NYS - L&H Practice Exam 2

Medicare advantage is a common name used for

a) Part A b) Part B c) Part C d) Part D

Under this required individual health
insurance policy provision the insurer has the right to demand evidence
of insurability but must make an underwriting decision within 45 days

a) Entire Contract; Changes b) Time Limit on Certain Defenses c) Grace Period d) Reinstatement

MEDICARE enrollment on 1st Day of the Month of 65th Birthday is automatic for

a) Part A b) Part B c) Part C d) Part D

Which of the following needs to fulfill the state examination requirement for an insurance producer’s license?
a) Representatives of Fraternal Benefit Societies who sells a permanent life insurance policy for less than $10,000 b) Applicants who hold a Chartered Life Underwriter or CPCU designation c) Applicants for a life, accident and health insurance brokers license d) Applicants whose life, accident and health agent license expired within the last 90 days

To Knowingly making any misleading
representation of a Medicare supplement policy for the purpose of
inducing a person to terminate coverage and take out a policy of
insurance with another insurer is called


a) Twisting b) High pressure tactics c) Cold Lead Advertising d) Churning

Travel insurance is most likely of this form of coverage

a) Accident Only b) Specified Disease c) Medical Indemnity d) Credit Disability

Which of the following is a core benefit of Medicare supplement policies?

a) Medicare Part A deductibles b) Medicare Part B deductibles c) All co-insurance amounts for Medicare parts A & B d) Part B excess amounts

Concerning permanent life insurance what
is the difference between the policy cash value and the death benefit
amount referred to as?


a) Market risk
b) Interest rate risk
c) Retention risk
d) Net amount at risk

Michael is the annuitant for a $500 per
month straight life annuity. If Michael dies after receiving 10 years of
installment income payments, his beneficiary will receive?
a) Nothing. Straight life annuities do not have beneficiaries. b) A lump sum payment equal to the present value of the remaining payments. c) A continuation of the installment payments for as long as the beneficiary lives. d) A continuation of the remaining installment payments until all payments are made.

Which of the following claims will most likely receive disability income benefits?


a) Injuries sustained while fleeing from a crime scene b) Serious illness incurred as a resident of a foreign country c) Bodily injuries incurred while a passenger of a commercial airlines d) Consuming a toxin to win a wager

The time between the onset of a disabling illness and the first indemnity payment is called

a) The probationary period b) The benefit period c) The elimination period d) The indemnity period

Concerning the federal age discrimination in employment act

a) Health insurance plans are exempt from the act for employees over age 65 b) An employee spouse over age 65 may be denied coverage under ADEA c) Employees must be covered over age 65 without exception d) Employers are prohibited from denying employees and their spouses over age 65 group coverage due to Medicare

Which of the following is not a characteristic of the waiver of premium (WP) option


a) It requires the payment of an additional premium b) It has a 90 day elimination period c) It pays premiums in the event of a total and permanent disability d) While the WP is in-force it prevents the insured from exercising a conversion option

Karen has a $250,000 whole life
insurance policy issued in 2001 with a $50,000 level term rider and an
AD&D double indemnity rider. Karen died in 2005 from pulmonary
cancer. Her beneficiary most likely received which amount?
a) $250,000 b) $300,000 c) $500,000 d) $550,000

Concerning Medicare supplement marketing regulations, which of the following is not specified procedure?

a) Insurers are required to assure fair and accurate policy comparisons b)
Notice to buyer prominently displayed on the first page of the policy
stating “This policy may not cover all of your medical expenses” c) Establish auditable procedures for verifying compliance d) Illustrating all available plans and benefits in a side by side comparison

Before a Company will be issued a Certificate of Authority to do
business in this state, capital and surplus requirements plus which of
the following must first be met?
a) Become a domiciled insurer b) Have all its Directors and Executives licensed in the lines it intends to sell c) Have all its Principal Directors and Executives clear a criminal background check d) Have all its Principal Directors and Executives pass a competency examination

The largest and most proficient provider of accident and health insurance in the United States is

a) Private commercial b) Government c) Industrial d) Casualty

An employee is eligible to continue his health insurance under COBRA rules. Which of the following statements is CORRECT?

a) Coverage continues up to 36 months, even if he obtains new coverage elsewhere b) He can increase benefits from his severed plan up to 110% of his previous coverage c) His coverage under COBRA is identical to that which he had under his group plan d) His coverage can be continued indefinitely

Which of the following plans is most restrictive concerning the individual’s choice of providers?

a) Basic: Hospital, Medical, Surgical b) Major Medical: Insurance Indemnity Plans c) Health Maintenance Organizations (HMOs) d) Preferred Provider Organizations (PPO)

A benefit formula that determines the
maximum sum of money payable under the contract is an example of which
long term care benefit basis?

a) Expense-Incurred Basis b) Per Diem Basis c) Lifetime Pool Basis d) Capitation basis

Who is not exempt from disability benefits law?

a) Business Owners b) Full-time students working temporary full time job c) Domestic employees working less than 40 hours a week for 1 employer d) Private school teachers

Which company delegates operational
control and ownership to another individual who hires captive agents to
market and distribute company products?


a) General Agency System b) Managerial Agency System c) Direct Response System d) American Agency System

Which of the following concerning the policy summary is correct?
a) It must not include the agent or broker name and business address b) It must be provided prior to the sales presentation c) It must include a clear illustration of policy values and premiums of the issued policy d) It must include guaranteed dividends

This part of Medicare is financed by a combination of payroll taxes & voluntary premium

a) Part A b) Part B c) Part C d) Part D

Fee-for-service and prepaid differ in which of the following respects?

a) Prepaid plans are also called indemnity plans b) Prepaid plans make direct payments to medical providers c) Fee-for-service plans have a limited choice of medical providers d) Prepaid plans are characterized by deductibles and co-insurance amounts

Rules relating to the replacement of health coverage with Medicare supplement insurance do not include which of the following?

a) A notice regarding replacement of coverage signed by the agent and insured b) A disclosure statement c) A 30 day free look period d) A guarantee that all coverages will be effective immediately

Medicare part B coverage eligibility requires

a) Minimum age of 65 b) Part A coverage c) Evidence of insurability d) Automatic and in-voluntary enrollment

A Qualified Long-Term Care policy a) Is subject to the 7½% excess of adjusted gross income deduction and specified age and premium limitations b) It cannnot be offered as an employee benefit by employers c) It must cover services provided under Medicare d) It must provide cash value accumulation

An
unfair and prohibited practice that prohibits Agents, Brokers, and
Insurers from offering to the Insured anything valued greater than $15
as an inducement to buy is called?
a) Misrepresentation b) False Advertising c) Unfair Discrimination d) Rebating

Under state law a dependent child who
became severely physically handicapped at age 18 may extend dependent
coverage under a parents accident and health insurance policy a) Until age 23 or marriage whichever comes first b) To age 35 as long as they remain unmarried c) As they remain dependent for maintenance and support up though age 32 d) For as long as the child is handicapped and remains dependent upon a parent for maintenance and support

Under this plan premiums are calculated annually and the insurer assumes full responsibility for payment of claims

a) Conventional Fully-Insured Plans b) Modified Fully-Insured Plans c) Partially Self-Funded Plans d) Fully Self-Funded (Self-Administered) Plans

Insurance designed to replace the loss of income due to accident and Illness is called? a) Disability b) Basic hospital c) Basic medical d) Indemnity

Who is the person contracted to receive annuity installments income payments?
a) Owner b) Annuitant c) Insured d) Beneficiary

Irene, age 30 is shopping for $50,000 of
life insurance coverage. Which of the following will probably offer her
the lowest first year premium?
a) Annual renewable term insurance b) Five year level term insurance c) Modified whole life insurance d) Ten year return of premium term insurance

Jared is a life settlement broker hired
by an accredited investor to evaluate life settlement contracts on a
fee-for-service basis. Jared details all the work performed in a written
memorandum signed by the client. If Jared now wants to change the
compensation arrangement to a commission basis, what must Jared do? a) Inform the client and wait a period of 90 days before he can legally earn commissions on that client b) Inform the client and wait a period of 180 days before he can legally earn commissions on that client c) Inform the client and wait a period of one year before he can legally earn commissions on that client d) Inform the client and wait a period of two years before he can legally earn commissions on that client

Which type of insurance is designed to provide coverage for short durations at minimal premium outlay?

a) Permanent b) Term c) Whole Life d) Variable Life

Which Medicare supplement policy offers coverage on all additional benefits offered through the supplement program?

a) Plan A b) Plan D c) Plan G d) Plan J

Most fixed equity index life policies are variants of which of the following types of policy?
a) Term b) Whole life c) Universal life d) Variable life

Which one of the following would be a source of instant liquidity upon the death of an estate owner?


a) His or her home b) Debts payable to the estate c) A life insurance policy on the estate owner’s life, payable to the estate d) bank certificates of deposit

Tony, aged 45 has a $250,000
participating life policy he owned since age 30 for which he pays a
$2,000 annual premium. He has $50,000 in paid up additions and a total
cash value of $75,000. What is the net amount at risk?

a) $180,000
b) $225,000
c) $250,000
d) 300,000

John
is the annuitant for a 20 year, $500 per month fixed period annuity. If
John dies after receiving 10 years of installment income payments, his
beneficiary will receive?
a) Nothing. Fixed Period Annuities do not have beneficiaries. b) A lump sum payment equal to the present value of the remaining payments. c) A continuation of the installment payments for as long as the beneficiary lives. d) A continuation of the remaining installment payments until all payments are made.

Harriet is comparing two different whole
life policy illustrations. The first shows a level premium throughout
her life and the second shows a lower level premium for the first five
years that increases in year six to a premium that is higher than the
whole life premium and remains level thereafter. What type of policy is
Harriet most likely comparing with to the first ordinary whole life
illustration?
a) Modified whole life b) Jumping Juvenile whole life c) Adjustable premium whole life d) Limited Pay whole life

Which of the following is a violation of life settlement law?
a)
The life settlement broker requests a medical visitation to determine
health status be performed every three months for the insured with a
life expectancy of less than one year
b)
A $500,000 life settlement contract pays a $300,000 lump sum at
settlement and $200,000 in equal installments over the next 12 months c)
A life settlement provider offers to purchase a $300,000 life policy on
an individual with a 3 year life expectancy for $200,000 d)
A life settlement provider offers to purchase a $250,000 life policy on
an individual less than a one year life expectancy for $150,000

Under this plan employers will typically utilize a stop loss provision that places a maximum limit to their claims risk

a) Conventional Fully-Insured Plans b) Modified Fully-Insured Plans c) Partially Self-Funded Plans d) Fully Self-Funded (Self-Administered) Plans

Upon receipt of a proof of death, an insurer has how much time to legally deny or pay the claim?
a) 10 days b) 15 days c) 30 days d) 45 days

Jake is an accredited investor who
purchases a settled contract on a well known industrialist. Which of the
following is correct concerning his purchased contract? a) He is exempt from the privacy regulation for he was not a party to the original transaction
b)
Any person gaining confidential information as a result of a life
settlement transaction is bound to comply and protect confidentiality of
the parties c) He may share confidential information with those he plans to designate as beneficiary d)
He is not bound to protect the documents and purchased policy from
other disinterested parties from reading the documents that reveal the
owner and or insured's private information

Which policy pays a fixed sum of money per day of hospitalization without regard to the actual expense incurred?

a) Hospital Indemnity b) Basic Hospital c) Comprehensive Hospital d) Hospital Maintenance

When the insured misstates their age in an accident and health insurance contract

a) The policy is void due to material misstatement b) A new application must be submitted with the corrected age and premium c) The insurer may adjust the benefits under the policy to correct the misstatement d) No adjustment may be made for the contract is binding as written