Health 3

Purchase Curriculum Members Sign-in Help

Health 3 1. Select the correct statement about long-term care policies. They are usually issued non-cancelable. Most LTC policies are guaranteed renewable up to age 70, after which they revert to optionally renewable policies. The best such policies are those that will pay benefits regardless of the level of care required by the insured. Virtually all LTC policies require prior hospitalization before benefits will be paid. 2. Which of the following provisions establishes one of a health policyowner's rights of ownership? Change of Beneficiary Legal Actions Entire Contract Payment of Claims 3. All of the following are primary risk factors in underwriting individual health insurance policies, EXCEPT: geographical location moral hazard occupation physical condition 4. When group disability benefits are paid directly to the individual employees who qualify, a tax question arises. Which of the following would be the most appropriate response? The premiums are tax deductible by the employer, the benefits are taxable to the employees. The premiums are not tax deductible by the employer, the benefits are taxable to the employees. Any amount contributed by the employee toward the premium would make the entire benefit tax free. The percentage contributed to the premium by the employee would make the percentage tax deductible by the employer. 5. A health insurance policy becomes effective when the first premium has been paid and the: application has been approved by the insurance company application has been received by the insurance company's home office medical examination has been completed agent has issued a conditional receipt to the proposed insured 6. An insurance application submitted to the insurance company without the initial premium provides coverage beginning when the: insurance company determines that the applicant is insurable and acceptable policy is mailed to the agent, regardless of when the policy is delivered to the insured application is signed by both the agent and the insured, and the policy is countersigned by the insurance company president insured is accepted by the insurance company, the premium is paid, and a continued good health statement is signed 7. Which of the following would probably NOT be considered in underwriting a health insurance risk? An individual's personal habits An individual's credit rating An individual's medical history An individual's marital status 8. The time limit on a Certain Defenses Provision in a health policy refers to: Pre-existing Conditions Incontestabililty Legal Actions Grace Period 9. Which of the following policy provisions defines a specific period in which an insured who has not paid the premium due remains covered by the policy? Ownership Rights Grace Period Consideration Waiver of Premium 10. All of the following are considered to be the three primary premiums factors to health insurance except: Interest Morality Morbidity Expense 11. All of the following are typically covered under a long-term insurance policy except: Alzheimer's disease senile dementia alcohol dependency Parkinson's disease 12. ThugLife advised her insurance company of a loss covered by her Major Medical policy. If the insurance company does not provide her with proper claim forms within 15 days, she has which of the following rights? the right to receive automatic payment of her claim the right to submit a description of the loss, in her own words, as proof of loss the right to file a suit against her company immediately the right to refuse to submit the required proof of loss 13. Under the NAIC Uniform Provisions Law, which of the following is optional for a health policy? Change of Occupation Entire Contract Physical Exam & Autopsy Time Limit on Certain Defenses 14. In a health insurance policy, the length of the grace period can be determined by which of the following? 1. the mode of premium payment 2. the length of the benefit period 3. the length of the elimination period 1 only 1 & 2 2 & 3 1, 2, & 3 15. Golan Hites purchases a health insurance policy and is told that the insurance company cannot raise the premium or terminate the coverage. Which of the following types of renewability clauses does this policy contain? Optionally Renewable Conditionally Renewable Provisionally Renewable Noncancelable, Guaranteed Renewable 16. After filing Proof of Loss an insured must wait how many days before filing suit for payment against an insurance company? 20 30 60 45 17. Riders or endorsements may do which of the following to a health insurance policy? I. add benefits II. restrict benefits III. limit coverage IV. increase premiums I and IV only II and III only I, II, and III only I, II, III and IV 18. Which of the following limits coverage under an insurance contract? Waiver of Premium Conditions Exclusions Declarations 19. There are how many standard Medicare supplement policies? 10 12 15 20 20. Personal Health Insurance policies do not normally include benefits for: injuries suffered while using an unsafe ladder injuries suffered in an auto accident rehabilitation for alcoholism a U.S. resident living abroad 21. Which of the following are considered required provisions for an individual health insurance policy? I. Proof of loss II. Payment of claim III. Illegal Occupation IV. Conformity with state statutes I & II III & IV II & IV I & III 22. What will the insurer do if its Disability Income policy contains a Change of Occupation provision, and the insured changes to a more hazardous job than is subsequently injured? The insurer can do nothing as long as the policyowner pays the premiums. Policy benefits will be reduced to an amount the premium would have purchased originally, based on the more hazardous occupation. The policyowner will have to pay an additional premium to cover the higher risk. A premium penalty will be charged against the benefits when a claim is filed. 23. Under a Health policy, an insured is required to provide written Proof of Loss to the insurance company within a maximum of how many days after a loss? 30 60 20 90 24. When receiving disability income payments for longer than two years, the insured must submit proof of loss how often? every month every three months every six months every year 25. An insured submits a valid documented claim for medical expenses covered by his Major Medical policy. According to the Time of Payment of Claims Provision, how soon must the company pay the claim? Within 14 days Within 10 days Within 45 days Within 30 days 26. If an insurance company is allowed to cancel the policy if two conditions are met, except health conditions, it is said to be: Noncancellable Guaranteed Renewable Conditionally Renewable Optionally Renewable 27. Which of the following is not considered a primary risk factor in health insurance? Physical Condition Moral Hazards Morbidity statistics Occupation 28. The "Time Limit on Certain Defenses" provision refers to which of the following: It refers to the period of time the policy must be in force before an insurance company can defend itself against a loss. It refers to the period of time, after a policy is issued, that an insurance company may deny the payment of a claim and void the policy because of a material misrepresentation. It indicates that the insurance company may void the policy at any time after issue for any misrepresentations in the application. It is the period of time the insured must wait before mounting legal action against an insurance company for the denial of a payment for losses covered by policy. 29. Required Provision 7 indicates that, except in the absence of the insured's legal capacity, if it was not reasonably possible for the insured to provide proof of loss as required in a policy, the latest time the proof of loss may be furnished is: three years from the time proof is otherwise required one year from the time proof is otherwise required within 90 days of a final notice from the insurer unlimited 30. Beautimus names her husband as the beneficiary of the accidental death benefit in her health policy. She has relinquished her right to change the beneficiary designation. According to Required Provision 12, Beautimus' husband is: an irrevocable beneficiary a revocable beneficiary a contingent beneficiary a tertiary beneficiary 31. Which of the following is not a mandatory health insurance provision? Reinstatement Provision Grace Period Provision Time of Payment of Claims provision Coinsurance provision 32. With the exception of instances of legal incapacity, Proof of Loss for surgical expense benefits must be furnished to the insurance company within: 60 days 90 days 6 months 1 year 33. Disability payments must be paid at least: Weekly Monthly Quarterly Annually 34. Which of the following policies can be written on a non-cancelable and guaranteed renewable basis? I. a Medicare supplement II. a Disability Income Policy I only II only I and II Neither I nor II 35. If an application is filed for the reinstatement of a Health Insurance policy but the company takes no action on such reinstatement, the policy is automatically reinstated after how many days? 30 45 14 20 36. Optional Provisions 1 and 2, addressing changes of occupation and misstatement of age, permit the insurer to do which of the following? cancel the policy request a revised application to correct the previous misstatements or alter information that has changed since the application was originally submitted charge a back-end premium to adjust for the premium that should have been charged for the true situation pay indemnities equal to the benefits that correspond to the premiums that have been paid 37. All Medicare supplement (or Medigap) policies must: have the same premium have the same core benefits duplicate benefits provided by Medicare all of the above 38. Which of the following statements most accurately describes a Guaranteed Renewable Disability policy? The insurance company may not refuse to renew the policy before a specified age, but may increase the premiums on all policies in the same class. The insurance company agrees not to cancel the policy before a specified age, or to ever raise the premium. The guaranteed renewable policy is usually renewable for the life of the insured. The guaranteed renewable to age 65 policy is very popular in the blue collar market. 39. Which of the following statements is/are true about a Medicare Supplement policy? 1. Only insurance companies affiliated with Medicare can provide Medicare Supplement policies. 2. These policies may be issued to anyone 59 1/2 or older without evidence of insurability. 3. Anyone who qualifies for Medicaid benefits may be issued these policies. 4. These policies are designed to cover the deductibles and coinsurance that Medicare patients have to pay. 1 only 2 & 3 3 & 4 4 only 40. Under the Claims Forms Provision, it is the company's responsibility to supply claim forms to an insured within how many days after receiving notice of a claim? 21 30 10 15 41. Which of the following concerning group disability insurance is/are true? I. Premiums are tax deductible by the employer, and benefits are taxable to the employee. II. Premiums are not tax deductible by the employer, and the benefits are taxable to the employees. III. Any amount contributed by the employee toward the premium makes the entire benefit tax free. IV. The percentage contributed to the premium by the employee makes the same percentage deductible by the employer. I II I & III I & IV 42. If the insured purchased a Long Term Care policy with a payable benefit of $130 per day and the actual cost of the facility was $120 per day, what would the policy pay? $120 per day $130 per day No more than the average cost per day in a given geographical area HIPPA limits benefits to $220 per day 43. Individual health policies contain how many required Uniform Provisions? 23 12 10 11 44. The factor in premium computation that has to do with the record-keeping and statistical analysis insurance companies perform is: expense loading reserves claims expierence policy fees 45. When an insured returns a policy to the insurance company within the Free Look Period, the Insurance company must do which of the following? refund all premiums paid refund the premiums paid, less issue expense charges refund the premiums paid, less the agent's commissions refund the premiums paid in excess of the cost of coverage for the time the insured had the policy 46. Primary support for Medicare Part A comes from: general tax revenues Social Security payroll taxes private funding a combination of the above 47. Under the optional Illegal Occupation Provision, which of the following applies if a loss occurs while the insured is participating in a felony or an illegal occupation? The insured's policy is automatically canceled. The insurer is not liable for the loss. The benefits are reduced 50%. The insurer has the right to increase the premiums. 48. Under a credit health policy, what is the maximum amount of any accidental death benefit included? $20,000 the amount of the original indebtedness the amount of outstanding indebtedness at any given time a specified multiple of the monthly loan payment 49. For group insurance, employees may be classified in all the following ways EXCEPT: by type of payroll by duties by length of service by age 50. As compared to individual disability income policies, group disability income policies are generally: more costly and have less liberal provisions more restrictive in terms of covered medical expense less costly and have more liberal provisions tied more closely to Social Security disability benefits 51. When individual disability benefits are paid directly to the individual who has paid the premium, a question of taxation arises. Which would be the most important response? The premium was tax deductible, therefore the benefit will be considered as taxable income. An exclusion ratio is used to determine the amount of benefit considered taxable. The premium was tax deductible, therefore the benefit will be considered tax free income. The premium was not tax deductible, therefore the benefit will be considered tax free income. 52. All of the following statements about noncancellable policies are true EXCEPT: A noncancellable policy is also called a noncancellable and guaranteed renewable policy. The only right to cancel the noncancellable policy is for nonpayment of premiums. The insurer may increase the premium rate after the policy is in effect, provided it does so by class of insureds. The insurer may regain the right to cancel or not to renew when the insured reaches an age specified in the policy. 53. The maximum pre-existing condition waiting period on a Medicare Supplement (which is not being replaced) is: 6 Months 30 Days 12 Months 24 Months 54. A Guaranteed Renewable health insurance policy allows the insurer to: I. change premium rates for all insureds in the same class II. renew, even though the insured is seriously ill and is preparing to file a claim III. change the policy provisions during the time the policy is in force IV. renew the policy if the insured shows a required evidence of insurability I, III, and IV only II and III only I and II only I and IV only 55. All of the following relate to Owner's Rights EXCEPT: The Reinstatement Provision The Listed Exclusions The Free Look Provision The Incontestable Provision 56. Which of the following policies can be written on a non-cancelable and guaranteed renewable basis? I. A Dental Care Policy II. A Disability Income Policy III. Comprehensive Medical Expense Policy IV. A Major Medical Expense Policy I only II only III and IV only None of the above 57. The Internal Revenue Service (IRS) considers Disability Income benefits paid under an employer-paid group Disability Income policy to be: taxable for 13 weeks only nontaxable for 26 weeks only fully taxable as ordinary income exempt from taxation 58. The N.A.I.C refers to the National Association of Insurance Companies. True False 59. Optional Provisions 1 and 2, addressing changes of occupation and misstatement of age, permit the insurer to do which of the following? They permit the insurer to cancel the policy. They allow the insurer to request the insured to fill out a new application, to correct previous misstatements or alter information that has changed since the application was originally submitted. They allow the insurer to charge a 'back-end' premium to make up for the premium the insurer would have charged had the true situation been known. They permit the insurer to pay indemnities equal to benefits that would have been purchased at the premium paid had the insurer known the facts when the premium was established. 60. Under the Notice of Claim provision in a Health policy, the insured must give notice to the insurance company within a maximum of how many days after incurring a covered loss? 20 30 60 90 61. What term describes a situation where a policyowner transfers a portion of his or her rights in an insurance policy to another party in order to secure a debt to that party? Collateral assignment Absolute assignment Transfer assignment Right of assignment

© 2003-2006 Florida School of Insurance, Inc. All Rights Reserved

[CURRICULUM] [CLASSROOM] [HELP] [CONTACT US]