Exam InsurExance

What is the maximum time period a life insurance application can be backdated?

Six months, 3 months, 30 days, 60 days

A producer who makes a statement that is maliciously critical of another insurer’s financial condition is guilty of:

Defamation

Which of the following is the mission of the Indiana Department of Insurance:

To protect consumers as they purchase
and use insurance products to keep their assets
and their families from loss or harm

What is the maximum exclusion for preexisting conditions under a Medicare Supplement Policy:

6 months

Whole Life Insurance policies must begin to accrue cash value

within three years after the effective
date

Which statement is TRUE about foreign insurance companies

They can be from a United states territory

Under Indiana Insurance Licensing Law, producers would be considered delinquent on child support payments if they are in arrears on payments

Three months

What is referred to as the limiting age in Medical Expense Health insurance policy?

the age when dependent children become eligible to buy their own insurance

Which is a violation of the Under Claims settlement Act?

Denying a claim after a reasonable investigation

Which power is NOT held by the Indiana Commissioner of Insurance?

To fine policyowners

An Indiana producer offers something of value to a potential policyowner outside of the promises contained in the policy to convince them to buy a policy. The producer is guilty of:

rebating

Under Indiana Children’s Health Insurance Program(CHIP), which of the following statements is NOT true concerning a child qualifying for coverage?

The child must have been born in United States

Which of the following describes the prohibited practice of changing an insured’s Life insurance policy by misleading the insured?

Twisting

What is required for a new applicant to be licensed as an Indiana resident producer?

Be appointed in writing by an admitted insurer

Under Indiana law, what may be used in a life insurance company’s underwriting procedures?

Medically specific information regarding HIV and AIDS

Which statement is TRUE about late enrollees in an Indiana Small Group Health Plan?

They are not eligible for dependent coverages for the first two years of employment

Under medical expense contracts, coverage for adopted children begins:

on the date of placement

Consistently violating the Indiana Under Claims Settlement Practice statute is considered an Unfair Competition Law violation and could result in:

a $50,000 fine

A life insurance producer MUST give which of the following documents to a client buying life insurance?

Both a buyer’s guide and a policy
summary

If a producer knowingly claims a policy covers risks which are NOT covered, the producer may be guilty of:

misrepresentation

Which statement is True about licensed Indiana insurance consultants

They provide insurance advice for a fee

Which condition does NOT trigger the
payment of benefits under Accelerated
Death Benefits?

The insured reaches age 59 1/2

Under Indiana law, who is responsible for responsible for determining if Long Term Care coverage is appropriate for a clients needs?

The producer

An insured dies during the conversion period of a group life policy. Which amount is payable to the beneficiary?

The face amount minus a conversion fee

Which statement is TRUE about licensed producers from another state who move to Indiana and immediately apply for an Indiana resident producer’s license?

They must surrender their current
resident producer’s licenses to their former
home state

A prospect wants to buy a policy that provide custodial or residential care. Under Indiana Health Insurance law, how long is the right to return for this policy?

31 days

Upon being appointed by an insurer, a producer agrees to perform which of the following activities?

sell, solicit and negotiate insurance
policies

Under Indiana law, what happens if a Death benefit is NOT paid to the beneficiary within 30 days of the insurance company’s receipt of the proof of death?

Interest will accrue

Which of following is a continuing education requirement for licensed life and Health producers in Indiana?

3 hours of ethics every 2 years

An insurance company may be found to have engaged in false advertising it

conservation

An insurance company may be found to have engaged in false advertising it

guarantees it’s dividends in a newspaper advertisement

Which of the following the purpose of the Life and Health Insurance Guaranty Association?

provide claims payments in the event of an insurance company insolvency

How many hours of continuing education (CE) credits can be carried forward into a producer’s next licensing period?

12

The Indiana Insurance Commissioner may issue a temporary producer’s license to:

the surviving spouse of a deceased

Which of the following is a violation of the Producer Licensing Law?

lying on the application for a producer license

Which statement is TRUE about the
negotiation of the insurance replacement?

It does not prohibit the replacement of life insurance policies

In Indiana, an applicant’s statements made on an application for a health Insurance policy can be contested:

for up to two years

Which of the following practices by a life insurance company is considered unfair discrimination?

charging varying rates for persons in the same risk class

Which of the following sections of a life insurance contract states that the application is part of the contract:

entire contract provision

An annuity that allows an individual to choose the annual premium payment amount is:

flexible premium

In order for a company to make a contributory group life insurance to its employees, what minimum percentage of the eligible employees must participate in the plan?

100%

Which of the following sections of an
insurance contract limits coverage?

exclusions

If a prospect does NOT submit the initial premium with an application, the producer should:

submit the policy to the insurance company like that.

If an insured commits suicide when a Suicide clause is in effect, an insurance company will take which of the following actions with a beneficiary’s claim?

deny the claim and retain the premium

J, a 30-year-old proposed insured, plans to retire at age 60 and wants to purchase life insurance that offers level premiums and life long protection. If J also wants the policy to be paid up when J retires, J should buy:

30 pay life

A copayment is a shared medical expense
between:

the insured and the medical insurance company

The premium mode that results in the lowest premium outlay is:

Annually

The intent of the Notice of Claim provision in an Accident and Health policy is to:

instruct policyowners that they are responsible for notifying insurance companies of claims

Which of the following reports has the primary purpose to inform an insurance company about a prospect’s previous medical insurance history

Medical Information Bureau

Which of the following statements is correct about an individual Disability income policy?

it is considered to be a reimbursement policy

Benefits are payable in a Critical illness Plan for which of the following situations or illnesses?

Leukemia

Which of the following statements is correct about statements a proposed insured makes on a life insurance application?

They are representations and deemed to
be true to the best of the applicant’s knowledge

Which of the following statements about a settlement option provision in a life insurance policy is correct?

It describes various methods of distributing Death benefits to beneficiaries

R’s life insurance policy lapsed because R did not pay the premium after 60 days. In order to put the policy back in force, R should take which of the following actions?

Complete an application for reinstatement and submit all back premiums due

S and W are business partners. Each takes out a $100,000 life insurance policy on the other, naming himself as primary beneficiary. S and W eventually dissolve their business, and two months later S dies. Although S was married at the time of death, the primary beneficiary is still W. However, an insurable interest no longer exists. The proceeds from S’s life insurance policy will go to:

W

Accidental Death and Dismemberment (AD&D) coverage provides benefits for death or dismemberment due to:

unexpected injury only

The USA Patriot Act was signed into law in response to:

September 11, 2001 Attack

An architect who has recently opened an office is concerned about not being able to pay employees salaries or the office rent if the architect becomes disabled. Which of the following types of policies should this individual purchase?

Business overhead expense

An insurance company accepts an application containing several unanswered questions and issues the policy. In this situation, the company:

must honor the policy as issued

The period of time at the beginning of a disability during which no benefits are payable is known as the:

Elimination period

Which of the following policy features permits an insured to pay premiums MORE than once every year.

Mode of premium provision

The recurrence of a disabling illness would most likely be declined as recurrent disability unless the insured had been disabled and then returned to work for a minimum of how many months before suffering the relapse?

9

An insured must take which of the following actions to continue a renewable term policy

Submit a renewal application

Which of the following statements is
CORRECT about a whole life policy?

The policyowner may borrow against the cash value of the policy

Which of the following features is a typical of Term insurance?

The policy expires at the end of the policy period

An insured age 30 wants to purchase a Whole life policy that will accumulate cash value at a faster rate in the early years of the policy.

20 pay life will accumulate cash value faster

One of the basic concepts of insurance underwriting is that a life insurance policyowner must be the insured, a blood relative of the insured, or someone who would suffer an economic loss if the insured died. The concept is known as:

Insurable interest

In a life insurance contract, the consideration given by the applicant in exchange for the promises of the insurance company consists of the insured’s statement in the application and which of the following items?

A written promise to pay all premiums when due

A beneficiary who must consent to a change of beneficiary designation in a life insurance policy is reffered to as:

an irrevocable beneficiary

On May 14, a prospect completed an application for insurance. The producer collects the initial premium and issues a conditional receipt. The insurance company determines that the prospect is insurable and issues a standard policy on May 26. If the producer delivers the policy to the insured on June 1, the effective date of coverage is:

May 26

Which of the following statements is
CORRECT regarding Variable Whole life
insurance?

It is insurance and a securities product

An applicant for life insurance must be informed of their rights under the Fair Credit Reporting Act at which of the following times:

When the producer completes the insured’s application

Which of the following provisions of a life insurance policy will pay a stated amount to an insured is blinded in an accident?

Accidental Death and Dismemberment clause

If a 45 year old individual bought an annuity to provide income for life beginning at age 65, the insured did NOT buy:

An immediate annuity

N owns a Disability income policy that will cover him to age 65, although the insurance company has the right to change the premium rate for the overall risk class to which N is assigned. Which of the following types of renewability best describes this situation?

Guaranteed renewable

S applies for an individual major medical policy and the insurance company issues a standard policy. When S receives the policy, S notices that the application is attached to the policy. Which of the following policy elements makes the application, if attached, part of the contract between S and the insurance company?

Entire contract provision

If an insured purchases an annuity from which income is received, the insured is the:

Annuitant

A guaranteed insurability provision is best described as a:

guarantee to keep a policy in force if the premium is paid

Able construction company wants to take out an insurance policy on its president to offset the cost of replacing the president if the president should die prematurely. The type of policy the company should buy is called:

Key Employee

Offer, acceptance and consideration are necessary elements of:

A contract

A provision included in group disability income contracts but NOT included in an individual disability income contract is the:

Probationary Period

If an insured fails to pay the premium when due, the insured health policy will remain in force

Grace Period

Which of the following parts of a life policy is guaranteed to be CORRECT?

A warranty

In a third-party ownership arrangement, which of the following individuals is a party to the contract?

The irrevocable Beneficiary

Which of the following features of a group Term Life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability?

Conversion Privilege

Which of the following statements BEST describes the primary difference between a HMO and a PPO?

Under a PPO the insured may use any
medical provider whereas providers are
restricted with HMOs

Which of the following statements about the Time Limit on Certain Defenses provision in an Accident and Health policy is CORRECT?

The accelerated death benefit in a life insurance contract can be accessed by which of the following methods?

A physician diagnosed a terminal illness

Which of the following statements is
CORRECT about the amount of the group life
death benefit that the beneficiary must
report for federal income tax purposes?

Nothing

An insured is employed by a manufacturing company that provides group health coverage for its employees and their dependents. If the insured dies, the company must allow the insured’s spouse and children to continue their group health coverage for a minimum of how many months according to COBRA?

6 months

The time of payment of claims provision requires that an insurance company pay Disability income benefits no less frequently than:

monthly

An insurance company notifies an insured that $50 of the insured’s physician charge is above the usual, customer, and reasonable limits covered by the Major Medical policy. In this situation the excess amount would be:

applied to the deductible

An application for a life insurance policy that is submitted with the initial premium is legally considered to be:

An offer

To enroll in Medicare Part C, an individual must:

already be enrolled in both Medicare Parts A and B

Which of the following policies combines life and health coverage:

Accidental Death and Dismemberment

An employee who owns an individual Disability Income policy is injured in an automobile accident and files proof of loss with the insurance company. Under the payment of claims provision in the policy, the company will likely pay the policy benefits to the:

insured

An applicant wants to purchase a $100000 AD&D policy on her spouse. The applicant is the primary beneficiary is her daughter is the contingent beneficiary. Which of the following persons MUST sign the application

The applicant

A policyowner may charge a revocable beneficiary at which of the following times?

Anytime

Which of the following characteristics is typical of group insurance?

Each employee receives an individual
contract

M understates her age in an application for life insurance policy. At M’s death the company will most likely:

pay an amount based on what M’s premium payments would have purchased if M had given her true age.