Financial Test
Quiz yourself by thinking what should be in
each of the black spaces below before clicking
on it to display the answer.
Help!
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| show | That a claim will be paid if an insurer becomes insolvent
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| Nonparticipating insurers do not allow their policyowners to receive the following | show 🗑
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| show | Fraternal Benefit Society System
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| show | Contract that allows the policyowner to receive a share of surplus in the form of policy dividends
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| Which of the following is a type of insurance where an insurer transfers loss exposures from policies written for its insureds? | show 🗑
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| show | Captive insurer
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| show | Mutual insurer
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| show | Losses due to fraud are eliminated
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| Which of the following is a contract that involves one party which indemnifies another when a loss arises from an unknown event? | show 🗑
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| John has an insurance policy that gives him the right to share in the insurer's surplus. What kind of policy is this? | show 🗑
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| Mutual insurers pay dividends to participating policyowners if the insurer has which of the following? | show 🗑
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| Which entity has as one of its objectives preserving state regulation of insurance? | show 🗑
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| show | Reinsurers usually deal with group policyowners.
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| show | PPGA's primarily sell. General agents primarily recruit, train, and manage.
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| All the following types of insurance companies may be approved to operate in nearly all states EXCEPT | show 🗑
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| What is the purpose of insurance? | show 🗑
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| Which title can a life insurance agent use when conducting business? | show 🗑
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| show | Premiums for participating policies are usually higher than for non-participating policies
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| show | Direct selling
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| A life insurance company that shares its suplus earnings with its insureds is known as | show 🗑
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| show | share in any company earnings and receive a dividend
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| show | pure risk
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| show | Probability of loss is unknown
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| Restoring an insured to the same condition as before a loss is known as | show 🗑
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| Which of the following describes the statement "The more times an event is repeated, the more predictable the outcome becomes"? | show 🗑
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| Which of the following is NOT considered to be a definition of the term "loss"? | show 🗑
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| Which of these statements correctly describes risk? | show 🗑
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| show | Speculative risk
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| Which of the following is considered to be a situation that has the potential for loss? | show 🗑
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| Which of the following is NOT an element of an insurable risk? | show 🗑
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| show | Risk is eliminated
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| show | Hazard
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| show | Moral hazard
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| Which of the following is NOT considered a definition of risk? | show 🗑
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| Who is considered the owner of a mutual insurance company? | show 🗑
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| Which of the following statements correctly describes a contract of indemnity? | show 🗑
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| show | Indemnity contract
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| show | Equal consideration is required between the involved parties
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| Which principle is accurately described with the statement "Insureds are entitled to recover an amount NOT greater than the amount of their loss"? | show 🗑
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| A unilateral contract is one in which | show 🗑
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| The importance of a representation is demonstrated in what rule? | show 🗑
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| Which course of action is the insurer entitled to when deliberate concealment is committed by the insured? | show 🗑
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| Which statement is CORRECT when describing a contract of adhesion? | show 🗑
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| A contract requires | show 🗑
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| show | Probability of loss
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| Which of the following requires insurers to disclose when an applicant's consumer or credit history is being investigated | show 🗑
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| show | Buyer's guide and policy summary
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| show | paid to the policyowners
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| Companies that sell more than one type of insurance are | show 🗑
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| John and Mary have a handicapped child that is financially dependent upon them. The death of one of the parents would not be financially disastrous, however the death of both likely would be. Which policy would be best suited for them? | show 🗑
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| show | a modified endowment contract
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| show | Modified premium, ordinary life, single premium
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| In a renewable term life insurance policy, the contract will usually | show 🗑
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| Which of the following is NOT a true description of non-medical life insurance? | show 🗑
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| A life insurance policy's limit of liability would be | show 🗑
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| Which of the following is NOT true regarding a family policy that covers children? | show 🗑
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| A life insurance policy where the insured can choose where the cash value can be invested is called | show 🗑
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| Variable life | show 🗑
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| show | endowment insurance
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| show | 10%
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| In a modified endowment contract, the penalty tax imposed on withdrawals is | show 🗑
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| show | Universal life
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| show | Non-medical
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| Which of the following statements do NOT apply to child coverage in a family policy? | show 🗑
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| show | Decreasing term
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| show | Insured becomes totally disabled
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| show | The policy's cost basis is exempt from taxation
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| show | Policy exclusion
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| A life insurance policy can be surrendered for its cash value under which policy provision? | show 🗑
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| show | A dividend option is selected by the insured at the time of policy purchase
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| An insurer can be protected from adverse selection with which policy provision? | show 🗑
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| show | 12/15th of the policy's face amount
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| show | Policy's cash value is not affected
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| After a policy has lapsed, which provision allows the insured to continue coverage? | show 🗑
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| show | Bank loans
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| In a life insurance policy, the entire contract consists of the | show 🗑
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| show | Monthly income payments
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| show | Make a premium payment after the due date without any loss of coverage
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| What does the guaranteed insurability option allow an insured to do? | show 🗑
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| Which provision will pay a portion of the death benefit prior to the insured's death due to a serious illness? | show 🗑
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| Pam is the primary beneficiary of a life insurance policy and wants to let the death benefit accumulate and receive only the monthly investment proceeds. Which settlement option should she choose? | show 🗑
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| A creditor would be allowed rights to life insurance policy proceeds if which of the following beneficiaries is chosen? | show 🗑
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| show | Exempt from federal income taxes
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| Which of the following is NOT a life insurance settlement option? | show 🗑
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| show | Insurer's expenses
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| Premiums are best described as | show 🗑
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| show | Mortality
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| show | Dividends
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| Which of the following describes the number of deaths in a year compared to the number of people in a select group? | show 🗑
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| show | mortality tables
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| Part 3 of the application contains what? | show 🗑
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| What risk classification rewards exceptionally good risks which will result in premium rates that are lower than standard risk? | show 🗑
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| show | copy of the signed authorization
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| What are members of the Medical Information Bureau (MIB) required to report? | show 🗑
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| Most U.S. life insurance companies belong to the | show 🗑
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| How does a conditional receipt differ from a binding receipt? | show 🗑
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| show | Substandard
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| The Medical Information Bureau consists of | show 🗑
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| Which of the following types of information is NOT required for a life insurance application? | show 🗑
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| show | underwriting
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| show | Applicants must be notified within a short period of time that their credit report has been requested.
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| show | applicant's financial condition, character, purpose of the sale, how long the agent has known the applicant
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| All of the following employees would normally be excluded from a group term life plan EXCEPT | show 🗑
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| show | Conversion
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| Which of the following is NOT a requirement for a terminated employee that has exercised the conversion privilege? | show 🗑
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| show | Employer pays the premium for the converted policy
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| All of the following are considered characteristics of group life insurance EXCEPT | show 🗑
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| A terminated employee that has exercised the conversion privilege is able to convert | show 🗑
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| show | Taxable income to the employee
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| Which of the following describes a contributory group insurance plan? | show 🗑
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| Who is issued a certificate of insurance with a group insurance policy? | show 🗑
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| How does underwriting differ between group life and individual life insurance? | show 🗑
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| In an employer group plan, what is the name of the policy issued to the employer? | show 🗑
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| Which of the following statements regarding equity index contract factors is most CORRECT? | show 🗑
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| show | Accumulation units
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| During the payout period of an annuity, the interest portion of the payment is | show 🗑
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| The monthly amount of benefit an annuitant receives is based on all of the following factors EXCEPT the | show 🗑
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| show | SEC and state regulation
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| show | Offers a maximum interest rate that increases annually
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| show | The time at which benefit payments start
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| The systematic liquidation of a sum of money is provided by a(n) | show 🗑
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| An annuity which is backed by a life insurer's separate account is called a(n) | show 🗑
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| Joanna and her husband, Tom, have a $40,000 annuity that pays them $200 a month. Tom dies and Joanna continues receiving the $200 monthly check as long as she lives. When Joanna dies, the annuity payments cease. This is an example of | show 🗑
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| show | Both life insurance and annuities use mortality tables.
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| show | Beneficiary
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| The purpose of the exclusion ratio is to | show 🗑
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| Variable annuity payouts are adjusted based upon which of the following? | show 🗑
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| State insurance laws generally allow a number of groups to hold blanket life insurance policies, all of the following are examples of groups eligible for blanket life insurance EXCEPT | show 🗑
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| show | Annuities are sold by life insurance agents, An annuity is a periodic payment, Annuitants can pay the annuity premiums in lump sums
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| show | a 1035 exchange
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| The interest credited to an equity indexed annuity is tied to increases in | show 🗑
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| show | Insurer
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| show | 60
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| A worker is entitled to Social Security disability benefits if all of the following are true | show 🗑
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| How long is a person expected to be disabled in order to receive Social Security disability benefits? | show 🗑
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| Who is eligible for Social Security survivor benefits? | show 🗑
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| show | Year in which worker was born
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| In order to be considered "currently insured" under Social Security, an individual must be credited with | show 🗑
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| show | Unable to engage in any substantial gainful activity (SGA).
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| show | currently insured and eligible for limited survivor benefits, you must have 6 credits of coverage during the last 13-quarter period.
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| show | Fully insured.
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| show | Fully insured
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| show | employer stock
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| What area of group health insurance is regulated under the Employee Retirement Security Act of 1974 (ERISA)? | show 🗑
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| show | Non-deductible contributions and tax-free distributions
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| What does ESOP stand for? | show 🗑
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| show | Nondiscrimination
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| All of these are examples of a business use for life insurance | show 🗑
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| show | Three policies for $100,000 each
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| show | when the insured dies, a death benefit is paid
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| Key person insurance is intended to | show 🗑
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| show | An individual's assets, An individual's expenses, An individual's income
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| Which of these requires an analysis of a family's financial needs and objectives should the breadwinner die or become disabled? | show 🗑
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| What is the tax advantage of key-person life insurance? | show 🗑
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| Which plan can be used as an incentive by an employer to help an employee buy life insurance? | show 🗑
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| show | 12
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| All of the following factors are used in the needs approach for determining the amount of required life insurance | show 🗑
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| show | Buy-sell funding, Key person, Partnership entity plan
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| During the underwriting process for a group health policy, it was discovered that 15 out of 50 members of the group have major health issues. How would the insurer handle this? | show 🗑
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| What percentage of eligible employees must participate in a noncontributory group health plan before it can be put in effect? | show 🗑
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| show | Insurer
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| show | prevent adverse selection
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| show | business expenses when a business owner becomes disabled
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| show | Special risk policy
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| Which of the following is typically covered under vision care insurance? | show 🗑
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| The problem of overinsurance is addressed in which health insurance provision? | show 🗑
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| show | Life insurance and disability insurance
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| show | Number of teeth cleanings per year, Dollar amount for eyeglass frames, Number of X-rays performed per year
EXCEPT Specific dollar amount for examinations
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| Individual health insurance policies are typically written on which basis? | show 🗑
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| show | 65
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| Disabled workers are covered under Workers' Compensation medical expense benefits for how long? | show 🗑
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| Medicare Part B has an initial enrollment period. How many months after an individual's 65th birthday month does this enrollment period end? | show 🗑
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| show | Preferred Provider Organization (PPO)
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| show | Medicare Part A
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| Medicare Part A covers what type of care? | show 🗑
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| show | Expenses are submitted to Medicare by the health provider
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| show | Hospice, Hospitalization, Inpatient care
not provide Doctor's services
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| Which statement regarding Medicare is true? | show 🗑
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| Who acts as the gatekeeper in a Health Maintenance Organization (HMO)? | show 🗑
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| show | Workers' Compensation
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| show | Employer pays the entire premium for Workers' Compensation coverage
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| Which of the following does specified disease insurance cover? | show 🗑
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| show | $5,000
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| show | Provide money for living expenses
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| show | First-dollar coverage
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| Medical expense policies will typically cover which of the following? | show 🗑
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| When does an insured qualify for stop-loss coverage? | show 🗑
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| Which of these statements is true concerning recurrent disabilities? | show 🗑
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| What does a Hospital Confinement indemnity policy pay for? | show 🗑
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| Which of the following terms is associated with a Major Medical policy? | show 🗑
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| What does the term coinsurance refer to? | show 🗑
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| show | Loss of income
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|
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| Which disability policy provision would address any concerns of the value of the benefits decreasing over time? | show 🗑
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| What is the elimination period of an individual disability policy? | show 🗑
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| A disability elimination period is best described as a | show 🗑
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| show | prepare the insured to return to employment
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| show | Own occupation
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| show | 14 day waiting period / 10 year benefit period
The disability income policy with the lowest waiting period and longest benefit period would have the highest premium.
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| show | Wages
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| show | an individual the means to replace wages
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| Coming from an insurance point of view, which of the following is the main risk associated with disability? | show 🗑
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| show | Permanent partial disabilty
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|
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| An example of a presumptive disability would be | show 🗑
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| 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? | show 🗑
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| Which clause defines total disability as being unable to perform the major duties of the insured's regular occupation? | show 🗑
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| Which of the following would be considered an activity of daily living under a long term care policy? | show 🗑
|
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| Periodic increases in policy benefits are allowed in which long-term care policy provision? | show 🗑
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| show | Medicare is primarily funded by Federal payroll and self-employment taxes, Hospice is covered by Medicare Part A, Doctors' services are covered by Medicare Part B. Not Long-term care is covered by Medicare Part C
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|
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| Which of the following plans will cover medical costs that Medicare doesn't cover? | show 🗑
|
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| Under a long-term care insurance policy, adult day care coverage will provide for | show 🗑
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| show | Legal Actions, Notice of claim, Reinstatement
Not Change of occupation
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| show | Benefits can be adjusted
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| show | exclusions
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|
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| Under a health insurance policy, the provision that states the kind of benefits provided and the circumstances under which they will be paid is called the | show 🗑
|
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| Under the Payment of Claims provision, when are benefits typically payable after proof of loss is received? | show 🗑
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| show | Optionally renewable
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|
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| Which type of health insurance policy cannot be canceled by the insurer nor increase the premiums? | show 🗑
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| Christine has a health insurance policy that has been in force beyond the incontestable period. The insurer has discovered that a fraudulent statement . What would the insurer have to pay on a claim, assuming this wasn't a guaranteed renewable policy? | show 🗑
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| show | 31 days
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|
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| What type of changes can be made to a guaranteed renewable health insurance policy? | show 🗑
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| show | When an insured becomes totally disabled
🗑
|
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| All of the following are primary risk factors in underwriting individual health insurance policies | show 🗑
|
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| show | To exclude from coverage losses resulting from specified conditions
🗑
|
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| Major risk factors in health insurance underwriting include all of the following | show 🗑
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| show | At least 10 days after the date of reinstatement
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|
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| show | Premiums are not deductible; benefits are tax-free
🗑
|
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| show | race
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|
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| Which of the following is NOT considered to be insurer expenses? | show 🗑
|
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| show | race
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|
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| show | Morbidity
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|
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| show | is most hazardous
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|
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| Which of the following would probably NOT be considered in underwriting a health insurance risk? | show 🗑
|
||||
| An increase in which factor will decrease the disability insurance premium? | show 🗑
|
||||
| show | morbidity
🗑
|
||||
| Which of the following is covered by the Family and Medical Leave Act (FMLA)? | show 🗑
|
||||
| Which of the following acts is a Federal offense committed by an insurance agent? | show 🗑
|
||||
| show | Insurance Code enforcement, Licensing agents, Protect policyowners
Not Interpret policy provisions
🗑
|
||||
| show | Prior acceptance
🗑
|
||||
| show | California
🗑
|
||||
| show | PCIP was created by the State of California for people rejected by private health insurers due to pre-existing conditions
🗑
|
||||
| show | Major Risk Medical Insurance Program
🗑
|
||||
| In what order are people on the MRMIP waiting list allowed to enroll? | show 🗑
|
||||
| show | Pregnancy must be treated as any other medical condition
🗑
|
||||
| Which of the following does the California Department of Insurance (CDI) have NO jurisdiction over? | show 🗑
|
||||
| Who does a life settlement broker represent? | show 🗑
|
||||
| What is an insurance solicitor authorized to do? | show 🗑
|
||||
| An insurance company entitled to transact business in California is called a(n) | show 🗑
|
||||
| show | Ability to pay, Needs of the client, Goals of the client
Not Attending physician's statement
🗑
|
||||
| Which of the following does the California Insurance Code NOT require an insurance policy to specify? | show 🗑
|
||||
| show | only before the insurance is in effect
🗑
|
||||
| show | Minimum of two activities of daily living
🗑
|
||||
| A person who asserts a right of recovery under an insurance policy is called | show 🗑
|
||||
| show | Age of the insured, Name of the agent, Name of the insurer
Not Statement that all values and benefits are guaranteed
🗑
|
||||
| According to the California Insurance Code, what term is used to describe a fact so important it could affect the policy premium? | show 🗑
|
||||
| Which of the following is considered to be an act of insurance solicitation? | show 🗑
|
||||
| show | Up to age 26
🗑
|
||||
| How long must a policy be in force before an insurer is prohibited from denying claims based on misstatements made on the health policy application? | show 🗑
|
||||
| show | solicitor
🗑
|
||||
| show | $5,000
🗑
|
||||
| An agent's attempt to stop the replacement of an existing life insurance policy is known as | show 🗑
|
||||
| How long must life agents keep their transaction records? | show 🗑
|
||||
| Life insurance surplus must be distributed to policyowners at what frequency? | show 🗑
|
||||
| show | Health Insurance Counseling and Advocacy Program (HiCAP)
🗑
|
||||
| The cost of services charged by the Health Insurance Counseling Advocacy Program (HiCap) is | show 🗑
|
||||
| show | Traveling overseas with a spouse
🗑
|
||||
| show | Between 10 and 30 days
🗑
|
||||
| show | Life and disability analyst
🗑
|
||||
| Which of the following is an accurate description of Access for Infants and Mothers Program (AIM)? | show 🗑
|
||||
| In California, an insurer organized under the state laws of Oregon is called a(n) | show 🗑
|
||||
| show | Permissive
🗑
|
||||
| show | Help an agent or broker sell insurance
🗑
|
||||
| show | May
🗑
|
||||
| What does the term "illustration" mean when used in the phrase "life insurance policy illustration", according to the California Insurance Code? | show 🗑
|
||||
| An individual who transacts life, disability, or life and accident and health insurance on behalf of an insurer is called a(n) | show 🗑
|
||||
| show | Policyowners, Primary beneficiaries, Insureds
Not Insurers
🗑
|
||||
| show | gold
🗑
|
||||
| According to the PPACA, an adult can be covered by a parent's health care plan until what age? | show 🗑
|
||||
| What does the term "indemnity" mean as it pertains to insurance? | show 🗑
|
||||
| show | A contract
🗑
|
||||
| The free-look period for life insurance policyowners age 60 or older is | show 🗑
|
||||
| According to PPACA, what is a health benefits exchange? | show 🗑
|
||||
| show | Advising a claimant to hire an attorney
🗑
|
||||
| Which of the following actions is allowed by Health Insurance Counseling and Advocacy Program (HiCAP) counselors? | show 🗑
|
||||
| Pete is a life agent who has misappropriated fiduciary funds to his own use. What is Pete guilty of? | show 🗑
|
||||
| show | Medi-Cal
🗑
|
||||
| show | unnecessary replacement
🗑
|
||||
| show | Its paid-in capital
🗑
|
||||
| When an insurer has met the qualifications necessary to transact business in California, it is said to be | show 🗑
|
||||
| show | Jim must still disclose the conviction on his insurance license application
🗑
|
||||
| What time period allows an insured's life insurance policy to remain in force even if the premium was not paid on the due date? | show 🗑
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| Which policy provision protects the policyowner from unintentional lapse of the contract? | show 🗑
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| show | Fully insured workers
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| How are Roth IRAs treated for tax purposes? | show 🗑
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| The California Insurance Code defines "policy" as a(n) | show 🗑
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| MRMIP is a | show 🗑
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| Both the Federal and state governments jointly finance which health insurance entitlement program? | show 🗑
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| show | unfair method of competition
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| Which entity has jurisdiction over health care coverage providers? | show 🗑
|
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| How is an agent's first year commission calculated for a replacement long-term policy? | show 🗑
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| show | Consent form
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| What is the insurance term the State of California uses for an insurer that is eligible to transact business in this state? | show 🗑
|
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| show | Rescission of the contract
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|
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| show | Notice of appointment must be submitted to the Commissioner
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Review the information in the table. When you are ready to quiz yourself you can hide individual columns or the entire table. Then you can click on the empty cells to reveal the answer. Try to recall what will be displayed before clicking the empty cell.
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To hide a column, click on the column name.
To hide the entire table, click on the "Hide All" button.
You may also shuffle the rows of the table by clicking on the "Shuffle" button.
Or sort by any of the columns using the down arrow next to any column heading.
If you know all the data on any row, you can temporarily remove it by tapping the trash can to the right of the row.
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Created by:
huangyiken3