Life And Health Insurance License Exam Practice Test

If a violation of a material warranty on the part of the insured is discovered, the insurer has the option to rescind the policy. Rescission means that the insurer can cancel the policy from its inception and treat it as if it never existed. This allows the insurer to avoid any obligations or liabilities under the policy. Rescission is a common recourse for insurers when there has been a misrepresentation or breach of warranty by the insured.

The guaranteed insurability option allows the policyholder to purchase additional insurance without having to provide evidence of insurability. This means that even if the policyholder's health or other factors have changed since they originally purchased the policy, they can still buy more coverage. This can be useful if the policyholder's needs have increased over time or if they want to ensure they have enough coverage for the future.

Acute care coverage in a hospital is not covered in a long-term care policy. Long-term care policies typically cover benefits such as home care, custodial care, and community-based care. Acute care, which refers to the treatment of short-term and severe medical conditions in a hospital setting, is usually covered by health insurance policies rather than long-term care policies.

In a 7 year vesting schedule, after 7 years of service, 100% of the employer contributions must be vested. This means that the employee is entitled to the full amount of the employer's contributions to their retirement or investment account. Vesting refers to the process by which an employee earns the right to receive the employer's contributions over time, and in this case, after 7 years, the employee has fully earned and is entitled to the entire amount.

A hazard is defined as a condition that increases the likelihood of a loss occurring. This means that it poses a potential danger or risk that could lead to a loss or harm. The other options listed in the question do not fit this definition. A large number of similar exposure units refers to a situation where there are many similar entities or individuals being exposed to a risk, but it does not necessarily indicate a hazard. A peril refers to a specific cause of loss, such as a fire or flood, rather than a condition that increases the likelihood of a loss. Lastly, a speculative risk involves the possibility of gain or loss, rather than a specific condition that increases the likelihood of a loss occurring.

Social Security Disability benefits are designed to provide financial assistance to individuals who are disabled and unable to work. However, these benefits are not intended to replace the entirety of a worker's previous earnings. The benefit amount is calculated based on the individual's work history and earnings up to the time of the disability, but it typically replaces only a portion of the worker's earnings, not the entire amount.

According to the CA Insurance Code, all insurers are required to maintain a department to investigate possible fraudulent claims from insureds. This means that insurance companies must have a dedicated department to look into any suspicious or potentially fraudulent claims made by their policyholders. This is important to ensure that insurance fraud is detected and prevented, protecting both the insurers and the honest policyholders from financial losses.

Long-term care policies sold in California must provide benefits for both institutional care and home care. This means that the policy should cover expenses related to care received in a nursing home or assisted living facility, as well as expenses for in-home care services. This requirement ensures that individuals have options and flexibility in choosing the type of care that best suits their needs and preferences.

Private nursing expense is not one of the three traditional benefits of a group basic medical expense plan. The three traditional benefits are surgical expense, physicians visit expense, and hospital expense. Private nursing expense refers to the cost of hiring a private nurse to provide care at home, which is typically not included in a basic medical expense plan.

Wellness benefits under a Health Maintenance Organization (HMO) typically include routine physicals, immunizations, and vision checks. However, fluoride treatments are not typically included in the wellness benefits provided by an HMO.

Term insurance is a type of life insurance that provides coverage for a specific term or period of time. It is typically characterized by low premiums because it only provides coverage for a specific period and does not accumulate cash value over time. This means that if the insured person survives the term, there is no payout or cash value associated with the policy. The low premiums make term insurance an affordable option for individuals who want temporary coverage without the need for cash value accumulation.

The correct answer is that the contingent beneficiary shares death proceeds equally with the primary beneficiary. This statement is false because contingent beneficiaries only receive the death proceeds if the primary beneficiary is deceased at the time of the insured's death. They do not share the proceeds equally with the primary beneficiary.

Under an individual health guaranteed renewal contract, the insurer has the right to change premiums for the same class insured. This means that the insurer can adjust the amount of money that the insured individual needs to pay for their health insurance coverage. This can be done based on factors such as the overall cost of healthcare, the individual's age, or any other relevant factors that may impact the risk associated with providing coverage. This allows the insurer to adjust the premiums to reflect the changing circumstances and costs associated with providing healthcare coverage.

The initial premium for term insurance is lower than the initial premium for whole life insurance because term insurance provides coverage for a specific period of time, typically 10, 20, or 30 years, while whole life insurance provides coverage for the entire lifetime of the insured. Since term insurance has a limited coverage period, the risk for the insurance company is lower compared to whole life insurance, resulting in a lower initial premium.

The statement is false because the Health Insurance Counseling Advocacy Program (HICAP) provides assistance to the public regardless of their financial ability to pay. HICAP offers free counseling and advocacy services to help individuals understand and navigate health insurance options, coverage, and claims. They aim to provide unbiased and objective information to empower individuals to make informed decisions about their healthcare.

Specified disease insurance is a type of insurance that pays medical benefits only if the insured person is diagnosed with a specific disease that is stipulated in the policy. This type of insurance is designed to provide coverage for the treatment and expenses associated with a particular illness or disease, such as cancer or heart disease. It is different from other types of insurance, such as group or individual medical expense insurance, which provide coverage for a wider range of medical conditions and expenses.

To obtain group insurance without providing evidence of insurability, eligible individuals generally have to enroll within a specified eligibility period. This means that they need to sign up for the insurance coverage within a specific timeframe determined by the insurance provider. By doing so, they can bypass the requirement of submitting an attending physician's statement or paying the first year premium in advance.

The purpose of the rehabilitation provision in a disability income policy is to encourage disabled insured individuals to return to their original occupations. This provision may include various forms of assistance, such as vocational training, job placement services, or financial support for education or retraining. By offering support and resources for rehabilitation, the policy aims to help disabled individuals regain their independence and return to work in their previous occupations.

The entire contract in a life insurance policy consists of the policy itself and the application. The application is considered a part of the contract when it is attached to the policy. This means that both the policy and the attached application form a legally binding agreement between the insurance company and the policyholder. Any verbal understandings or sales literature presented by the agent may provide additional information but do not make up the entire contract.

A life agent must maintain records regarding policies sold in this state for 5 years. This is important for various reasons, such as ensuring compliance with regulations, resolving any disputes or claims that may arise in the future, and providing a reference for any necessary audits or investigations. By keeping these records for 5 years, the life agent can demonstrate transparency and accountability in their business practices.

Individuals have the right to ask a Medicare carrier to review the decision if they disagree with the amount Medicare will pay. This means that they can submit a request for a reconsideration of the decision, providing any additional information or evidence that may support their case. The Medicare carrier will then review the decision and determine if any changes should be made. This allows individuals to have their case reevaluated and potentially receive a different outcome.

If another insurer submits an employment application, it does not necessarily mean that the agent's appointment with the current insurer will be discontinued. The agent may have the option to work for both insurers simultaneously or may choose to decline the new employment offer. Therefore, this circumstance does not automatically lead to the discontinuation of the agent's appointment with the current insurer.

The cash value of a whole life policy typically increases over time as the policyholder pays premiums and accumulates interest. In this case, the insured's policy is already paid-up, meaning they have finished making premium payments. Therefore, the cash value will continue to grow based on the interest rate specified in the policy until the insured reaches age 100, at which point it will reach $100,000.

Traditional comprehensive major medical plans typically include deductibles, out-of-pocket maximums, and coinsurance. These components require individuals to pay a certain amount of money out of pocket before the insurance coverage kicks in. However, first-dollar coverage is not included in these plans. First-dollar coverage refers to insurance plans that cover all medical expenses from the first dollar, without any out-of-pocket costs. In traditional comprehensive major medical plans, individuals are typically responsible for paying a portion of their medical expenses before the insurance coverage begins.

The disability income policy social insurance supplement (SIS) benefit rider provides a payment only when the insured is totally disabled, but not receiving any social insurance benefit plans. This means that the rider will only pay benefits if the insured is unable to work due to a disability and does not qualify for any other social insurance benefits. It is designed to provide additional financial support to individuals who are disabled and do not have any other sources of income from social insurance programs.

The correct answer is "the daily benefit coverage amount stated in the policy for each day the insured is confined in the hospital." This means that the insurance policy will provide a fixed daily amount to the insured for each day they are confined in the hospital. This amount is predetermined and specified in the policy. It does not cover all the expenses incurred or the actual hospital expenses, but rather provides a set daily benefit.

All of the descriptions listed in the options are eligible for Medicare. A person who has been entitled to Social Security disability benefits for 24 months is eligible for Medicare. A person who has reached 65 and is willing to pay a premium but is not eligible for Social Security is also eligible for Medicare. Finally, a person who has reached 65 and is eligible for Social Security is eligible for Medicare as well. Therefore, all of the above options are eligible for Medicare.

If an applicant for an insurance license had a previous application for a professional license denied for cause by any licensing authority within five years of the date of the filing, the Insurance Commissioner's most likely course of action would be to deny the application without a hearing. This means that the applicant would not have the opportunity to present their case or provide any additional information to support their application. The previous denial of a professional license suggests that there may be issues or concerns with the applicant's qualifications or suitability for holding a license, which would lead to the denial of the insurance license application without further investigation or review.

The total disability definition used by the Social Security Administration is the most difficult for an injured worker to satisfy because it requires the worker to be completely unable to perform any type of work, not just their own occupation. This means that even if the worker is unable to perform their previous job, they may still be considered able to work in a different capacity, which may make it harder for them to qualify for disability benefits.

The correct answer is "Within a specified number of days after injury." This means that in order for the beneficiary to receive the principal sum benefit for death from a disability policy, the death must occur within a certain timeframe after the injury. This indicates that there is a specific window of time during which the death must occur in order for the benefit to be paid out.

Long-term care policies that deliver benefits for community based or home care services must include respite care, hospice care, and home health care services. These services are essential for individuals who require long-term care and wish to receive it in the comfort of their own homes or within their community. Respite care provides temporary relief for caregivers, hospice care focuses on providing comfort and support for individuals with terminal illnesses, and home health care services offer medical assistance and support at home. Therefore, including all three options in the long-term care policy ensures comprehensive coverage and support for individuals in need.

The social security normal retirement age depends upon the worker's year of birth. The year of birth determines the specific age at which an individual becomes eligible for full retirement benefits. The Social Security Administration has set different retirement ages based on birth year, with later birth years requiring individuals to wait longer before receiving full benefits.

A TSA (Tax-Sheltered Annuity) is a retirement plan specifically designed for employees of public school systems. It allows these employees to contribute a portion of their salary to a tax-deferred account, which can then be used to fund their retirement. This plan is tailored to meet the needs of individuals working in the education sector and provides them with a way to save for their future.

The commonly used 30, 60, 90, and 180 disability terminology refers to the number of days for which no benefits are payable. This means that if a person becomes disabled, they will not receive any benefits for the specified number of days after the disability occurs. After this waiting period, the benefits will start to be payable.

The correct answer is "RW and Associates underwriting for BLG Insurance Corporation." This statement implies that RW and Associates is directly involved in the underwriting process for BLG Insurance Corporation, which may not be accurate. The other options correctly state the relationship between RW and Associates and BLG Insurance Corporation, such as representing, placing business through, or using the services of BLG Insurance Corporation.

A long benefit period and a short elimination period are the features of a long-term care policy that would have the highest premium. A long benefit period means that the policy will provide coverage for a longer duration, which increases the risk for the insurance company and thus leads to a higher premium. On the other hand, a short elimination period refers to the waiting period before the policy starts providing benefits. A shorter elimination period reduces the waiting time for the policyholder to start receiving benefits, increasing the likelihood of a claim and therefore resulting in a higher premium.

The conversion privilege allows a person to change their coverage from a group policy to an individual policy. This means that if someone is covered under a group insurance policy, they have the option to switch to an individual policy if they want more personalized coverage or if they are no longer eligible for the group policy. This conversion privilege provides flexibility and allows individuals to tailor their insurance coverage to better suit their needs.

Roth IRAs are a retirement plan that utilizes non-deductible contributions. Unlike traditional IRAs, contributions to a Roth IRA are made with after-tax dollars, meaning they are not tax-deductible. However, the earnings and withdrawals from a Roth IRA are tax-free, making it an attractive option for individuals who anticipate being in a higher tax bracket in retirement.

Parties to a contract are never required to communicate information solely based on personal judgment for a matter in question. This means that personal opinions or subjective beliefs are not considered necessary or relevant when it comes to providing information in a contract. Instead, parties are expected to provide factual and objective information that is necessary and relevant to the matter at hand. Personal judgment may introduce biases or inaccuracies, which can undermine the integrity and effectiveness of the contract. Therefore, it is best to rely on objective and verifiable information rather than personal judgment.

LTC insurance policies typically cover expenses related to long-term care, such as home health care and adult day care. However, a hospital acute care unit is not considered long-term care and is therefore not covered by LTC insurance. This type of care is usually provided for a short duration in a hospital setting and is typically covered by health insurance or Medicare. Therefore, the correct answer is Hospital acute care unit.

A corridor deductible is a type of deductible that is applied between the exhaustion of basic plan limits and the commencement of excess coverage. It serves as a threshold that must be met before the excess coverage kicks in. This type of deductible helps to limit the insurer's liability by ensuring that the insured bears a portion of the costs before the insurance coverage fully takes effect.

The probationary period in a group health policy is intended for people who joined the group after the policy effective date. During this period, these individuals may have limited or no coverage for certain pre-existing conditions. This allows the insurance company to assess the health status of new members and determine the level of risk they pose. It also helps prevent adverse selection, where individuals only join the group when they need expensive medical treatments. By imposing a probationary period, the insurance company can ensure the stability and affordability of the group health policy for all members.

The false statement about the HICAP program is that it provides assistance for a fee based upon ability to pay. The HICAP program does not charge a fee for its services, as stated in the given options.

ERISA, enacted in 1974, is a federal law that sets standards for pension and health plans offered by employers. It requires plan sponsors to provide participants with plan descriptions and benefit statements. Plan descriptions outline the details of the plan, including eligibility requirements, contribution limits, and investment options. Benefit statements provide participants with information about their accrued benefits, including account balances and projected retirement income. These requirements aim to ensure transparency and enable participants to make informed decisions regarding their retirement plans. Therefore, plan descriptions and benefit statements are necessary components of ERISA compliance.

A corridor deductible is a type of deductible that charges the insured after basic medical benefits have been paid and before other medical coverage begins. This means that once the insured has reached their deductible for basic medical benefits, they will then be responsible for paying the corridor deductible before their other medical coverage kicks in. This type of deductible helps to limit the amount of out-of-pocket expenses for the insured and ensures that they have some coverage before reaching their out-of-pocket limit.

The correct answer is "Any substantial gainful activity." This means that in order to be considered disabled under social security, a person must be unable to engage in any activity that provides a significant income. This definition is used to determine eligibility for disability benefits, as it ensures that individuals who are truly unable to work and earn a living are provided with financial support.

The correct answer is the number of exposure units. The amount of premium an insured will pay is determined by multiplying the rate by the number of exposure units. Exposure units refer to the units of measurement used to assess the potential risk or exposure faced by the insured. The more exposure units there are, the higher the premium will be, as it indicates a greater likelihood of a claim being made.

The statement that is not true is "Part C provides long-term care benefits." Medicare Part C, also known as Medicare Advantage, provides additional benefits beyond what is covered by Parts A and B, such as prescription drug coverage and dental services. However, it does not provide long-term care benefits, which are typically covered by Medicaid or private long-term care insurance.

The correct answer is 2 and 4. In the Medicare system, the services provided by doctors and surgeons are covered by Part B, which requires a charge for coverage. Therefore, options 2 and 4 are the correct choices. Option 1 is incorrect because Part A does not cover the services provided by doctors and surgeons. Option 3 is also incorrect because there is a charge for coverage under Part B.

In group underwriting, the cost of coverage is lower compared to individual underwriting. This is because the risk is spread across a larger pool of individuals, which allows for a more affordable premium for each member. Group underwriting also allows for negotiation of lower rates with insurance providers due to the larger number of individuals being insured. Therefore, the cost of coverage is a significant benefit for the insured in group underwriting.

Adding the accidental death benefit to a whole life policy does not affect the policy's cash value. This means that the cash value of the policy remains the same even after adding the accidental death benefit. The additional premium charged for this benefit is separate from the cash value and does not impact it. The accidental death benefit provides an additional payout if the insured dies due to an accident, but it does not impact the policy's cash value.

Loss retention is an effective risk management technique when the losses are highly predictable, the insured chooses to assume the losses involved, and the worst possible loss is not serious. However, if the probability of loss is unknown, it becomes difficult to assess the potential risks and make informed decisions regarding loss retention. Therefore, the absence of knowledge about the probability of loss would make loss retention less effective as a risk management technique.

An adverse underwriting decision refers to a decision made by an insurance company that negatively impacts the applicant. Charging a higher rate based on the information provided, declination of insurance coverage, and termination of insurance coverage are all examples of adverse underwriting decisions as they result in the applicant facing higher costs or being denied coverage. However, failure of the agent to submit the application to an insurance company does not directly impact the applicant and therefore does not fall under the category of an adverse underwriting decision.

In the state of California, it is not legal to provide free insurance coverage as an inducement for completing a transaction. This means that businesses cannot offer free insurance as a way to entice customers to purchase their services.

Medicare Part A provides coverage for hospitalization, home health care, and hospice services. However, it does not cover physicians' services. These services are typically covered under Medicare Part B, which includes coverage for doctor visits, outpatient care, and other medical services provided by physicians. Therefore, physicians' services are not included in the coverage provided by Medicare Part A.

The location of the insured entity is not a principal factor used to determine group disability income rates. Factors such as the average age of the insureds, maximum indemnity period, and length of the waiting/elimination period are typically considered when calculating group disability income rates. The location of the insured entity may have an impact on other aspects of insurance, such as the cost of healthcare, but it is not directly related to determining disability income rates.

Self-funding of employee benefit plans can be used for short-term disability benefits, health benefits, and hospital benefits. However, death benefits are typically not covered under self-funded plans. Death benefits are usually provided through life insurance policies or other separate arrangements, as they involve a different type of risk and financial consideration compared to other employee benefits.

Under COBRA, a qualifying event ensures that an employee who loses coverage can elect to continue coverage. This means that if an employee experiences a qualifying event, such as termination of employment or reduction in work hours, they have the option to choose to maintain their health insurance coverage, usually for a limited period of time, by paying the full premium themselves. This allows individuals to maintain their healthcare benefits even if they are no longer employed or their hours are reduced.

The social security (OASDHI) program provides only a minimum floor of income, and individuals are expected to supplement this with their own personal programs. This means that the program does not guarantee a sufficient income for individuals, and they are encouraged to have additional sources of income or savings to meet their financial needs.

HMOs, or Health Maintenance Organizations, are involved in providing healthcare services, controlling costs by encouraging preventive care, and providing healthcare financial coverage. However, they do not emphasize the use of specialty physicians. HMOs typically focus on primary care physicians and encourage patients to seek care from within their network of providers. Specialty physicians are often accessed through referrals from primary care physicians, but they are not the primary emphasis of HMOs.

An insurer who has enough financial resources only to provide for all its liabilities and for all reinsurance of all outstanding risks is described as "solvent." Solvency means that the insurer has the financial capacity to meet its obligations and cover potential losses without being in a state of insolvency or financial distress.

The correct answer is "All the above are false." This means that all of the statements mentioned in the question are false according to the code. According to the code, long-term care insurance cannot exclude degenerative conditions like Alzheimer's, they cannot require hospital stays of certain lengths before providing benefits, and "Inflation guard" is not a non-legal provision in LTC policies.

In defined contribution plans, employers make specific contributions to an employee's retirement account. These contributions are usually a percentage of the employee's salary or a fixed amount determined by the employer. The amount of money in the retirement account depends on the contributions made by both the employer and the employee, as well as the performance of the investments made with those contributions. This is different from defined benefit plans where the employer guarantees a specific retirement benefit to the employee, regardless of the contributions made. Individual retirement accounts and Keogh plans are types of retirement accounts that individuals can contribute to on their own.

False is the correct answer because it refers to a representation that does not align with its stipulations or assertions. It indicates that something is not true or accurate, suggesting that the representation is misleading or incorrect.

The given answer is "Extended term." Common life insurance policy riders typically include options such as guaranteed insurability, accidental death, and waiver of premium. However, extended term is not typically included as a rider. Extended term is a feature that allows the policyholder to use the cash value of the policy to convert it into a term policy for a specific period. While it is a feature available in some life insurance policies, it is not considered a rider.

A group health plan third party administrator is responsible for various tasks related to the administration of the plan. They typically handle tasks such as receiving employee payments, tracking insured eligibility, and handling member complaints. However, paying policy owner premiums is not typically a responsibility of the third party administrator. This task is usually handled directly by the policy owner or their designated representative.

The correct answer is "When no settlement option is chosen, the proceeds are automatically paid to the policy owner's state." This statement is not true because when no settlement option is chosen, the proceeds are typically paid to the policy owner's beneficiaries or estate, not to the policy owner's state.

Survivorship life insurance, also known as second-to-die insurance, is a type of policy where the death benefit is paid out upon the death of the second insured individual. This means that the policy face amount is not paid out only upon the death of the first insured to die, making this statement false. Survivorship life insurance is commonly used to meet estate tax obligations as it provides a lump sum payout that can be used to cover these expenses. Additionally, survivorship life insurance policies often have lower premiums compared to separate policies covering each individual insured. However, the statement that the policy face amounts are usually more than $1,000,000 is not necessarily true, as the face amount can vary depending on the specific policy and coverage needs.

When a licensed agent submits a renewal application with the applicable fee on or before the expiration date, they will be able to operate for up to 60 days after the specified expiration date. This means that even if the license has technically expired, the agent is still allowed to continue operating for an additional 60 days. This provides a grace period for the agent to complete the renewal process and ensure that their license remains valid.

The statement "It is paid entirely by FICA (social security) payroll taxes" is incorrect. Part B of Medicare is not paid entirely by FICA payroll taxes. While a portion of the funding for Part B comes from these taxes, beneficiaries are also responsible for paying monthly premiums, annual deductibles, and co-payments or coinsurance for the services they receive under Part B.

The given answer, "Accidental death and dismemberment coverage," is not included in the definition of health insurance in California after January 1, 2002. This means that health insurance in California includes group medical coverage, individual hospital coverage, and individual surgical benefits. However, accidental death and dismemberment coverage is not considered a type of health insurance coverage in California.

A representation may be withdrawn only before the insurance is in effect because once the insurance policy is in effect, the representation becomes a part of the contract and cannot be changed or withdrawn unilaterally. The representation is a statement made by the insured regarding a material fact that influences the insurer's decision to accept or reject the risk. Therefore, it is crucial for the insured to provide accurate and truthful information before the insurance takes effect.

Individual disability income policies have non-deductible premiums, meaning that the policyholder cannot claim a tax deduction for the premiums paid. However, the benefits received from the policy are tax-free, meaning that the policyholder does not have to pay taxes on the benefits received. This tax treatment is designed to provide financial support to individuals who are unable to work due to a disability, without imposing additional tax burdens on them.

Retirement benefits under social security are available only for workers who have earned enough credits to be considered "fully insured". This means that they have accumulated a sufficient number of quarters of coverage based on their work history and earnings. Being fully insured ensures that individuals are eligible to receive retirement benefits once they reach the eligible age, regardless of their current employment status or health condition.

When the policy owner is unable to continue premium payments, the reduced paid-up non-forfeiture option allows them to use the cash value of the policy to purchase a new paid-up policy. In this case, the cash value of $10,000 is used to purchase a new policy with a face value of $20,000. This means that the policy owner will no longer have to make premium payments and the new policy is fully paid-up.

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The purpose of laws regarding the replacement of life and annuity contracts is to establish penalties for failure to comply with replacement requirements, to assure the purchaser receives information to make an informed decision, and to reduce the opportunity for misrepresentation and incomplete disclosures. These laws are not intended to protect the interests of life insurers and their agents, as their main focus is on protecting the consumers and ensuring fair practices in the insurance industry.

A life agent's records must include all correspondence between the agent and the policy holder, a copy of the outline of coverage, and all policies sold by the agent. However, printed material in general use which has been distributed by the insurer does not need to be included in the agent's records. This is because such material is readily available to the policy holder and does not need to be specifically recorded by the agent.

The reduced paid-up insurance option allows the policyholder to use the cash value of their existing policy to purchase a new paid-up policy with a lower face value. This means that the policyholder will have a new policy that is fully paid for and does not require any further premium payments, but the coverage amount will be less than the original policy. This option is often chosen when the policyholder wants to maintain some level of coverage but cannot afford to continue paying premiums at the current level.

The husband receives medical care and XYZ group insurer is secondary. This means that the wife's insurance from XYZ company will only pay benefits after the husband's insurance from ABC company has paid its share. The coordination of benefits clause ensures that there is no over-insurance and that each insurer determines their responsibility for a claim based on what the other insurer will not pay.

24-hour coverage refers to a type of insurance policy that provides continuous protection for both work-related and non-work-related injuries and illnesses. This means that individuals are covered for medical expenses and indemnity regardless of whether the injury or illness occurred on the job or outside of work. It offers a seamless delivery of benefits, ensuring that individuals receive the necessary support and compensation regardless of the circumstances surrounding their injury or illness.

Insurers may offer policies that contain only the core benefits. This means that Medicare Supplement Insurance plans are not required to include additional benefits beyond the core benefits. Insurers have the flexibility to design and offer policies that only provide the basic coverage required by Medicare.

The adjustments made in a cash value account in a universal life policy each time a payment is made include subtracting from mortality and general expense charges, adding the current interest, and adding the current premium paid. However, the insurer does not subtract the policy surrender charges from the cash value account when a payment is made.

Insurers and policies that provide Medicare supplement coverage are not prohibited from excluding any preexisting conditions if the policy has been in force for at least 6 months. This means that if an individual has a preexisting condition and they have had the policy for less than 6 months, the insurer may exclude coverage for that condition. However, after the 6-month period, the insurer cannot exclude coverage for any preexisting conditions.

The Worker's Compensation Subsequent Injury Fund typically provides benefits when an employee who has already suffered a work-related injury subsequently suffers another work-related injury. The fund is designed to encourage employers to hire workers with pre-existing disabilities by covering the additional costs associated with subsequent injuries. Therefore, both the first and second injuries must be the result of on-the-job accidents for benefits to be paid from this fund.

The correct answer is "Offer only broader plans." This is not allowed by code in connection with the sale of Medicare supplement policies because it violates the requirement to offer core plans as a stand-alone or along with broader plans. The code mandates that insurers must offer at least one standardized core plan in addition to any other plans they offer. Therefore, offering only broader plans would not be in compliance with the code.

Employer contributions to qualified pension plans are not taxable to employees in the year they are contributed. Instead, these contributions are tax-deferred, meaning they are not subject to income tax until the employees receive them as benefits in the future. This tax advantage allows the contributions to grow and accumulate investment earnings without being reduced by immediate taxes. Once the employees receive the contributions as benefits, they are then taxed on the amounts received.

Medicare provides very limited nursing home coverage for long-term care for the elderly. This means that Medicare only covers a small portion of the costs associated with nursing home care. It is important for individuals to understand that Medicare is not designed to provide extensive coverage for long-term care needs, and they may need to explore other options such as Medicaid or private insurance to fully cover their long-term care expenses.

An absolute assignment refers to the transfer of ownership of a life insurance policy to another party. In the context of viatical settlements, it means that the policyholder assigns their policy to a third party in exchange for a lump sum payment. This allows the policyholder to receive immediate funds while they are still alive, rather than waiting for the death benefit to be paid out. Therefore, an absolute assignment is the method through which viatical settlements are accomplished.

The correct answer is "Provides for the periodic return of a percentage of the premiums that have been paid if the insured becomes and remains disabled." This means that if the insured becomes disabled and remains disabled, they will receive a percentage of the premiums they have paid over time. This rider provides a form of financial protection for the insured in case they become disabled and are unable to continue paying premiums.

The interest option is a settlement option that allows only the death benefit earnings to be paid to the beneficiary. This means that the beneficiary will receive only the interest earned on the death benefit, rather than the entire death benefit itself. This option may be chosen by the policyholder if they want to ensure that the principal amount of the death benefit remains intact and can continue to earn interest over time.

A coordination of benefits clause is designed to prevent an individual from receiving more than 100% of their actual healthcare expenses by coordinating multiple health insurance plans. In this scenario, all of the given circumstances could potentially result in recovery of more than 100% of actual healthcare expenses, except for a worker's medical plan including a carryover deductible provision. This provision allows the worker to carry over any unused deductible amount from the previous year, which may help reduce their out-of-pocket expenses but does not directly contribute to exceeding the 100% recovery limit.

The correct answer is "A provision that considers the insured to be disabled if donating a body organ." This means that if the insured person donates a body organ, they will be considered disabled and eligible for disability income benefits. This provision recognizes the potential impact on the donor's health and ability to work after organ donation, providing financial support during the recovery period.

The correct answer is 60. The social security blackout period refers to the period of time after the death of a spouse when the surviving spouse is not eligible to receive social security benefits. This blackout period typically ends when the surviving spouse reaches the age of 60. At this age, the surviving spouse becomes eligible to receive survivor benefits based on their deceased spouse's social security earnings record.