Maryland Laws and Rules
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72 Terms
In regards to the Affordable Care Act (ACA), which of these is NOT a role of a health insurance exchange?
Contact the employer if an employee stops coverage under a plan offered in the exchange
Each delivered life insurance policy in Maryland MUST include a(n)
notary seal
underwriting manual
legible and brief description of the policy on the first page
actuarial table on the first page
legible and brief description of the policy on the first page
How many days notice must a producer be given prior to a scheduled hearing?
30 days
10 days
14 days
21 days
10 days
If a Medicare Supplement policy is cancelled by the insurer, which of these circumstances does NOT require prior approval by the Commissioner?
Nonpayment of premium
A lapsed long-term care policy may be reinstated within ___ months of the lapse date if the insured was mentally incapacitated.
5
Michelle recently purchased a long-term care policy. Her policy may temporarily exclude health conditions that
Were treated during a specific period preceding the policy date
Replacement regulations exist in order to
Protect policyowners from misrepresentation and loss of benefits
3 multiple choice options
When must a claim on a life insurance policy be paid after proof of loss has been received by the insurer?
Promptly
3 multiple choice options
Which of the following is NOT a valid reason for a producer's license to be revoked?
Sharing commissions with licensed agents
3 multiple choice options
Which of these is NOT considered to be an unfair trade practice?
Reinsurance
3 multiple choice options
Which of these is NOT an Unfair Claims Settlement Practice?
Denying unsubstantiated claims on a timely basis
3 multiple choice options
Under Federal Law, which of the following actions may result in a producer becoming imprisoned?
Producer embezzling funds from an insurer
3 multiple choice options
A producer who sells an individual life insurance policy in Maryland MUST deliver to the policyowner a(n)
Policy Summary and Buyer's Guide
3 multiple choice options
When a producer is replacing an existing ordinary life insurance policy, the producer must take all of the following actions EXCEPT
Obtain the beneficiary's signature
3 multiple choice options
Which of the following regulates the quality of care provided by a health maintenance organization (HMO)?
Secretary of the Department of Health and Mental Hygiene
3 multiple choice options
Why were Exchanges implemented by the Affordable Care Act (ACA)?
To create a one-stop market for standardized health insurance plans
3 multiple choice options
The Maryland Life and Health Guaranty Corporation protects the ______ in the event of insurer insolvency.
Insured
3 multiple choice options
A producer MUST notify the Commissioner for
Conducting business under an assumed name
3 multiple choice options
Chuck and Shaquille are both licensed producers in the same line of insurance. Chuck provides Shaquille with a referral that results in a sale. Commissions on this sale will likely be
Shared by both producers
3 multiple choice options
A producer recently replaced an existing Medicare Supplement policy with a new policy. The producer's compensation for the new policy
CANNOT exceed the renewal commission of the original policy
3 multiple choice options
A producer may NOT advertise an insurance product if he/she
Uses a policy title to misrepresent the coverage
3 multiple choice options
The Life and Health Insurance Guaranty Corporation protects the public in the event of
The impairment of a member insurer unable to pay claims
3 multiple choice options
Persuading an insured, to the insured's detriment, to switch policies is called
Twisting
3 multiple choice options
A pre-existing conditions limitation may NOT exceed ____ month(s) in all Medicare Supplement policies sold in Maryland.
6
3 multiple choice options
The Commissioner has reason to believe a producer is in violation of Maryland insurance law. Which of the following may be issued against the producer?
Cease and desist order
3 multiple choice options
A life insurance replacement gives the policyowner the right to return the policy for a 100% refund within ____ days of policy delivery.
30
Terminally-ill life insurance policyowners may sell their policy at a discount to a third party. This type of agreement is called a(n)
Viatical Settlement
3 multiple choice options
What does "SHOP" stand for in SHOP Exchange?
Small Business Health Options Program
3 multiple choice options
Tony the producer induces a poliyowner to cancel her existing insurance policy and take out a new one by misrepresenting the benefits of the inferior new policy. Tony has engaged in the unfair trade practice of
Twisting
3 multiple choice options
Mentally or physically handicapped dependent children MUST be covered under an individual health insurance policy
Until they become self-supportive
3 multiple choice options
A life insurance policy that is paid annually contains a grace period of at least ____ days.
30
3 multiple choice options
What must be disclosed when a producer advertises a life insurance policy?
Name of the actual insurer
3 multiple choice options
The free-look period for a Medicare Supplement policy sold in Maryland is ____ days.
30
3 multiple choice options
Exchange a new policy for one already in force is called
Replacement
3 multiple choice options
Which of the following entities is the Maryland Insurance Administration associated with?
State government
3 multiple choice options
All Medicare supplement policies sold during the open enrollment period MUST
Be issued regardless of health status
3 multiple choice options
Carlos' producer license has been suspended due to non-renewal. He may apply for reinstatement within the ____ period following the date when the license should have been renewed.
12
3 multiple choice options
Any administrative action taken against a producer MUST be reported to the Commissioner within ____ days after the final disposition.
30
3 multiple choice options
Every ____ year(s), a producer's license in Maryland must be renewed.
Two
3 multiple choice options
A(n) _______ producer lives in another state and transacts insurance in Maryland.
Nonresident
3 multiple choice options
Which of the following BEST defines the illegal act of twisting?
Misrepresenting a policy for the purpose of inducing a policyholder to change or replace an existing policy
3 multiple choice options
The financial records of each domestic company MUST be inspected every ____ years by the Commissioner.
5
3 multiple choice options
A life insurance policyowner is allowed ____ days upon policy delivery to return the policy for a full premium refund.
10
3 multiple choice options
_______ can be defined as "replacing a policy when it is NOT in the best interest of the client".
Twisting
3 multiple choice options
According to the Affordable Care Act, coverage may be rescinded
If intentionally false statements were offered
3 multiple choice options
Which of the following actions may result in a producer's license being suspended?
Rebating a portion of the commission to the insured
3 multiple choice options
Most Medicare Supplement information used by an insurer must be approved by the State. Which of the following types of information does NOT require State approval?
Government publications
3 multiple choice options
All of these are considered to be a violation of the Federal Fraud and False Statements Act EXCEPT
Claims reimbursement
3 multiple choice options
A producer may be found guilty of misrepresentation for
Failing to disclose a policy's exclusions
3 multiple choice options
A Maryland resident producer must be at least ____ years of age.
18
3 multiple choice options
Before a Medicare Supplement advertisement is released to the public, it must first be approved by the
Commissioner
3 multiple choice options
What is the purpose of the Life and Health Insurance Guaranty Corporation?
Provides benefits in the event of an insurer's impairment or insolvency
3 multiple choice options
According to federal fraud and false statements regulation, what is required for a prohibited person to transact insurance business in this state?
Written consent from the state insurance regulatory agency
3 multiple choice options
The Maryland Life and Health Insurance Guaranty Corporation is funded by
Assessments of member insurers
3 multiple choice options
Before an individual is permitted to act as an insurance agent, he/she must hold a valid insurance license and be ____ by an authorized insurer
Appointed
3 multiple choice options
A group Medicare Supplement policy was terminated and not replaced by the insurer. In this situation, the insurer MUST
Provide an offer of conversion to individual coverage
3 multiple choice options
A life insurance policy sold in Maryland can be cancelled for nonfraudulent misstatements for up to
2 years
3 multiple choice options
Discouraging consumers from purchasing products from an insurer is called a(n)
Boycott
3 multiple choice options
The Affordable Care Act (ACA) established "exchanges" in order to
Assist individuals and small businesses when making their health insurance purchases
3 multiple choice options
Which of these situations would NOT potentially involve a prison sentence under Federal law?
Selling insurance with a nonresident license
3 multiple choice options
A producer is proposing that a policyowner replacing an existing individual health insurance policy with a new one. Under the new contract, a pre-existing conditions exclusion
May reduce the insured's benefits
3 multiple choice options
Which of the following is NOT required to be reported by a producer?
Producer's change of financial status
3 multiple choice options
Under the Maryland Health Insurance Plan, comprehensive health benefits are provided to
Medically uninsurable residents
3 multiple choice options
Misrepresenting pertinent policy provisions relating to coverage after a loss is a(n)
Unfair claims settlement practice
3 multiple choice options
If a producer commits an unfair trade practice, all of these actions by the Maryland Insurance Administration are true EXCEPT
Maryland Insurance Administration's decision is final
3 multiple choice options
Who is eligible for health coverage under a group policy issued to a labor union?
Every member of that union
3 multiple choice options
According to the Affordable Care Act (ACA), the proportion of premium revenues spent on clinical services and quality improvements is called the
Medical loss ratio
3 multiple choice options
Once a child is born and covered under a health insurance plan, any reduction in benefits on the newborn is
Strictly prohibited
3 multiple choice options
Benefits contained under a Medicare Supplement policy CANNOT
Duplicate Medicare benefits
3 multiple choice options
A producer may share commission with
Another licensed but unappointed agent
3 multiple choice options
ABC Corporation has a group life insurance policy that covers its employees and their dependent children. Which of the following would be considered a "dependent child"?
Employed 22 year old child who relies on the insured employee for financial support
Child over the age of 18 years who attends an educational institution and relies on the insured employee for financial support
Married child over the age of 26
Child age 27 still living at home and not attending an educational institution
Child over the age of 18 years who attends an educational institution and relies on the insured employee for financial support
Licensed producers in Maryland are authorized to
rate coverages
classify rates
approve coverages
solicit, receive, and forward applications to the insurer
solicit, receive, and forward applications to the insurer