the insured policy proceeds nonforfeiture value |
policy proceeds
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The incontestable clause allows an insurer to disallow a change of ownership throughout the Contestable period disallow a change of beneficiary during the Contestable period contest a claim at anytime if the cause of death was accidental contest a claim during the contestable period |
contest a claim during the contestable period |
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How do life insurance companies handle cases where the insured commits suicide within the contract's stated Contestable period? Claims are denied under the Suicide clause of the policy Company pays twice the face amount under the double indemnity clause Claims are paid in full Premiums are returned under the Consideration clause |
Claims are denied under the Suicide clause of the policy |
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N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase? 30 Pay Life Term to Age 70 Universal Life Adjustable Life |
30 Pay Life |
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How long does the coverage normally remain on a limited-pay life policy? age 65 age 100 when premium payments stop at the discretion of the insurer |
age 100 |
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Which of these statements describe a Modified Endowment Contract (MEC)? Falls below the minimum amount of premium that can be paid into a policy and still have it recognized as a life insurance contract Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as a life insurance contract The 7-pay test is used to determine the minimum death benefit of the policy The 7-pay test is used to determine the maximum death benefit of the policy |
Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as a life insurance contract |
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What type of life insurance incorporates flexible premiums and an adjustable death benefit? Endowment Policy Modified Whole Life Decreasing Term Universal Life |
Universal Life |
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A Limited-Pay Life policy has graded death benefits no cash value premium payments limited to a specified number of years premium payments that are paid to age 100 |
premium payments limited to a specified number of years |
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What type of life insurance gives the greatest amount of coverage for a limited period of time? Term life Graded Premium Whole life Whole life Endowment policy |
Term life |
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A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as Adjustable Life Graded-Premium Life Variable Life Modified Whole Life |
Variable Life
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What type of life policy covers two people and pays upon the death of the last insured? Shared Survivorship Adjustable Joint |
Survivorship |
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Which of these circumstances is a Business Disability Buy-Sell policy designed to help in the sale of a business? Company becoming insolvent Death of the business owner Business owner becoming disabled Key employee becoming disabled |
Business owner becoming disabled |
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Which of the following characteristics are associated with a large group disability income policy? No waiting periods No medical underwriting No elimination periods No limit of benefits |
No medical underwriting |
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The individual who provides general medical care for a patient as well as the referral for specialized care is known as a Physician's assistant Primary Care Physician Secondary Care Physician Third Party Administrator |
Primary Care Physician |
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The health insurance program which is administered by each state and funded by both the federal and state governments is called Long-term care Medicaid Medicare Supplemental Program Medicare |
Medicaid
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Which of the following services is NOT covered under a hospitalization expense policy? daily room and board surgeon's fees intensive care miscellaneous expenses |
surgeon's fees |
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The provision that defines to whom the insurer will pay benefits to is called Entire Contract Proof of Loss Claim Forms Payment of Claims |
Payment of Claims |
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A producer 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 |
determine if the applicant is an acceptable risk by completing standard underwriting procedures |
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R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity? Residual Disability Recurrent Disability Presumptive Disability Occupational Disability |
Residual Disability |
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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 |
converted to an individual permanent policy at an individual rate |
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When a person returns to work after a period of total disability but cannot earn as much as he or she did before the disability, this situation is called which of the following? Waiver of premium Recurring disability Residual disability Presumptive disability |
Residual disability |
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A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type of policy will pay a monthly benefit to the personal assistant? Disability Income Major Medical Key Employee Business Overhead Expense |
Disability Income |
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A producer who tells claimants that their rights may be impaired if they fail to complete a release form within a given period of time could be guilty of defamation rebating coercion discrimination |
coercion |
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A policy loan is made possible by which of these life insurance policy features? Policy loan clause Cash value provision Owner's rights provision Consideration clause |
Cash value provision |
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Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)? Employee funds the HRA entirely Employer funds the HRA entirely HRA's can be offered with other health plans HRA's allow reimbursement for eligible medical expenses |
Employee funds the HRA entirely |
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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 |
Normally includes an Elimination period |
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Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy? Limited Special risk Reimbursement Blanket |
Reimbursement |
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As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of? Coercion Defamation Rebating Misrepresentation |
Coercion |
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How many hours of continuing education must a newly licensed agent complete every two years? 4 8 16 24 |
24 |
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A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan's termination? 14 days 31 days 45 days 60 days |
31 days |
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Non-occupational disability coverage is designed for 24 hour protection those who are exempt from Workers' Compensation coverage sole proprietors and self-employed individuals employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation |
employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation |
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Medicare Part B does NOT cover occupational therapy inpatient hospital services physician and surgeon services medical equipment rental |
inpatient hospital services |
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An agent's license can be suspended or revoked by writing primarily controlled business not meeting annual sales quota replacing an existing insurance policy with a new one issuing a binding receipt |
writing primarily controlled business |
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Florida's 14-day free-look period for life insurance policies begins at the date of delivery date of approval date of application date of physical examination |
date of delivery |
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Which of the following employer tasks does a Professional Employer Organization normally handle? Marketing strategies Setting sales quotas Administration tasks Hiring staff |
Administration tasks |
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Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer? Rebating Coercion Sliding Misrepresentation |
Misrepresentation |
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An incomplete life insurance application submitted to an insurer will result in which of these actions? Application will be returned to the writing agent Application will be approved with restrictions Application will be pending until a MIB report is sent to the insurer Application will be automatically declined |
Application will be returned to the writing agent |
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When does a life insurance contract become effective if the initial premium is not collected during the application process? After all medical and personal information has been evaluated When insurer receives initial premium from the producer When producer delivers policy and collects initial premium After application has been approved by the underwriters |
When producer delivers policy and collects initial premium |
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What does the insuring agreement in a Life insurance contract establish? An insurer's basic promise The insurance policy's grace period An insurer's required reserve amount The obligations of the beneficiary |
An insurer's basic promise |
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Which provision is NOT a requirement in a group life policy? Conversion Grace period Incontestable period Accidental |
Accidental |
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Which of the following BEST describes how pre-admission certifications are used? Used to assist in underwriting Used to prevent nonessential medical costs Used to minimize hospital lawsuits Used to help process claims |
Used to prevent nonessential medical costs |
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Which of the following statements describes what an Accident and Health policyowner may NOT do? File a covered claim Assign ownership Cancel the coverage Adjust the premium payments |
Adjust the premium payments |
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Company Z has a Cross Purchase Buy-Sell Agreement in place among its three founding partners. If the agreement is funded with individual life insurance, what would it require? One policy is owned and paid for by the company Each partner must own a policy on the other partners One policy is owned by the company and premiums are split equally among the partners Each partner owns their own individual policy |
Each partner must own a policy on the other partners |
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The agreement in a life insurance contract that states a specific sum of money will be paid to a designated person upon an insured's death is called a(n) Entire Contract provision Consideration clause Insuring agreement Assignment agreement |
Insuring agreement |
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Which of the following costs would a Basic Hospital/Surgical policy likely cover? Surgically removing a facial birthmark Care given at a nursing home Treating a wound from a soldier injured at war Lost income caused by a hospital stay |
Surgically removing a facial birthmark |
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S has a Whole Life policy with a premium payment due soon. Which provision would keep the policy in force if S does not make the required payment and the policy has adequate cash value from which the premium payment can be made? Automatic Policy Loan Assignment Grace Period Waiver of Premium |
Automatic Policy Loan |
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A characteristic of Preferred Provider Organizations (PPOs) would be: Discounted fees for the patient Not allowed to see out-of-network physicians Physicians are paid on a capitation basis A primary care physician is required |
Discounted fees for the patient |
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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 |
Consideration clause |
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How are surrender charges deducted in a life policy with a rear-end loaded provision? Deducted from the death benefit Deducted when the policy is discontinued Deducted from policy's cash value Deducted when assigned to another policyowner |
Deducted when the policy is discontinued |
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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 |
Insuring clause |
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In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy? Nonforfeiture Entire Contract Insuring Clause Owner's Rights |
Owner's Rights |
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What type of life insurance are credit policies issued as? Whole Variable Term Universal |
Term |
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Term insurance has which of the following characteristics? Expires at the end of the policy period Builds cash value Has nonforfeiture options Endows at the end of the policy period |
Expires at the end of the policy period |
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What type of life insurance incorporates flexible premiums and an adjustable death benefit? Endowment Policy Modified Whole Life Decreasing Term Universal Life |
Universal Life |
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D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed? Limited-pay life Graded Premium Level term Endowment |
Level term |
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What kind of life insurance product covers children under their parent's policy? Family Maintenance rider Term rider Family Income rider Payor benefit |
Term rider |
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What is the consideration given by an insurer in the Consideration clause of a life policy? Promise to never cancel coverage Promise to pay a death benefit Promise to not raise premiums Promise to pay a policy dividend |
Promise to pay a death benefit |
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What does a Face Amount Plus Cash Value Policy supposed to pay at the insured's death? Face amount plus the policy's cash value Face amount plus the policy's dividends The greater amount of the policy's death benefit or the cash value Face amount plus total premium paid throughout the life of the policy |
Face amount plus the policy's cash value |
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What type of life policy covers 2 lives and pays the face amount after the first one dies? Group Life Joint Life Policy Family Income Policy Last Survivor Policy |
Joint Life |
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A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as Adjustable Life Graded-Premium Life Variable Life Modified Whole Life |
Variable Life |
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The type of annuity that can be purchased with one monetary deposit is called a(n) Single Deposit annuity Single Premium annuity Fixed annuity Immediate annuity |
Immediate annuity |
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Which of these types of coverage is best described as a short term medical policy? interim coverage provisional coverage transitional coverage conversion coverage |
interim coverage |
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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 |
Normally includes an Elimination period |
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A Health Reimbursement Arrangement MUST be established with employee funding with other employer-sponsored benefit plans by the employer only during specific open enrollment periods |
by the employer |
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An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective? When the policy is issued The date of policy delivery When the conditions of the receipt are met The date the sales appointment was set |
When the conditions of the receipt are met |
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Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy? Limited Special risk Reimbursement Blanket |
Reimbursement |
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Which of the following unfair trade practices involves an agent who makes malicious statements about another person's financial condition? Boycotting Defamation Unfair discrimination Misrepresentation |
Defamation |
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Non-occupational disability coverage is designed for 24 hour protection those who are exempt from Workers' Compensation coverage sole proprietors and self-employed individuals employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation |
employees who suffer non-work related disabilities, since work-related disabilities are covered by Workers' Compensation |
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A disability elimination period is best described as a time deductible dollar deductible e eligibility period probation period |
time deductible
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The coordination of benefits (COB) provision exists in order to avoid duplication of benefit payments avoid excessive hospitalization lower insurance premiums maximize patient care |
avoid duplication of benefit payments
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Which of the following employer tasks does a Professional Employer Organization normally handle? Marketing strategies Setting sales quotas Administration tasks Hiring staff |
Administration tasks
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Convincing a prospective insured to buy an insurance policy based on exaggerations is called rebating intimidation twisting misrepresentation |
misrepresentation
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J is an agent who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of? Coercion Sliding Twisting Rebating |
Twisting
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Which type of insurance company allows their policyowners to elect a governing body? Stock Mixed Admitted Mutual |
Mutual
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Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer? Rebating Coercion Sliding Misrepresentation |
Misrepresentation
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Which of the following is an example of an Unfair Trade Practice? Shared commissions Fiduciary Replacement Coercion |
Coercion |
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Defamation occurs when an agent makes a false statement intended to malign another insurer replace an existing insurance policy with another restrict fair trade misrepresent the provisions of an insurance policy |
malign another insurer
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Which of these statements is INCORRECT regarding the federal income tax treatment of life insurance? Premiums are normally not tax deductible Cash dividends are normally not taxed Entire cash surrender value is taxable Proceeds are received tax-free if there is a named beneficiary |
Entire cash surrender value is taxable
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Group life insurance policies are generally written as a term rider annually renewable term increasing term group whole life |
annually renewable term |
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Which provision prevents an insurer from changing the terms of the contract with the policyowner by referring to documents not found within the policy itself? Policy Exclusion Incontestable Entire Contract Assignment |
Entire Contract
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Deductibles are used in health policies to lower the incidents of fraud the coinsurance amount overuse of medical services adverse selection |
overuse of medical services
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Which of the following statements BEST defines usual, customary, and reasonable (UCR) charges? The maximum premium an insurer can charge for their health insurance based on geography The maximum amount an employer can contribute to a contributory health plan The maximum deductible an insured can be charged The maximum amount considered eligible for reimbursement by an insurance company under a health plan |
The maximum amount considered eligible for reimbursement by an insurance company under a health plan
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Which of these are NOT an example of a Nonforfeiture option? Extended Term Reduced Paid-up Cash Surrender Life Income |
Life Income
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Which of the following BEST describes a Hospital Indemnity policy? Coverage that reimburses an insured for surgeon expenses Coverage that pays a stated amount per day of a covered hospitalization Coverage that replaces lost income due to hospitalization Coverage that pays for hospital room and board |
Coverage that pays a stated amount per day of a covered hospitalization
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Which of the following statements does NOT accurately describe the tax treatment of premiums and benefits of individual Accident and Health insurance? Disability income policy premiums are NOT tax-deductible Disability income policy premiums are tax-deductible Major medical policy benefits are normally not taxed Disability income policy benefits are normally not taxed |
Disability income policy premiums are tax-deductible
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A medical care provider which typically delivers health services at its own local medical facility is known as a Health Maintenance Organization Regional Provider Multiple Employer Trust Preferred Provider Organization |
Health Maintenance Organization
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Which policy requires an agent to register with the National Association of Securities Dealers (NASD) before selling? Variable Life Credit Life Universal Life Interest-Sensitive Whole Life |
Variable Life
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Which of the following actions require a policyowner to provide proof of insurability in an Adjustable Life policy? increase face amount decrease face amount increase premium-paying period decrease premium payment |
increase face amount
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All of these statements about Equity Indexed Life Insurance are correct EXCEPT Cash value has a minimum rate of accumulation If the gain on the index goes beyond the policy's minimum rate of return, the cash value will mirror that of the index The premiums can be lowered or raised, based on investment performance Tied to an equity index such as the S&P 500 |
The premiums can be lowered or raised, based on investment performance
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Credit Life insurance is issued in any amount at the discretion of the applicant used in the event of loss of income issued in an amount not to exceed the amount of the loan coverage that waives the premiums on a loan payment in the event of total disability |
issued in an amount not to exceed the amount of the loan |
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Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies? beneficiary insured policyowner insurer |
policyowner
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Which of the following statements BEST describes how a policy that uses the "accidental bodily injury" definition of an accident differs from one that uses the "accidental means" definition? Double indemnity Benefits are taxable More restrictive Less restrictive |
Less restrictive
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All of these are characteristics of an Adjustable Life policy EXCEPT All of these are characteristics of an Adjustable Life policy EXCEPT adjustable premium payment period combination of term and whole life insurance face amount can be adjusted using policy dividends |
face amount can be adjusted using policy dividends
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A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision? Payor provision Accelerated Benefits provision Assignment provision Waiver of Premium provision |
Payor provision |
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Insurance policies offered on a "take it or leave it" basis are considered what? Conditional Contracts Aleatory Contracts Unilateral Contracts Contracts of Adhesion |
Contracts of Adhesion |
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K buys a policy where the premium stays fixed for the first 5 years. The premium then increases in year 6 and stays level thereafter, all the while the death benefit remains the same. What kind of policy is this? Variable Life Adjustable Life Graded Premium Whole Life Modified Whole Life |
Modified Whole Life
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Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options? Modified Whole Life Variable Life Universal Life Adjustable Life |
Variable Life
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Additional coverage can be added to a Whole Life policy by adding a(n) payor rider accelerated benefit rider decreasing term rider automatic premium loan rider |
decreasing term rider
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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 |
Normally includes an Elimination period
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In a Disability Income policy, which of these clauses acts as a deductible? Elimination Period Waiver Period Deductible Period Probationary Period |
Elimination Period
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As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of? Coercion Defamation Rebating Misrepresentation |
Coercion |
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T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary? Request will be accepted only if in writing by the insured Change will be made only if premiums are paid current Change will be made immediately Request of the change will be refused |
Request of the change will be refused
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What do Dread Disease policies cover? A specific disease or illness All diseases or illnesses Only terminal illnesses Only heart-related diseases |
All diseases or illnesses
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Within how many days after policy delivery can a Medicare Supplement policy be returned for a 100% premium refund? 15 20 25 30 |
30
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What do families pay that are covered by the Florida Healthy Kids Corporation? Full premium A portion of the premium The first initial premium Nothing |
A portion of the premium
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When must insurable interest exist for a life insurance contract to be valid? inception of the contract Throughout the entire length of the contract When the insured dies During the contestable period |
inception of the contract
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An agent is an individual that represents whom? Insurer Insured Broker Himself/Herself |
Insurer
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What is the elimination period of an individual disability policy?
Time period an insured must wait before coverage begins Time period a disabled person must wait before benefits are paid Time period after the policy issue date in which the provisions are still contestable The point in time when benefits are no longer payable |
Time period a disabled person must wait before benefits are paid
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After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms? File a lawsuit Contact the insurer again requesting forms Nothing File written proof of loss |
File written proof of loss
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A long-term care lapse notice must be delivered to both the applicant and secondary addressee beneficiary personal physician MIB |
secondary addressee
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An example of rebating would be a mutual insurance company paying dividends to its policyowners reducing the premiums across the board for a specific risk class offering a client something of value not stated in the contract in exchange for their business using intimidation in order to restrain or monopolize the business of insurance. |
offering a client something of value not stated in the contract in exchange for their business
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The annuity that represents the largest possible monthly payment to an individual annuitant is a(n) Cash Refund Installment Refund Straight Life annuity Life Annuity with Period Certain |
Straight Life annuity |
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Which type of policy is considered to be overfunded, as stated by IRS guidelines? Modified Whole Life Modified Endowment Contract Variable Universal Life Interest-Sensitive Whole Life |
Modified Endowment Contract
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The investment gains from a Universal Life Policy usually go toward the death benefit the dividends the cash value paying off a policy loan |
the cash value
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What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years? Family Lump Sum Policy Family Maintenance Policy Family Survivor Policy Family Income Policy |
Family Maintenance Policy
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What kind of premium does a Whole Life policy have? decreasing adjustable level deferred |
level |
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Which of the following statements about Health Reimbursement Arrangements (HRA) is CORRECT? If the employee had a qualified medical leave from work, lost wages can be reimbursed If the employee paid for qualified medical expenses, the reimbursements may be tax-free Any unused amounts are added to employee's gross income Health insurance premiums can be reimbursed to the employee |
If the employee paid for qualified medical expenses, the reimbursements may be tax-free
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What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy? Premiums may increase at time of renewal Premiums may increase at any time Policy may be renewed at the discretion of the insured Policy may be amended by insurer at any time |
Premiums may increase at time of renewal |
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M’s insurance company denied a reinstatement application for her lapsed health insurance policy. The company did not notify M of this denial. How many days from the reinstatement application date does the insurance company have to notify M of the denial before the policy will be automatically placed back in force? 10 days 30 days 45 days 60 days |
45 days
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K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary? Return of premiums paid Cash value plus interest $20,000 death benefit Face amount plus interest |
$20,000 death benefit
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An agent selling Medicare Supplement policies must provide every applicant with a(n) MIB form COBRA form Suitability form Signed consent form |
Suitability form
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All of the following will result in the suspension of an agent's license EXCEPT intentionally misrepresenting the provisions of a policy acting with fiduciary responsibility forging a name on an insurance application being convicted of a felony |
acting with fiduciary responsibility
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Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy? Notice to existing and replacing insurers of intention to replace A list of all policies the agent has replaced in the last 3 years A statement made by the agent that NAIC guidelines have been met during the replacement process A copy of the agent's insurance license |
Notice to existing and replacing insurers of intention to replace
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The Life and Health Insurance Guaranty Association is an entity that assists in underwriting large insurance policies funded by admitted insurance companies through assessments funded by the state government administered by the Federal government |
funded by admitted insurance companies through assessments
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