LIFE HEALTH AND ACCIDENT INSURANCE EXAM. CHAPTER 12. QUESTIONS AND ANSWERS.

Chapter 12: Health and
Accident Insurance Exam

1. What is issued to each employee of an employer health plan?
   A) Provision
   B) Receipt
   C) Policy
   D) Certificate
2. The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers
   who employ at least
   A) 10 employees
   B) 20 employees
   C) 30 employees
   D) 40 employees
3. An employer is issued a group medical insurance policy. This single contract is
   known as a(n)
   A) entire contract
   B) master policy
   C) certificate of coverage
   D) employer contract
4. A master contract and certificate of coverage can be found in which type of policy?
   A) Long-term

B) Medicaid
C) Group
D) Medicare

5. The election of COBRA for continuation of health coverage will
   A) increase the coverage and lower premium
   B) maintain the same coverage and increase premium
   C) increase out-of-pocket costs and lower premium
   D) decrease out-of-pocket costs and maintain same premium
6. An insurer has the right to recover payment made to the insured from the negligent
   party. These rights are called
   A) contributory
   B) indemnity
   C)estoppel
   D) subrogation
7. Without a Section 125 Plan in place, what would happen to an employee’s payroll
   contribution to an HSA?
   A) It would be considered taxable income to the employee
   B) The employee would not be allowed to an HSA
   C) The employer would pay payroll tax and FICA on the contribution amount
   D) The employer would not be allowed to deduct the contribution from the employee’s
   pay
8. According to the Health Insurance Portability and Accountability Act (HIPAA), when
   can a group health policy renewal be denied?

A) There have been too many claims in the previous year
B) The size of the group has increased by more than 10%
C) Participation or contribution rules have been violated
D) Participation or contribution rules have been changed

9. A group Disability Income plan that pays tax-free benefits to covered employees is
   considered
   A) non-contributory
   B) partially contributory
   C) group contributory
   D) fully contributory
10. The purpose of the Coordination of Benefits provision in group accident and health
    plans is to
    A) avoid overpayment of claims
    B) reduce out-of-pocket costs
    C) reduce adverse selection
    D) lower the cost of premiums
11. Continued coverage under COBRA would be provided to all of the following
    EXCEPT:
    A) former dependent of employee no longer of dependent status
    B) terminated employee
    C) divorced spouse of employee
    D) a covered employee is terminated for gross misconduct