Texas Life and Health Insurance Exam Questions and
Answers (Verified Solutions) 2023
What type of reinsurance contract involves two companies automatically
sharing their risk exposure? – correct answer \u2705Treaty
The stated amount or percent of liquid assets that an insurer must have on
hand that will satisfy future obligations to its policyholders is called – correct
answer \u2705reserves
When third-party ownership is involved, applicants who also happen to be
the stated primary beneficiary are required to have – correct answer
\u2705insurable interest
Statements made on an insurance application that are believed to be true to
the best of the applicant’s knowledge are called – correct answer
\u2705representations
The part of a life insurance policy guaranteed to be true is called a(n) –
correct answer \u2705warranty
Which of these is NOT a type of agent authority?
Express<\/p>\n\n\n\n
Texas Life and Health Insurance Exam Questions and
Answers (Verified Solutions) 2023
Implied
Principal
Apparent – correct answer \u2705Principal
The Consideration clause of an insurance contract includes – correct answer
\u2705the schedule and amount of premium payments
E and F are business partners. Each takes out a $500,000 life insurance policy
on the other, naming himself as primary beneficiary. E and F eventually
terminate their business, and four months later E dies. Although E was
married with three children at the time of death, the primary beneficiary is
still F. However, an insurable interest no longer exists. Where will the
proceeds from E’s life insurance policy be directed to? – correct answer \u2705In
this situation, the proceeds from E’s life insurance policy will go to F.
Which term defines the legally enforceable promise in an insurance contract
by the insurer? – correct answer \u2705Unilateral<\/p>\n\n\n\n
Texas Life and Health Insurance Exam Questions and An annuity promises that, if the annuitant dies before receiving payments equal to the correct value, the payments will be continued to a beneficiary until an amount equal to the contract value has been paid. This type of annuity is called<\/p>\n\n\n\n An installment Refund annuity One becomes eligible for Social Security disability benefits after having been disabled for<\/p>\n\n\n\n 3 months A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?<\/p>\n\n\n\n Straight life accumulates faster than Limited-pay Life Who makes the legally enforceable promises in a unilateral insurance policy?<\/p>\n\n\n\n Beneficiary The Consideration clause in a life insurance policy indicates that a policyowner’s consideration consists of a completed application and<\/p>\n\n\n\n the initial premium Which parts of a life insurance policy are guaranteed to be true?<\/p>\n\n\n\n Rating A comprehensive major medical health insurance policy contains an Eligible Expenses provision which identifies the types of health care services that are covered. All of the following health care services are typically covered EXCEPT for<\/p>\n\n\n\n hospital charges If a retiree on Medicare required five hospital stays in one year, which policy would provide the best insurance for excess hospital expenses?<\/p>\n\n\n\n Long-term care S, while in the process of converting her group life insurance to an individual policy, dies. What happens to the claim her beneficiary submits?<\/p>\n\n\n\n No benefits are payable under the Master contract All of the following are limited benefit plans EXCEPT<\/p>\n\n\n\n cancer policies A physician opens up a new practice and qualifies for a $7,000\/month Disability Income policy. What rider would the physician add if he wants the ability to increase his policy benefit as his practice and income grow?<\/p>\n\n\n\n Extended Term rider An agent whose license has been revoked is required to<\/p>\n\n\n\n wait at least five years before applying for a new license The benefits under a Disability Buy-Out policy are<\/p>\n\n\n\n normally paid in installments he Health Insurance Portability and Accountability Act (HIPAA) gives privacy protection for<\/p>\n\n\n\n insolvency How are surrender charges deducted in a life policy with a rear-end loaded provision?<\/p>\n\n\n\n Deducted from the death benefit What MUST an insurance company use in its advertising?<\/p>\n\n\n\n Its trade name An accident policy will most likely pay a benefit for a(n)<\/p>\n\n\n\n self-inflicted injury M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M’s policy goes into effect EXCEPT<\/p>\n\n\n\n policy is delivered When a policyowner cash surrenders a Universal Life insurance policy in it’s early years, this may be considered a red flag for a(n)<\/p>\n\n\n\n Federal Fair Credit Act Violation Which of these do NOT constitute policy delivery?<\/p>\n\n\n\n Policy mailed to applicant What is the MINIMUM number of Activities of Daily Living (ADL) an insured must be unable to perform to qualify for Long Term Care benefits?<\/p>\n\n\n\n 1 An agent who tells a client that dividends are guaranteed may be guilty of<\/p>\n\n\n\n fraud Which statement regarding a Key Employee Life policy is NOT true?<\/p>\n\n\n\n The application must be signed by the key employee A policyowner’s rights are limited under which beneficiary designation?<\/p>\n\n\n\n Revocable Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company. What action should J take?<\/p>\n\n\n\n Deposit the applicant’s check into his account and make a personal check out to the insurance company from his personal account Variable Whole Life Insurance can be described as<\/p>\n\n\n\n both an insurance and securities product A 66 year-old is covered under a group health plan while employed with a business that has 40 employees. If she injures herself while walking in the park, what coverage would be considered primary?<\/p>\n\n\n\n Medicaid Medicare<\/p>\n\n\n\n is a disability program T owns an Accident & Health policy and notifies her insurance company that she has chosen a less hazardous occupation. Under the Change of Occupation provision, which of the following actions may her insurance company take?<\/p>\n\n\n\n Allow her to take a tax deduction on unearned premiums All of the following statements about health coverage for newborns are correct EXCEPT<\/p>\n\n\n\n coverage begins and benefits are payable from the moment of birth Which provision prevents an insurer from changing the terms of the contract with the policyowner by referring to documents not found within the policy itself?<\/p>\n\n\n\n Policy Exclusion An employee with $25,000 group term life coverage was recently fired. This employee’s group coverage may be converted to a<\/p>\n\n\n\n $125,000 individual whole life policy M purchases a $70,000 Life Insurance Policy with premium payments of $550 a year for the first 5 years. At the beginning of the sixth year, the premium will increase to $800 per year but will remain level thereafter. The face amount will remain at $70,000 throughout the life of the policy. The type of policy that M has purchased is<\/p>\n\n\n\n Adjustable Life S would like to use dividends from her life insurance policy to purchase paid-up additions. All of these would be factors that determine how much coverage can be purchased EXCEPT<\/p>\n\n\n\n type of life insurance Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?<\/p>\n\n\n\n Have the customer sign a blank application, then take the application back to his office to complete prior to sending it off to the insurance company Which of the following statements is CORRECT about the period in which a Term Policy can be converted?<\/p>\n\n\n\n It is the same in all contracts If, at the time of an insured’s death, the insurance company discovers that the insured’s age was misstated on the application for life insurance, the company will most likely<\/p>\n\n\n\n deny the claim for policy proceeds on the basis of fraud K is an agent who takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?<\/p>\n\n\n\n The date the sales appointment was made An assignment of benefits of a Health Policy<\/p>\n\n\n\n transfers payments to someone other than the policyowner What type of policy would only provide coverage for specific types of illnesses (cancer, stroke, etc)?<\/p>\n\n\n\n MEWA K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would cover her loss of income?<\/p>\n\n\n\n Indemnity M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son?<\/p>\n\n\n\n Tertiary The Accidental Death and Dismemberment (AD&D) provision in a life insurance policy would pay additional benefits if the insured<\/p>\n\n\n\n dies of natural causes Which of the following policy features allows an insured to defer current health charges to the following year’s deductible instead of the current year’s deducitble?<\/p>\n\n\n\n Deferral provision T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this?<\/p>\n\n\n\n Fixed Certain On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?<\/p>\n\n\n\n Collect initial premium Which of the following costs would a Basic Hospital\/Surgical policy likely cover?<\/p>\n\n\n\n Surgically removing a facial birthmark Which of these statements concerning an Individual Straight Life annuity is accurate?<\/p>\n\n\n\n Life expectancy of the annuitant is not a factor J let her life insurance policy lapse 8 months ago due to nonpayment. She can reestablish coverage under which of the following provisions?<\/p>\n\n\n\n Payor clause P is an employee who quits her job and wants to convert her group health coverage to an individual policy. After the expiration of COBRA laws, which of the following statements is TRUE?<\/p>\n\n\n\n She DOES need to provide evidence of insurability A whole life insurance policyowner does not wish to continue making premium payments. Which of the following enables the policyowner to sell the policy for more than its cash value?<\/p>\n\n\n\n Cash surrender Who can purchase a plan through the Marketplace?<\/p>\n\n\n\n Anyone What is Old Age and Survivors Health Insurance (OASDHI) also known as?<\/p>\n\n\n\n Medicare Which of these require an offer, acceptance, and consideration?<\/p>\n\n\n\n Warranty How does a typical Variable Life Policy investment account grow?<\/p>\n\n\n\n Tied to price of gold An applicant’s medical information received from the Medical Information Bureau (MIB) may be furnished to the<\/p>\n\n\n\n agent After the initial enrollment period, an HMO must hold an open enrollment period of how many days at LEAST once in every 12-month period?<\/p>\n\n\n\n 15 Which of the following is NOT included in the policy face?<\/p>\n\n\n\n Free Look provision A student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following?<\/p>\n\n\n\n Guaranteed Insurability rider In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy?<\/p>\n\n\n\n Nonforfeiture A Renewable Term Policy is renewable at the option of the<\/p>\n\n\n\n Owner Which of these is considered a true statement regarding Medicaid?<\/p>\n\n\n\n Funded by both state and federal governments Which is true concerning a Variable Universal Life policy?<\/p>\n\n\n\n Policyowner controls where the investment will go and selects the amount of the premium payment In life insurance, the needs approach is used mostly to establish<\/p>\n\n\n\n which type of life insurance a client should apply for A life insurance illustration is NOT required to include the<\/p>\n\n\n\n name of the insurer Which of these characteristics is consistent with a Straight Life policy?<\/p>\n\n\n\n Owner can adjust both premium and death benefit Under the Texas insurance code, which of the following statements about the Suicide clause is CORRECT?<\/p>\n\n\n\n The Commissioner of Insurance must review insurance companies’ Suicide clauses every five years for discrimination Which of the following best describes a contingent beneficiary?<\/p>\n\n\n\n Person designated by the insured to receive policy proceeds in the event that the primary beneficiary dies before the insured A Business Disability Buyout plan policy is designed<\/p>\n\n\n\n as an incurred expense plan Term insurance has which of the following characteristics?<\/p>\n\n\n\n Expires at the end of the policy period An agent MUST do which of the following during a sales presentation for a participating life insurance policy?<\/p>\n\n\n\n Include a statement that dividends are NOT guaranteed In regards to representations or warranties, which of these statements is TRUE?<\/p>\n\n\n\n Warranties are statements considered to be true to the best of the applicant’s belief The Commissioner of Insurance may issue a temporary agent’s license for a maximum of how many days?<\/p>\n\n\n\n 180 A stock insurance company is owned by it’s<\/p>\n\n\n\n directors J chooses a monthly premium payment mode on his Whole Life insurance policy. Which of these statements is correct?<\/p>\n\n\n\n The gross premium is higher on a monthly payment mode as compared to being paid annually What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies? Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan?<\/p>\n\n\n\n Revocable assignment Under what system do a group of doctors and hospitals in a designated area contract with an insurer to provide services at a prearranged cost to the insured?<\/p>\n\n\n\n HMO Basic Hospital and Surgical policy benefits are<\/p>\n\n\n\n lower than the actual expenses incurred An employer that offers a qualified retirement plan to its employees is eligible to<\/p>\n\n\n\n avoid ERISA regulations What action can a policyowner take if an application for a bank loan requires collateral?<\/p>\n\n\n\n Utilize accelerated benefits provision Which of the following provisions specifies how long a policyowner’s health coverage will remain in effect if the policyowner does not pay the premium when it is due?<\/p>\n\n\n\n Grace Period The Consideration clause in a life insurance contract contains what pertinent information?<\/p>\n\n\n\n Summary of benefits T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. Five years later, T commits suicide. How much will the insurer pay?<\/p>\n\n\n\n The total premiums paid minus any policy loans T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?<\/p>\n\n\n\n $1,000,000 The clause identifying which losses resulting from an accident or sickness are insured by the policy is called the<\/p>\n\n\n\n Entire Contract provision What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?<\/p>\n\n\n\n Term Life What is the purpose of the Time of Payment of Claims provision?<\/p>\n\n\n\n Requires the insured to wait 60 days after submitting Proof of Loss before filing a lawsuit A long-term care rider in a life insurance policy pays a daily benefit in the event of which of the following?<\/p>\n\n\n\n Critical illness 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?<\/p>\n\n\n\n Owner’s Rights clause The Insurance Commissioner may examine the records of an insurance company in order to<\/p>\n\n\n\n determine the solvency of the company What does Medicare Parts A and B cover?<\/p>\n\n\n\n Part A covers hospitalization; Part B covers long-term care What is issued to each employee of an employer health plan?<\/p>\n\n\n\n Provision A 42-year-old executive wants to purchase life insurance that will allow for increases or decreases to coverage as his\/her needs change. Which of the following policies will best meet this need?<\/p>\n\n\n\n Endowment at Age 75 When a life insurance policy exceeds certain IRS table values, the result would create which of the following?<\/p>\n\n\n\n 1035 Exchange Which of the following statements BEST defines usual, customary, and reasonable (UCR) charges?<\/p>\n\n\n\n The maximum premium an insurer can charge for their health insurance based on geography K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?<\/p>\n\n\n\n Return of premiums paid Which of the following are NOT managed care organizations?<\/p>\n\n\n\n Point-of-Service plan (POS) K has a health policy that must be renewed by the insurer and the premiums can only be increased if applied to the entire class of insureds. This type of policy is considered<\/p>\n\n\n\n optionally renewable What type of life insurance incorporates flexible premiums and an adjustable death benefit?<\/p>\n\n\n\n Endowment Policy P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?<\/p>\n\n\n\n A straight life deffered annuity Quarterly premium payments increase the annual cost of insurance because<\/p>\n\n\n\n insurer risk exposure is greater N purchases an annuity by making payments in an amount no less than $100 quarterly. This describes which of the following annuities?<\/p>\n\n\n\n Installment Immediate If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of?<\/p>\n\n\n\n Insurer What kind of life insurance product covers children under their parent’s policy?<\/p>\n\n\n\n Family Maintenance rider When an insurer issues a policy that refuses to cover certain risks, this is referred to as a(n)<\/p>\n\n\n\n elimination What is the purpose of the U.S.A. Patriot Act?<\/p>\n\n\n\n detect and deter fraud The health insurance program which is administered by each state and funded by both the federal and state governments is called<\/p>\n\n\n\n Long-term care R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?<\/p>\n\n\n\n Residual Disability A group life insurance policy may NOT insure groups consisting exclusively of persons who are<\/p>\n\n\n\n salaried, clerical, or administrative employees Credit Life insurance is<\/p>\n\n\n\n issued in any amount at the discretion of the applicant If an insurance company issues a Disability Income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best desribes this policy is called<\/p>\n\n\n\n noncancellable All of the following may charge fees for insurance advice EXCEPT<\/p>\n\n\n\n Legal reserve agents An agent MUST give a prospective insured an Outline of Coverage when taking an application for a<\/p>\n\n\n\n Whole life policy A creditor who requires a debtor to obtain insurance from a particular company or agent as a condition for a loan is coercion Which of the following circumstances would cause a Medicare Supplement policy to be cancelled?<\/p>\n\n\n\n A claim greatly exceeds the benefits payable Benefits for drug and alcohol treatment under a group health policy must include all of the following services EXCEPT<\/p>\n\n\n\n treatment in a certified facility V is insured under an individual Disability Income policy with a 30-day Elimination period. On July 1, he is involved in an accident and temporarily disabled. He returns to work on December 1. How many months of benefit are payable?<\/p>\n\n\n\n 6 months A foreign insurance company is one that is incorporated<\/p>\n\n\n\n under Texas law A group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a<\/p>\n\n\n\n treaty insurer What should an insured do if the insurer does not send claims forms within the time period set forth in a health policy’s Claims Forms provision?<\/p>\n\n\n\n File a lawsuit Which of these is considered a mandatory provision?<\/p>\n\n\n\n Payment of Claims N has a Major Medical policy that only pays a portion of N’s medical expenses. N is responsible for paying the remaining balance. This provision is known as<\/p>\n\n\n\n Assignment of Benefits A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision?<\/p>\n\n\n\n Payor provision The sections of an insurance contract which limit coverage are called<\/p>\n\n\n\n waivers Which of the following is NOT a limited benefit plan?<\/p>\n\n\n\n cancer policies All of the following provisions must be included in life insurance policies EXCEPT<\/p>\n\n\n\n Incontestability In a life insurance policy, which feature states that the policy will not cover certain risks?<\/p>\n\n\n\n Exception What type of life policy covers two people and pays upon the death of the last insured?<\/p>\n\n\n\n Shared J is a subscriber to a plan which contracts with doctors and hospitals to provide medical benefits at a predetermined price. What type of plan does J belong to?<\/p>\n\n\n\n Multiple Employer Welfare Arrangement Which of the following actions is NOT possible with a Universal Life policy?<\/p>\n\n\n\n Policy’s cash value may be used to pay premiums If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?<\/p>\n\n\n\n Primary beneficiary’s estate Which of these is NOT considered to be a cost connected with an individual’s death?<\/p>\n\n\n\n Funeral expense Which of the following requires insurers to disclose when an applicant’s consumer or credit history is being investigated<\/p>\n\n\n\n 1970 – Fair Credit Reporting Act What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?<\/p>\n\n\n\n Family Lump Sum Policy Which of the following statements about the classification of applicants is INCORRECT?<\/p>\n\n\n\n Substandard applicants are never declined by underwriters A Health Reimbursement Arrangement MUST be established<\/p>\n\n\n\n with employee funding Variable annuities may invest premiums in each of the following EXCEPT<\/p>\n\n\n\n Common Stock Under the USA Patriot Act, insurers are required to report receipt of cash payments in excess of<\/p>\n\n\n\n $10,000 What percentage of continuing education instruction MUST be completed in the classroom or classroom equivalent?<\/p>\n\n\n\n 25% A certificate of authority does which of the following?<\/p>\n\n\n\n Gives an agent authority to represent a specific insurance company An insurer receives proof of loss for an acceptable medical expense claim under an Individual Health Insurance Policy. Under the Time of Payment of Claims provision, the insurer MUST pay the benefits<\/p>\n\n\n\n immediately The Notice of Claims provision requires a policyowner to<\/p>\n\n\n\n provide proof of loss to an insurer within a specified time P purchases a $50,000 whole life insurance policy in 2005. One of the questions on the application asks if P engages in scuba diving, to which P answers “No”. The policy is then issued with no scuba exclusions. In 2010, P takes up scuba diving and dies in a scuba-related accident in 2011. What will the insurer pay to P’s beneficiary?<\/p>\n\n\n\n Premiums paid plus interest The Misstatement of Age provision requires that if the age of the insured is misstated, then any amount payable is<\/p>\n\n\n\n forfeited T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?<\/p>\n\n\n\n Request will be accepted only if in writing by the insured Which of the following health insurance coverages is BEST suited for meeting the expenses of catastrophic illness?<\/p>\n\n\n\n Major Medical An underwriter determines that an applicant’s risk should be recategorized due to a health issue. This policy may be issued with a(n)<\/p>\n\n\n\n delayed effective date What provision in a life insurance policy states that the application is considered part of the contract?<\/p>\n\n\n\n Application provision When an employee is required to pay a portion of the premium for an employer\/employee group health plan, the employee is covered under which of the following plans?<\/p>\n\n\n\n Joint In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and<\/p>\n\n\n\n a Medical Information Report A newly licensed General Lines agent must complete a MINIMUM of how many hours of continuing education within 24 months after initial license?<\/p>\n\n\n\n 10 A nonprofit incorporated society that does not have capital stock and operates for the sole benefit of its members is known as<\/p>\n\n\n\n a fraternal benefit society An enrollee of a Health Maintenance Organization (HMO) may be cancelled or nonrenewed for which of the following reasons?<\/p>\n\n\n\n Failure to pay for coverage Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following contractual elements?<\/p>\n\n\n\n Consideration Rick recently died and left behind an individual IRA account in his name. His widow was forwarded the balance of the IRA. The widow qualifies for the<\/p>\n\n\n\n marital deduction An organization that solicits insurance only among its members is known as a<\/p>\n\n\n\n specific order K purchased a $10,000 Life Policy that will pay the face amount to her if she lives to age 65, or to her beneficiary if she dies before age 65. K purchased which of the following types of policies?<\/p>\n\n\n\n Limited-Pay Life T was treated for an ailment 2 months prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards.How will the insurer likely consider this condition?<\/p>\n\n\n\n Insurer will require a higher deductible for any claims resulting from this condition What would the Medical Information Bureau (MIB) identify?<\/p>\n\n\n\n Testing positive for marijuana use from a previous screening In a Life insurance contract, an insurance company’s promise to pay stated benefits is called the<\/p>\n\n\n\n Insuring clause Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?<\/p>\n\n\n\n Interest Only When must insurable interest exist for a life insurance contract to be valid?<\/p>\n\n\n\n Inception of the contract An insurance agent does NOT have fiduciary responsibilities to<\/p>\n\n\n\n insurance companies If an insured sustains a loss on a policy sold by an agent through an insurance company that is not authorized to do business in Texas, which of the following would be liable?<\/p>\n\n\n\n The agent only An applicant for an agent’s license must meet which of the following requirements?<\/p>\n\n\n\n Be honest, trustworthy, and reliable Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?<\/p>\n\n\n\n The 403(b) custodian Bryce purchased a disability income policy with a rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this?<\/p>\n\n\n\n Guaranteed insurability rider Which of these statements concerning an individual Disability Income policy is TRUE?<\/p>\n\n\n\n Premiums are normally tax-deductible N is a student pilot with a large life insurance policy. Which of these features would limit the insurer’s obligation in the event N was killed while flying as a student pilot?<\/p>\n\n\n\n Misrepresentation N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?<\/p>\n\n\n\n 30 Pay Life Which statement is TRUE in regards to a policy loan?<\/p>\n\n\n\n Past-due interest payments not paid after 3 months will void the policy P is self-employed and owns an Individual Disability Income policy. He becomes totally disabled on June 1 and receives $2,000 a month for the next 10 months. How much of this income is subject to federal income tax?<\/p>\n\n\n\n $20,000 What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability?<\/p>\n\n\n\n Entire contract Which of the following statements BEST describes the intent of a Coinsurance clause in a Major Medical policy?<\/p>\n\n\n\n Discourages overutilization of the insurance coverage At the age of 45, an individual withdraws $50,000 from his Qualified Profit-Sharing Plan and then deposits this amount into a personal savings account. This action would result in<\/p>\n\n\n\n Only income tax on the amount withdrawn Before holding a hearing regarding an agent’s unfair or deceptive practice, the Insurance Commissioner MUST give how many days notice?<\/p>\n\n\n\n 3 Which of the following is an important underwriting principle of group life insurance?<\/p>\n\n\n\n Physical examinations are required The Consideration clause of an insurance contract includes<\/p>\n\n\n\n the buyer’s guide K has a life insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an automobile accident, where would the death proceeds be directed?<\/p>\n\n\n\n Daughter The Commissioner of insurance may suspend, revoke, or refuse to renew the license of an agent who<\/p>\n\n\n\n is convicted of a misdemeanor M is insured under a basic Hospital\/Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for?<\/p>\n\n\n\n Claim payment is equal to physician’s actual charges If X wants to buy $50,000 worth of permanent protection on his\/her spouse and $25,000 worth of 10-year Term coverage on X under the same policy, the applicant should purchase<\/p>\n\n\n\n An Estate Builder Policy The insuring clause<\/p>\n\n\n\n Specifies the additional time given to pay past due premiums How does group insurance differ from individual insurance?<\/p>\n\n\n\n Evidence of insurability is required A Long-Term Care policy must offer a MINIMUM benefit period of how many months?<\/p>\n\n\n\n 12 What percent of personal life insurance premiums is usually deductible for federal income tax purposes?<\/p>\n\n\n\n 100% Why is an applicant’s signature required on a life insurance application?<\/p>\n\n\n\n To attest that the statements on the application are warranties When a policyowner exchanges a term policy for a whole life policy without providing proof of good health, which of these apply?<\/p>\n\n\n\n Extended term option The premiums paid by an employer for his employee’s group life insurance are usually considered to be<\/p>\n\n\n\n tax-deductible to the employer An individual who purchases a Life annuity is given protection against<\/p>\n\n\n\n inflation How are Roth IRA distributions normally taxed?<\/p>\n\n\n\n 10% penalty tax is applied An employee of 20 years recently retired at age 59 1\/2. This employee’s group life contract can be<\/p>\n\n\n\n converted to an individual permanent policy at an individual rate A Loss-Purchase Buy and Sell agreement among three partners, funded with individual life insurance, would require how many policies?<\/p>\n\n\n\n 3 Group life policies MUST include all of the following provisions EXCEPT<\/p>\n\n\n\n Ownership When can a policyowner change a revocable beneficiary?<\/p>\n\n\n\n Anytime The option that provides an additional death benefit for a limited amount of time at the lowest possible cost is called a(n)<\/p>\n\n\n\n Term rider Upon delivery of a rated life insurance policy, the Producer must obtain each of the following EXCEPT<\/p>\n\n\n\n Signed HIPAA disclosure An insurance company must provide information on fraudulent claims at the request of all of the following entities EXCEPT<\/p>\n\n\n\n local law enforcement agencies At what point does an informal contract become binding?<\/p>\n\n\n\n When one party makes an invitation and the other makes an offer Texas Life and Health Insurance Exam Questions andAnswers (Verified Solutions) 2023What type of reinsurance contract involves two companies automaticallysharing their risk exposure? – correct answer \u2705TreatyThe stated amount or percent of liquid assets that an insurer must have onhand that will satisfy future obligations to its policyholders is called – correctanswer \u2705reservesWhen third-party ownership is […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-114727","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/114727","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=114727"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/114727\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=114727"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=114727"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=114727"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
Answers (Verified Solutions) 2023
Insurance contracts are known as __<\/em> because certain future conditions or
acts must occur before any claims can be paid. – correct answer
\u2705conditional
Which of these require an offer, acceptance, and consideration? – correct
answer \u2705Contract
Which of these is NOT considered to be an element of an insurance
contract?
the offer
acceptance
negotiating
consideration – correct answer \u2705negotiating
An agent is an individual that represents whom? – correct answer \u2705Insurer
Which policy requires an agent to register with the National Association of
Securities Dealers (NASD) before selling? – correct answer \u2705Variable Life
<\/p>\n\n\n\n
A Straight Life annuity
A Cash Refund annuity
A Joint Life annuity
An installment Refund annuity<\/p>\n\n\n\n
5 months
6 months
12 months
5 months<\/p>\n\n\n\n
20-Pay Life accumulates cash value faster than Straight Life
Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurer’s financial rating
20-Pay Life and Straight Life accumulate cash value at the same rate
20-Pay Life accumulates cash value faster than Straight Life<\/p>\n\n\n\n
Insurance company
Insured
Applicant
Insurance company<\/p>\n\n\n\n
agreeing to a physical examination
delivery of policy
disclosure of any medical conditions
the initial premium<\/p>\n\n\n\n
Representation
Statement
Warranty
Warranty<\/p>\n\n\n\n
physician fees
experimental and investigative services
nursing services
experimental and investigative services<\/p>\n\n\n\n
Indemnity
Medicare Supplement
Medicaid
Medicare Supplement<\/p>\n\n\n\n
Full benefits are payable under the Master contract
Full benefits are payable under the converted policy
Benefits less required premium are payable under the converted policy
Full benefits are payable under the Master contract<\/p>\n\n\n\n
life insurance policies
dental policies
critical illness policies
life insurance policies<\/p>\n\n\n\n
Cost of Living Adjustment rider
Guaranteed Insurability Option rider
Waiver of Premium rider
Guaranteed Insurability Option rider<\/p>\n\n\n\n
submit all previously written policies to the Commissioner of Insurance’s office for servicing of the accounts
cancel all policies currently in effect and advise the insureds to place them elsewhere
continue to service the existing accounts but not solicit new business
wait at least five years before applying for a new license<\/p>\n\n\n\n
taxable to the beneficiary
payable to the company or another shareholder
normally paid after a short elimination period
payable to the company or another shareholder<\/p>\n\n\n\n
health information
financial information
overinsurance
health information<\/p>\n\n\n\n
Deducted when the policy is discontinued
Deducted from policy’s cash value
Deducted when assigned to another policyowner
Deducted when the policy is discontinued<\/p>\n\n\n\n
Its true corporate name
Its service mark
Its corporate logo
Its true corporate name<\/p>\n\n\n\n
critical illness
on-the-job accident
off-the-job accident
off-the-job accident<\/p>\n\n\n\n
free-look period has expired
insurance company issues policy
initial premium is collected
free-look period has expired<\/p>\n\n\n\n
Title 18 Fraud violation
Anti-Money Laundering violation
Unfair Trade Practice violation
Anti-Money Laundering violation<\/p>\n\n\n\n
Policy mailed to agent
Policy delivered to the applicant by the agent
Policy issued with a rating
Policy issued with a rating<\/p>\n\n\n\n
2
3
4
2<\/p>\n\n\n\n
rebating
misrepresentation
slander
misrepresentation<\/p>\n\n\n\n
Its purpose is to prevent the financial loss that may ensue if a key employee dies
The beneficiary is named by the key employee
The company purchases, owns, pays the premiums and is the beneficiary
The beneficiary is named by the key employee<\/p>\n\n\n\n
Tertiary
Contingent
Irrevocable
Irrevocable<\/p>\n\n\n\n
Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company
Cross off his name on the “pay to” portion of the check, write the name of the insurance company, and send the check back to the insurance company
Deposit the check in to his personal account, use the funds to purchase a cashiers check, and send the new cashiers check back to the insurance company
Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company<\/p>\n\n\n\n
an insurance product only
a securities product only
the insurance company assumes the investment risk
both an insurance and securities product<\/p>\n\n\n\n
Long-term care
Medicare
Her group health plan
Her group health plan<\/p>\n\n\n\n
is a hospital and medical expense insurance program
offers assistance in making health insurance premiums
Part D provides payment for surgeon expenses
is a hospital and medical expense insurance program<\/p>\n\n\n\n
Increase her policy’s coverage amount
Decrease her policy’s coverage amount
Nothing
Increase her policy’s coverage amount<\/p>\n\n\n\n
coverage includes necessary care and treatment of congenital defects
coverage during the first year is limited to congenital defects
continued coverage after the first 31 days is dependent on notification
coverage during the first year is limited to congenital defects<\/p>\n\n\n\n
Incontestable
Entire Contract Provision
Assignment
Entire Contract Provision<\/p>\n\n\n\n
$25,000 modified whole life policy
$25,000 individual term life policy
$25,000 individual whole life policy
$25,000 individual whole life policy<\/p>\n\n\n\n
Indeterminate Premium Life
Grader Premium Life
Modified Premium Life
Modified Premium Life<\/p>\n\n\n\n
S’s attained age
dividend amount used toward purchase
beneficiary’s age
beneficiary’s age<\/p>\n\n\n\n
Complete the application over the phone with the customer, sign the application for the customer, then send the application off to the insurance company
Complete the application and review the information with the customer prior to obtaining the customer’s signature, then send the application off to the insurance company
Have the customer fill out the application and send it to his office for him to sign, then send it off to the insurance company
Complete the application and review the information with the customer prior to obtaining the customer’s signature, then send the application off to the insurance company<\/p>\n\n\n\n
It is set by state regulation
It can be changed by the insured
It varies according to the contracts
It varies according to the contracts<\/p>\n\n\n\n
collect the correct premiums and pay the claim
pay the policy proceeds in the amount the premiums would have purchased at the insured’s actual age
pay the policy proceeds less a penalty not to exceed 12% of those proceeds
pay the policy proceeds in the amount the premiums would have purchased at the insured’s actual age<\/p>\n\n\n\n
The date the application was submitted to the insurance company
The date of application
The date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured
The date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured<\/p>\n\n\n\n
is prohibited by state law
is allowed only on policies dates after 1992
transfers rights from the company to the policyholder
transfers payments to someone other than the policyowner<\/p>\n\n\n\n
Blanket insurance
Dread disease insurance
Disability insurance
Dread disease insurance<\/p>\n\n\n\n
Major Medical
Travel
Disability Income
Disability Income<\/p>\n\n\n\n
Irrevocable
Revocable
Contingent
Revocable<\/p>\n\n\n\n
becomes critically ill
becomes chronically ill
is blinded in an accident
is blinded in an accident<\/p>\n\n\n\n
Carryover provision
Stop Loss provision
Corridor provision
Carryover provision<\/p>\n\n\n\n
Joint and Full Survivor
Life Annuity with Period Certain
Installment Refund
Life Annuity with Period Certain<\/p>\n\n\n\n
Collect initial premium along with a signed health statement
Explain to the applicant the policy is no longer in effect due to change in health condition
Collect initial premium and leave a binding receipt
Collect initial premium along with a signed health statement<\/p>\n\n\n\n
Care given at a nursing home
Treating a wound from a soldier injured at war
Lost income caused by a hospital stay
Surgically removing a facial birthmark<\/p>\n\n\n\n
The payments are received tax-free
Only available to employees of nonprofit charitable, educational, and religious organizations
Payments are made to an annuitant for life
Payments are made to an annuitant for life<\/p>\n\n\n\n
Automatic Premium Loan provision
Reinstatement provision
Waiver of Premium
Reinstatement provision<\/p>\n\n\n\n
She does NOT need to provide evidence of insurability
She will have up to 6 months to convert to an individual policy
She will be paying exactly the same premium for the individual plan as she did the group plan
She does NOT need to provide evidence of insurability<\/p>\n\n\n\n
Life settlement contract
Buy-sell arrangement
1031 Exchange
Life settlement contract<\/p>\n\n\n\n
Any legal resident except those incarcerated
Only those who do not have access to employer-sponsored coverage
Only those who might be eligible for tax credits
Any legal resident except those incarcerated<\/p>\n\n\n\n
Social Security
Medicaid
FICA
Social Security<\/p>\n\n\n\n
Estoppel
Contract
Representation
Contract<\/p>\n\n\n\n
Through mutual funds, stocks, bonds
Based on returns from insurer’s general account
Tied to Treasury Bills
Through mutual funds, stocks, bonds<\/p>\n\n\n\n
applicant’s spouse
National Association of Insurance Commissioners (NAIC)
applicant’s physician
applicant’s physician<\/p>\n\n\n\n
31
45
90
31<\/p>\n\n\n\n
Name of the insured
Name of the insurer
Exclusions
Exclusions<\/p>\n\n\n\n
Aviation exclusion
Impairment rider
Accidental Death Benefit rider
Aviation exclusion<\/p>\n\n\n\n
Entire Contract
Insuring Clause
Owner’s Rights
Owner’s Rights<\/p>\n\n\n\n
Company
Insured
Assignee
insured<\/p>\n\n\n\n
Intended to be used by individuals age 65 and older
Provides disability income benefits
Automatically covers those receiving Social Security disability benefits
Funded by both state and federal governments<\/p>\n\n\n\n
Policyowner has no say where the investment will go but can choose the premium mode
The investment vehicle for this type of policy is held in the insurer’s general portfolio
The death benefit can vary but the policyowner has no say in the premium amount paid
Policyowner controls where the investment will go and selects the amount of the premium payment<\/p>\n\n\n\n
how much life insurance a client should apply for
which company a client should use when applying for life insurance
what the maximum amount the client can spend on life insurance
how much life insurance a client should apply for<\/p>\n\n\n\n
underwriting or rating classification upon which the illustration is based
initial death benefit
company’s mortality table
company’s mortality table<\/p>\n\n\n\n
Premiums are lower for the first five years, increase the sixth year, then levels off for the remaining length of the contract
Owner has the option of converting to term insurance
Premiums are payable for as long as there is insurance coverage in force
Premiums are payable for as long as there is insurance coverage in force<\/p>\n\n\n\n
A Suicide clause must apply equally to Life and Accidental Death and Dismemberment (AD&D) policies
An insurance company must actuarially justify any suicide limitation
Suicide may not be a defense against payment after the second year
Suicide may not be a defense against payment after the second year<\/p>\n\n\n\n
Person designated by the primary beneficiary’s executor to receive policy proceeds
Person designated by the state to receive policy proceeds in the event that the primary beneficiary dies
Person designated by the insurance comapany to receive policy proceeds in the event that the primary beneficiary dies
Person designated by the insured to receive policy proceeds in the event that the primary beneficiary dies before the insured<\/p>\n\n\n\n
with a very short Elimination period
to pay benefits to the Corporation or other shareholders
to pay benefits to the insured’s spouse
to pay benefits to the Corporation or other shareholders<\/p>\n\n\n\n
Builds cash value
Has nonforfeiture options
Endows at the end of the policy period
Expires at the end of the policy period<\/p>\n\n\n\n
Include a statement that dividends ARE guaranteed
Explain the applicable Nonforfeiture values
Explain the surrender cost indexes for 5 and 10 years
Include a statement that dividends are NOT guaranteed<\/p>\n\n\n\n
If material to the risk, false representations will void a policy
Representations are statements guaranteed to be true in every respect
If material to the risk, false representations will NOT void a policy
If material to the risk, false representations will void a policy<\/p>\n\n\n\n
90
60
30
90<\/p>\n\n\n\n
stockholders
agents
insureds
stockholders<\/p>\n\n\n\n
The gross premium is lower on a monthly payment mode as compared to being paid annually
The cash value from a life policy paid on a monthly basis builds quicker than one paid on an annual basis
The face amount of a life policy paid on a monthly basis is higher than one paid on an annual basis
The gross premium is higher on a monthly payment mode as compared to being paid annually<\/p>\n\n\n\n
Family Maintenance Policy
Family Income Policy
Survivor Policy
Family Survivor Policy
Family Maintenance Policy<\/p>\n\n\n\n
Beneficiary change
Irrevocable assignment
Collateral assignment
Collateral assignment<\/p>\n\n\n\n
PPO
EPO
PLHSO
PPO<\/p>\n\n\n\n
higher than the actual expenses incurred
normally subject to deductibles
normally subject to coinsurance
lower than the actual expenses incurred<\/p>\n\n\n\n
make tax-deductible contributions to the plan
make tax deductible contributions to key employees only
make partial tax-deductible contributions to the plan
make tax-deductible contributions to the plan<\/p>\n\n\n\n
Borrow against policy cash value and use as a down payment
Assign policy ownership to the bank
Name bank as beneficiary
Assign policy ownership to the bank<\/p>\n\n\n\n
Consideration
Waiver of Premium
Reinstatement
Grace Period<\/p>\n\n\n\n
Offer and acceptance
Entire Contract
Amount of premium payments and when they are due
Amount of premium payments and when they are due<\/p>\n\n\n\n
Nothing
$50,000
$100,000
$50,000<\/p>\n\n\n\n
$500,000
$250,000
$0
$0<\/p>\n\n\n\n
Consideration clause
Benefit clause
Insuring clause
Insuring clause<\/p>\n\n\n\n
Whole Life
Credit Life
Universal Life
Whole Life<\/p>\n\n\n\n
Prevents delayed claim payments made by the insurer
Requires a probation period for each claim filed by the insured
Protects the insurer from frivolous lawsuits
Prevents delayed claim payments made by the insurer<\/p>\n\n\n\n
Terminal illness
Inability of the insured to perform more than 2 Activities of Daily Living (ADL’s)
Inability of the insured to maintain insurance premiums due to unemployment
Inability of the insured to perform more than 2 Activities of Daily Living (ADL’s)<\/p>\n\n\n\n
Incontestable Period
Insuring Agreement
Conversion privilege
Conversion privilege<\/p>\n\n\n\n
determine the trust deposits of the company
approve the claims records of the company for tax purposes
assess the company’s value on behalf of a prospective client
determine the solvency of the company<\/p>\n\n\n\n
Part A covers doctor’s services; Part B covers hospitalization
Part A covers hospitalization; Part B covers doctor’s services
Part A covers prescription drugs; Part B covers disability
Part A covers hospitalization; Part B covers doctor’s services<\/p>\n\n\n\n
Receipt
Policy
Certificate
Certificate<\/p>\n\n\n\n
Universal Life
Graded Benefit Whole Life
Modified Whole Life
Universal Life<\/p>\n\n\n\n
An investment
Modified Endowment Contract (MEC)
Endowment
Modified Endowment Contract (MEC)<\/p>\n\n\n\n
The maximum amount an employer can contribute to a contributory health plan
The maximum deductible an insured can be charged
The maximum amount considered eligible for reimbursement by an insurance company under a health plan
The maximum amount considered eligible for reimbursement by an insurance company under a health plan<\/p>\n\n\n\n
Cash value plus interest
$20,000 death benefit
Face amount plus interest
$20,000 death benefit<\/p>\n\n\n\n
Preferred Provider Organization (PPO)
Medical Information Bureau (MIB)
Health Maintenance Organization (HMO)
Medical Information Bureau (MIB)<\/p>\n\n\n\n
conditionally renewable
guaranteed renewable
noncancellable
guaranteed renewable<\/p>\n\n\n\n
Modified Whole Life
Decreasing Term
Universal Life
Universal Life<\/p>\n\n\n\n
A straight life annuity
An immediate annuity
A deferred annuity
An immediate annuity<\/p>\n\n\n\n
interest to the insurer is increased while administrative costs are decreased
mortality costs are greater
interest to the insurer is decreased while the administrative costs are increased
interest to the insurer is decreased while the administrative costs are increased<\/p>\n\n\n\n
Fixed Installment Deferred
Flexible Installment Deferred
Flexible Premium Immediate
Flexible Installment Deferred<\/p>\n\n\n\n
Beneficiary
Reinsurer
Insured
Insured<\/p>\n\n\n\n
Term rider
Family Income rider
Payor benefit
Term rider<\/p>\n\n\n\n
exclusion
limitation
exception
exclusion<\/p>\n\n\n\n
detect and deter alien insurance companies
detect and deter terrorism
detect and deter misrepresentations
detect and deter terrorism<\/p>\n\n\n\n
Medicaid
Medicare Supplemental Program
Medicare
Medicaid<\/p>\n\n\n\n
Recurrent Disability
Presumptive Disability
Occupational Disability
Residual Disability<\/p>\n\n\n\n
hourly paid laborers or their supervisors
administrative, managerial, or sales personnel
related by marriage, blood or legal adoption
related by marriage, blood or legal adoption<\/p>\n\n\n\n
used in the event of loss of income
issued in an amount not to exceed the amount of the loan
coverage that waives the premiums on a loan payment in the event of total disability
issued in an amount not to exceed the amount of the loan<\/p>\n\n\n\n
conditionally renewable
cancellable
guaranteed renewable
noncancellable<\/p>\n\n\n\n
Financial planners
Life and Health insurance counselors
Managing general agents
Legal reserve agents<\/p>\n\n\n\n
Variable Annuity
Medicare Supplement policy
Term Life policy
Medicare Supplement policy<\/p>\n\n\n\n
guilty of<\/p>\n\n\n\n
fraud
rebating
boycotting
coercion<\/p>\n\n\n\n
The insured fails to pay the premium
The attending physician dies before the claim is settled
The insured is no longer in good health
The insured fails to pay the premium<\/p>\n\n\n\n
transportation to and from an outpatient facility
outpatient treatment through a public hospital or clinic
group therapy prescribed by a physician
transportation to and from an outpatient facility<\/p>\n\n\n\n
5 months
4 1\/2 months
4 months
4 months<\/p>\n\n\n\n
under the laws of another state
is a territory of the United States
outside the United States
under the laws of another state<\/p>\n\n\n\n
risk retention group
risk assumption group
captive insurer
risk retention group<\/p>\n\n\n\n
Submit the claim in any form
Wait for the claim form to arrive
Resubmit the request for a claim form
Submit the claim in any form<\/p>\n\n\n\n
Insurance with Other Insurers
Misstatement of Age
Change of Occupation
Payment of Claims<\/p>\n\n\n\n
Coinsurance
Indemnity
Co-deductible
Coinsurance<\/p>\n\n\n\n
Accelerated Benefits provision
Assignment provision
Waiver of Premium provision
Payor provision<\/p>\n\n\n\n
riders
exclusions
limitations
exclusions<\/p>\n\n\n\n
life insurance policies
dental policies
critical illness policies
life insurance policies<\/p>\n\n\n\n
Entire Contract
Extended Term
Misstatement of Age
Extended Term<\/p>\n\n\n\n
Exclusion
Ejection
Expulsion
Exclusion<\/p>\n\n\n\n
Survivorship
Adjustable
Joint
Survivorship<\/p>\n\n\n\n
Multiple Employer Trust
Health Maintenance Organization
Co-op Arrangement
Health Maintenance Organization<\/p>\n\n\n\n
Premium payments may be made at unscheduled times
Premiums may be applied as a credit against income tax
Face amount may be adjusted
Premiums may be applied as a credit against income tax<\/p>\n\n\n\n
Primary beneficiary’s next of kin
Insured’s estate
Insured’s contingent beneficiary
Insured’s contingent beneficiary<\/p>\n\n\n\n
Tax liability
Business expenses
Probate costs
Business expenses<\/p>\n\n\n\n
1959 – Intervention by (SEC) The Securities and Exchange Commission
1999 – Financial Services Modernization Act
1945 – The McCarran-Ferguson Act
1970 – Fair Credit Reporting Act<\/p>\n\n\n\n
Family Maintenance Policy
Family Survivor Policy
Family Income Policy
Family Maintenance Policy<\/p>\n\n\n\n
Substandard applicants are occasionally declined by underwriters
Preferred risk applicants typically have better premium rates than standard risk applicants
An applicant can be classified as substandard risk because of a hazardous job
Substandard applicants are never declined by underwriters<\/p>\n\n\n\n
with other employer-sponsored benefit plans
by the employer
only during specific open enrollment periods
by the employer<\/p>\n\n\n\n
Money Market securities
Insurer’s corporate business account
Junk bonds
Insurer’s corporate business account<\/p>\n\n\n\n
$7,500
$5,000
$2,500
$10,000<\/p>\n\n\n\n
50%
75%
100%
50%<\/p>\n\n\n\n
Permits an agent to solicit insurance in Texas
Permits a decreased agent’s relative to act as an agent for a limited period of time
Permits an insurance company to transact business in Texas
Permits an insurance company to transact business in Texas<\/p>\n\n\n\n
within a maximum of three months
within a reasonable amount of time
at least monthly
immediately<\/p>\n\n\n\n
notify an insurer of a claim within a specified time
wait 60 days after filing a claim to initiate a lawsuit against an insurer
notify their physician of a claim within a specified time
notify an insurer of a claim within a specified time<\/p>\n\n\n\n
Nothing. Claim will be denied
$50,000 minus any outstanding policy loans
$100,000 because the cause of death was accidental
$50,000 minus any outstanding policy loans<\/p>\n\n\n\n
an amount that the premiums paid would have purchased at the current age or ages
an amount consists of the premiums paid for the policy if the policy was issued for over three years
reduced by a specified percentage of the face amount
an amount that the premiums paid would have purchased at the current age or ages<\/p>\n\n\n\n
Change will be made only if premiums are paid current
Change will be made immediately
Request of the change will be refused
Request of the change will be refused<\/p>\n\n\n\n
Hospital Expense
Surgical Expense
Hospital Income
Major Medical<\/p>\n\n\n\n
exclusion for the medical condition
extended Contestable period
Concealment clause
exclusion for the medical condition<\/p>\n\n\n\n
Policy Exclusions provision
Entire Contract provision
Incontestability provision
Entire Contract provision<\/p>\n\n\n\n
Noncontributory
Contributory
Participating
Contributory<\/p>\n\n\n\n
the initial premium
forward it immediately to the insurer
Attending Physician Statement
the initial premium<\/p>\n\n\n\n
15
20
24
24<\/p>\n\n\n\n
a stock insurer
a mutual insurer
the Life and Health Insurance Guaranty Association
a fraternal benefit society<\/p>\n\n\n\n
Marriage to a person with a pre-existing condition
Excessive use of health care benefits
Refusing HMO advice to quit smoking
Failure to pay for coverage<\/p>\n\n\n\n
Competent Parties
Offer\/Acceptance
Legal Purpose (Insurable Interest)
Legal Purpose (Insurable Interest)<\/p>\n\n\n\n
death benefits
Section 1035 exchange
capital gains tax rate
marital deduction<\/p>\n\n\n\n
specialized company
limited insurance company
fraternal benefit society
fraternal benefit society<\/p>\n\n\n\n
Term to Age 65
Whole Life Paid-Up at Age 65
Endowment at Age 65
Endowment at Age 65<\/p>\n\n\n\n
Insurer is required to initially cover this pre-existing condition
Insurer will permanently exclude the condition from the policy
Insurer will likely treat as a pre-existing condition which may not be covered for one year
Insurer will likely treat as a pre-existing condition which may not be covered for one year<\/p>\n\n\n\n
Existing life insurance coverage with other carriers
Credit scores
Primary physician
Testing positive for marijuana use from a previous screening<\/p>\n\n\n\n
Consideration clause
Entire Contract
Owner’s rights
Insuring clause<\/p>\n\n\n\n
Fixed Period
Fixed Amount
Life Income
Life Income<\/p>\n\n\n\n
Throughout the entire length of the contract
When the insured dies
During the contestable period
Inception of the contract<\/p>\n\n\n\n
insureds
applicants
other agents
other agents<\/p>\n\n\n\n
The company only
The agent and the company
The Life, Accident, Health and Hospital Insurance Guaranty Association
The agent and the company<\/p>\n\n\n\n
Be at least 17 years of age
Have been a resident of Texas for at least 6 months
Post a $100,000 Performance Bond
Be honest, trustworthy, and reliable<\/p>\n\n\n\n
The financial institution
The employer
The employee
The employee<\/p>\n\n\n\n
Additional coverage rider
Paid-up option rider
Extended insurability rider
Guaranteed insurability rider<\/p>\n\n\n\n
Age of the insured determines the amount of the benefits
Normally includes an Elimination period
Benefits are normally taxable
Normally includes an Elimination period<\/p>\n\n\n\n
Exclusion
Collateral assignment
Concealment
Exclusion<\/p>\n\n\n\n
Term to Age 70
Universal Life
Adjustable Life
30 Pay Life<\/p>\n\n\n\n
Past-due interest on a policy loan is added to the total debt
Insurance companies can send delinquent interest accounts to a collection agency
Insurance companies can charge an interest rate based on the policyowner’s credit report
Past-due interest on a policy loan is added to the total debt<\/p>\n\n\n\n
$14,000
$6,000
$0
$0<\/p>\n\n\n\n
Owner’s rights
Nonforfeiture options
Conversion
Conversion<\/p>\n\n\n\n
Minimizes the need for deductibles
Discourages adverse selection
Minimizes the waiting period
Discourages overutilization of the insurance coverage<\/p>\n\n\n\n
Income tax and a 10% penalty assessed upon funds withdrawn from the Qualified Plan
Continued tax-free accumulations in the bank savings account
Only a 10% penalty on the withdrawal of funds
Income tax and a 10% penalty assessed upon funds withdrawn from the Qualified Plan<\/p>\n\n\n\n
5
10
30
30<\/p>\n\n\n\n
Everyone must be covered in the group
Employer must pay for the entire premium
The group must be formed for the purpose of getting affordable insurance
Everyone must be covered in the group<\/p>\n\n\n\n
a summary of the coverage provided
the named beneficiaries
the schedule and amount of premium payments
the schedule and amount of premium payments<\/p>\n\n\n\n
Husband’s estate
K’s estate
Trust fund
Daughter<\/p>\n\n\n\n
is found guilty of misrepresentation or fraud in obtaining the license
files for bankruptcy
fails to write any business for six consecutive months<\/p>\n\n\n\n
Claim payment is negotiated between physician and patient
Determined by the schedule of benefits from the hospital
Determined by the terms of the policy
Determined by the terms of the policy<\/p>\n\n\n\n
A Whole Life Policy with Extended Term
A Whole Life Policy with an Other Insured Rider
A Whole Life Policy with a Payor benefit
A Whole Life Policy with an Other Insured Rider<\/p>\n\n\n\n
States the scope and limits of the coverage
States the amount of premium to be collected
Prohibits the insured from suing the insurer for at least 60 days after filing a written proof of loss
States the scope and limits of the coverage<\/p>\n\n\n\n
Premiums are higher
Premiums are lower
Pre-existing conditions not covered
Premiums are lower<\/p>\n\n\n\n
18
24
30
12<\/p>\n\n\n\n
75%
50%
0%
0%<\/p>\n\n\n\n
To attest that the statements on the application are accurate to the best of the applicant’s knowledge
To give Power of Attorney to the producer if needed
To attest that all statements on the application are guaranteed to be true
To attest that the statements on the application are accurate to the best of the applicant’s knowledge<\/p>\n\n\n\n
Conversion provision
1035 Exchange
Incontestable period
Conversion provision<\/p>\n\n\n\n
partially deductible to the employee
tax-deductible to the employee
taxable income to the employee
tax-deductible to the employee<\/p>\n\n\n\n
the risk of dying prematurely
the risk of living longer than expected
the risk of not having enough retirement income
the risk of living longer than expected<\/p>\n\n\n\n
Taxed as ordinary income
Capital gains tax is applied
Distributions are received tax-free
Distributions are received tax-free<\/p>\n\n\n\n
converted to an individual permanent policy at a group rate
continued at an individual rate
continued at a group rate
converted to an individual permanent policy at an individual rate<\/p>\n\n\n\n
6
9
12
6<\/p>\n\n\n\n
Beneficiary Designation
Conversion Privilege
Right to Loan Proceeds
Right to Loan Proceeds<\/p>\n\n\n\n
After the consent of the current beneficiary
Never
Only if primary beneficiary dies
Anytime<\/p>\n\n\n\n
Accidental Death and Dismemberment rider (AD&D)
Family rider
Annuity
Accidental Death and Dismemberment rider (AD&D)<\/p>\n\n\n\n
Signed amendment
Signed statement of Good Health
The required premium
Signed HIPAA disclosure<\/p>\n\n\n\n
the Commissioner of Insurance
the Attorney General
an insured
an insured<\/p>\n\n\n\n
When an offer is made by one party and the other party rejects the offer and makes a counteroffer
When one party makes an offer and the other party accepts that offer
When one party makes the required payment
When one party makes an offer and the other party accepts that offer<\/p>\n","protected":false},"excerpt":{"rendered":"