MD LIFE AND HEALTH FINAL EXAM WITH COMPLETE SOLUTIONS. ACTUAL EXAM UPDATE.

MD LIFE AND HEALTH FINAL EXAM WITH COMPLETE SOLUTIONS. ACTUAL EXAM UPDATE. The difference between a Long Term Care Partnership Plan and a Non- Partnership Plan is which of the following? - Ans: Asset Protection All of the following are considered appropriate uses of life insurance for business purposes EXCEPT - Ans: Protecting the business by covering entry level employees with life insurance Susan is insured through her Group Health Insurance plan and changed her coverage to an individual plan with the same insurer after her employment was terminated. This change is called a(n) - Ans: conversion Maria is a Preferred Provider Organization (PPO) subscriber and received care from an out-of-network provider. Which of the following is the likely result? - Ans: Care is covered Which of these statements concerning Traditional IRAs is CORRECT? - Ans: Earnings are taxable when withdrawn Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), a terminated employee's benefits must - Ans: be the same and the premium cannot exceed 102% A life insurance policy normally contains a provision that restricts coverage in the event of death under all of the following situations EXCEPT - Ans: fare- paying passenger According to the Health Insurance Portability and Accountability Act (HIPAA), when can a group health policy renewal be denied? - Ans: Participation or contribution rules have been violated Who regulates the quality of care provided by a heath maintenance organization (HMO)? - Ans: Secretary of the Department of Health and Mental Hygiene Under a disability income policy, which provision would be payable if the cause of an injury is unexpected and accidental? - Ans: Accidental bodily injury provision Shirley has a $500,000 10-year non-renewable level term life policy. If she dies 15 years after the policy's inception date, how much will her beneficiary receive? - Ans: Nothing Tom has a rider on his disability income policy that guarantees the right to increase his benefits without a medical exam. What kind of rider is this? - Ans: Guaranteed insurability rider The deeds and actions of a producer indicate what kind of authority? - Ans: Apparent Jennifer is required to pay a specific sum out of pocket before any benefits are paid in a year. Her health policy most likely contains a(n) - Ans: deductible An individual most likely will have an insurable interest in insuring a person's life if - Ans: an economic interest exists for the continuance of the insured's life According to life insurance contract law, insurable interest exists - Ans: at the time of application In an employer-sponsored contributory group Disability Income plan, the employer pays 60% of the premium and each employee pays 40% of the premium. Any income benefits paid are taxed to the employee at - Ans: 60% of the benefit Which of the following is considered to be an alternative to a life settlement? - Ans: Accelerated death benefit rider A separate converted policy may, at the option of the insurance company, be issued to cover a(n) - Ans: dependent Which of the following decisions would a Health Savings Account (HSA) owner NOT be able to make? - Ans: The amount contributed by the employer According to the Affordable Care Act, any plan in existence prior to which date is considered a grandfathered plan? - Ans: March 23, 2010 The taxable portion of each annuity payment is calculated using which method? - Ans: Exclusion Ratio Medicare Part A does not pay for medical benefits provided for treatment in a skilled nursing facility beyond - Ans: 100 days Who is eligible for insurance under a group policy issued to a labor union? - Ans: Every member of that union Credit Accident and Health plans are designed to - Ans: help pay off existing loans during periods of disability Key Person Disability Insurance pays benefits to the - Ans: employer What happens when an insurance policy is backdated? - Ans: The policy's effective date is earlier than the present According to the Affordable Care Act, what metal tier is required to have an actuarial value of 70% with covered individuals paying 30% through deductibles, co-pays, and other cost sharing features? - Ans: Silver Plan Which of the following is an annuity that is linked to a market-related index? - Ans: Equity-indexed annuity Which of these factors is NOT taken into consideration when determining the cost of a long-term care policy? - Ans: Personal income A person who, for a fee, gives advice or recommendations on benefits provided by an insurance contract is called - Ans: an advisor What type of policy would only provide coverage for specific types of illnesses (cancer, stroke, etc)? - Ans: Dread disease insurance When does a life insurance policy typically become effective? - Ans: When initial premium is collected and policy is issued Claims payable to a Disability Income insured, even when the insured can continue to work, are the result of a - Ans: Presumptive disability If an employee contributes 50% toward the disability plan premium provided by an employer, what would be considered the taxable income of a $1,000 monthly disability benefit? - Ans: $500 Which of the following basics is a producer's fiduciary responsibility? - Ans: Collecting premiums and paying them to the insurance company Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life policy covering all three of their lives. If Mike dies first, the policy proceeds - Ans: will no longer provide insurance protection All of the following actions are considered rebating EXCEPT - Ans: sharing commissions with other licensed and appointed agents Joe has a life insurance policy that has a face amount of $300,000. After a number of years, the policy's cash value accumulates to $50,000 and the face amount becomes $350,000. What kind of policy is this? - Ans: Universal Life policy