Tennessee Health Insurance License
Review Exam FX Questions & Answers
All of the following could be considered rebates if offered to an insured in the sale of insurance
EXCEPT
a)An offer to share in commissions generated by the sale.
b)Dividends from a mutual insurer.
c)An offer of employment.
d)Stocks, securities, or bonds. - ANSWERSb)Dividends from a mutual insurer. Dividends paid to
policyholders of a mutual insurer are not considered to be a rebate because the policy specifies
that they might be paid.
Which provision states that the insurance company must pay Medical Expense claims
immediately? - ANSWERSTime of Payment of Claims - The Time Payment of Claims provision
requires that claims will be paid immediately upon receipt of proofs of loss except for periodic
payments, which are to be paid as specified in the policy.
Which of the following is NOT a feature of a guaranteed renewable provision?
a)The insured has a unilateral right to renew the policy for the life of the contract.
b)Coverage is not renewable beyond the insured's age 65.
c)The insured's benefits cannot be reduced.
d)The insurer can increase the policy premium on an individual basis. - ANSWERSd)The insurer
can increase the policy premium on an individual basis. Guaranteed renewable provision has all
the same features that the noncancellable provision does, with the exception that the insurer
can increase the policy premium on the policy anniversary date. However, the premiums can
only be increased on a class basis, not on an individual policy.
,In insurance, an offer is usually made when - ANSWERSAn applicant submits an application to
the insurer.
Under a Key Person disability income policy, premium payments - ANSWERSAre made by the
business and are not tax-deductible.
What is the typical deductible for basic surgical expense insurance? - ANSWERS$0
Which of the following is true about the requirements regarding HIV exams?
a)Results may be disclosed to the agent and the underwriter.
b)Prior informed oral consent is required from the applicant.
c)HIV exams may not be used as a basis for underwriting.
d)The applicant must give prior informed written consent. - ANSWERSd)The applicant must give
prior informed written consent. A separate written consent form must be obtained prior to an
HIV exam. HIV exam results may be disclosed to underwriters, but not agents.
Unless otherwise extended, how soon from the proof of loss must an insurer advise the insured
of the acceptance or denial of a claim? - ANSWERS60 days - After proof of loss has been
submitted and a receipt has been acknowledged, an insurer must conduct an investigation and
submit a notice to the insured of the acceptance or denial of the claim within 60 days. This time
requirement may be extended for an additional 60 days if a reason for the extension is provided
to the insured.
The HMO Act of 1973 required employers to offer an HMO plan as an alternative to regular
health plans if the company had more than 25 employees. How has this plan since changed? -
ANSWERSEmployees are no longer forced to offer HMO plans.
An insured is covered by a disability income policy that contains an accidental means clause.
The insured exits a bus by jumping down the steps and breaks an ankle. What coverage will
apply? - ANSWERSNo coverage will apply, since the injury could have been forseen.
, A client has a new individual disability income policy with a 20-day probationary period and a
30-day elimination period. Ten days later, the client breaks their leg and is off work for 45 days.
How many days of disability benefits will the policy pay? - ANSWERS15 days - A probationary
period refers to the amount of time that coverage is not available for illness-related disabilities,
so it would not apply to a broken leg. The elimination period, however, is the time that must
elapse between the onset of the disability and when benefits will start being paid. In this case,
the individual is considered disabled for 45 days, and the benefits will start to be paid after 30
days. So, the client will receive benefits for 15 days.
An insured pays a monthly premium of $100 for her health insurance. What would be the
duration of the grace period under her policy? - ANSWERS10 days - The grace period is 7 days if
the premium is paid weekly, 10 days if paid monthly, and 31 days for all other modes.
In a group health policy, a probationary period is intended for people who - ANSWERSJoin the
group after the effective date - The probationary period is the waiting period new employees
must satisfy before becoming eligible for benefits.
Which of the following does the Insuring Clause specify? - ANSWERSThe Insuring Clause lists the
insured, the insurance company, what kind of losses are covered, and for how much the losses
would be compensated.
Following hospitalization because of an accident, Bill was confined in a skilled nursing facility.
Medicare will pay full benefits in this facility for how many days? - ANSWERS20 - Following
hospitalization for at least three days, if medically necessary, Medicare pays for all covered
services during the first 20 days in a skilled nursing facility. Days 21 through 100 require a daily
copayment.
Medicare Part A services do NOT include which of the following?
A) Outpatient Hospital Treatment
B) Post hospital Skilled Nursing Facility Care
C) Hospitalization
Review Exam FX Questions & Answers
All of the following could be considered rebates if offered to an insured in the sale of insurance
EXCEPT
a)An offer to share in commissions generated by the sale.
b)Dividends from a mutual insurer.
c)An offer of employment.
d)Stocks, securities, or bonds. - ANSWERSb)Dividends from a mutual insurer. Dividends paid to
policyholders of a mutual insurer are not considered to be a rebate because the policy specifies
that they might be paid.
Which provision states that the insurance company must pay Medical Expense claims
immediately? - ANSWERSTime of Payment of Claims - The Time Payment of Claims provision
requires that claims will be paid immediately upon receipt of proofs of loss except for periodic
payments, which are to be paid as specified in the policy.
Which of the following is NOT a feature of a guaranteed renewable provision?
a)The insured has a unilateral right to renew the policy for the life of the contract.
b)Coverage is not renewable beyond the insured's age 65.
c)The insured's benefits cannot be reduced.
d)The insurer can increase the policy premium on an individual basis. - ANSWERSd)The insurer
can increase the policy premium on an individual basis. Guaranteed renewable provision has all
the same features that the noncancellable provision does, with the exception that the insurer
can increase the policy premium on the policy anniversary date. However, the premiums can
only be increased on a class basis, not on an individual policy.
,In insurance, an offer is usually made when - ANSWERSAn applicant submits an application to
the insurer.
Under a Key Person disability income policy, premium payments - ANSWERSAre made by the
business and are not tax-deductible.
What is the typical deductible for basic surgical expense insurance? - ANSWERS$0
Which of the following is true about the requirements regarding HIV exams?
a)Results may be disclosed to the agent and the underwriter.
b)Prior informed oral consent is required from the applicant.
c)HIV exams may not be used as a basis for underwriting.
d)The applicant must give prior informed written consent. - ANSWERSd)The applicant must give
prior informed written consent. A separate written consent form must be obtained prior to an
HIV exam. HIV exam results may be disclosed to underwriters, but not agents.
Unless otherwise extended, how soon from the proof of loss must an insurer advise the insured
of the acceptance or denial of a claim? - ANSWERS60 days - After proof of loss has been
submitted and a receipt has been acknowledged, an insurer must conduct an investigation and
submit a notice to the insured of the acceptance or denial of the claim within 60 days. This time
requirement may be extended for an additional 60 days if a reason for the extension is provided
to the insured.
The HMO Act of 1973 required employers to offer an HMO plan as an alternative to regular
health plans if the company had more than 25 employees. How has this plan since changed? -
ANSWERSEmployees are no longer forced to offer HMO plans.
An insured is covered by a disability income policy that contains an accidental means clause.
The insured exits a bus by jumping down the steps and breaks an ankle. What coverage will
apply? - ANSWERSNo coverage will apply, since the injury could have been forseen.
, A client has a new individual disability income policy with a 20-day probationary period and a
30-day elimination period. Ten days later, the client breaks their leg and is off work for 45 days.
How many days of disability benefits will the policy pay? - ANSWERS15 days - A probationary
period refers to the amount of time that coverage is not available for illness-related disabilities,
so it would not apply to a broken leg. The elimination period, however, is the time that must
elapse between the onset of the disability and when benefits will start being paid. In this case,
the individual is considered disabled for 45 days, and the benefits will start to be paid after 30
days. So, the client will receive benefits for 15 days.
An insured pays a monthly premium of $100 for her health insurance. What would be the
duration of the grace period under her policy? - ANSWERS10 days - The grace period is 7 days if
the premium is paid weekly, 10 days if paid monthly, and 31 days for all other modes.
In a group health policy, a probationary period is intended for people who - ANSWERSJoin the
group after the effective date - The probationary period is the waiting period new employees
must satisfy before becoming eligible for benefits.
Which of the following does the Insuring Clause specify? - ANSWERSThe Insuring Clause lists the
insured, the insurance company, what kind of losses are covered, and for how much the losses
would be compensated.
Following hospitalization because of an accident, Bill was confined in a skilled nursing facility.
Medicare will pay full benefits in this facility for how many days? - ANSWERS20 - Following
hospitalization for at least three days, if medically necessary, Medicare pays for all covered
services during the first 20 days in a skilled nursing facility. Days 21 through 100 require a daily
copayment.
Medicare Part A services do NOT include which of the following?
A) Outpatient Hospital Treatment
B) Post hospital Skilled Nursing Facility Care
C) Hospitalization
