South Carolina Life/Health Final Exam 2 Questions & Answers 100% Correct

Any of the following transactions will be subject to federal income tax consequences in a modified endowment contract (MEC), EXCEPT: Select one: a. Policy loans b. Policy withdrawals c. Partial withdrawals d. Death proceeds - ANSWER-Death proceeds Death benefits are the only payment not affected by the federal law regarding modified endowment contracts. What are the rules for genetic testing and health insurance? Select one: a. Genetic testing can never be used for any reason. b. Genetic testing can be used for setting rates only. c. Genetic testing can be used to limit coverage. d. Genetic testing can be used to refuse to renew a policy. - ANSWER-Genetic testing can never be used for any reason. Insurers may not discriminate based on genetic information provided in the plan. Discriminatory acts include terminating or limiting the coverage, refusing to renew the policy, imposing a waiting limit, or establishing new premium rates. Which of the following is required for a contributory plan? Select one: a. The employer pays all fees and premiums. b. 50% participation of eligible employees