In most dental plans, a deductible typically is NOT applied to

preventative and diagnostic services

All of these are used to prevent adverse selection in a group dental plan EXCEPT

Decreased employee participation

How can a group dental insurer discourage adverse selection?

Limit the duration of coverage

The dental specialty which deals with the replacement of missing teeth is called

Prosthodontics

Medicare Part C is:

available to those who are enrolled in Medicare Part A and Part B

Which Long Term Care insurance statement is true?

Pre-existing conditions must be covered after the coverage has been in force for six months

S wants to open a tax-exempt Health Savings Account. To qualify for this type of account, Federal law dictates that S must be enrolled in a:

High-deductible health plan

A Hospital/Surgical Expense policy was purchased for a family of four in March of 2013. The policy was issued with a $500 deductible and a limit of four deductibles per calendar year. Two claims were paid in September 2013, each incurring medical expenses in excess of the deductible. Two additional claims were filed in 2014, each in excess of the deductible amount as well. What would be this family's out-of-pocket medical expenses for 2013?

$1,000

This type of deductible provision waives the deductible for all family members after some of them have satisfied individual deductibles within the same year:

Family maximum deductible

J was reviewing her Health Insurance policy and noticed the phrase "This policy will only pay for a semi-private room". This phrase is considered to be a(n)

internal limit

Which of these is NOT a source of funding for Social Security benefits?

Federal Government

M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for?

Determined by the terms of the policy

This type of deductible provision states that should more than one family member be involved in a common accident, or suffer the same illness, only one individual deductible amount shall be applied.

Common accident deductible

Which of the following statements BEST defines usual, customary, and reasonable (UCR) charges?

The maximum amount considered eligible for reimbursement by an insurance company under a health plan

Which of the following services is NOT included under hospitalization expense coverage?

surgical fees

Which of the following consists of an offer, acceptance, and consideration?

Contract

What type of policy would only provide coverage for specific types of illnesses (cancer, stroke, etc.)?

Dread disease insurance

Who is NOT required to sign a health insurance application?

Beneficiary

Which of these is NOT considered to be an element of an insurance contract?

negotiating

What is the initial requirement for an insured to become eligible for benefits under the Waiver of Premium provision?

Insured must be under a physician's care

C was injured while deep sea diving and requires a hospital stay. C has a Major Medical policy with a 80/20 coinsurance clause and a $400 deductible. What is the MAXIMUM C will pay if the covered medical expenses are $2000?

$720

A contract where one party either accepts or rejects the terms of a contract written by another party is called a contract of

adhesion

Deductibles are used in health policies to lower:

overuse of medical services

Which of the following BEST describes a short-term medical expense policy?

Nonrenewable

According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid?

31 days

An insurance contract is considered a policy of adhesion. This means that the contract can only be modified by _____.

the insurer

In Major Medical Expense policies, what is the objective of a Stop Loss provision?

Limits an insured's out-of-pocket medical expenses

The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the:

Insuring clause

Under an individual Health Insurance policy, the Time Limit of Certain Defenses provision states that nonfraudulent misstatements first become incontestable two years

from the date that the policy was issued

Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?

Entire Contract

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?

2

Any changes made on an insurance application requires the initials of whom?

Applicant

What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy?

Premiums may increase at time of renewal

An insurance company normally has 2 years to contest information provided on an accident and health application. This 2 year period begins on the date that the:

insurer dates the policy

Which of the following statements describes what an Accident and Health policyowner may NOT do?

Adjust the premium payments

In an insurance contract, the insurer is the only party who makes a legally enforceable promise. What kind of contract is this?

Unilateral

An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.

15

Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy?

Premiums are waived after the insured has been totally disabled for a specified time period

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:

guaranteed renewable

What action should a producer take if the initial premium is NOT submitted with the application?

Forward the application to the insurer without the initial premium

When does a Probationary Period provision become effective in a health insurance contract?

At the policy's inception

With Optionally Renewable Health policies, the insurer may:

review the policy annually and determine whether or not to renew it

Which of the following health insurance policy provisions specifies the health care services a policy will provide?

Insuring clause

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?

Grace Period

S filed a written Proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning:

1-Nov

Which mode of payment is NOT used by health insurance policies?

Single premium

Which of these is considered a mandatory provision?

Payment of Claims

Before a health insurance policy is issued, which of these components of the contract is required?

Applicant's signature on application

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?

PPO

With Accidental Death and Dismemberment policies, what is the purpose of the Grace Period?

Gives the policyowner additional time to pay overdue premiums

The Consideration clause of an insurance contract includes:

the schedule and amount of premium payments

P has recently signed an application for insurance. The insurer MUST advise her in writing that an investigative consumer report may be conducted according to the

Fair Credit Reporting Act

When an insured changes to a more hazardous occupation, which disability policy provision allows an insurer to adjust policy benefits and rates?

Change of occupation provision

Which of the following BEST describes a warranty?

Statement guaranteed to be true

A Disability Income policy that only the policyowner can terminate and which the rates will never go up is considered to be

Noncancellable

A Business Overhead Expense policy would cover which of the following if a business owner becomes disabled?

Utilities and office rent

An insurance company would MOST likely pay benefits under an Accidental Death and Dismemberment policy for which of the following losses?

Loss of eyesight due to an accidental injury

Which of these terms accurately defines an underwriter's assessment of information on a health insurance application?

Risk classification

Which of the following are NOT managed care organizations?

Medical Information Bureau (MIB)

Why must an Accident & Health insurance applicant answer all questions on the application?

Statements and representations on the application are part of the consideration for issuing a policy

Which of the following types of organizations are prepaid group health plans, where members pay in advance for the services of participating physicians and hospitals that have agreements?

HMO

f an individual is covered under an Accidental Death Policy and dies, an autopsy can be performed in all these situations, EXCEPT:

When the state prohibits this by law

, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J's age, as stated on the application five years ago, was found to be understated by ten years. Which of the following actions will the insurance company take?

The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age

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?

Contributory

Which of these factors do NOT play a role in the underwriting of a health insurance policy?

Marital status

K failed to pay a renewal premium within the time granted by the insurer. K then sends in a payment which the insurer subsequently accepts. Which policy provision specifies that coverage may be restored in this situation?

Reinstatement

What is being delivered during a policy delivery?

Insurance contract to the proposed insured

Which Accident and Health policy provision addresses preexisting conditions?

Time Limit on Certain Defenses

M applies for a health insurance policy and pays the initial premium. When the agent completes the application, a conditional receipt is left with the applicant. The insurance company’s underwriting department request’s M’s medical records and determines that M has had asthma for many years. All of the following are probable underwriting outcomes, EXCEPT:

Changing the policy's provisions

T applied for a Disability Income policy and has a history of back injuries. The insurer issued the policy with a statement that excludes coverage for back injuries. This statement is called a(n)

impairment rider

P loses an arm in a farm accident and is paid $10,000 from his Accidental Death and Dismemberment policy. This benefit is known as the

Capital Sum

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?

Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company

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?

F

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?

Insured's contingent beneficiary

Which of the following statements BEST describes what the Legal Actions provision of an Accident and Health policy requires?

An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed

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?

Increase her policy's coverage amount

The insuring clause

States the scope and limits of the coverage

The Notice of Claims provision requires a policyowner to:

notify an insurer of a claim within a specified time

After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms?

File written proof of loss

An underwriter determines that an applicant's risk should be recategorized due to a health issue. This policy may be issued with a(n):

exclusion for the medical condition

According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?

Monthly

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?

Submit the claim in any form

K completes an application for a disability policy but does not pay the initial premium. The company approves the policy standard and the agent delivers the policy. K then pays her initial premium 3 days later. At what point does K’s policy take effect?

Date the initial premium is collected

P is a producer who notices 5 questions on a health application were not answered. What actions should P take?

Set up a meeting with the applicant to answer the remaining questions

Accidental Death coverage is provided to commercial airline passengers in which of the following types of policies?

Blanket Accident policy

Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?

Entire Contract

Which of the following is considered to be the time period after a Health Policy is issued, during which no benefits are provided for illness?

Probationary Period

In the event of an illness, a(n) _______ _______ policy would reimburse an insured for loss of earnings.

Disability Income

Dental care coverage is designed to cover the costs of all of the following EXCEPT:

loss of income

An insurance company receives E’s application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet?

Consideration clause

C is the policyowner of a Comprehensive individual Major Medical policy. C pays an annual premium which is due September 1. If C forgets to pay the premium and is hospitalized September 10, how will the insurer handle this claim?

Pay the claim in full minus the premium due

X is insured with a Disability Income policy that provides coverage until age 65. This policy allows the insurer to change the premium rate for the overall risk class assigned. Which of these renewability features does this policy contain?

Guaranteed Renewable

In health insurance policies, a waiver of premium provision keeps the coverage in force without premium payments:

After an insured has become totally disabled as defined in the policy

Which health policy clause specifies the amount of benefits to be paid?

Insuring

P is a Major Medical policyowner who is hospitalized as a result of injuries sustained from participating in a carjacking. How will the insurer most likely handle this claim?

Claim will be denied

A Business Disability Buyout plan policy is designed:

to pay benefits to the Corporation or other shareholders

N is covered under an individual Disability policy with a 30-day Elimination period and a monthly benefit of $500. N is totally disabled for 3 1/2 months. N's total benefit received on this claim is:

$1,250

S is the policyowner of a Major Medical policy. The premiums are paid monthly and due on the 1st of each month. S fails to make September's payment and is hospitalized October 15th. When S files the claim for this hospitalization, the insurer will likely

deny the claim

All of the following statements regarding group health insurance is true, EXCEPT:

An individual policy is given to each member

The ________ clause identifies which losses resulting from an accident or sickness are insured by the policy.

Insuring

P received Disability income benefits for 3 months then returns to work. She is able to work one month before her condition returns, leaving her disabled once again. What would the insurance company most likely regard this second period of disability as?

A recurrent disability

The insured and insurance company will share the cost of covered losses under which health policy feature?

Payment of Claims provision

B has a $100,000 Accidental Death and Dismemberment policy that pays triple indemnity for common carrier death. If B is killed from an accident on a commercial flight, what will the policy pay B's beneficiary?

$300,000

A Disability Income policyowner recently submitted a claim for a chronic neck problem that has now resulted in total disability. The original neck injury occurred before the application was taken 5 years prior. The neck injury was never disclosed to the insurer at the time of application. How will the insurer handle this claim?

Claim will be paid and coverage will remain in force

Which parts of a health insurance policy are guaranteed to be true?

Warranty

The provision that defines to whom the insurer will pay benefits to is called:

Payment of Claims

A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type of policy will pay a monthly benefit to the personal assistant?

Disability Income

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?

4 months

D is an architect receiving Disability Income benefits who is not able to return to work full time, but can work on a part-time basis. Which of these features would allow D to continue receiving benefits?

Residual Benefit clause

Under a Guaranteed Renewable health insurance policy, the insurer

may cancel the policy for nonpayment only

Insurers may request a hearing within ____ if their policy is rejected

20 Days

Periodic health claim payments MUST be made at least:

monthly

Disability policies do NOT normally pay for disabilities arising from which of the following?

War

T sends proof of loss to her insurer for an acceptable medical expense claim under her individual Health Insurance policy. Upon receipt, the insurer must pay the benefits

immediately

Which of the following would be a likely candidate for disability income insurance on a key employee?

Company executive

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?

Guaranteed Insurability Option rider

Which statement is TRUE regarding a group accident & health policy issued to an employer?

The employer receives the policy and each employee is issued a certificate

Which of these statements concerning COBRA is correct?

Under COBRA, dependents of employees covered by group plans have the same extension and conversion privileges available to them as the employee

Which of the following is an alternative method of providing health insurance?

Consumer Cooperative

Which of the following is NOT a characteristic of Preferred Provider Organizations (PPOs)?

PPOs provide equal benefits and costs for services obtained in-network and out of network.

Which of the following BEST describes how pre-admission certification is used?

Used to prevent nonessential medical costs

The agreement in which hospitals and physician groups in a specific area contract with an insurance company to provide medical care at predetermined costs is:

Preferred Provider Organization (PPO)

P is a new employee and will be obtaining non-contributory group Major Medical insurance from her employer. Which of the following actions must she take during the open enrollment period?

Sign an enrollment card

A Preferred Provider Organization (PPO) _____.

offers medical insurance by sponsoring a network of health care providers.

COBRA laws allows continuation of health coverage for:

employees and their dependents