Final exam Alabama life in.pdf file:///C:/Users/Admin/Downloads/Final%20exam%20Alabama%20
Alabama Life and Health Insurance Final Exam
1. Under a health maintenance organization HMO service providers are paid a fixed monthly
fee for each member. This concept is called ANS Capitation
2. When can a lapsed life insurance policy usually be reinstated ANS Within three to five
years of the policy lapsing
3. All of these statements concerning the coordination of benefits are true ex- cept ANS The
secondary insurance does not pay benefits. Which means the secondary insurer does pay
benefits
4. The period of time during which a surviving spouse does not qualify for Social Security
survivor or retirement benefits is called ANS The blackout period
5. Peggy surrenders a permanent life policy with a cash value of $15,000 and then
outstanding policy loan of $5,000. If she chooses the reduced paid-up option what will be the
result? ANS A paid up permanent policy purchased with
$10,000
6. Total disability can be defined as the insureds inability to perform the occupation for which
he or she is reasonably qualified by education training or experience for disability income
insurance purposes this definition is what ANS Own occupation
1 of 22 9/10/2024, 9:34
,Final exam Alabama life in.pdf file:///C:/Users/Admin/Downloads/Final%20exam%20Alabama%20
7. Why are insurance contracts said to be contracts of adhesion ANS The contract has been
prepared by one party the insurer and the other party which is the insured must accept the
contract as written
8. Catherine is a retiring and was recently hospitalized for 10 days. Which type of insurance
policy would best cover her for excess Hospital expenses-
ANS Medicare supplement. A Medicare supplement policy will provide a subscriber the best
coverage for excess charges
9. What do major medical policies typically cover ANS Usual, customary, and nec- essary
expenses
10. At what point does a whole life policy pay the face amount? ANS Upon the insureds
death or reaching the age of 100
11. Which type of Term policy allows the policyowner to switch to permanent insurance ANS
Convertible term
12. Trent has a permanent partial disability where he is paid 50% of his previous
income. Trent is covered by a ANS Residual disability benefit
13. Which of these actions could result in a lapsed policy ANS Premium was not paid during
the grace period
2 of 22 9/10/2024, 9:34
,Final exam Alabama life in.pdf file:///C:/Users/Admin/Downloads/Final%20exam%20Alabama%20
14. The minimum grace period for a life insurance policy sold in Alabama is ANS 30 days
15. Benefits under a health insurance policy May with the insureds written request be payable
to ANS I Hospital, physician, or surgeon. The right of assignment built into most commercial
Health policies allows the policyowner to assign benefit payments from the insurer directly to
the healthcare provider
16. The monthly benefit of an annuity certain is determined by ANS The annuitant's payout
Period selection
17. If insurance premiums are paid more frequently than annually the policy owner can expect
to ANS Have a higher total outlay of dollars for the coverage for that year
18. According to Alabama Law agents of a health maintenance organization HMO ANS
Must be licensed as Insurance Producers and are subject to all producer licensing
requirements
19. When does adverse selection exist ANS When the risks accepted for insurance has a
higher likelihood of experiencing loss than an average group
20. Amy owns a disability income policy with a non-cancelable renewal provi- sion. Which of the
following is guaranteed in her policy ANS Coverage and premium rate are guaranteed as long
as the premiums are paid
3 of 22 9/10/2024, 9:34
Alabama Life and Health Insurance Final Exam
1. Under a health maintenance organization HMO service providers are paid a fixed monthly
fee for each member. This concept is called ANS Capitation
2. When can a lapsed life insurance policy usually be reinstated ANS Within three to five
years of the policy lapsing
3. All of these statements concerning the coordination of benefits are true ex- cept ANS The
secondary insurance does not pay benefits. Which means the secondary insurer does pay
benefits
4. The period of time during which a surviving spouse does not qualify for Social Security
survivor or retirement benefits is called ANS The blackout period
5. Peggy surrenders a permanent life policy with a cash value of $15,000 and then
outstanding policy loan of $5,000. If she chooses the reduced paid-up option what will be the
result? ANS A paid up permanent policy purchased with
$10,000
6. Total disability can be defined as the insureds inability to perform the occupation for which
he or she is reasonably qualified by education training or experience for disability income
insurance purposes this definition is what ANS Own occupation
1 of 22 9/10/2024, 9:34
,Final exam Alabama life in.pdf file:///C:/Users/Admin/Downloads/Final%20exam%20Alabama%20
7. Why are insurance contracts said to be contracts of adhesion ANS The contract has been
prepared by one party the insurer and the other party which is the insured must accept the
contract as written
8. Catherine is a retiring and was recently hospitalized for 10 days. Which type of insurance
policy would best cover her for excess Hospital expenses-
ANS Medicare supplement. A Medicare supplement policy will provide a subscriber the best
coverage for excess charges
9. What do major medical policies typically cover ANS Usual, customary, and nec- essary
expenses
10. At what point does a whole life policy pay the face amount? ANS Upon the insureds
death or reaching the age of 100
11. Which type of Term policy allows the policyowner to switch to permanent insurance ANS
Convertible term
12. Trent has a permanent partial disability where he is paid 50% of his previous
income. Trent is covered by a ANS Residual disability benefit
13. Which of these actions could result in a lapsed policy ANS Premium was not paid during
the grace period
2 of 22 9/10/2024, 9:34
,Final exam Alabama life in.pdf file:///C:/Users/Admin/Downloads/Final%20exam%20Alabama%20
14. The minimum grace period for a life insurance policy sold in Alabama is ANS 30 days
15. Benefits under a health insurance policy May with the insureds written request be payable
to ANS I Hospital, physician, or surgeon. The right of assignment built into most commercial
Health policies allows the policyowner to assign benefit payments from the insurer directly to
the healthcare provider
16. The monthly benefit of an annuity certain is determined by ANS The annuitant's payout
Period selection
17. If insurance premiums are paid more frequently than annually the policy owner can expect
to ANS Have a higher total outlay of dollars for the coverage for that year
18. According to Alabama Law agents of a health maintenance organization HMO ANS
Must be licensed as Insurance Producers and are subject to all producer licensing
requirements
19. When does adverse selection exist ANS When the risks accepted for insurance has a
higher likelihood of experiencing loss than an average group
20. Amy owns a disability income policy with a non-cancelable renewal provi- sion. Which of the
following is guaranteed in her policy ANS Coverage and premium rate are guaranteed as long
as the premiums are paid
3 of 22 9/10/2024, 9:34
