Alabama Insurance Top Questions and Answers 2024

Who does the insurance agent legally represent? - The insurance company Which of the following terms may be used when describing the premiums for a life insurance policy advertised in Alabama? - Savings Profit Deposit None of these* Ann is an employee covered by a Group Life plan through her employer. When Ann is terminated, her employer fails to inform her about the plans conversion option. Two weeks late, Ann dies in an automobile accident. How will this situation be handled? - Full benefits must be paid by the insurer How frequently does a disability income policy typically pay benefits? - monthly If an insured under a Major Medical insurance policy with a $200 deductible and an 80% coinsurance clause incurred the following covered expenses: Hospital room and board $2,000; Surgeon's fee $1,500. How much would the policy pay? - 2,640 (2,000 + 1,500 = 3,500 - 200 = 3,300 x .8) The maximum amount of coverage placed on a disability income policy is based on the insured's: - earned income from the previous year The agreement between a producer and the insurance company specifies the authority given to a producer to act on behalf of the insurer. This is called: - Expressed authority How is the Alabama Life and Disability Insurance Guaranty Association able to pay claims for insolvent insurers? - Assessments against other admitted insurers in Alabama Which is NOT true regarding Medicare Supplement policies? - Must include a minimum 20-day Free-Look provision What is the minimum age requirement for a minor in Alabama to purchase a life insurance policy? - 15 The highest premium payment would be charged to which risk classification? - Substandard The Long Term Care Partnership program is designed to allow seniors to: - shelter assets from the spend-down requirements of Medicaid A policyowner with a $100,000 whole life policy has a cash value of $10,000. There is an outstanding loan of $5,000 and a past-due premium of $250. If the policyowner chooses the reduced paid-up option and then later dies, what will the beneficiary receive? - The reduced paid-up coverage amount minus $5,250 A policyowner can collect the face amount on what type of policy? - endowment policy Which of these is NOT considered a form of advertisement in Alabama? - A producer sending a Christmas card to a client Paul has a major medical policy which begins with basic first dollar coverage that pays up to its limits, then he must pay a certain dollar amount of covered expenses before the major medical portion steps in. The dollar amount Paul must pay is called the: - corridor deductible All of these statements concerning the coordination of benefits are true, EXCEPT: - The secondary insurer does NOT pay benefits An insurance producer represents the: - insurance company Which of the following statements is NOT correct? - Agents are allowed to waive certain policy provisions