Washington Life And Disability Insurance Quiz

The correct answer is that collecting any sum as premium for insurance and then not providing insurance, collecting any sum as premium for insurance in excess of the actual amount, and knowingly failing to return to the person, within a reasonable length of time, any excess premium collected are all considered illegal dealings in premiums. These practices involve fraudulent actions such as taking money for insurance coverage that is not provided or charging more than the agreed-upon premium amount. Additionally, failing to return any excess premium collected is also illegal as it is a breach of trust and fiduciary duty.

Universal life insurance policies typically offer a guaranteed contract interest rate, which is usually between 3% and 6%. However, there is also the potential for the policyowner to receive a current interest rate, which is not guaranteed in the contract. This means that the policyowner may receive a higher or lower interest rate depending on market conditions or the performance of the insurance company's investments. Therefore, the statement "Universal life guarantees a contract interest rate (usually 3%-6%) there is also potential for policyowner to get a current interest rate which is not guaranteed in contract" is true.

Loss is defined as the reduction, decrease, or disappearance of value of the person or property insured in a policy, caused by a named peril. Insurance provides a means to transfer this loss.

An indexed universal life policy is a type of life insurance policy that offers a cash value component tied to the performance of a specific equity index, such as the S&P 500. This means that the policyholder has the potential to earn higher returns based on the performance of the index, while also having the flexibility to adjust their premium payments and death benefit. Unlike variable life policies, indexed universal life policies do not directly invest in stocks or mutual funds, making them less risky. Therefore, the correct answer is D. Indexed Universal Life Policy.

If an insured does not refund a premium within 30 days of the policy, an additional 10% penalty is added to the premium refund. This penalty serves as a deterrent for insured individuals to delay or avoid refunding their premiums. It encourages timely payment and ensures that the insurance company is compensated for any potential losses or administrative costs incurred due to non-payment.

The Washington Life and Disability Insurance Guaranty Association provides protection to policyowners, insureds, and beneficiaries in the event that an insurance company is unable to fulfill their financial obligations. This means that if an insurer becomes insolvent or unable to pay claims, the association steps in to cover the losses. Therefore, the statement that the association protects policyowners, insureds, and beneficiaries from financial losses caused by insurers who become unable to pay or meet contractual agreements is true.

The correct answer is D. Exclusions. Exclusions are the types of risks that the policy will not cover. These are specific situations or circumstances that are listed in the policy as not being eligible for coverage. The purpose of exclusions is to limit the insurer's liability and prevent them from having to pay out claims for certain types of risks.

Insurable risks involve losses that are outside the insured's control, specified as to the cause, time, place, and amount, and can be estimated in terms of frequency and severity. Insurers need to be reasonably certain that their losses will not exceed specific limits, which is why coverage for catastrophic events like war and nuclear events is usually excluded. Additionally, there must be a large pool of insured individuals that represents a random selection of risks in various aspects such as age, gender, occupation, health, economic status, and geographic location.

In health insurance, the insurer is required to provide the claimant with claims forms within 15 days. This ensures that the claimant has the necessary forms to submit their claim in a timely manner. Providing the forms promptly allows the claimant to start the claims process without delay, ensuring that they can receive the necessary coverage and benefits as soon as possible.

A universal life policy does indeed have two components: the insurance component and the cash account. The insurance component provides coverage for the policyholder and is typically annually renewable term insurance. The cash account, on the other hand, allows the policyholder to accumulate savings and earn interest on those savings. Therefore, the statement is true.

Health carriers that provide coverage for maternity services must allow the attending provider, in consultation with the mother, to decide on the length of inpatient stay. This means that the decision cannot be made solely through contracts or agreements between providers, hospitals, and insurers. The decision must be based on accepted medical practice.

Indexed Universal Life (IUL) is a type of life insurance policy that shares similarities with Variable Universal Life (VUL). Both IUL and VUL offer flexible premiums, meaning the policyholder can adjust the amount they contribute to the policy over time. They also provide an adjustable death benefit, allowing the policyholder to increase or decrease the amount of coverage as needed. Additionally, both policies give the policyowner the ability to decide where the cash value of the policy will be invested. The primary difference between IUL and VUL is the investment component. In IUL, the cash value is tied to a stock market index, while in VUL, the policyholder can choose from a variety of investment options.

The most common exclusions found in life insurance policies are related to aviation, hazardous occupations or hobbies, war or military service, and suicide. Life insurance typically covers individuals as passengers or pilots on regularly scheduled airlines, but may exclude coverage for noncommercial pilots or require an additional premium. If the insured has a hazardous job or engages in hazardous hobbies, death resulting from these activities may be excluded or require a higher premium. While most life insurance policies do not exclude military service, there are limitations on the death benefit if the insured dies as a result of war or while serving in the military. Suicide provisions protect insurers by stipulating a period of time during which the death benefit will not be paid if the insured commits suicide, with the beneficiary entitled to a refund of premiums. After this stipulated period, the entire death benefit will be paid in the event of suicide.

The explanation for the given correct answer is that if a renewal premium is not paid within the given time, the policy can still be reinstated if the insurer or an authorized insurance producer accepts the premium without requiring an application for reinstatement. However, if an application is required and a conditional receipt is issued, the policy will be reinstated upon approval of the application by the insurer or, if not approved, after 45 days from the date of the conditional receipt. The reinstated policy will only cover loss resulting from accidental injury after the date of reinstatement and loss due to sickness starting more than ten days after that date.

The Commissioner may order a replacement of policies improperly issued with an unauthorized insurer to an authorized insurer. This means that if policies were issued by an unauthorized insurer, the Commissioner has the authority to order those policies to be replaced with policies from an authorized insurer. This ensures that policyholders are protected and that they are covered by a reputable and authorized insurance company.

Juvenile life insurance is a type of life insurance that is specifically designed to cover the life of a minor. It provides financial protection for the child's future and can help cover expenses such as education or medical costs. This type of insurance is typically purchased by parents or legal guardians to ensure that their child is financially secure in the event of their death.

The provision that stipulates that the policy and a copy of the application, along with any riders or amendments, constitute the entire contract means that all the terms and conditions of the insurance agreement are contained within these documents. It also states that no statements made before the contract can be used to alter the contract after it is written. This provision ensures that both the insurer and the insured cannot make any changes to the contract unless both parties agree.

The statement is true because it states that notice of claim must be given to the insurer within twenty days after the occurrence or commencement of any loss covered by the policy, or as soon thereafter as is reasonably possible. It also states that notice given by or on behalf of the insured or the beneficiary to the insurer at the designated location or to any authorized agent of the insurer shall be deemed notice to the insurer.

The given statement is true. According to the policy, if the insurer does not provide the claimant with the necessary claim forms within fifteen days of receiving the notice of claim, the claimant is considered to have fulfilled the requirement for proof of loss by submitting written proof within the time specified in the policy. This means that the claimant does not need to wait for the forms and can proceed with providing the necessary information to support their claim.

The correct answer is that associations must have been actively in existence for at least one year, have a constitution and bylaws, be organized and maintained for purposes other than obtaining insurance, and be deemed to be the policy holder. This means that in order for an association to qualify for policies issued to insure only association members, it must meet all of these criteria.

Variable premiums are a type of investment in which the policyholder can choose to allocate their premium payments towards investment options offered by the insurance company. These investment options are typically similar to mutual funds and are referred to as accumulation units. By purchasing these accumulation units, the policyholder is essentially buying shares in a mutual fund-like investment vehicle. Therefore, the statement that variable premiums purchase accumulation units which is similar to buying shares in a mutual fund is true.

The statement is true because it states that the coverage for the newly born child must be no less than the coverage of the child's mother for no less than three weeks, even if there are separate hospital admissions. This means that regardless of whether the mother and child are admitted to separate hospitals, the coverage for the child cannot be less than the mother's coverage for a minimum of three weeks.

When a primary care provider's contract is terminated without cause by the plan or subcontractor, the carrier is required to cover their services for at least 60 days after receiving notice of termination. This allows the patients who were receiving care from that provider to have sufficient time to find a new primary care provider and transition their care smoothly.

Stock companies in general insurance are indeed owned by stockholders who provide the capital needed to establish and run the insurance company. These stockholders also share in any profits or losses that the company may experience. The officers of the company are elected by the stockholders and are responsible for managing the operations of the stock insurance company. Additionally, stock companies typically issue nonparticipating policies, meaning that policyholders do not participate in the profits or losses of the company. Therefore, the statement "True" accurately reflects the given information.

The correct answer is "Waiver of Premium". This benefit allows the insured, when disabled, to stop paying the premiums once they qualify for benefits. During the elimination period, the premiums are usually refunded to the insured. The Waiver of Premium feature is typically included in the policy to provide financial relief to the insured during a period of disability.

The given statement is true. According to the policy, written proof of loss must be provided to the insurer within ninety days after the termination of the period for which the insurer is liable or within ninety days after the date of the loss. However, if it was not reasonably possible to provide proof within that time, the claim will not be invalidated or reduced as long as the proof is furnished as soon as reasonably possible, but no later than one year from the time proof is otherwise required.

Flexible Premium Policies allow the policyowner to pay more or less than planned premiums. This means that the policyowner has the flexibility to adjust the amount of premiums they pay, either increasing or decreasing it based on their financial situation or preferences. This allows for greater flexibility and control over the policy and its associated costs.

An "enrolled participant" refers to a person or group of persons who have entered into a contractual arrangement or on whose behalf a contractual arrangement has been entered into with a health care service contractor to receive health care services. This means that they have a formal agreement with a health care service contractor to receive medical services. This option accurately describes the definition of an enrolled participant.

The term "preexisting condition" refers to any medical condition, illness, or injury that already existed before the effective date of coverage. This means that if a person has a health issue before obtaining health insurance, it may be considered a preexisting condition and could have an impact on their coverage or eligibility for certain benefits. This definition is in line with the commonly understood meaning of the term.

Health Savings Accounts (HSAs) are designed to help individuals save for qualified health expenses that they, their spouse, or other dependents incur. An individual who is covered by a high-deductible health plan can make a tax-deductible contribution to an HSA and use it to pay for out-of-pocket medical expenses. HSAs feature tax deferred growth and enable the insured to pay for medical expenses with pre-tax income. Excess funds can be carried over to the next year.

Under the supervision of the Commissioner, the Guaranty Association maintains two accounts: the general account and the securities account. This statement is false because the Guaranty Association does not maintain these accounts.

Adjustable Life is the correct answer because it is a type of life insurance policy that allows the insured to adjust the coverage amount and premium payments as their needs change. This flexibility makes it suitable for individuals who want the ability to modify their policy according to their evolving financial situation. Universal Life and Variable Life are other types of life insurance policies, but they do not offer the same level of adjustability as Adjustable Life. Survivorship is a type of life insurance policy that covers two individuals and pays out the death benefit upon the death of the last surviving person.

An annuity is a contract that provides income for a specified period of years or for life. Unlike life insurance, which provides a death benefit to beneficiaries upon the insured's death, an annuity focuses on providing a steady stream of income. Annuities are often used as a retirement savings tool, allowing individuals to contribute funds over time and then receive regular payments in the future. They can provide financial security and stability during retirement years.

Medicare Part C, also known as Medicare Advantage, is the correct answer. This option is the only one that matches the description provided in the question. Medicare Part C plans cover all services covered under original Medicare except hospice care and some care in qualifying clinical research studies. Additionally, Medicare Part C plans may offer extra coverage such as vision, hearing, dental, and other health and wellness programs. To be eligible for Medicare Part C, beneficiaries must be enrolled in both Medicare Part A and B.

Provisions are characteristics of an insurance contract that are fairly universal with different policies. Provisions are the specific terms and conditions that outline the rights and obligations of both the insurance company and the policyholder. These provisions include details about coverage limits, exclusions, premiums, and other important terms of the insurance contract. While riders and options may also be included in an insurance contract, provisions are the fundamental and essential elements that define the contract itself.

A variable life policy allows policyholders to invest their premiums into various investment funds, such as stocks, bonds, or money market funds. The cash value of the policy is directly linked to the performance of these investment funds. On the other hand, an indexed life policy's cash value is dependent on the performance of an equity index, such as the S&P 500. Therefore, the statement that a variable life policy's cash value is dependent on the performance of 1 or more investment funds and an indexed life policy's cash value is dependent on the performance of an equity index is true.

Group long-term care insurance refers to a policy or contract that is provided to either one or more employers, labor organizations, or a trust or the trustees of a fund established by employers or labor organizations for current or former employees or members. It can also be issued to a professional, trade, or occupational association for its members or former/retired members. Therefore, the correct answer is C, as it includes both scenarios mentioned in options A and B.

The correct answer is Cost of Living Adjustments (COLA). This rider will help protect against inflation by automatically increasing the insured's monthly benefit once claim payments have begun. The first increase would typically occur at the end of the first year, followed by annual increases for as long as the insured remains on the claim. COLA ensures that the insured's benefits keep pace with the rising cost of living, providing them with a higher benefit amount to account for inflation. This helps maintain the purchasing power of the benefit over time.

Title insurance agents and surplus lines brokers are not considered producers. Producers refer to individuals or entities that are licensed to sell insurance policies. While title insurance agents and surplus lines brokers are involved in the insurance industry, they have specific roles that differ from traditional producers. Title insurance agents specialize in providing insurance for property titles, while surplus lines brokers handle insurance for high-risk or hard-to-place risks. Therefore, the correct answer is False.

A nonparticipating (stock) policy is a type of insurance policy that does not pay dividends to policyholders. Instead, any taxable dividends generated by the policy are paid to the stockholders of the insurance company. This means that policyholders do not receive any additional financial benefits beyond the coverage provided by the policy itself. Therefore, the statement "A nonparticipating (stock) policy does not pay dividends to policyowners; however taxable dividends are paid to stockholders" is true.

The correct answer is "accumulation period." This is the period of time during which the owner of an annuity makes payments, or premiums, into the annuity. It is also the period of time in which these payments earn interest on a tax-deferred basis. During the accumulation period, the funds in the annuity are growing and accumulating. Once the accumulation period ends, the annuity enters the annuitization period, where the accumulated funds are converted into a stream of income payments.

Irrevocable beneficiaries must give their written consent to be changed.

Before the sale of a policy, both the insured and the agent must sign the disclosures. This ensures that both parties are aware of the terms and conditions of the policy and have agreed to them. The agent plays a crucial role in facilitating the sale of the policy and is responsible for providing the necessary information and obtaining the required signatures.

Riders are additional provisions that are added to a policy to modify existing provisions. These additional provisions can enhance or alter the coverage provided by the policy. By adding riders, policyholders can customize their policies to better suit their individual needs and preferences. Riders can address specific concerns or provide additional benefits, allowing policyholders to tailor their coverage to their unique circumstances.

An insurance contract is an agreement between the policyowner and an insurer. The policyowner is the person who owns the insurance policy, while the insurer is the company that provides the insurance coverage. This agreement outlines the terms and conditions of the insurance policy, including the coverage provided, the premium to be paid, and any exclusions or limitations. The insurer agrees to provide the specified coverage in exchange for the policyowner paying the premium.

Mutual companies are owned by the policyowners and issue participating policies. This means that policyowners have ownership rights and are entitled to dividends. Dividends are a return of excess premiums and are nontaxable. They are generated when the premiums and earnings combined exceed the actual costs of providing coverage, creating a surplus. However, it is important to note that dividends are not guaranteed. Therefore, the statement "Mutual companies are owned by the policyowners and issue participating policies" is true.

Premium payments for personally owned health insurance are typically not tax deductible, meaning that individuals cannot deduct the cost of their premiums from their taxable income. However, the benefits received from personally owned health insurance are generally tax-free. This means that when individuals receive benefits from their health insurance policy, they do not have to pay taxes on those benefits. Therefore, the statement that personally owned health insurance premium payments are nondeductible and benefits are received tax-free is true.

The statement is true because cash and death benefits are not guaranteed in indexed universal life insurance. Additionally, indexed universal life insurance does not require a license to sell, while variable life insurance does. Therefore, the correct answer is true.

The statement is true because the Commissioner has defined it as an unfair practice for an insurer to conduct business under a name other than its legal name. This is important because if consumers are not aware of the insurer's legal name, it can compromise their policy rights and legal rights. It also causes unnecessary waste of the Commissioner's resources and delays the inquiry and resolution when consumers seek assistance without knowing the insurer's legal name, which can potentially harm the consumer. Therefore, the statement is true.

Producer's do not have to power to change anything in the contract, or to waive any of its provisions.

Title insurance agents and surplus lines brokers are not considered producers because they do not produce or create insurance policies. Instead, they act as intermediaries between the insurance company and the insured party, facilitating the purchase of insurance policies. Producers, on the other hand, are responsible for creating and selling insurance policies directly to customers.

Implied authority refers to the authority that is not explicitly stated in a contract but is assumed to be granted to an agent in order to conduct insurance business on behalf of the principal. This authority is incidental and is derived from express authority, as it is not possible to include every single detail of an agent's authority in a written contract. Therefore, the correct answer is A. Implied Authority.

Options offer insurers and insureds the ability to invest or distribute a sum of money available in the life policy. This means that policyholders have the flexibility to choose how they want to use the funds within their life insurance policy, whether it be investing it or distributing it in some other way. This allows for greater control and customization of the policy to meet the individual needs and preferences of the insured.

The term "issuer" in this context refers to any entity that delivers or issues long-term care insurance policies, contracts, or riders. This includes insurance companies, as they are one of the main providers of insurance products. However, it also includes other entities such as fraternal benefit societies, health care service contractors, and health maintenance organizations, as long as they deliver or issue long-term care insurance.

Nonresidents may qualify for coverage by the Guaranteed Association. This means that individuals who do not reside in a particular area or country can still be eligible for coverage through the Guaranteed Association. This could be due to specific circumstances or criteria set by the association that allows nonresidents to access their coverage.

Coinsurance is an agreement between an insurer and insured in which both parties are expected to pay a certain portion of the potential loss and other expenses. This means that the insured will be responsible for a percentage of the cost of covered services, while the insurer will pay the remaining percentage. Coinsurance helps to share the financial burden between the insurer and insured, ensuring that both parties contribute to the cost of healthcare expenses.

Premium payments made by the employer for health insurance can be deducted as a business expense because it is considered a benefit provided to the employee as part of their compensation package. However, the benefits received by the employee are taxable as income because they are considered a form of compensation. Therefore, the statement that employer-provided health insurance premium payments can be deducted as a business expense and the benefits received by the employee are taxable is true.

The statement is true because policyowners can borrow an amount equal to their cash value. If they take a loan from their policy, any outstanding loans and interest will be deducted from the insured's death benefit upon their death if the loan is not paid back.

In this regulation, the term "legal name" of the insurer refers to the name that is displayed on the Washington state certificate of authority issued by the commissioner. Therefore, the statement that the answer is True is correct.

Transacting insurance without a license is a serious offense that is considered a Class B Felony. This means that it is a felony crime that carries significant penalties, including imprisonment and fines. It is important to have a license to ensure that individuals engaging in insurance transactions have the necessary knowledge and qualifications to protect the interests of the insured parties.

The statement is true because the illegal occupation clause is indeed an optional provision that gives the insurer the right to reject a claim if the insured was engaged in an illegal act or occupation. This clause is included in insurance policies to protect the insurer from having to pay out claims that arise from illegal activities. If the insured is found to be involved in illegal activities at the time of the claim, the insurer can deny coverage based on this clause.

The question states that anyone engaged in the business of insurance who knowingly makes false material statements may be subject to certain consequences. Option C states that the person may be fined or imprisoned for up to 10 years, or both. This means that if someone in the insurance business is found guilty of making false material statements, they can face a maximum punishment of a fine, imprisonment for up to 10 years, or both.

To become a producer, a person must meet several requirements. They must be 18 years or older, as this is the legal age for obtaining a license. They must also have a clean record and not have committed any acts that would result in license denial, suspension, or revocation. Additionally, they need to complete a prelicensing course for the specific line(s) of authority they wish to be licensed in. They must pay the appropriate fees and pass the examination to demonstrate their knowledge and competency. Finally, they must provide personal information and fingerprints for a background check conducted by the Washington State Patrol, FBI, and other authorized agencies.

In Washington, for Life Insurance- Cash Value policies, the policy must include a provision that allows the policyowner to take a policy loan after 3 full years of premium payment. This means that the policyowner can borrow against the cash value of the policy after making premium payments for a continuous period of 3 years.

The main duties of a Commissioner are to administer and enforce the rules of the Insurance Code. This involves ensuring that insurance companies comply with regulations, investigating complaints, and taking appropriate enforcement actions when necessary. The Commissioner is responsible for overseeing the insurance industry and protecting the interests of policyholders.

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Fraternals or Fraternal Benefit Societies are organizations that offer insurance benefits exclusively to their members who are affiliated with a lodge, religious organization, or fraternal organization. These organizations are considered charitable institutions and are not classified as insurers. However, they are still subject to the same regulations as insurance companies that provide coverage to the general public. Therefore, the correct answer is C. Fraternals or Fraternal Benefit Society.

The misstatement of age or sex clause in health insurance states that if the age of the insured has been misstated, all amounts payable under the policy will be adjusted to the amounts that the premiums paid would have purchased at the correct age. This means that the policy benefits will be recalculated based on the correct age of the insured, ensuring that the premiums paid are in line with the actual age of the policyholder.

The duties of the replacing insurance company include requiring the agent to provide a list of the applicant's life insurance or annuity contracts to be replaced and a copy of the replacement to the applicant. They also need to send a written notice to each existing insurance company within 3 business days of receiving the application, stating the replacement and including a policy summary. Additionally, they must provide in the policy or notice delivered with the policy that the applicant has the right to a refund of all premiums paid within 20 days of policy delivery (Free-Look Period).

The correct answer is A Agent/Producer. This is because the classification of producers in the insurance industry typically includes agents and brokers. Agents act as representatives of the insurance company and sell insurance policies on their behalf. They have the authority to bind coverage and make decisions on behalf of the insurer. Therefore, an agent or producer is the appropriate classification for a legal representative of an insurance company.

The given statement is true. According to the information provided, the commissioner has the authority to disapprove any agreement if the benefits provided are considered unreasonable in relation to the amount charged for the agreement. It is also stated that rate filings for individual health benefit plans must be approved by the commissioner within sixty days after the required documents are filed. If the commissioner does not disapprove the filing within this time frame, it will be deemed approved. Therefore, the statement is true.

Insurers are required to include their NAIC code in written communications to the commissioner in response to any investigation, inquiry, enforcement matter, or examination. The NAIC code is a unique identifier assigned to each insurance company by the National Association of Insurance Commissioners. This code helps the commissioner easily identify the legal name of the insurer and ensure accurate record-keeping and communication between the insurer and regulatory authorities. Therefore, the statement is true.

Medicare Supplement Plan K includes 50% coverage for both the Medicare Part A deductible and skilled nursing facility coinsurance. This means that if a person has Plan K, they would be responsible for paying the remaining 50% of these costs out of pocket. This plan may be a good option for individuals who are willing to take on more of the financial responsibility in exchange for a lower premium.

Insurers' written communications to the commissioner in response to any investigation, inquiry, enforcement matter, or examination must include the insurer's NAIC code. This requirement applies in three specific situations: when the specific insurer is known, in negotiations preliminary to the execution of an insurance contract, in the execution of an insurance contract, and in the transaction of matters subsequent to the execution of an insurance contract and arising out of it.

The correct answer is D. All of the above. Disciplinary actions in this context refer to the consequences that can be imposed on an individual or entity for violating certain rules or regulations. These actions can include denial of license, suspension, revocation, or refusal to renew, as well as the issuance of a cease and desist order, and imposition of fines. Therefore, the correct answer is D, as it encompasses all the options mentioned in the question.

The statement is true. In general insurance, risk refers to the uncertainty or possibility of a loss happening. Insurance is designed to provide protection against potential risks by transferring the financial burden of losses to an insurance company. Therefore, it is accurate to say that risk in general insurance is the uncertainty or chance of loss occurring.

Both Class A and Class B assessments are authorized and called for different purposes. Class A assessments are authorized and called for the purpose of meeting administrative and legal costs and other expenses, regardless of whether they are related to a particular impaired or insolvent insurer. On the other hand, Class B assessments are authorized and called specifically to carry out the powers and duties of the association with regard to an impaired or insolvent insurer. Therefore, both Class A and Class B assessments are authorized and called, making option C the correct answer.

The statement is true because the insurer's claim files can be examined by the commissioner or their appointed designees. These files must include all notes and work papers related to the claim, with enough detail to reconstruct important events and their corresponding dates. This ensures transparency and accountability in the claims process.

The correct answer is B. Insurer (principal). The insurer is the company that issues an insurance policy. They are responsible for providing coverage and paying out claims to the policyholder in the event of a covered loss. The insurer is also known as the principal in the insurance contract.

The correct answer is "Change of Occupation". This rider provides for a benefit or premium reduction if the insured changes his/her job. If insured changes to a more dangerous job and then has a disability claim, the insurance company will calculate how much disability benefit that the premium would have purchased at the insured's more hazardous job. If insured changes to a less hazardous job the insured can request a premium reduction.

Apparent authority refers to the assumption of authority based on the actions, words, or deeds of the principal or because of circumstances the principal has created. In the given example, the agent using the insurer's stationery creates the appearance that they are authorized to transact insurance on behalf of the insurer, leading the applicant to believe so. This is an example of apparent authority.

Title 48, which is the Washington Insurance Code, is designed to protect the public. This means that it contains laws and regulations that aim to ensure fair and ethical practices in the insurance industry, protect consumers from fraud or unfair treatment by insurance companies, and promote transparency and accountability. The code likely includes provisions related to licensing and regulation of insurance companies, consumer rights and protections, dispute resolution mechanisms, and other measures that prioritize the interests and well-being of the public.

The statement is true because when an insurance producer is appointed as an agent by an insurer, their relationship is that of an insurer and agent. This means that the insurance producer acts on behalf of the insurer and has the authority to bind the insurer to insurance contracts and perform other related activities. The producer is authorized to represent the insurer's interests and is responsible for carrying out transactions during the existence of the agency appointment.

Applicants who are not residents of Washington may be licensed as nonresident producers/adjusters if they currently maintain a resident license for the lines of insurance as defined in Washington insurance statutes or if the state of residence reciprocates and licenses Washington producers and adjusters as nonresidents. Additionally, if the applicant's state of residence does not issue an adjuster's license, they must pass a written adjuster's examination. Therefore, the statement is true.

The annuity period refers to the time when the accumulated sum from the accumulation period is converted into a stream of income payments to the annuitant. This period is also known as the annuitization period, liquidation period, or pay-out period. During this period, the annuitant receives regular payments from the accumulated funds, providing them with a steady income stream.

Insurers are required to notify the policy owner of the initial rate of interest on a cash loan, provide reasonable advance notice of any increase in the rate, and inform the policy owner of the initial rate of interest on premium loans as soon as it is reasonably practical to do so after making the initial loan. Therefore, option D, "All of the above," is the correct answer as it includes all the requirements that insurers must fulfill in terms of notifying the policy owner.

The statement is true because it accurately describes the determination of class A and class B assessments by the board. Class A assessments can be authorized and called on a pro rata or nonpro rata basis, and if pro rata, they can be credited against future class B assessments. The total of all nonpro rata assessments is limited to one hundred fifty dollars per member insurer in any one calendar year. Class B assessments can be allocated among the accounts based on an allocation formula determined by the board, which can be based on premiums, reserves, or any other fair and reasonable standard.

The correct answer includes multiple statements that describe actions that an insurer should not take when dealing with first party claimants. These actions include failing to fully disclose policy provisions, concealing benefits or coverages, denying a claim for failure to exhibit property without proof of demand, imposing unreasonable time limits for notice of loss or proof of loss, requesting a release that extends beyond the subject matter of the claim, issuing checks or drafts that release the insurer from total liability, and making benefit payments without advising the payee of possible reimbursement. These statements ensure that the insurer acts in a fair and transparent manner when handling claims.

Medicare Supplement Plan D covers the core benefits of Medicare, which include hospitalization coinsurance, hospice coinsurance, and the first three pints of blood. It also covers the Medicare Part B deductible, which is the amount that beneficiaries have to pay out of pocket before Medicare starts covering their medical expenses. Additionally, Plan D provides coverage for skilled nursing facility coinsurance, which is the cost of care in a skilled nursing facility after the first 20 days, and it includes the foreign travel benefit, which covers emergency medical expenses when traveling outside of the United States.

In the context of group long-term care insurance, the term "applicant" refers to the proposed certificate holder. This means that the person who applies for the insurance coverage on behalf of a group is considered the applicant and would be the proposed certificate holder if the application is approved. Therefore, the statement is true.

Class B assessments against member insurers are required to be in proportion to the premiums received on business in the state by each assessed member insurer. This proportion is determined by comparing the premiums received on policies or contracts covered by each account for the three most recent calendar years preceding the year in which the insurer became insolvent or impaired. The assessment amount will be based on this proportion and will ensure that each member insurer contributes their fair share towards the account or subaccount. Therefore, the statement "True" is the correct answer.

The correct answer is E. All of the above. This means that if an insurance producer receives a fee from the insured, they must disclose the full amount of the fee paid by the insured. Additionally, they must disclose the full amount of any commission paid to them by the insurer, if one is received. They must also provide an explanation of any offset or reimbursement of fees or commissions. Finally, they must disclose the full name of the insurer that may pay any commission to the insurance producer. Therefore, all of these options are required to be disclosed in writing to the insured.

Under the supervision of the Commissioner, the Guaranty Association maintains two accounts: the disability account and the life and annuity account.

HMOs and PPOs are prepaid service plans in which the service providers are paid directly. This means that the healthcare providers receive payment from the HMO or PPO organization for the services they provide to the members of the plan. This payment arrangement ensures that members have access to a network of healthcare providers who have agreed to provide services at a discounted rate. Therefore, the statement is true.

The minimum age for a producer license is 18 years old. This means that individuals must be at least 18 years old in order to obtain a producer license.

Insurance companies have options to coordinate with Social Security and Workers Compensation Benefits to avoid over insurance. These options include the Additional Monthly Benefit Rider (AMB) and the Social Insurance Supplement (SIS) Rider. Therefore, the statement is true.

The correct answer is A. This option defines the term "covered person" or "enrollee" as someone who is included in a health plan, whether they are an enrollee, subscriber, policyholder, beneficiary of a group plan, or an individual covered by any other health plan. This definition encompasses a wide range of individuals who are covered by health insurance.

A fraternal benefit society is defined as an incorporated society, order, or supreme lodge that operates without capital stock and is conducted solely for the benefit of its members and their beneficiaries. It is not operated for profit and follows a lodge system with a ritualistic form of work. It also has a representative form of government and provides benefits in accordance with the relevant chapter. Therefore, the statement is true.

Nonresidents may qualify for coverage by the Guaranty Association only if the insurer is based in Washington, if the state in which the person resides has a similar association as the Washington association, and if the person is not eligible for coverage by any other state's association because the insurer was not licensed in that state at the specified time in the state's guaranty association law.

The minimum nonforfeiture amount is a protection for policyholders in the event that they decide to surrender their insurance policy. It ensures that they receive a certain amount of the premiums they have paid. In this case, the net considerations for a given contract year must be 87 1/2% of the gross considerations credited to the contract during that year. This means that the minimum nonforfeiture amount will be calculated based on 87 1/2% of the premiums paid by the policyholder in that specific year.

Short Term Disability benefits are commonly provided by employers for all of their employees. The elimination period for these benefits can be as short as 0 days, meaning the employee can start receiving benefits immediately after becoming disabled. The benefit period, however, is typically not longer than 2 years, although it could be as short as 6 months or 1 year. Therefore, Short Term Disability is the correct answer.

The correct answer is D. 30 days. According to the information provided, the investigation of a claim must be completed within 30 days after notification of the claim, unless the investigation is not completed. This suggests that there may be circumstances where the investigation takes longer than 30 days, but in general, the expectation is that it should be completed within this timeframe.

The correct answer is F. All but E. This means that "review organization" does not refer to a disability insurer regulated (option A), a health care service contractor (option B), or entities affiliated with, under contract with, or acting on behalf of a health carrier to perform a utilization review (option D). Therefore, the correct answer is all options except E.

This is false, the producer is not allowed to transact business until the license renewal or reinstatement is complete.

In an indemnity policy, the insurance company will only reimburse the actual amount of loss incurred by the policyholder. In this case, Sarah's medical bills were $20,000, so the insurance company will only reimburse her that amount, not the total amount of insurance coverage she has. Therefore, the statement is true.

Health Reimbursement Accounts (HRA) consist of funds set aside by employers to reimburse employees for qualified medical expenses. The employer's contribution to an HRA is tax-deductible in the year of reimbursement, and the employee is not taxed on the funds received. This makes HRAs a tax-advantaged benefit for both employers and employees.

The correct answer is D. Both B and C. In general insurance, there are two types of risks: pure risks and speculative risks. Pure risks are those that involve only the possibility of loss or no loss, such as accidents or natural disasters. Speculative risks, on the other hand, involve the possibility of loss, gain, or no change, such as gambling or investing in the stock market. Therefore, both pure and speculative risks are present in general insurance.

The statement is true because the business of insurance is indeed affected by the public interest. It is important for all parties involved, including the insurer, insured, providers, and representatives, to act in good faith, avoid deception, and practice honesty and equity in all insurance matters. This duty is necessary to maintain the integrity of insurance and ensure that the public's interests are protected.

If the agent is working within the conditions of his/her contract, it means that they are fulfilling their obligations and responsibilities as outlined in the agreement. In this case, the principal/insurer is fully responsible for any actions or decisions made by the agent within the scope of their contract. This means that if any liabilities or claims arise from the agent's actions, the principal/insurer will bear the responsibility for them. Therefore, the statement "In General Insurance- If the agent is working within the conditions of his/her contract the principal/insurer is fully responsible" is true.

The annuity income amount is determined by multiple factors including the amount of premium paid or cash value accumulated, the frequency of the payment, the interest rate, and the annuitant's age and gender. These factors all play a role in calculating the annuity income amount.

A copayment is an arrangement where an insured individual is required to pay a specified amount of money upfront for certain services, while the provider covers the remaining cost. This is a common practice in health insurance plans, where the insured pays a fixed amount for each visit or service, and the insurance company covers the rest. Copayments help to share the cost of healthcare between the insured individual and the insurance provider.

An individual contract refers to a contract for health care services that is specifically issued to and covers an individual. This type of contract may also include coverage for dependents, such as family members. Therefore, option A accurately describes the meaning of an individual contract. Option B refers to a group contract, which is different from an individual contract. Option C provides a general definition of a person or group of persons who have entered into a contractual arrangement with a health care service contractor, but it does not specifically define an individual contract. Therefore, the correct answer is A.

The correct answer is I. All of the above. This is because all of the options listed (A-H) are general powers, duties, and responsibilities that are typically associated with the role of a commissioner in enforcing the provisions of the Insurance Code. These include following rules and regulations, conducting examinations and investigations, maintaining confidentiality, issuing cease and desist orders, issuing licenses or certificates of authority, spreading information about insurance laws, and appointing deputies.

The statement is true because it states that written disclosure, which includes the insured's written consent, must be signed by both the insurance producer and the insured. Additionally, the insurance producer is required to retain the writing for five years. It also mentions that in cases where written consent cannot be reasonably obtained, consent documented by the insurance producer is acceptable.

Medicare Supplement Plans are indeed identified with the letters A-N and all must have the core benefits found in Plan A. Plan A is required to be offered by insurance companies selling Medigap, while the other plans are optional.

Variable Universal Life Insurance has a flexible premium that can be adjusted based on the policyholder's needs. The premium can be increased, decreased, or skipped as long as there is enough value in the policy to cover the death benefit. Additionally, this type of insurance allows for the increasing or decreasing amount of insurance coverage depending on the policyholder's changing circumstances. Lastly, Variable Universal Life Insurance also offers the option for cash withdrawals or policy loans, providing the policyholder with access to funds when needed.

The correct answer is C because it states that "dependent" refers to the enrollee's legal spouse and dependent children who are eligible for coverage under the enrollee's health benefit plan. This definition specifically identifies who can be considered a dependent in the context of health insurance coverage.

The given statement is true. The purpose of the regulation, WAC 284-30-300 through 284-30-400, is to define certain minimum standards that, if violated frequently enough to indicate a general business practice, will be considered unfair claims settlement practices. This regulation authorizes the commissioner to define methods of competition and acts and practices in the insurance business that are unfair or deceptive. It is also referred to as the unfair claims settlement practices regulation.

Medicare supplements CANNOT used attained age rating.