CFP Exam Questions ALL YOU NEED
(Latest Update ) with Verified
Answers 100 % Correct [Grade A]
Social Insurance Substitute Rider (disability) - correct answer Reduces base benefit if
Social Security pays.
Pays full benefit if Social Security denies or delays.
Lowers premium (insurer pays less if SS pays).
Social Insurance Supplement Rider (disability) - correct answer Adds extra benefit
during Social Security waiting period (5 months).
Pays difference if Social Security benefit is less than rider's amount.
Raises premium (insurer pays more).
Disability Renewability provisions (3) - correct answer Noncancelable - guaranteed
renewal, fixed premium, expensive, insured cannot cancel
Guaranteed renewable - premiums can increase, insurer cant cancel but can become
unfavorable
Conditionally renewable - renew if conditions are met, insurer can cancel
,Disability taxation (Employee and Employer) - correct answer ER pays Premium (ER
deduct, EE pays tax)
EE Pays Premium (Non deduct, EE benefits tax free)
Shared Premium ( ER deducts share, EE gets tax free their share paid)
Disability Taxation (Business) - correct answer S corp / partnership - biz deducts
premium, person includes premium in income, benefits tax free
business overhead expense - premium deductible, benefits are taxable
Disability Buy-out policy - benefits are tax free, premiums are not deductible
Deductible - correct answer The amount you pay out of pocket before your insurance
starts to pay.
Coinsurance - correct answer The percentage of costs you share with the insurer after
the deductible is met.
,Maximum Out-of-Pocket - correct answer The most you'll pay in a year for covered
services (includes deductible, copays, and coinsurance). After that, the insurance pays
100%.
Max out of pocket formula - correct answer =Deductible +(Coinsurance
Rate×Coinsurance Limit)
COBRA - correct answer 20 employees(part time workers count as half) + have a
medical plan (dental ,vision, drugs too)
Protects against loss of coverage (worker, spouse, or child)
Must elect cobra withing 60 days of qualifying event
102% charge up in premium to admin costs
(applies to non gov, non church employees)
Qualifying event 18 months (COBRA) - correct answer (work related events)
Reduction in hours
Quitting
Normal termination
, Qualifying event 29 months (COBRA) - correct answer (SS disability)
employee or qualified beneficiary meets Social Security
definition of disabled.
(can qualify for medicare after 24m of ss disability)
Qualifying event 36 months - correct answer (Other events)
Death
Divorce
Medicare eligibility (employee)
Child reaching age 26
2010 Health Care reform Legislation (ACA & HC and Edu reconciliation act) - correct
answer No lifetime or annual limits on essential health benefits.
Free preventive services (no deductible, copay, or coinsurance).
Dependent coverage allowed until age 26:
Can be married (but spouse/kids not covered).
No pre-existing condition exclusions.
(Latest Update ) with Verified
Answers 100 % Correct [Grade A]
Social Insurance Substitute Rider (disability) - correct answer Reduces base benefit if
Social Security pays.
Pays full benefit if Social Security denies or delays.
Lowers premium (insurer pays less if SS pays).
Social Insurance Supplement Rider (disability) - correct answer Adds extra benefit
during Social Security waiting period (5 months).
Pays difference if Social Security benefit is less than rider's amount.
Raises premium (insurer pays more).
Disability Renewability provisions (3) - correct answer Noncancelable - guaranteed
renewal, fixed premium, expensive, insured cannot cancel
Guaranteed renewable - premiums can increase, insurer cant cancel but can become
unfavorable
Conditionally renewable - renew if conditions are met, insurer can cancel
,Disability taxation (Employee and Employer) - correct answer ER pays Premium (ER
deduct, EE pays tax)
EE Pays Premium (Non deduct, EE benefits tax free)
Shared Premium ( ER deducts share, EE gets tax free their share paid)
Disability Taxation (Business) - correct answer S corp / partnership - biz deducts
premium, person includes premium in income, benefits tax free
business overhead expense - premium deductible, benefits are taxable
Disability Buy-out policy - benefits are tax free, premiums are not deductible
Deductible - correct answer The amount you pay out of pocket before your insurance
starts to pay.
Coinsurance - correct answer The percentage of costs you share with the insurer after
the deductible is met.
,Maximum Out-of-Pocket - correct answer The most you'll pay in a year for covered
services (includes deductible, copays, and coinsurance). After that, the insurance pays
100%.
Max out of pocket formula - correct answer =Deductible +(Coinsurance
Rate×Coinsurance Limit)
COBRA - correct answer 20 employees(part time workers count as half) + have a
medical plan (dental ,vision, drugs too)
Protects against loss of coverage (worker, spouse, or child)
Must elect cobra withing 60 days of qualifying event
102% charge up in premium to admin costs
(applies to non gov, non church employees)
Qualifying event 18 months (COBRA) - correct answer (work related events)
Reduction in hours
Quitting
Normal termination
, Qualifying event 29 months (COBRA) - correct answer (SS disability)
employee or qualified beneficiary meets Social Security
definition of disabled.
(can qualify for medicare after 24m of ss disability)
Qualifying event 36 months - correct answer (Other events)
Death
Divorce
Medicare eligibility (employee)
Child reaching age 26
2010 Health Care reform Legislation (ACA & HC and Edu reconciliation act) - correct
answer No lifetime or annual limits on essential health benefits.
Free preventive services (no deductible, copay, or coinsurance).
Dependent coverage allowed until age 26:
Can be married (but spouse/kids not covered).
No pre-existing condition exclusions.
