Kansas Insurance - Life and Health Insurance Questions and Answers 100% Pass

Kansas Insurance - Life and Health Insurance Questions and Answers 100% Pass The Kansas Life and Health Insurance Guaranty Act Association provides payment for covered claims under certain insurance policies in the event that a company is insolvent What are the limits of the KLHIGAA? Life: $100,00 in death benefits; $100,00 in net surrender value Annuities: $250,00 in present value Health: $100,00 in benefits Underwriting a method insurer's use to reduce or avoid risk Adverse Selection reducing risk as much as possible by eliminating as much "bad risk" as possible Medical Information Bureau (MIB) A nonprofit association that maintains medical data on applicants for life insurance What are the four risk classifications? Preferred, Standard, Sub-Standard, Declined Rate-up Age lifestyle and physical condition of the applicant versus actual age Flat extra rate up temporary increase that can be changed when the condition or situation no longer exist Tabular Rates permanent increases for health conditions such as being overweight or high blood pressure Graded Death Benefits having a lower death benefit in exchange for lower premiums What are the responsibilities of an insurance producer? 1. Make sure applicant fills application out completely 2. Make sure applicant has insurable interest Health Insurance Portability and Accountability Act (HIPAA) requires a consent form to be signed by the insured before doctor can release medical information to the insurer STOLI Stranger-Originated Life Insurance IOLI Investor-Originated Life Insurance Viatical Settlement the sale of a life insurance policy by a terminally ill insured to another party, typically to investors or investor groups, who hope to profit by the insured's early death What factors affect individual life insurance? Average of funeral cost, debts the insured carries, dependents, legacy, college tuition for heir What factors affect business life insurance? Value of business and financial need to keep business functioning if key employee dies Risk retention a group of individuals or businesses that share the same exposure to a loss Self-Insuring setting aside money to be used in the event of injury or loss What are requirements to be considered an employee group? Minimum of 2 people Minimum of 25 people if a union or association What is considered in underwriting a group policy? Average age of group, gender ratio, # of individuals participating, and persistency factors Non-contributory plans employer pays entire premium and 100% of employees must be covered Contributory plans employee is required to pay portion of premium but only 75% must enroll within 31 days of eligibility What is the employer's role? 1. Determine the benefits provided 2. Choose how plan is administered (themselves or TPA {Third Party Admin}) Receipts if an applicant pays a premium, the producer is required to give them a receipt What is the purpose of a receipt? 1. Proof of payment 2. provides coverage until application is approved