A Life And Health Trivia Quiz!

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1. All of the following are used in underwriting for health insurance, except:

Explanation

When underwriting for health insurance, various factors are considered to assess the risk and determine the premiums. These factors typically include income, sex, and age as they can provide insights into an individual's health risks and potential healthcare needs. However, intelligence is not a relevant factor in underwriting for health insurance as it does not directly impact a person's health or their likelihood of requiring medical treatment.

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About This Quiz
A Life And Health Trivia Quiz! - Quiz

Here we go with another Life and Health trivia quiz. Life on earth goes hand in hand with a healthy lifestyle, and there are different ways of achieving... see morethis. All living things depend on each other for survival, and this forms a basis for the life and health class. This is the sixth practice exam in preparation for the main exam. Take it up and keep an eye out for the seventh one.
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2. During the disability elimination period:

Explanation

During the disability elimination period, no benefits are payable. This period is a waiting period before the insurance policy starts providing benefits. It is typically the initial period of disability where the insured individual must wait before receiving any benefits. This waiting period allows the insurance company to verify the disability and ensure that it meets the policy's criteria for benefits. Therefore, during this period, no benefits are payable to the insured individual.

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3. An agent acting as an insurance agent, broker, solicitor, life agent, or bail agent acts in which capacity when handling premiums or return premiums for an insured?

Explanation

An agent acting as an insurance agent, broker, solicitor, life agent, or bail agent acts in the capacity of a fiduciary when handling premiums or return premiums for an insured. A fiduciary is a person who is entrusted with the responsibility to act in the best interest of another party. In this case, the agent is entrusted with handling the funds of the insured, and therefore, has a legal and ethical duty to act in the insured's best interest. This includes ensuring that the premiums are handled properly and returned if necessary.

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4. What is it called when an insurer uses higher rates based solely on religion, race, or ethnic group?

Explanation

Unfair discrimination is the correct answer because it refers to the practice of an insurer using higher rates based solely on religion, race, or ethnic group. This practice is considered unfair as it violates the principles of equality and fairness, and it is illegal in many jurisdictions. It is important for insurers to assess risk based on relevant factors such as individual characteristics and behavior, rather than discriminatory factors like religion, race, or ethnicity.

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5. To authorize the release of an attending physician's report, the applicant must:

Explanation

To authorize the release of an attending physician's report, the applicant is required to sign a consent form. This form serves as a legal document granting permission for the release of the report to the relevant parties. By signing the consent form, the applicant acknowledges their understanding and agreement to allow the physician to disclose their medical information. This ensures that the release of the report is done in compliance with privacy laws and regulations.

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6. If no other method of payment is selected, which of the following is the automatic mode of settlement for life insurance proceeds?

Explanation

The automatic mode of settlement for life insurance proceeds, if no other method of payment is selected, is a lump-sum settlement in cash. This means that the beneficiary will receive the entire amount of the life insurance proceeds in a single payment, rather than receiving it in installments or through other methods such as extended term insurance, life income, or a paid-up policy.

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7. A supplemental insurance policy that pays a set amount for each day that an individual is hospitalized is known as:

Explanation

A supplemental insurance policy that pays a set amount for each day that an individual is hospitalized is known as a hospital confinement indemnity. This type of policy provides additional coverage specifically for hospital stays, offering financial assistance to cover the costs associated with being hospitalized. It is designed to provide a fixed daily benefit to the policyholder during their hospital confinement, regardless of other medical expenses or treatments.

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8. Yearly probabilities of death are shown in:

Explanation

Mortality tables provide yearly probabilities of death for different age groups. These tables are used by insurance companies to calculate premiums and assess the risk of insuring individuals. They provide valuable information on the likelihood of death at different ages, which is essential for determining life insurance rates and payouts. Morbidity tables, on the other hand, focus on the probability of illness or disability rather than death. Policy illustrations and summaries are documents that provide an overview of the terms and conditions of an insurance policy, but they do not contain specific mortality data.

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9. A commonly used cost containment measure for emergency hospital care under a major medical expense plan is:

Explanation

A deductible is a commonly used cost containment measure for emergency hospital care under a major medical expense plan. It refers to the amount of money that the insured individual must pay out of pocket before the insurance coverage kicks in. By having a deductible, it helps to reduce the overall cost of healthcare by shifting a portion of the financial responsibility onto the insured individual. This encourages individuals to be more mindful of their healthcare expenses and helps to control unnecessary utilization of emergency hospital care.

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10. A measure for rating an individuals need for long term care benefits is called:

Explanation

Activities of daily living (ADLs) refer to the basic self-care tasks that individuals need to perform on a daily basis, such as bathing, dressing, eating, toileting, transferring, and continence. The ability to perform these activities is often used as a measure to determine an individual's need for long-term care benefits. If someone is unable to perform one or more ADLs independently, they may require assistance or support, which could indicate a need for long-term care services. Therefore, ADLs serve as a measure for rating an individual's need for long-term care benefits.

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11. Which type of insurance policy provides a death benefit that matches the projected outstanding debt on an individual's home?

Explanation

Mortgage protection insurance is a type of insurance policy that provides a death benefit that matches the projected outstanding debt on an individual's home. This means that if the insured person passes away, the insurance policy will pay off the remaining mortgage balance, ensuring that the individual's family does not have to worry about the financial burden of the mortgage. This type of insurance is specifically designed to protect the family's home in the event of the insured person's death.

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12. After a life insurance policy has been in effect for two years, what prevents it from being rescinded by the insurer?

Explanation

The incontestability clause prevents a life insurance policy from being rescinded by the insurer after it has been in effect for two years. This clause states that the insurer cannot dispute the validity of the policy or void it based on any misrepresentations made by the insured during the application process. Essentially, it provides a safeguard for the policyholder, ensuring that the insurance company cannot revoke the policy after the initial two-year period has passed.

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13. Which risk classification carries the lowest premium?

Explanation

Preferred carries the lowest premium because it represents the lowest level of risk for the insurance company. Preferred individuals are considered to be in good health and have a low likelihood of making a claim. Therefore, the insurance company charges them a lower premium compared to other risk classifications such as Standard, Substandard, or Endowed, which indicate higher levels of risk and potential for claims.

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14. According to state law, what size print must be used for the licensee's license number on all price quotes, business cards, and printed material?

Explanation

According to state law, the licensee's license number must be printed in the same size as their phone number, fax number, or address. This means that the license number should not be larger or smaller than any other contact information on the material.

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15. The CA Insurance Code states that policies or certificates may be called comprehensive long term care insurance if they provide benefits for:

Explanation

The correct answer is Institutional (nursing facilities) and home care. According to the CA Insurance Code, policies or certificates can be called comprehensive long term care insurance if they provide benefits for both institutional care (nursing facilities) and home care. This means that the insurance coverage includes both types of care settings, allowing individuals to receive care either in a nursing facility or in their own homes.

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16. Traditional comprehensive major medical plans include all of the following, except:

Explanation

Traditional comprehensive major medical plans include deductibles, co-insurance, and out-of-pocket maximums. These features require the policyholder to pay a certain amount of expenses before the insurance coverage kicks in, share a percentage of costs with the insurance company, and limit the maximum amount the policyholder has to pay out of pocket, respectively. However, first-dollar coverage is not included in these plans. First-dollar coverage means that the insurance starts paying for medical expenses from the first dollar spent, without any deductibles or co-insurance requirements. Therefore, it is not a part of traditional comprehensive major medical plans.

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17. A provision stating that health insureds and their insurers will share covered losses in an agreed proportion is called:

Explanation

Co-insurance is a provision in health insurance where the insured individual and the insurance company share the covered losses in an agreed proportion. This means that the insured person is responsible for paying a certain percentage of the covered expenses, while the insurance company covers the remaining portion. Co-insurance helps to distribute the financial risk between the insured individual and the insurer, ensuring that both parties contribute to the cost of healthcare services.

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18. The process whereby a mutual insurer becomes a stock company is called:

Explanation

Demutualization is the process by which a mutual insurer converts itself into a stock company. This involves the transformation of the company's ownership structure from being owned by policyholders to being owned by shareholders. Through demutualization, the company's policyholders receive shares in the newly formed stock company, allowing them to become shareholders and potentially benefit from any future profits. This process is often undertaken to increase the company's access to capital markets and improve its ability to compete in the industry.

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19. Which life insurance classification carries the highest premium?

Explanation

Substandard life insurance classification carries the highest premium because it is offered to individuals who pose a higher risk to the insurance company due to their health conditions, lifestyle choices, or occupation. These individuals may have pre-existing medical conditions, engage in risky activities, or have a history of health issues. As a result, the insurance company charges higher premiums to compensate for the increased likelihood of having to pay out a claim.

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20. A group insurance plan is contributory when the:

Explanation

In a contributory group insurance plan, the employee is required to pay a portion of the premium. This means that the cost of the insurance coverage is shared between the employer and the employee. The employer may still contribute to the premium, but the employee is responsible for paying a portion as well. This arrangement helps to distribute the financial burden of the insurance coverage and encourages employees to have a stake in their own coverage.

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21. The group medical plan provision that applies when a claimant has coverage under more than one plan is knows as?

Explanation

Coordination of benefits is the group medical plan provision that applies when a claimant has coverage under more than one plan. This provision ensures that the total benefits received by the claimant do not exceed the actual cost of the medical expenses. It helps in determining the primary and secondary payer for the claim, avoiding duplicate payments, and ensuring fair distribution of benefits among multiple insurance plans.

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22. After the deductible is paid, what percentage of the balance of approved charges does Medicare Part B pay?

Explanation

Medicare Part B pays 80% of the balance of approved charges after the deductible is paid. This means that once the deductible is met, Medicare will cover 80% of the remaining approved charges, while the individual is responsible for the remaining 20%.

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23. Whose benefits are affected by the blackout period?

Explanation

The blackout period refers to the period of time after the death of a fully insured worker when the surviving spouse is not yet eligible to receive Social Security benefits. During this period, the surviving spouse's benefits are affected as they are not able to receive any financial support from Social Security. Therefore, the correct answer is the surviving spouse.

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24. What do we call the process whereby insurer's decide which customers to insure, and what coverage to offer?

Explanation

Underwriting is the process where insurers assess and evaluate the risks associated with potential customers. It involves determining whether to provide insurance coverage to a customer and what specific coverage to offer. This process helps insurers make informed decisions about which customers to insure based on their risk profiles and helps them set appropriate premiums and terms for the coverage provided.

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25. To meet the chronically ill trigger of a long term care policy, an individual must be unable to perform a minimum of:

Explanation

To meet the chronically ill trigger of a long term care policy, an individual must be unable to perform a minimum of two activities of daily living. This means that the person must have significant difficulty or require assistance with at least two basic tasks such as bathing, dressing, eating, transferring, toileting, or continence. This requirement ensures that the individual has a substantial need for long term care services and assistance.

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26. A life insurance application is important for all of the following reasons, except:

Explanation

The correct answer is that the beneficiary must sign the application before the insurer will issue the policy. This is because the beneficiary's signature is not a requirement for the issuance of a life insurance policy. The application is important for all the other reasons mentioned, such as requiring truthful statements, containing essential information about the applicant, and becoming a part of the policy if a copy is attached.

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27. When must insurance records for insurance agents and insurance brokers be made available to the insurance commissioner?

Explanation

Insurance records for insurance agents and insurance brokers must be made available to the insurance commissioner at all times. This means that the records should be accessible and ready for inspection whenever the commissioner requires them, without any specific time limit or condition. This ensures transparency and accountability in the insurance industry, allowing the commissioner to monitor and regulate the activities of agents and brokers effectively.

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28. Which statement best describes a life insurance policy dividend?

Explanation

A life insurance policy dividend is the distribution of excess funds accumulated by the insurer on participating policies. This means that when the insurance company collects more premiums than necessary to cover claims and expenses, they distribute the excess funds back to the policyholders who have a participating policy. This is different from a non-participating policy, where the policyholder does not receive a dividend. Therefore, the statement that best describes a life insurance policy dividend is that it is the distribution of excess funds accumulated by the insurer on participating policies.

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29. After the deductible, what portion does a patient pay for covered expenses under Medicare Part B?

Explanation

After the deductible, a patient is responsible for paying 20% of the covered expenses under Medicare Part B. This means that Medicare will cover 80% of the costs, while the patient will be responsible for the remaining 20%. This system helps to ensure that patients have some financial responsibility for their healthcare expenses while still providing them with a significant amount of coverage.

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30. The initial requirements for a licensed agent to sell long term care insurance includes training in all of the following area, except:

Explanation

The initial requirements for a licensed agent to sell long term care insurance include training in all of the following areas except financial planning. This means that financial planning is not a mandatory area of training for agents selling long term care insurance. The other areas mentioned, such as available long term care services and facilities, California regulations, and alternatives to the purchase of long term care insurance, are all important aspects that agents must be knowledgeable about in order to sell long term care insurance effectively.

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31. All of the following statements about social security disability benefits are true, except:

Explanation

Social security disability benefits are not designed to replace the entire amount of the worker's earnings. Instead, they are calculated based on the worker's earnings up to the time of disability. The amount of benefits received may be less than the worker's previous earnings.

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32. The request for an attending physician's report must be accompanied by a copy of the:

Explanation

When requesting an attending physician's report, it is necessary to include a signed authorization. This authorization allows the insurance company to access the individual's medical records and obtain the necessary information from the attending physician. Without a signed authorization, the insurance company would not have the legal permission to request and obtain the required medical information. Therefore, a signed authorization is a crucial document that must accompany the request for an attending physician's report.

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33. Which of the following functions is best defined as an insurance company's identifying and selling to potential customers?

Explanation

Marketing is the best defined function as an insurance company's identifying and selling to potential customers. Marketing involves activities such as market research, advertising, and promotion, which are aimed at identifying potential customers and persuading them to purchase insurance products. It focuses on creating brand awareness, developing marketing strategies, and implementing tactics to attract and retain customers. Marketing plays a crucial role in understanding customer needs, positioning insurance products, and effectively communicating their value to potential customers.

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34. Long term care policies can be replaced for all of the following reasons, except:

Explanation

Long term care policies can be replaced for various reasons, such as if the new policy has a lower premium or greater benefits. Additionally, if the insured's condition has significantly improved, they may choose to replace their policy. However, the given answer states that the new policy has fewer benefits and a higher premium, which is not a valid reason for replacing a long term care policy.

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35. Health maintenance organizations (HMOs) are required to provide for all of the following services, except:

Explanation

HMOs are required to provide prescription drugs, emergency services, preventive services, and physician services. Therefore, the correct answer is prescription drugs, as they are not typically covered by HMO plans.

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36. What is required when an applicant reveals conditions that require more information?

Explanation

When an applicant reveals conditions that require more information, a physical examination is required. This is because a physical examination allows a healthcare professional to assess the applicant's overall health and determine if there are any underlying medical conditions that may affect their eligibility or coverage. By conducting a physical examination, the insurer can gather additional information to make an informed decision about the applicant's insurability and potential risk factors.

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37. If a person was in violation of Section 770 of the CA Insurance Code, what action would the insurance Commissioner most likely take if the violation dealt with loans on the security of real or personal property?

Explanation

If a person is in violation of Section 770 of the CA Insurance Code, the insurance Commissioner would most likely issue a cease and desist order for a violation of more than one transaction. This means that the violator would be ordered to stop engaging in the illegal activity of making loans on the security of real or personal property. This action is taken to prevent further violations and protect the interests of consumers.

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38. Which coverage is available at no cost to persons at age 65?

Explanation

Medicare Part A is available at no cost to persons at age 65. Medicare Part A is the hospital insurance portion of Medicare, which covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care services. While Medicare Part B and Social Security retirement benefits are also available to persons at age 65, they may come with costs such as monthly premiums. Long term care insurance is a separate insurance policy that individuals can purchase to cover long-term care services, but it is not available at no cost.

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39. Under a disability income insurance policy with an "own occupation" clause, an employee who can no longer perform the tasks of the job held at the time of injury is considered:

Explanation

Under a disability income insurance policy with an "own occupation" clause, an employee who can no longer perform the tasks of the job held at the time of injury is considered "totally disabled." This means that the individual is unable to engage in any gainful employment due to their injury or disability. The "own occupation" clause specifically refers to the inability to perform the tasks of the specific job the individual held at the time of the injury, rather than any job in general. Therefore, the correct answer is "totally disabled."

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40. Which of the following may be offered by insurers providing Medicare supplement insurance?

Explanation

Insurers providing Medicare supplement insurance may offer the core benefit plan without any additional benefits. This means that they would provide coverage for the basic benefits that are not covered by Medicare, such as deductibles, copayments, and coinsurance. However, they would not offer any additional benefits beyond the core coverage. This option may be suitable for individuals who only require basic coverage and do not need any extra benefits.

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41. A policy owner has the right to change all of the following, except:

Explanation

A policy owner has the right to change the beneficiary, the payment mode, and the dividend option. However, the dividend schedule refers to the timing and frequency of dividend payments, which is determined by the insurance company. Therefore, the policy owner does not have the right to change the dividend schedule.

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42. Which optional program is only for individuals age 65 or older?

Explanation

Medicare Part B is the correct answer because it is a program specifically designed for individuals age 65 or older. Medicare Part B provides medical insurance coverage, including doctor visits, outpatient care, and preventive services. It is an optional program that individuals can choose to enroll in, in addition to Medicare Part A, which covers hospital insurance. Long term care insurance is not age-restricted and can be purchased by individuals of any age. Social Security survivor benefits are available to eligible individuals regardless of age.

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43. Members of the Medical information Bureau are required to report:

Explanation

Members of the Medical Information Bureau are required to report medical impairments found during the underwriting process. This means that if a member physician identifies any medical conditions or impairments while evaluating an applicant's eligibility for insurance coverage, they must report this information to the Medical Information Bureau. This reporting helps insurance companies assess the risk associated with insuring individuals with specific medical conditions and make informed decisions about coverage and premiums.

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44. Jean's healthcare provider is a "service provider." This mans:

Explanation

The correct answer is "Her payment for services goes directly to the provider." This means that Jean's healthcare provider is a service provider, and when she receives healthcare services, she directly pays the provider for those services. This implies that the payment is not made to a third party or intermediary, but directly to the healthcare provider.

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45. By adopting a self-funded health plan, an employer will have greater flexibility in all areas of the planning, except:

Explanation

By adopting a self-funded health plan, an employer will have greater flexibility in all areas of the planning, except claims severity. This means that while the employer can have more control and flexibility over the group size, benefits provided, and cost of the plan, they may not have the same level of control over the severity of the claims made by employees. Claims severity refers to the extent or seriousness of the medical conditions or treatments required, and this may be influenced by factors beyond the employer's control, such as the health status and needs of the employees.

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46. Which of the following statements defines partial disability?

Explanation

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47. Social Security disability benefits are paid to persons expected to die or be disabled at least:

Explanation

Social Security disability benefits are paid to persons who are expected to be disabled for at least 12 months. This means that the individual must have a medical condition that prevents them from working and is expected to last for at least a year or result in death. The 12-month requirement ensures that the benefits are provided to individuals with long-term disabilities, rather than those with short-term or temporary conditions.

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48. The price of insurance for each exposure unit is called the:

Explanation

The price of insurance for each exposure unit is called the rate. This rate is determined based on various factors such as the level of risk associated with the exposure unit and the coverage provided by the insurance policy. It represents the cost of the insurance coverage for a specific unit of exposure, such as a person or property. The rate is typically calculated by insurance companies to ensure that they are charging an appropriate amount to cover potential claims and expenses.

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49. Which of the following is the best definition of premium?

Explanation

Premium is the money that the insured pays the insurer to obtain the benefits mentioned in the policy. This payment is made regularly, usually on a monthly or yearly basis, and is based on the coverage amount and the risk factors associated with the insured. It is essentially the cost of insurance coverage that the policyholder must pay to maintain their policy and receive the promised benefits in case of a covered event or loss.

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50. What must a life agent do in order to be able to sell 24-hour care coverage?

Explanation

Life agents are already authorized to sell 24-hour care coverage with a life license. This means they do not need to complete any additional courses or applications to sell this type of coverage.

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51. An agent must submit all of the following to the insurer, except:

Explanation

The agent must submit all of the listed items to the insurer except for a copy of all printed communications used for the presentation. This means that the agent is required to provide a copy of the signed replacement notice, a statement signed by the applicant regarding replacement of existing life insurance, and a signed statement indicating if the agent knows a replacement is involved in the transaction. The omission of the copy of printed communications suggests that the insurer does not require this specific documentation for their records.

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52. Which statement is true regarding participating in a group health insurance plan?

Explanation

A non-contributory group health plan must cover all eligible members means that every eligible member of the group must be included in the plan without having to pay any premiums or contributions. This type of plan is fully funded by the employer or the group sponsor, and the members do not have to make any financial contributions towards the coverage.

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53. When referring to an insurance contract, when must a representation be made?

Explanation

In the context of an insurance contract, a representation must be made either at the time of or before policy issuance. This means that the representation can be made during the application process when applying for the insurance policy, or it can be made after the policy has been issued but before it takes effect. In both cases, the insured individual is required to provide accurate and truthful information about themselves and the subject matter of the insurance policy. The representation helps the insurer assess the risk and determine the terms and conditions of the policy.

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54. Under disability income insurance, bodily injury must meet the following criteria to be classified as accidental:

Explanation

In disability income insurance, the cause of the bodily injury may be intentional, meaning it was done on purpose, but the result of the injury must be accidental. This means that even if someone intentionally caused the injury, as long as the result of the injury was accidental, it would still be classified as accidental under the insurance policy.

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55. Any situation that presents the possibility of a loss is known as:

Explanation

A loss exposure refers to any situation that presents the possibility of a loss. This could include events such as accidents, natural disasters, or financial downturns that could result in financial or other types of losses. By identifying and assessing these potential risks, individuals or organizations can take appropriate measures to mitigate or manage them effectively.

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56. What is the difference between a conditional premium receipt and a binding premium receipt?

Explanation

A binding premium receipt is the only type of receipt that guarantees insurance coverage from the date the receipt is given. This means that even if the applicant is not insurable, they will still have coverage under the binding receipt. On the other hand, a conditional premium receipt requires the applicant to be insurable in order to have coverage. Therefore, the difference between the two is that a binding receipt always provides insurance from the date of receipt, while a conditional receipt depends on the insurability of the applicant.

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57. If an insurer pays an insured $25,000 in lost wages, $45,000 for physicians visits and hospital costs, and $15,000 for physical therapy treatments, and later discovers that the claim was fraudulent, the insured may be fined as much as:

Explanation

If an insurer pays an insured $25,000 in lost wages, $45,000 for physicians visits and hospital costs, and $15,000 for physical therapy treatments, and later discovers that the claim was fraudulent, the insured may be fined as much as $170,000. This is because the insured received a total of $85,000 in fraudulent payments ($25,000 + $45,000 + $15,000), and the fine for fraudulent claims is typically equal to double the amount received. Therefore, the insured may be fined $170,000, which is double the fraudulent payments received.

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58. Which settlement option allows only the death benefit earnings to be paid to the beneficiary?

Explanation

The interest option allows only the death benefit earnings to be paid to the beneficiary. This means that the beneficiary will receive the interest earned on the death benefit amount, but not the principal amount itself. This option is often chosen by individuals who want to ensure a steady stream of income for their beneficiaries without depleting the principal amount.

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59. According to Employee Retirement Income Security Act of 1974 (ERISA) fiduciary standards, benefit plans are operated for:

Explanation

The correct answer is plan participants and beneficiaries. According to the Employee Retirement Income Security Act of 1974 (ERISA) fiduciary standards, benefit plans are operated for the benefit of the plan participants and beneficiaries. This means that the fiduciaries of the plan have a legal duty to act in the best interests of the participants and beneficiaries, ensuring that the plan is managed and administered in a way that maximizes their benefits and protects their rights. The plan sponsors and employees may also benefit from the plan, but the primary focus is on the participants and beneficiaries.

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60. Life insurance settlement options include all of the following, except:

Explanation

The extended term option is not a life insurance settlement option. This option allows the policyholder to use the cash value of the policy to purchase a term insurance policy with the same death benefit as the original policy. The other options mentioned, such as the interest option, fixed amount option, and fixed period option, are all valid settlement options that allow the policyholder to receive the policy's cash value in different ways.

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61. Who are members of the Medical Information Bureau?

Explanation

The Medical Information Bureau (MIB) is a specialized organization that collects and maintains medical information on individuals. This information is primarily used by life insurance companies to assess the risk associated with insuring an individual. Therefore, the members of the MIB are life insurance companies who have access to the information stored in the database. Physicians, hospitals, and health insurance companies are not members of the MIB as they do not have direct access to the information or utilize it for insurance purposes.

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62. Which of the following is not an option for the use of the policy dividends?

Explanation

The policy dividends cannot be used to fund the addition of monthly income payments. Policy dividends are typically used to purchase additional insurance coverage or reduce premiums. Monthly income payments are not typically considered as an option for the use of policy dividends.

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63. A self-insured group qualifies for stop-loss coverage after claims:

Explanation

The correct answer is "Exceed a specified limit in a set period of time." This means that a self-insured group becomes eligible for stop-loss coverage when their claims go beyond a predetermined threshold within a specific time frame. Stop-loss coverage is designed to protect self-insured groups from catastrophic losses by reimbursing them for claims that exceed a certain limit. Once the claims surpass this limit within the specified time period, the group can then avail the additional coverage provided by stop-loss insurance.

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64. Which non-forfeiture option uses cash surrender values to purchase paid-up term insurance for the full face amount of the policy?

Explanation

Extended term insurance is a non-forfeiture option that uses the cash surrender values of a policy to purchase paid-up term insurance for the full face amount of the policy. This means that the policyholder can use the accumulated cash value to continue the coverage without paying additional premiums, but instead, the policy is converted into a term insurance policy for the same face amount. This option allows the policyholder to maintain coverage while utilizing the cash value of the policy.

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65. With Medicare coverage:

Explanation

Part B provides benefits for diagnostic tests and x-rays performed on an out-patient basis. This means that individuals covered by Medicare can receive coverage for these types of medical procedures without being admitted to a hospital or other in-patient facility. Part B coverage is specifically designed to provide outpatient services, including diagnostic tests and x-rays, which can be crucial for diagnosing and monitoring various medical conditions. This coverage is separate from Part A, which focuses on in-patient hospital care.

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66. All of the following are features of a preferred provider organization (PPO), except:

Explanation

A preferred provider organization (PPO) is a type of healthcare plan that allows individuals to choose their healthcare providers from a network of preferred providers. The providers are paid on a fee-for-service basis, meaning they are paid for each service they provide. Employees have the freedom to choose their practitioners without the need for referrals. However, in a PPO, primary care physicians do not act as gatekeepers. This means that individuals do not need to obtain a referral from their primary care physician in order to see a specialist.

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67. What rule is used to determine the importance of a representation?

Explanation

The rule used to determine the importance of a representation is the materiality of concealment. This means that if information is intentionally hidden or concealed, and if that information is important or material to the decision-making process, it can affect the validity of the representation.

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68. Frank and Ernest are 25 year old identical twins. They are both in excellent health. Both buy life policies that have $500 annual premiums. Frank buys a 5-year renewable term policy. Ernest buys a whole life policy. Which statement is no true ?

Explanation

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69. In a reinsurance agreement, the insurance company that transfers its loss exposure to another insurer is called:

Explanation

In a reinsurance agreement, the insurance company that transfers its loss exposure to another insurer is called the primary insurer. This is because the primary insurer is the original insurance company that underwrites the policy and assumes the risk of loss. By transferring its loss exposure to a reinsurer, the primary insurer can limit its potential losses and protect its financial stability. The reinsurer, on the other hand, assumes a portion of the risk and provides financial support to the primary insurer in exchange for a premium.

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70. All of the following statements about the gatekeeper system are true, except:

Explanation

The gatekeeper system is a common feature of Health Maintenance Organization (HMO) plans, where insured individuals are required to choose a primary care physician (PCP) as their gatekeeper. The PCP authorizes and coordinates all medical care, including referrals to specialists when necessary. This system ensures that insured individuals must seek initial care through their PCP, who plays a central role in managing their healthcare. Specialists themselves do not typically serve as gatekeepers in this system.

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  • Oct 06, 2023
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  • Jan 29, 2010
    Quiz Created by
    Pchinna
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All of the following are used in underwriting for health insurance,...
During the disability elimination period:
An agent acting as an insurance agent, broker, solicitor, life agent,...
What is it called when an insurer uses higher rates based solely on...
To authorize the release of an attending physician's report, the...
If no other method of payment is selected, which of the following is...
A supplemental insurance policy that pays a set amount for each day...
Yearly probabilities of death are shown in:
A commonly used cost containment measure for emergency hospital care...
A measure for rating an individuals need for long term care benefits...
Which type of insurance policy provides a death benefit that matches...
After a life insurance policy has been in effect for two years, what...
Which risk classification carries the lowest premium?
According to state law, what size print must be used for the...
The CA Insurance Code states that policies or certificates may be...
Traditional comprehensive major medical plans include all of the...
A provision stating that health insureds and their insurers will share...
The process whereby a mutual insurer becomes a stock company is...
Which life insurance classification carries the highest premium?
A group insurance plan is contributory when the:
The group medical plan provision that applies when a claimant has...
After the deductible is paid, what percentage of the balance of...
Whose benefits are affected by the blackout period?
What do we call the process whereby insurer's decide which customers...
To meet the chronically ill trigger of a long term care policy, an...
A life insurance application is important for all of the following...
When must insurance records for insurance agents and insurance brokers...
Which statement best describes a life insurance policy dividend?
After the deductible, what portion does a patient pay for covered...
The initial requirements for a licensed agent to sell long term care...
All of the following statements about social security disability...
The request for an attending physician's report must be...
Which of the following functions is best defined as an insurance...
Long term care policies can be replaced for all of the following...
Health maintenance organizations (HMOs) are required to provide for...
What is required when an applicant reveals conditions that require...
If a person was in violation of Section 770 of the CA Insurance Code,...
Which coverage is available at no cost to persons at age 65?
Under a disability income insurance policy with an "own...
Which of the following may be offered by insurers providing Medicare...
A policy owner has the right to change all of the following, except:
Which optional program is only for individuals age 65 or older?
Members of the Medical information Bureau are required to report:
Jean's healthcare provider is a "service provider." This...
By adopting a self-funded health plan, an employer will have greater...
Which of the following statements defines partial disability?
Social Security disability benefits are paid to persons expected to...
The price of insurance for each exposure unit is called the:
Which of the following is the best definition of premium?
What must a life agent do in order to be able to sell 24-hour care...
An agent must submit all of the following to the insurer, except:
Which statement is true regarding participating in a group health...
When referring to an insurance contract, when must a representation be...
Under disability income insurance, bodily injury must meet the...
Any situation that presents the possibility of a loss is known as:
What is the difference between a conditional premium receipt and a...
If an insurer pays an insured $25,000 in lost wages, $45,000 for...
Which settlement option allows only the death benefit earnings to be...
According to Employee Retirement Income Security Act of 1974 (ERISA)...
Life insurance settlement options include all of the following,...
Who are members of the Medical Information Bureau?
Which of the following is not an option for the use of the policy...
A self-insured group qualifies for stop-loss coverage after claims:
Which non-forfeiture option uses cash surrender values to purchase...
With Medicare coverage:
All of the following are features of a preferred provider organization...
What rule is used to determine the importance of a representation?
Frank and Ernest are 25 year old identical twins. They are both in...
In a reinsurance agreement, the insurance company that transfers its...
All of the following statements about the gatekeeper system are true,...
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