Accident and Health Insurance Exam Questions and 1100% Verified Correct Answers Using Marking Scheme Already Scored 100% A basis of prepayment in which a fixed amount of money is prepaid per individual and
found in some managed care plan is known as:
A: Per Head Payment
B: Fee for Service
C: Salaried Amount
D: Per Capita Prepaid - Correct AnswerD: Per Capita Prepaid
A business can provide group insurance to their employees if:
A: the purchase of insurance is incidental to the business
B: the purchase of insurance is entirely made by the employer
C: the purchase of insurance is made regardless of business ownership
D: None of the Above - Correct AnswerA: the purchase of insurance is incidental to the business
A CORRECT statement about benefits payable under a Disability Buy-Out policy that is
owned by a business entity is that they are:
A: related directly to salary
B: paid in installments
C: paid to the corporation
D: paid directly to the employee - Correct AnswerC: paid to the corporation
A Long Term Care Group policy that is converted has to be:
A: conditionally renewable
B: guaranteed renewable
C: optionally renewable
D: noncancelable - Correct AnswerB: guaranteed renewable
A LTC policy that will only pay for ADL given occasionally by a licensed professional is:
A: Skilled Care
B: Intermediate Care
C: Custodial Care
D: None of the Above - Correct AnswerC: Custodial Care
A mandatory provision in health policies that specifies when an insurer must send proof of loss forms to the insured within a certain amount of time from notice of claim is known as?
A: Claim Forms
B: Time Limit on Certain Defenses
C: Written Proof of Loss
D: Notice of Claim - Correct AnswerA: Claim Forms
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A noncancelable policy meCorrect Answerthe company A: may not raise the premium or terminate the policy except for nonpayment of premium
B: may not cancel before the insured reaches age 50
C: may pay limited benefits and cannot cancel all benefits
D: can only terminate coverage if the insured switches occupations - Correct AnswerA: may not raise the premium or terminate the policy except for nonpayment of premium
A policy that is issued at standard rates is an example of:
A: Adverse Selection
B: Risk Classification
C: Substandard Risk
D: None of the Above - Correct AnswerB: Risk Classification
A producer earned a fee of $500 and a commission for the sale of an insurance product.Forty-five days after coverage began the insured cancelled the policy. What, if any, refund is the insured entitled to in this instance?
A: No refund amount is due.
B: $250
C: $500
D: $500 and the producer must return any commissions earned from the sale back to
the insurance company. - Correct AnswerB: $250
A producer is served with a Cease and Desist Order for unfair competition and he violates the Order. The statutory fine for this action is
A: 500
B: 1000
C: 2000
D: $100 per day up to a maximum of $5,000. - Correct AnswerB: 1000
A producer tells his client that his disability income policy will pay for all of his medical bills if disabled. The producer is guilty of
A: Twisting
B: Misrepresentation
C: Defamation
D: False Advertising - Correct AnswerB: Misrepresentation
A producer violates the written order from the Director pertaining to their market conduct activities. What is the maximum civil penalty that can be assessed by the Director against a producer in this circumstance?
A: $10,000
B: $20,000
C: $50,000
D: $100,000 - Correct AnswerB: $20,000
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A producer violates the written order from the Director pertaining to their market conduct activities. What is the maximum civil penalty that can be assessed by the Director against a producer in this circumstance?
A: $10,000
B: $20,000
C: $50,000
D: $100,000 - Correct AnswerB: $20,000
A producer who makes misleading comparisons between a product an insured owns and a policy the producer is trying to sell as a replacement is an activity known as
A: Misappropriation
B: Twisting
C: Defamation
D: Rebating - Correct AnswerB: Twisting
A producer who places insurance with an insurer, either directly or indirectly, with whom the producer does not have an agent contract
A: is grounds for license revocation.
B: requires a special limited license.
C: requires that the producer must post a surety bond in favor of the people of Illinois.D: must pay a state fee based on volume of business placed with such an insurer. - Correct AnswerC: requires that the producer must post a surety bond in favor of the people of Illinois.
A provision in a health policy that stipulates that any medical impairments that occurred within a specific time before coverage began that will not be covered under a policy is
known as:
A: Exclusion
B: Waiver of Coverage
C: Preexisting Conditions
D: All of the Above - Correct AnswerC: Preexisting Conditions
All of the following are CORRECT about Medicare EXCEPT:
A: An insured who is age 30 but collecting Social Security disability for the last two years is eligible for Medicare.B: An insured who is age 60 and is at the end stage of renal failure is eligible for Medicare.
C: An insured who turns age 65 and is still employed is eligible for Medicare.
D: An insured who has Medicare Part A is eligible to enroll for Medigap policies within six months of enrolling in Part A. - Correct AnswerD: An insured who has Medicare Part A is eligible to enroll for Medigap policies within six months of enrolling in Part A.
All of the following are CORRECT under advertising statutes EXCEPT:
A: Insurers can use third party endorsements, but they must be genuine and factual.
B: All ads, regardless of mediums, must be clear and complete.
C: Details on PEC must be disclosed when replacement is involved. 3 / 4
D: Advertisement files must be kept by the insurer for up to 3 years. - Correct AnswerD: Advertisement files must be kept by the insurer for up to 3 years.
All of the following are CORRECT under Medicare supplement minimum standards
EXCEPT:
A: Policies must be issued as noncancelable.
B: Payments on benefits may not be labeled as usual or customary.
C: Supplements cannot pay benefits on losses resulting for sickness any differently than accidents.D: Except for replacement, it is illegal for an agent to sell a supplement to an insured that already owns one. - Correct AnswerA: Policies must be issued as noncancelable.
All of the following are optional provisions EXCEPT:
A: Physical Examination and Autopsy
B: Illegal Occupation
C: Change of Occupation
D: None of the Above - Correct AnswerA: Physical Examination and Autopsy
All of the following are qualifications that apply to a non-resident producer in Illinois,
EXCEPT:
A: The non-resident must be licensed in their home state for a minimum of 2 years before Illinois will grant non-resident producer status.B: The non-resident must file an affidavit naming the Director to receive service of process on the non-resident's behalf.
C: There is a $250 license fee due and payable every two years.
D: The non-resident producer must be in good standing in their home state with
reference to their resident producer status. - Correct AnswerA: The non-resident must be licensed in their home state for a minimum of 2 years before Illinois will grant non- resident producer status.
All of the following are required disclosure forms at application EXCEPT:
A: HIPAA
B: HIV
C: MIB
D: None of the Above - Correct AnswerC: MIB
All of the following are required disclosure forms at application EXCEPT:
A: HIPAA
B: HIV
C: MIB
D: None of the Above - Correct AnswerC: MIB
All of the following are true regarding benefits under a Key Employee policy EXCEPT:
A: Benefits may be paid monthly over a year period to make up employee salary.
B: Benefits may be taxable or tax free depending on premium deduction by the payor.C: Benefits may be paid up to three times employee salary in a lump sum amount.
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