Indiana State Life and Health Insurance
Exam
A "reimbursement policy" pays what amount of covered Long-Term Care expenses?
All expenses regardless of the policy limits
Actual covered expenses up to the daily maximum
A daily dollar amount regardless of the actual incurred expenses
The usual, customary, and reasonable expenses regardless of the policy limits - ANS-Actual
covered expenses up to the daily maximum
A 55 year old recently received a $30,000 distribution from a previous employer's 401k plan,
minus $6,000 withholding. Which federal taxes apply if none of the funds were rolled over?
Only income taxes on $30,000
Only income taxes on $24,000
Income taxes plus a 10% penalty tax on $30,000
Income taxes plus a 10% penalty tax on $24,000 - ANS-Income taxes plus a 10% penalty tax on
$30,000
A comprehensive major medical health insurance policy contains an Eligible Expenses provision
which identifies the types of health care services that are covered. All of the following health
care services are typically covered except for?
Hospital Charges
Physician Fees
Experimental and Investigative Services
Nursing Services - ANS-Experimental and Investigative Services
A domestic insurance company in Indiana must?
Be organized under Indiana insurance laws
Own real estate in Indiana
Write insurance on risks located only in Indiana
,Honor the charter of the NAIC - ANS-Be organized under Indiana insurance laws
A domestic insurance company in Indiana must?
Own real estate in Indiana
Write insurance on risks located only in Indiana
Be incorporated and formed in Indiana
Honor the charter of the NAIC - ANS-Be incorporated and formed in Indiana
A level premium indicates?
The premium is fixed for a period stated in the contract, then becomes variable
The premium con only be changed with the consent of the insurer
The premium stays level until the policy's renewal date
The premium is fixed for the entire duration of the contract - ANS-The premium is fixed for the
entire duration of the contract
A life insurance application must be signed by all of these except?
The policyowner
The agent
the insured (if an adult)
Beneficiary - ANS-Beneficiary
A life policy loan in Indiana cannot charge a fixed of interest higher than?
7%
8%
9%
10% - ANS-8%
A life policy loan in Indiana cannot charge a fixed rate of interest higher than?
7%
8%
9%
10% - ANS-8%
A noncontributory group term life plan is characterized by?
The entire cost of the plan is paid for by the employer
The entire cost of the plan is paid for by the employee
,The cost of the plan is shared by both employer and employee
Both employer and employee must provide evidence of insurability - ANS-The entire cost of the
plan is paid for by the employer
A nonprofit incorporated society that does not have capital stock and operates for the sole
benefit of its members is known as?
A fraternal benefit society
A stock insurer
A mutual insurer
The Life and Health Insurance Guaranty Association - ANS-A fraternal benefit society
A policy of adhesion can only be modified by whom?
The agent
The applicant
The primary beneficiary
The insurance company - ANS-The insurance company
A policyowner is allowed to pay premiums more than once a year under which provision?
Insuring
Consideration
Payor
Mode of Premium - ANS-Mode of Premium
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash
value at a faster rate in the early years of the policy. which of these statements made by the
producer would be correct?
Straight life accumulates faster than Limited-Pay Life
20-Pay Life accumulates cash value faster than Straight Life
Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurers financial
rating
20-Pay Life and Straight Life accumulate cash value at the same rate - ANS-20-Pay Life
accumulates cash value faster than Straight Life
A primary beneficiary has died before the insured in a life insurance policy. A contingent
beneficiary is also named in the policy. Which of the following will occur when the insured dies?
Proceeds will go to the primary beneficiary's estate
, Probate will decide who receives proceeds
Proceeds will go to the contingent beneficiary
proceeds will go to the insured's estate - ANS-Proceeds will go to the contingent beneficiary
A producer must notify the Insurance Commissioner within____days of an address change?
15
30
45
60 - ANS-30
A producer's license may be denied, suspended, or revoked if the license?
Engages in replacement of an existing policy
Is found guilty of misrepresentation in obtaining the license
Files for bankruptcy
Does not meet a sales quota - ANS-Is found guilty of misrepresentation in obtaining the license
A producers license may be denied, suspended, or revoked if the licensee?
Engages in replacement of an existing policy
Is found guilty of misrepresentation in obtaining the license
Files for bankruptcy
Does not meet a sales quota - ANS-Is found guilty of misrepresentation in obtaining the license
A whole life insurance policyowner does not wish to continue making premium payments. Which
of the following enables the policyowner to sell the policy for more than its cash value?
Cash Surrender
Life Settlement Contract
Buy-Sell Arrangement
1031 Exchange - ANS-Life Settlement Contract
ABC Insurance Company has accepted a life insurance application which contains unanswered
questions. The company then makes the application part of the life contract. In this situation, the
insurer has?
Waived one of its legal rights
Issued a voidable policy
Committed an act of fraud
Exam
A "reimbursement policy" pays what amount of covered Long-Term Care expenses?
All expenses regardless of the policy limits
Actual covered expenses up to the daily maximum
A daily dollar amount regardless of the actual incurred expenses
The usual, customary, and reasonable expenses regardless of the policy limits - ANS-Actual
covered expenses up to the daily maximum
A 55 year old recently received a $30,000 distribution from a previous employer's 401k plan,
minus $6,000 withholding. Which federal taxes apply if none of the funds were rolled over?
Only income taxes on $30,000
Only income taxes on $24,000
Income taxes plus a 10% penalty tax on $30,000
Income taxes plus a 10% penalty tax on $24,000 - ANS-Income taxes plus a 10% penalty tax on
$30,000
A comprehensive major medical health insurance policy contains an Eligible Expenses provision
which identifies the types of health care services that are covered. All of the following health
care services are typically covered except for?
Hospital Charges
Physician Fees
Experimental and Investigative Services
Nursing Services - ANS-Experimental and Investigative Services
A domestic insurance company in Indiana must?
Be organized under Indiana insurance laws
Own real estate in Indiana
Write insurance on risks located only in Indiana
,Honor the charter of the NAIC - ANS-Be organized under Indiana insurance laws
A domestic insurance company in Indiana must?
Own real estate in Indiana
Write insurance on risks located only in Indiana
Be incorporated and formed in Indiana
Honor the charter of the NAIC - ANS-Be incorporated and formed in Indiana
A level premium indicates?
The premium is fixed for a period stated in the contract, then becomes variable
The premium con only be changed with the consent of the insurer
The premium stays level until the policy's renewal date
The premium is fixed for the entire duration of the contract - ANS-The premium is fixed for the
entire duration of the contract
A life insurance application must be signed by all of these except?
The policyowner
The agent
the insured (if an adult)
Beneficiary - ANS-Beneficiary
A life policy loan in Indiana cannot charge a fixed of interest higher than?
7%
8%
9%
10% - ANS-8%
A life policy loan in Indiana cannot charge a fixed rate of interest higher than?
7%
8%
9%
10% - ANS-8%
A noncontributory group term life plan is characterized by?
The entire cost of the plan is paid for by the employer
The entire cost of the plan is paid for by the employee
,The cost of the plan is shared by both employer and employee
Both employer and employee must provide evidence of insurability - ANS-The entire cost of the
plan is paid for by the employer
A nonprofit incorporated society that does not have capital stock and operates for the sole
benefit of its members is known as?
A fraternal benefit society
A stock insurer
A mutual insurer
The Life and Health Insurance Guaranty Association - ANS-A fraternal benefit society
A policy of adhesion can only be modified by whom?
The agent
The applicant
The primary beneficiary
The insurance company - ANS-The insurance company
A policyowner is allowed to pay premiums more than once a year under which provision?
Insuring
Consideration
Payor
Mode of Premium - ANS-Mode of Premium
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash
value at a faster rate in the early years of the policy. which of these statements made by the
producer would be correct?
Straight life accumulates faster than Limited-Pay Life
20-Pay Life accumulates cash value faster than Straight Life
Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurers financial
rating
20-Pay Life and Straight Life accumulate cash value at the same rate - ANS-20-Pay Life
accumulates cash value faster than Straight Life
A primary beneficiary has died before the insured in a life insurance policy. A contingent
beneficiary is also named in the policy. Which of the following will occur when the insured dies?
Proceeds will go to the primary beneficiary's estate
, Probate will decide who receives proceeds
Proceeds will go to the contingent beneficiary
proceeds will go to the insured's estate - ANS-Proceeds will go to the contingent beneficiary
A producer must notify the Insurance Commissioner within____days of an address change?
15
30
45
60 - ANS-30
A producer's license may be denied, suspended, or revoked if the license?
Engages in replacement of an existing policy
Is found guilty of misrepresentation in obtaining the license
Files for bankruptcy
Does not meet a sales quota - ANS-Is found guilty of misrepresentation in obtaining the license
A producers license may be denied, suspended, or revoked if the licensee?
Engages in replacement of an existing policy
Is found guilty of misrepresentation in obtaining the license
Files for bankruptcy
Does not meet a sales quota - ANS-Is found guilty of misrepresentation in obtaining the license
A whole life insurance policyowner does not wish to continue making premium payments. Which
of the following enables the policyowner to sell the policy for more than its cash value?
Cash Surrender
Life Settlement Contract
Buy-Sell Arrangement
1031 Exchange - ANS-Life Settlement Contract
ABC Insurance Company has accepted a life insurance application which contains unanswered
questions. The company then makes the application part of the life contract. In this situation, the
insurer has?
Waived one of its legal rights
Issued a voidable policy
Committed an act of fraud
