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

To qualify for a tax-exempt Health Savings Account, an insured must be enrolled in a

high-deductible health plan

A Hospital/Surgical Expense policy with a $500 deductible pays 2 claims in 2013; what are the family's out-of-pocket medical expenses for 2013?

$1000

This deductible provision waives the deductible for all family members after some satisfy individual deductibles within the same year

family maximum deductible

"This policy will only pay for a semi-private room" is considered an

internal limit

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

federal government

Under a basic Hospital/Surgical Expense policy, what determines the claim a physician's surgery is eligible for?

determined by the terms of the policy

This deductible provision applies one deductible if more than one family member is involved in the same accident

common accident deductible

Usual, customary, and reasonable charges are

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

Which service is NOT included under hospitalization expense coverage?

surgical fees

Which consists of an offer, acceptance, and consideration?

contract

What type of policy provides coverage only for specific illnesses such as cancer or stroke?

dread disease insurance

Who is NOT required to sign a health insurance application?

beneficiary

Which is NOT an element of an insurance contract?

negotiating

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

insured must be under a physician's care

With a Major Medical policy having 80/20 coinsurance and a $400 deductible on $2000 of covered expenses, what is the maximum the insured pays?

$720

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

adhesion

Deductibles are used in health policies to lower

overuse of medical services

Which best describes a short-term medical expense policy?

nonrenewable

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

31 days

A policy of adhesion means 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, nonfraudulent misstatements first become incontestable two years from

the date that the policy was issued

Which provision prohibits an insurance company from incorporating external documents into an insurance policy?

entire contract

What is the minimum number of Activities of Daily Living 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

A characteristic of a Conditionally Renewable Health Insurance policy is

premiums may increase at time of renewal

The 2-year contestability period on an accident and health application begins on the date that the

insurer dates the policy

Which statement describes what an Accident and Health policyowner may NOT do?

adjust the premium payments

If the insurer is the only party making a legally enforceable promise, the contract is

unilateral

An insurer must provide claim forms within how many days after receiving notice of loss?

15

Which statement 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

A health policy that must be renewed by the insurer and whose premiums can only be increased on a class basis is

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 provision specifies the health care services a policy will provide?

insuring clause

Which provision specifies how long coverage remains in effect if the premium is not paid on time?

grace period

If written proof of loss for a disability income claim is filed on September 1, when can legal action begin?

1-Nov

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

single premium

Which is considered a mandatory provision?

payment of claims

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

applicant's signature on application

Under what system do doctors and hospitals in a designated area contract with an insurer to provide services at a prearranged cost?

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

An insurer must advise the applicant 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 the insurer to adjust policy benefits and rates?

change of occupation provision

Which statement best describes a warranty?

statement guaranteed to be true

A Disability Income policy that only the policyowner can terminate and whose rates will never increase is

noncancellable

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

utilities and office rent

An insurer would most likely pay AD&D benefits for which loss?

loss of eyesight due to an accidental injury

Which term 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 and Health applicant answer all questions on the application?

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

Which type of organization is a prepaid group health plan where members pay in advance for services of participating physicians and hospitals?

HMO

An autopsy can be performed in all of these situations EXCEPT

when the state prohibits this by law

If age was understated on an AD&D application and the insured later dies from accidental injuries, what will the insurer do?

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

When an employee pays part of the premium for a group health plan, the plan is

contributory

Which factor does NOT play a role in underwriting a health insurance policy?

marital status

If a renewal premium is paid late and then accepted by the insurer, which provision allows coverage to be restored?

reinstatement

What is being delivered during policy delivery?

insurance contract to the proposed insured

Which Accident and Health policy provision addresses preexisting conditions?

time limit on certain defenses

If an applicant paid the initial premium and the insurer discovers a long history of asthma, which is NOT a probable underwriting outcome?

changing the policy's provisions

If a Disability Income policy excludes coverage for back injuries, that exclusion statement is called an

impairment rider

In AD&D, the amount payable for accidental loss of eyesight or dismemberment is the

capital sum

If a premium check is incorrectly made out to the producer, what should the producer do?

return to the customer and collect a new check made out to the insurance company

If business partners buy life insurance on each other and later dissolve the business, who receives the proceeds if one dies and the former partner is still the named beneficiary?

the named beneficiary

If the insured and primary beneficiary die in the same accident and order of death cannot be determined, where do proceeds go under the Uniform Simultaneous Death Act?

insured's contingent beneficiary

What does the Legal Actions provision of an Accident and Health policy require?

an insured must wait at least 60 days after Proof of Loss has been submitted before filing a lawsuit

If the insured changes to a less hazardous occupation, under the Change of Occupation provision the insurer may

increase the policy's coverage amount

The insuring clause

states the scope and limits of the coverage

The Notice of Claims provision requires the policyowner to

notify an insurer of a claim within a specified time

After giving notice of loss, what must the insured do if the insurer does not furnish forms?

file written proof of loss

If an underwriter recategorizes an applicant due to a health issue, the policy may be issued with an

exclusion for the medical condition

According to the Time Payment of Claims provision, Disability Income benefits must be paid no less frequently than

monthly

If the insurer does not send claims forms within the required time, what should the insured do?

submit the claim in any form

If a disability policy is approved standard but the initial premium is not paid until 3 days after delivery, when does the policy take effect?

date the initial premium is collected

If 5 questions on a health application are unanswered, what should the producer do?

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

Accidental Death coverage is provided to commercial airline passengers under which type of policy?

blanket accident policy

Which clause requires the insurer to attach a copy of the application to the policy so it becomes part of the contract?

entire contract

What is the period after a health policy is issued during which no benefits are provided for illness?

probationary period

In the event of illness, which policy reimburses an insured for loss of earnings?

disability income

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

loss of income

If an applicant leaves medical history incomplete and does not pay the initial premium, which clause details the unmet conditions?

consideration clause

If an annual premium due September 1 is unpaid and the insured is hospitalized September 10, how is the claim handled?

pay the claim in full minus the premium due

A Disability Income policy to age 65 that allows the insurer to change rates for the overall risk class is

guaranteed renewable

A waiver of premium provision keeps coverage in force without premium payments

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

Which clause specifies the amount of benefits to be paid?

insuring

If an insured is hospitalized after participating in a carjacking, how will the Major Medical insurer likely handle the claim?

claim will be denied

A Business Disability Buyout plan is designed

to pay benefits to the Corporation or other shareholders

With a 30-day elimination period and $500 monthly benefit, if the insured is totally disabled for 3.5 months, the total benefit is

$1250

If a monthly premium due September 1 is not paid and the insured is hospitalized October 15, how will the Major Medical insurer likely handle the claim?

deny the claim

All statements regarding group health insurance are true EXCEPT

an individual policy is given to each member

The clause that identifies which losses resulting from accident or sickness are insured by the policy is the

insuring clause

If an insured receives disability benefits, returns to work for one month, and then becomes disabled again from the same condition, the second period is

a recurrent disability

The insured and insurance company sharing the cost of covered losses is called

coinsurance

If an AD&D policy pays triple indemnity for common carrier death and the insured dies in a commercial flight accident, what is paid on a $100,000 policy?

$300000

If a preexisting neck injury was never disclosed 5 years ago and now causes total disability, how will the insurer handle the claim?

claim will be paid and coverage will remain in force

Which part of a health insurance policy is guaranteed to be true?

warranty

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

payment of claims provision

If a CEO's assistant is injured at home and cannot work for four months, which policy pays a monthly benefit?

disability income

If an insured is disabled from July 1 through November 30 with a 30-day elimination period, how many months of benefit are payable?

4 months

What feature allows an insured who can only return to part-time work to continue receiving Disability Income 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 how many days 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

war

Once proof of loss is received for an acceptable medical expense claim, the insurer must pay benefits

immediately

Who would be a likely candidate for disability income insurance on a key employee?

company executive

What rider lets a physician increase Disability Income coverage as income grows?

guaranteed insurability option rider

Which statement is true regarding a group Accident and Health policy issued to an employer?

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

Which statement concerning COBRA is correct?

dependents of employees covered by group plans have the same extension and conversion privileges as the employee

Which is an alternative method of providing health insurance?

consumer cooperative

Which is NOT a characteristic of PPOs?

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

How is pre-admission certification best used?

used to prevent nonessential medical costs

The agreement where hospitals and physician groups contract with an insurer to provide care at predetermined costs is a

Preferred Provider Organization (PPO)

What must a new employee do during open enrollment for noncontributory group Major Medical insurance?

sign an enrollment card

A Preferred Provider Organization (PPO)

offers medical insurance by sponsoring a network of health care providers

COBRA allows continuation of health coverage for

employees and their dependents