CEBS - GBA 1 - PRACTICE EXAM 2025|
BRAND NEW ACTUAL EXAM WITH 100%
VERIFIED QUESTIONS AND CORRECT
SOLUTIONS| GUARANTEED VALUE PACK|
ACE YOUR GRADES.
1. Which of the following statements correctly describes
minimum requirements that group benefit plans typically
must meet in order to be prospectively rated on contract
renewal? - ANSWERS____The more unpredictable the
event that will trigger a claim, the larger the minimum
group size and premium requirements
2. Which of the following statements correctly describes the
term graduation as it applies to mortality tables? -
ANSWERS____It is a mathematical process that removes
anomalies that should not appear in the mortality data
3. If the plan sponsor pays the premium, which of the
following group insured benefits is taxable to the plan
member? - ANSWERS____Long-term disability (LTD)
4. Which of the following statements correctly describes
phases of a group plan marketing? - ANSWERS____Plan
features of both contributory and noncontributory benefit
, plans must be communicated to plan members during the
enrollment process
5. Which of the following statements correctly describes a
characteristic of an insurable risk? - ANSWERS____The loss
must have financial significance to the insured (The loss
must not be catastrophic to the insurer. Option C: The loss
must occur by chance. Option D: The loss must be
predictable for the insurer.)
6. With respect to marketing a group insurance plan, which
of the following statements best describes insurer
representatives known as account executives? -
ANSWERS____They are involved in enrolling group
members and installing new plans
7. Which of the following statements correctly describes the
statistical concept known as the law of large numbers? -
ANSWERS____Future probabilities of loss are not valid
unless a large number of incidents exist to ensure the
outcomes are less likely to deviate
8. Which of the following statements correctly describes an
insured plan that is insurer-administered? -
ANSWERS____For self-insured plans with an
administrative services only (ASO) arrangement, the
, insurer bills the plan sponsor monthly for administration
fees
9. If the probability that an individual will live one year is 0.95
and the probability of dying in the following year is 0.10,
what is the probability that an individual will survive both
years? - ANSWERS____0.855 (P (Survive both years) =
(0.95) x (1 - 0.1) = 0.95 x 0.90 = 0.855.)
10. Which of the following statements correctly describes
the group benefits enrollment process for new employees?
- ANSWERS____An employee can enroll in the plan any
time between his or her date of hire and the end of a
waiting period
11. A type of service offered under a third-party
administrators (TPAs) claims settlement only arrangement
is: - ANSWERS____Adjudicating and paying claims
12. Unless otherwise specified in the group insurance
contract, a plan member's status under a group benefits
plan terminates the earliest at which: - ANSWERS____The
plan member retires (Unless otherwise specified in the
group insurance contract, the order in which coverage
terminates is effective the earliest date the plan member
retires, the plan member's service with the plan sponsor is
, terminated, the plan member ceases active work, and the
plan member is no longer a member of an eligible class
and premium payments stop.)
13. Which of the following statements correctly describes
eligibility requirements under most group insurance plans?
- ANSWERS____Unmarried children under a specified age
and dependent on the plan member for support are
eligible for coverage
14. Which of the following statements correctly describes
the negotiated placement method of marketing a group
benefits plan? - ANSWERS____Once potential insurers are
identified, each company submits a brief report that
highlights its general strategy, philosophy and proposed
group benefits plan
15. True North Insurance has established a waiver-of-
premium reserve of $100,000 and will have to pay out an
optional life insurance benefit of $200,000. With an
interest rate of 6% compounded annually, how many years
will it take for the reserve of $100,000 to accumulate to
$200,000? - ANSWERS____12 years (Use the relationship
between future value and present value to solve for the
number of time periods.
16. FVt = PV x (1 + r)^t
17. $200,000 = $100,000 x (1 + 6%)^t
BRAND NEW ACTUAL EXAM WITH 100%
VERIFIED QUESTIONS AND CORRECT
SOLUTIONS| GUARANTEED VALUE PACK|
ACE YOUR GRADES.
1. Which of the following statements correctly describes
minimum requirements that group benefit plans typically
must meet in order to be prospectively rated on contract
renewal? - ANSWERS____The more unpredictable the
event that will trigger a claim, the larger the minimum
group size and premium requirements
2. Which of the following statements correctly describes the
term graduation as it applies to mortality tables? -
ANSWERS____It is a mathematical process that removes
anomalies that should not appear in the mortality data
3. If the plan sponsor pays the premium, which of the
following group insured benefits is taxable to the plan
member? - ANSWERS____Long-term disability (LTD)
4. Which of the following statements correctly describes
phases of a group plan marketing? - ANSWERS____Plan
features of both contributory and noncontributory benefit
, plans must be communicated to plan members during the
enrollment process
5. Which of the following statements correctly describes a
characteristic of an insurable risk? - ANSWERS____The loss
must have financial significance to the insured (The loss
must not be catastrophic to the insurer. Option C: The loss
must occur by chance. Option D: The loss must be
predictable for the insurer.)
6. With respect to marketing a group insurance plan, which
of the following statements best describes insurer
representatives known as account executives? -
ANSWERS____They are involved in enrolling group
members and installing new plans
7. Which of the following statements correctly describes the
statistical concept known as the law of large numbers? -
ANSWERS____Future probabilities of loss are not valid
unless a large number of incidents exist to ensure the
outcomes are less likely to deviate
8. Which of the following statements correctly describes an
insured plan that is insurer-administered? -
ANSWERS____For self-insured plans with an
administrative services only (ASO) arrangement, the
, insurer bills the plan sponsor monthly for administration
fees
9. If the probability that an individual will live one year is 0.95
and the probability of dying in the following year is 0.10,
what is the probability that an individual will survive both
years? - ANSWERS____0.855 (P (Survive both years) =
(0.95) x (1 - 0.1) = 0.95 x 0.90 = 0.855.)
10. Which of the following statements correctly describes
the group benefits enrollment process for new employees?
- ANSWERS____An employee can enroll in the plan any
time between his or her date of hire and the end of a
waiting period
11. A type of service offered under a third-party
administrators (TPAs) claims settlement only arrangement
is: - ANSWERS____Adjudicating and paying claims
12. Unless otherwise specified in the group insurance
contract, a plan member's status under a group benefits
plan terminates the earliest at which: - ANSWERS____The
plan member retires (Unless otherwise specified in the
group insurance contract, the order in which coverage
terminates is effective the earliest date the plan member
retires, the plan member's service with the plan sponsor is
, terminated, the plan member ceases active work, and the
plan member is no longer a member of an eligible class
and premium payments stop.)
13. Which of the following statements correctly describes
eligibility requirements under most group insurance plans?
- ANSWERS____Unmarried children under a specified age
and dependent on the plan member for support are
eligible for coverage
14. Which of the following statements correctly describes
the negotiated placement method of marketing a group
benefits plan? - ANSWERS____Once potential insurers are
identified, each company submits a brief report that
highlights its general strategy, philosophy and proposed
group benefits plan
15. True North Insurance has established a waiver-of-
premium reserve of $100,000 and will have to pay out an
optional life insurance benefit of $200,000. With an
interest rate of 6% compounded annually, how many years
will it take for the reserve of $100,000 to accumulate to
$200,000? - ANSWERS____12 years (Use the relationship
between future value and present value to solve for the
number of time periods.
16. FVt = PV x (1 + r)^t
17. $200,000 = $100,000 x (1 + 6%)^t
