ExamFX Pennsylvania life and health ExamFX simulated exam
Terms in this set (109)
An employee becomes insured under a PPO plan provided by his employer. If the insured decides to go to a physician who is not a PPO provider, which of the following will happen?
The PPO will pay reduced benefits
Insurers may change which of the following on a guaranteed renewable health insurance policy?
Rates by class
If a business wants to buy a disability income policy on a key employee, which of the following is considered the applicant?
When must an insurance company present an outline of coverage to an applicant for a Medicare Supplement Policy?
At the time of application
According to the PPACA metal levels classification, if a health plan is expected to cover 90% of the cost for an average population, and the participants would cover the remaining 10% what type of plan is that?
A producer licensed in Pennsylvania must notify the Insurance Department of any change in address in his or her residence or business address within how many days?
Which of the following is true regarding Medicare Supplement Policies?
They must be guaranteed renewable
When the policy premium wasn't submitted with the application, what should the agent obtain from the insured upon policy delivery
A statement of good health
The act of voluntarily giving up insurance by the insured is called
What type of benefit helps to pay for accidental injuries that are not severe enough to qualify as disabilities?
Medical Reimbursement Benefit
Which renewal option does NOT guarantee renewal and allows the insurance company to refuse renewal of a policy of any premium due date
In comparison to a policy that uses the accidental means definition, a policy that uses the accidental bodily injury definition would provide a coverage that is?
Broader in general
Once it has been reasonably proven that a person unknowingly violated the insurance code regarding unfair methods of competition, the department may impose a civil penalty of?
$1000 for each violation
Which renewability provision are you most likely to see on a travel accident policy
Period of time
Which of the following conditions would a disability income policy most likely NOT require in order to qualify for benefits?
A specified income status prior to disability
When an individual purchases insurance, what risk management technique is he or she practicing?
An insured does not have to pay coinsurance or deductibles on a full-series mouth x-ray but does have to pay a deductible to get his cavities filled. Which dental plan does he have?
In which of the following situations is it legal to limit coverage based on marital status?
It is never legal to limit coverage based on marital status
Which document helps ensure that full and fair disclosure is provided to the recipient of a policy
Outline of coverage
Under the affordable care act, what percentage of preventive care must be covered without cost sharing
Who is the beneficiary in a credit health policy?
The lending institution
What is the maximum age for qualifying for a catastrophic plan?
An insured has been injured in an accident. Although he is still receiving benefits from his disability income policy, he does not have to pay premiums. This means that the policy includes
Waiver of premium feature
Group disability income insurance premiums paid by the employer are
Deductible by the employer as an ordinary business expense
Under HIPAA which of the following is INCORRECT regarding eligibility requirements for conversion to an individual policy
An individual who was previously covered by group insurance for 6 months is eligible
In reference to the Standard Medicare Supplement benefits plans, what does the term standard mean?
All providers will have the same coverage options and conditions for each plan
All of the following are true regarding the medical information bureau (mib) EXCEPT
MIB reports are based upon information supplied by doctors and hospitals
All of the following are ways in which a Major Medical policy premium is determined EXCEPT
The average age of the group
The purpose of managed care health insurance plans is to
Control health insurance claims and expenses
What is the purpose of COBRA?
To provide continuation of coverage for terminated employees
The annual contribution limit of a dependent care flexible spending account is set by
A hospital indemnity policy will pay?
A benefit for each day the insured is in a hospital
Which health insurance provision describes the insured' s right to cancel coverage
What documentation grants express authority to an agent
Agents contract with the principal
If an insurance company offers Medicare Supplement policies, it must offer which of the following plans
In a disability policy, the elimination (or waiting) period refers to the period between
The first day of disability and the day the insured starts receiving benefits
Which of the following is NOT a feature of a guaranteed renewable provision
The insurer can increase the policy premium on an individual bases
If an employee terminates her employment, which of the following provisions would allow her to continue health coverage under an individual policy, if requested within 31 days
Which renewability provision allows an insurer to terminate a policy for any reason, and to increase the premiums for any class of insureds
An insured is receiving hospice care. His insurer will pay for painkillers but not for an operation to reduce the size of a tumor. What term best fits this arrangement
According to the telemarketing sales rules, what are the permissible calling hours for telemarketing calls
8am until 9pm
Which type of Medicare policy requires insured's to use specific healthcare providers and hospitals (network providers) EXCEPT in emergency situations
An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. this results in a long hospitalization period. Which of the following is true?
The group plan will not pay because the employee was injured at work
To be eligible under HIPAA regulations, for how long should an individual health plan have been covered under the previous group plan?
Which of the following describes taxation of individual disability income insurance premiums and benefits?
Premiums are not tax deductible and benefits are not taxable
An insurer wishes to compare the information given in an insurance application with the previous insurance applications by the same applicant but for different companies. What organization can help the insurer accomplish this?
The Medical Information Bureau
All of the following are true about group disability income insurance EXCEPT
Coverage applies both on and off the job
According to the Future Increase Option Rider (FIO) which of the following is NOT a qualifying event to increase an insured's benefit level?
Death of a spouse
The benefits received by the business in a Disability Buy-sell policy are
Income tax free
Which of the following will vary the length of the grace period in health insurance policies?
The mode of the premium payment
Peril is most easily defined as
The cause of loss insured against
In which of the following health plans are benefit payments attributed to employer contributions taxable to the employee
Group Disability Income
To avoid violations of unfair settlement regulations, insurer's are required to acknowledge the receipt of a claim within how many days?
A long-term care shoppers guide must be presented at what point?
Prior to the time of application
Representations are written or oral statements made by the applicant that are
Considered true to the best of the applicants knowledge
Which of the following is NOT a goal of risk retention?
To minimize the insured's level of liability in the event of loss
After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true
By law, the new, individual policy must provide the same benefits as the group insurance policy
In a group health policy, a probationary period is intended for people
Who joined the group after the effective date
Disability income policies can provide coverage for a loss of income when returning to work only part time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability?
The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof of loss is known as
In forming an insurance contract, when does acceptance usually occur?
When an insurer's underwriter approves coverage
Every insurer marketing Long-term Care insurance must establish marketing procedures to ensure all of the following EXCEPT
LTC policies are marketed effectively to prospective insured's
If a licensed person is moving to Pennsylvania, he or she may become licensed as a resident if they submit a completed application within how many days of establishing residence in Pennsylvania with proof of licensing from their prior home state?
What is the contract provision that allows the insurer to nonrenew health coverage if certain events occur?
When health care insurer's negotiate contracts with health care providers or physicians to provide health care services for subscribers at favorable cost, it is called
Preferred Provider Organization (PPO)
Which of the following statements is true regarding LTC insurance?
Every policy must offer non forfeiture benefits to the applicant
What document describes an insured's medical history, including diagnoses and treatments?
Attending Physicians statement
A guaranteed renewable health insurance policy allows the
policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class
An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would she be receiving benefits under an "own occupation" disability plan?
Which of the following is excluded in a dental insurance plan?
Which of the following is INCORRECT concerning Medicaid?
It is solely a federally administered program
How is emergency care covered for a member of an HMO
A member of an HMO can receive care in or out of the HMO service area, but care is preferred in the service area.
Which of the following provisions is mandatory for health insurance policies
Physical examination and autopsy
Once it has been reasonably proven that a person knowingly violated the insurance code regarding unfair methods of competition, the department may impose a civil penalty of
$5,000 for each violation
All of the following are examples of risk retention EXCEPT
A noncontributory group disability income has a 30-day waiting period and offers benefits of $2,000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive
$12,000 All of which is taxable
Which of the following is an eligibility requirement for all social security disability income benefits
Have attained fully insured status
Which of the following dental insurance categories would cover the filling of cavities?
Routine and restorative care
Insurer's are required to keep records, when may the department examine these records?
At any time
Who is involved in completing the agents report?
Only the agent
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?
Which of the following are the main factors taken into account when calculating residual disability benefits?
Present earnings and earning prior to disability
All of the following statements describe MEWA EXCEPT
MEWA's are groups of at least 3 employees
All of the following are characteristics of a Major Medical expense policy EXCEPT
Low maximum limits
An insured has a Major Medical policy with a $500 deductible and a coinsurance clause of 80/20 if he incurs medical expenses of $4,000 the insurer would pay
Which insurance principle States that if a policy allows for greater compensation than the financial loss incurred, the insured may only recover benefits for the amount lost?
While repairing the roof of his house an insured accidentally falls off and breaks his arm and sustains a head injury that results in total blindness of both eyes. His policy contains a accidental death & dismemberment rider. What is the extent of benefits he will receive?
For the purpose of insurance, risk is defined as
The uncertainty or chance of loss
Underwriting is a Major consideration when an insured wishes to replace her current policy for all of the following reasons EXCEPT
Premiums always stay the same
An individual was just caught acting as an exclusive general agent even though he is not properly licensed. Assuming that this occurred in a single day, what is the maximum penalty he faces?
A Third degree misdemeanor and a $1,000 fine
Anyone caught violating the requirements of long-term care insurance will be subject to
A civil penalty of up to 3 times the amount of commissions paid for each policy involved or $10,000 whichever is greater
In an optionally renewable policy, the insurer has which of the following options?
Under a key-person disability income policy, premium payments
are made by the business and are not tax deductible
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?
Why is is essential for an insurer to document all correspondence with the insured?
Errors and omissions
All of the following are considered to be supplemental benefits under an HMO plan EXCEPT
If a consumer requests additional information concerning an investigative consumer report how long does the insurer or reporting agency have to comply?
If a new individual long-term care policyholder is not satisfied with a new policy, within how many days can the insured return the policy for a full premium refund?
Can an individual who belongs to a POS plan use an out-of-network physician?
Yes and they may use any preferred physician even if not part of the HMO
All of the following may be excluded from coverage in a Major Medical Expense policy EXCEPT
After the elimination period, a totally disabled insured qualified and started receiving benefits from his disability income policy that has a waiver of premium rider. What will likely happen to the premiums paid into the policy during the elimination period?
Premiums will be refunded
Which is NOT true regarding an insured who is considered to be a standard risk?
The insured may habe to pay slightly higher premiums
Which of the following is the most common time for errors and omissions to occur on the part of an imsurer?
In a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are
Not taxable since the IRS treats them as a return of a portion of the premium paid
What options allows the insured to periodically increase benefit levels without providing evidence of insurability
Guarantee of insuranility
Which of the following authorities monitors the financial strength of insurers
Department of Insurance
How can a physician be added to the PPO's approved list?
Agree to follow the PPO standards and charge the appropriate fees
Which of the following statements is correct?
HMO's may pay for services not covered by Medicare