Docsity
Docsity

Prepare for your exams
Prepare for your exams

Study with the several resources on Docsity


Earn points to download
Earn points to download

Earn points by helping other students or get them with a premium plan


Guidelines and tips
Guidelines and tips

California Life, Accident, and Health Insurance Practice Questions and Answers, Exams of Insurance law

A comprehensive set of practice questions and answers related to california life, accident, and health insurance. It covers various aspects of insurance, including annuities, life insurance, disability income, group health insurance, and health insurance policies. The questions are designed to test knowledge of key concepts, provisions, and principles related to insurance in california. This resource can be valuable for students preparing for exams or professionals seeking to enhance their understanding of insurance practices.

Typology: Exams

2024/2025

Available from 12/06/2024

Fortis-In-Re
Fortis-In-Re šŸ‡ŗšŸ‡ø

1

(1)

2.3K documents

1 / 50

Toggle sidebar

This page cannot be seen from the preview

Don't miss anything!

bg1
CALIFORNIA LIFE, ACCIDENT, AND
HEALTH INSURANCE| 300+
PRACTICE QUESTIONS AND
ANSWERS A+ GRADE
pf3
pf4
pf5
pf8
pf9
pfa
pfd
pfe
pff
pf12
pf13
pf14
pf15
pf16
pf17
pf18
pf19
pf1a
pf1b
pf1c
pf1d
pf1e
pf1f
pf20
pf21
pf22
pf23
pf24
pf25
pf26
pf27
pf28
pf29
pf2a
pf2b
pf2c
pf2d
pf2e
pf2f
pf30
pf31
pf32

Partial preview of the text

Download California Life, Accident, and Health Insurance Practice Questions and Answers and more Exams Insurance law in PDF only on Docsity!

CALIFORNIA LIFE, ACCIDENT, AND

HEALTH INSURANCE| 300+

PRACTICE QUESTIONS AND

ANSWERS A+ GRADE

California Life, Accident, and

Health Insurance| 300+ Questions

and Answers

  1. An annuitant would like to determine the amount of an annuity distribution that is exempt from taxation. What is used to calculate this? - Correct Answer - exclusion ratio
  2. Cindy buys a 10-year certain annuity with an installment refund. After receiving monthly payments for 5 years, Cindy dies. How many remaining payments will the insurer make to her beneficiary? - Correct Answer - 60 payments
  3. A savings vehicle designed to first accumulate funds and then systematically liquidates the funds is called - Correct Answer - Deferred annuity
  4. Which of the following is not a feature of equity-indexed annuities? - Correct Answer - Offers maximum interest rate that increased annually
  5. An annuity which is backed by a life insurer's separate account is called a(n) - Correct Answer - variable annuity
  1. Which of the following is NOT a benefit of insurance? - Correct Answer - Losses due to fraud are eliminated
  2. A participating company is also referred to as which type of insurer? - Correct Answer - Mutual insurer
  3. Manuel is considered to be a disabled person as defined by the Americans with Disabilities Act (ADA). As such, he is unable to perform any of the following life activities EXCEPT - Correct Answer - Driving
  4. What are the residual disability income insurance payments based on? - Correct Answer - The amount of the insured's income is reduced by the disability
  5. Which of these statements is NOT true concerning recurrent disabilities? - Correct Answer - The insurer continues coverage after a new elimination period
  6. Allen has a disability income policy with a $2, monthly benefit and a 30-day elimination period. He is unable to work 90 days following an automobile accident. What will the policy pay? - Correct Answer - 5,
  1. Which of the following is NOT a provision in a disability income policy? - Correct Answer - Deductible and coinsurance provision
  2. The elimination period in disability income policy serves the same purpose as - Correct Answer - A deductible
  3. Dyan is considered partially disabled by her insurance company. Which of the following BEST describes her situation? - Correct Answer - She is working part-time and receiving lost income under her long-term disability benefit
  4. Who is financially liable for the payment of covered claims in a fully insured group health plan? - Correct Answer - Insurer
  5. In regards to a group health insurance plan, which statement is CORRECT? - Correct Answer - A non- contributory group health plan must cover all eligible memebers
  6. When a claimant has coverage under more than one health plan, which group medical plan provision applies? - Correct Answer - Coordination of benefits
  1. The insurer has the option of terminating a health insurance policy on a date stated in the contract. What type of policy is this? - Correct Answer - Optionally renewable
  2. Which type of health insurance policy cannot be canceled by the insurer nor increase the premiums? - Correct Answer - Noncancellable
  3. The conditions, times, and circumstances under which an insured is NOT covered by a health policy are called? - Correct Answer - Exclusions
  4. The misstatement of age provision in a health policy states that if an insured gives the wrong age at the time of application, what action can the insurance company take? - Correct Answer - Benefits can be adjusted
  5. Bruce is involved in an accident and becomes totally and permanently disabled. His insurance policy continues in force without payment of further premiums. Which policy provision is responsible for this? - Correct Answer - Waiver of premium provision
  6. In what situation does a waiver of premium provision keep a health insurance policy in force without premium

payments? - Correct Answer - When an insured becomes totally disabled

  1. Which of these factors do NOT affect the rates of medical insurance? - Correct Answer - Race
  2. How does rising morbidity rates affect health insurance? - Correct Answer - Increased premiums
  3. Which of these is NOT a relevant factor in the health insurance principle of morbidity? - Correct Answer - Intelligence
  4. Which of the following is NOT a factor in determining the morbidity of a group individuals? - Correct Answer - Race
  5. If a material warranty violation on the part of the insured is found, what recourse does an insurer have? - Correct Answer - Rescind the policy
  6. Restoring an insured to the same condition as before a loss is an example of the principle of - Correct Answer - Indemnity
  1. What is the price of insurance for each exposure unit? - Correct Answer - Rate
  2. When calculating life insurance premium rates, which component would an agent's commission fall under? - Correct Answer - Insurer's expenses
  3. A spendthrift clause in a life insurance policy - Correct Answer - restricts the ability of the beneficiary to assign benefits
  4. How are death benefits that are received by a beneficiary normally treated for tax purposes? - Correct Answer - Exempt from federal income taxes
  5. Which of the following is NOT a life insurance settlement option? - Correct Answer - Extended term option
  6. When calculation life insurance premium rates, which component affected by an insured's age and gender? - Correct Answer - Mortality
  7. A creditor would be allowed rights to life insurance policy proceeds if which of the following beneficiaries is chosen? - Correct Answer - The insured's estate
  1. 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? - Correct Answer - Interest option
  2. Which provision will pay a portion of the death benefits prior to the insured's death due to a serious illness? - Correct Answer - Accelerated death benefit
  3. What does the grace period allow a life insurance policy owner to do? - Correct Answer - Make a premium payment after the due date without any loss of coverage
  4. Which of the following does a policy owner NOT have a right to change? - Correct Answer - Dividend schedule
  5. What does the guaranteed insurability option allow an insured to do? - Correct Answer - Purchase additional coverage with no evidence of insurability required
  6. A life insurance policy can be surrendered for its cash value under which policy provision? - Correct Answer - Nonforfeiture options
  1. An insurance policy written after 1988 that fails to pass the seven-pay test is known as - Correct Answer - A modified endowment contract
  2. What is the proper order of initial life insurance premiums, from lowest to highest? - Correct Answer - Modified premium, ordinary life, single premium
  3. Which of the following is NOT true regarding a family policy that covers children? - Correct Answer - Conversion of child's coverage to permanent insurance does NOT require evidence of insurability
  4. Scott has just purchased a new house. He is now shopping for a life insurance policy that provides a death benefit that matches the projected outstanding debt of his mortgage. Which life policy would best suit his needs? - Correct Answer - Mortgage redemption
  5. Which of the following is NOT a true description of non- medical life insurance? - Correct Answer - Applicants are not required to answer medical questions on the application
  6. 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? - Correct Answer - Second-to-die policy

  1. Which of the following statements do NOT apply to a child coverage in a family policy? - Correct Answer - Only children born prior to policy's issue date may be included
  2. Lynn owns a life policy that guarantees the right to renew the policy each year, regardless of health, but at an increased premium. What kind of policy is this? - Correct Answer - Renewable term
  3. A life insurance policy that pays the face amount if the insured survives to a specified period of the time called - Correct Answer - Endowment insurance
  4. In a renewable term life insurance policy, the contract will usually - Correct Answer - Require a higher premium payable at each renewal
  5. In a modified endowment contract, the penalty tax imposed on premature withdrawals is - Correct Answer - 10%
  1. Which of the following is NOT a risk classification that an underwriter would use? - Correct Answer - Dividend risk
  2. The objective of underwriting is to - Correct Answer - Avoid selecting a disproportionate number of bad risks
  3. Which of the following terms is NOT associated with a Major Medical policy? - Correct Answer - Capitation
  4. All of these are examples of cost sharing in a health insurance policy EXCEPT - Correct Answer - Coordination
  5. The elimination period in a disability income policy serves the same purpose as a(n)_______ in a medical expense policy. - Correct Answer - Deductible
  6. Medical expense policies will typically cover which of the following? - Correct Answer - Injuries caused by accidents
  7. At what point does a self-insured group qualify for the stop-loss coverage? - Correct Answer - When claims exceed a specified limit in a set period of time
  1. An insured is protected from the expense of a catastrophic illness by which of the following health insurance provisions? - Correct Answer - Stop-loss
  2. Which of the following does specified disease insurance NOT cover? - Correct Answer - Costs covered by medical expense insurance
  3. Which of the following types of policies pays a stated amount of each day an individual is hospitalized - Correct Answer - Hospital confinement indemnity
  4. Major medical expense plans typically use a cost containment measure for emergency hospital care. This is referred to as a(n) - Correct Answer - Deductible
  5. What is considered the most common type of specified disease insurance policy? - Correct Answer - Cancer
  6. An insurer having a large number of similar exposure units is considered important because - Correct Answer - The greater the number insured, the more accurately the insurer can predict losses and set appropriate premiums
  1. Which of the following is any situation that presents the possibility of a loss? - Correct Answer - Loss exposure
  2. Which of the following best describes the statement "The more times an event is repeated, the more predictable the outcome becomes"? - Correct Answer - Law of large numbers
  3. ESOPs are typically invested in - Correct Answer - employer stock
  4. How are Roth IRA's treated for tax purposes? - Correct Answer - Non-deductible contributions and tax-free distributions
  5. What area of group health insurance is regulated under the Employee Retirement Security Act of 1974 (ERISA)? - Correct Answer - Disclosure and reporting
  6. Employer contributions qualified plans are - Correct Answer - Tax deductible by the employer
  7. Under a 10 year- vesting schedule, what percentage of employer contributions must be vested after 10 years of service? - Correct Answer - 100%
  1. Which of the following is NOT included under long-term care insurance? - Correct Answer - Hospital acute care
  2. Which of the following plans will cover medical costs that Medicare doesn't cover? - Correct Answer - Medicare supplement
  3. What type of coverage pays a benefit for part-time nursing care that can be provided in a patient's home? - Correct Answer - Home health care
  4. Which of the following would be considered an activity of daily living under a long term care policy? - Correct Answer - bathing
  5. Under a long-term care insurance policy, adult day care coverage will provide for - Correct Answer - part time care at a facility for elderly individuals who live at home
  6. Which type of worker has Social Security benefits available to them? - Correct Answer - Fully insured
  7. The reason for social insurance is to - Correct Answer - protect certain vulnerable segments of the population