MD Life and Health Final Exam With
Complete Solutions<\/p>\n\n\n\n
The difference between a Long Term Care Partnership Plan and a Non-Partnership
Plan is which of the following? CORRECT ANSWERS Asset Protection
All of the following are considered appropriate uses of life insurance for business
purposes EXCEPT CORRECT ANSWERS Protecting the business by covering entry
level employees with life insurance
Susan is insured through her Group Health Insurance plan and changed her coverage
to an individual plan with the same insurer after her employment was terminated. This
change is called a(n) CORRECT ANSWERS conversion
Maria is a Preferred Provider Organization (PPO) subscriber and received care from an
out-of-network provider. Which of the following is the likely result? CORRECT
ANSWERS Care is covered
Which of these statements concerning Traditional IRAs is CORRECT? CORRECT
ANSWERS Earnings are taxable when withdrawn
Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), a terminated
employee’s benefits must CORRECT ANSWERS be the same and the premium cannot
exceed 102%
A life insurance policy normally contains a provision that restricts coverage in the event
of death under all of the following situations EXCEPT CORRECT ANSWERS fare\u0002paying passenger
According to the Health Insurance Portability and Accountability Act (HIPAA), when can
a group health policy renewal be denied? CORRECT ANSWERS Participation or
contribution rules have been violated
Who regulates the quality of care provided by a heath maintenance organization
(HMO)? CORRECT ANSWERS Secretary of the Department of Health and Mental
Hygiene
Under a disability income policy, which provision would be payable if the cause of an
injury is unexpected and accidental? CORRECT ANSWERS Accidental bodily injury
provision<\/p>\n\n\n\n
Shirley has a $500,000 10-year non-renewable level term life policy. If she dies 15
years after the policy’s inception date, how much will her beneficiary receive?
CORRECT ANSWERS Nothing
Tom has a rider on his disability income policy that guarantees the right to increase his
benefits without a medical exam. What kind of rider is this? CORRECT ANSWERS
Guaranteed insurability rider
The deeds and actions of a producer indicate what kind of authority? CORRECT
ANSWERS Apparent
Jennifer is required to pay a specific sum out of pocket before any benefits are paid in a
year. Her health policy most likely contains a(n) CORRECT ANSWERS deductible
An individual most likely will have an insurable interest in insuring a person’s life if
CORRECT ANSWERS an economic interest exists for the continuance of the insured’s
life
According to life insurance contract law, insurable interest exists CORRECT ANSWERS
at the time of application
In an employer-sponsored contributory group Disability Income plan, the employer pays
60% of the premium and each employee pays 40% of the premium. Any income
benefits paid are taxed to the employee at CORRECT ANSWERS 60% of the benefit
Which of the following is considered to be an alternative to a life settlement? CORRECT
ANSWERS Accelerated death benefit rider
A separate converted policy may, at the option of the insurance company, be issued to
cover a(n) CORRECT ANSWERS dependent
Which of the following decisions would a Health Savings Account (HSA) owner NOT be
able to make? CORRECT ANSWERS The amount contributed by the employer
According to the Affordable Care Act, any plan in existence prior to which date is
considered a grandfathered plan? CORRECT ANSWERS March 23, 2010
The taxable portion of each annuity payment is calculated using which method?
CORRECT ANSWERS Exclusion Ratio
Medicare Part A does not pay for medical benefits provided for treatment in a skilled
nursing facility beyond CORRECT ANSWERS 100 days
Who is eligible for insurance under a group policy issued to a labor union? CORRECT
ANSWERS Every member of that union<\/p>\n\n\n\n
Credit Accident and Health plans are designed to CORRECT ANSWERS help pay off
existing loans during periods of disability
Key Person Disability Insurance pays benefits to the CORRECT ANSWERS employer
What happens when an insurance policy is backdated? CORRECT ANSWERS The
policy’s effective date is earlier than the present
According to the Affordable Care Act, what metal tier is required to have an actuarial
value of 70% with covered individuals paying 30% through deductibles, co-pays, and
other cost sharing features? CORRECT ANSWERS Silver Plan
Which of the following is an annuity that is linked to a market-related index? CORRECT
ANSWERS Equity-indexed annuity
Which of these factors is NOT taken into consideration when determining the cost of a
long-term care policy? CORRECT ANSWERS Personal income
A person who, for a fee, gives advice or recommendations on benefits provided by an
insurance contract is called CORRECT ANSWERS an advisor
What type of policy would only provide coverage for specific types of illnesses (cancer,
stroke, etc)? CORRECT ANSWERS Dread disease insurance
When does a life insurance policy typically become effective? CORRECT ANSWERS
When initial premium is collected and policy is issued
Claims payable to a Disability Income insured, even when the insured can continue to
work, are the result of a CORRECT ANSWERS Presumptive disability
If an employee contributes 50% toward the disability plan premium provided by an
employer, what would be considered the taxable income of a $1,000 monthly disability
benefit? CORRECT ANSWERS $500
Which of the following basics is a producer’s fiduciary responsibility? CORRECT
ANSWERS Collecting premiums and paying them to the insurance company
Shawn, Mike, and Dave are brothers who have a $100,000 “first to die” joint life policy
covering all three of their lives. If Mike dies first, the policy proceeds CORRECT
ANSWERS will no longer provide insurance protection
All of the following actions are considered rebating EXCEPT CORRECT ANSWERS
sharing commissions with other licensed and appointed <\/p>\n\n\n\n
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