CEBS - GBA 1 - Practice Exam Questions and Answers |Complete Solutions
Graded A+ |100% Correct
Which of the following statements correctly describe(s) how agents, brokers and consultants
are compensated? Consultants are compensated on a project, FFS or commission basis
(Brokers are normally compensated by commission or fee-for-service (FFS))
(Agents are compensated by commissions paid by the insurer whose products they sell.)
Which of the following statements correctly describe(s) a traditional group benefits plan for
salaried and hourly employees? A traditional group benefits plan for both salaried and
hourly employees includes core, optional and ancillary benefits
(Salaried employees are more likely to be provided with a salary continuance plan than with a
weekly indemnity/short-term disability (WI/STD) plan.)
(Both usually provide long-term disability (LTD) benefits.)
Which of the following statements correctly describe(s) the cash loss ratio or paid claims loss
ratio of a group? It is the ratio of paid claims to billed premiums for any given period
(Incurred claims loss aka target loss ratio: billed premiums less retention)
Which of the following statements correctly describe(s) mortality data? Mortality statistics
are based on population and insurance data
Insurance data is generally more accurate than population data, because the data reflects more
careful documentation of dates of birth and dates of death
,(Census statistics and death records from insurers are compiled by Stats Can and analyzed
every 5 years)
Which of the following statements correctly describe(s) group insurance marketing? A plan
sponsor or its advisor solicits proposals or bids from insurers for the purpose of implementing a
new or modified group benefits plan or validating the competitiveness of the services and costs
of its current plan
A plan sponsor can market a plan directly, using the insurer's account executives as points of
contact
A plan sponsor can market a plan indirectly, using an intermediary such as an agent, broker or
consultant
Which of the following statements correctly describe(s) compound interest? It is the
standard used in most business transactions
(Simple interest is payable only on the original principal)
(Interest on treasury bills is determined using simple interest)
Which of the following statements correctly reflect(s) mortality rates? The probability of a
person aged x living to age x + 1 is denoted by px
The probability of a person aged x surviving one year is equal to (1x+1)/ 1x
In adjudicating claims under a group benefits plan, a claims analyst must confirm: That the
group contract was in force at the time the loss/expense was incurred
That the insurer received proof of loss within the time frame stipulated in the group contract
, To whom the benefit should be paid
Danika Novikov of Caldwell Associates completed installation of a revised group benefits plan
for a new client, Accurate Accounting. The revised plan was installed after a benefits review and
a marketing of the plan resulted in a change of insurers. Danika explained the benefits and
administrative requirements to the firm's senior partner and controller. She provided written
information about the new insurer, Haliburton Insurance, including a copy of the new
commission scale. She disclosed that she owned 15% of Haliburton Insurance. She did not,
however, advise Accurate Accounting that the commission scale with Haliburton Insurance was
higher than the scale for any of the other quoting insurers and that, in placing this business with
Haliburton Insurance, Danika and her spouse would be invited to the insurer's upcoming
conference in Bermuda. Which of the following Canadian Life and Health Insurance Association
(CLHIA Whether the advisor is eligible for additional monetary or nonmonetary
compensation from the insurer
Conflicts of interest
(Nature of the advisor's relationship with the insurer providing the product was disclosed)
According to the Canadian Life and Health Insurance Association (CLHIA) guidelines related to
insurance product disclosure, the plan description provided to each individual insured under a
group contract include(s): The name of the plan sponsor, the insurer and group policy
number
Claims provisions, including a description of how to submit a claim and proof-of-loss time limits
Which of the following statements correctly define(s) underwriting? It is used by insurers to
evaluate the risk of a group benefits plan
It is used by insurers to establish a premium rating basis
Graded A+ |100% Correct
Which of the following statements correctly describe(s) how agents, brokers and consultants
are compensated? Consultants are compensated on a project, FFS or commission basis
(Brokers are normally compensated by commission or fee-for-service (FFS))
(Agents are compensated by commissions paid by the insurer whose products they sell.)
Which of the following statements correctly describe(s) a traditional group benefits plan for
salaried and hourly employees? A traditional group benefits plan for both salaried and
hourly employees includes core, optional and ancillary benefits
(Salaried employees are more likely to be provided with a salary continuance plan than with a
weekly indemnity/short-term disability (WI/STD) plan.)
(Both usually provide long-term disability (LTD) benefits.)
Which of the following statements correctly describe(s) the cash loss ratio or paid claims loss
ratio of a group? It is the ratio of paid claims to billed premiums for any given period
(Incurred claims loss aka target loss ratio: billed premiums less retention)
Which of the following statements correctly describe(s) mortality data? Mortality statistics
are based on population and insurance data
Insurance data is generally more accurate than population data, because the data reflects more
careful documentation of dates of birth and dates of death
,(Census statistics and death records from insurers are compiled by Stats Can and analyzed
every 5 years)
Which of the following statements correctly describe(s) group insurance marketing? A plan
sponsor or its advisor solicits proposals or bids from insurers for the purpose of implementing a
new or modified group benefits plan or validating the competitiveness of the services and costs
of its current plan
A plan sponsor can market a plan directly, using the insurer's account executives as points of
contact
A plan sponsor can market a plan indirectly, using an intermediary such as an agent, broker or
consultant
Which of the following statements correctly describe(s) compound interest? It is the
standard used in most business transactions
(Simple interest is payable only on the original principal)
(Interest on treasury bills is determined using simple interest)
Which of the following statements correctly reflect(s) mortality rates? The probability of a
person aged x living to age x + 1 is denoted by px
The probability of a person aged x surviving one year is equal to (1x+1)/ 1x
In adjudicating claims under a group benefits plan, a claims analyst must confirm: That the
group contract was in force at the time the loss/expense was incurred
That the insurer received proof of loss within the time frame stipulated in the group contract
, To whom the benefit should be paid
Danika Novikov of Caldwell Associates completed installation of a revised group benefits plan
for a new client, Accurate Accounting. The revised plan was installed after a benefits review and
a marketing of the plan resulted in a change of insurers. Danika explained the benefits and
administrative requirements to the firm's senior partner and controller. She provided written
information about the new insurer, Haliburton Insurance, including a copy of the new
commission scale. She disclosed that she owned 15% of Haliburton Insurance. She did not,
however, advise Accurate Accounting that the commission scale with Haliburton Insurance was
higher than the scale for any of the other quoting insurers and that, in placing this business with
Haliburton Insurance, Danika and her spouse would be invited to the insurer's upcoming
conference in Bermuda. Which of the following Canadian Life and Health Insurance Association
(CLHIA Whether the advisor is eligible for additional monetary or nonmonetary
compensation from the insurer
Conflicts of interest
(Nature of the advisor's relationship with the insurer providing the product was disclosed)
According to the Canadian Life and Health Insurance Association (CLHIA) guidelines related to
insurance product disclosure, the plan description provided to each individual insured under a
group contract include(s): The name of the plan sponsor, the insurer and group policy
number
Claims provisions, including a description of how to submit a claim and proof-of-loss time limits
Which of the following statements correctly define(s) underwriting? It is used by insurers to
evaluate the risk of a group benefits plan
It is used by insurers to establish a premium rating basis
