ALABAMA INSURANCE TEST 100% QUESTIONS & ANSWERS A+
SCORE SOLUTION GUARANTEED PASS REVIEW
What is a certificate of insurance? - --ANSWERS---a certificate
issued to each individual covered by the group life insurance
Which is not true regarding medicare supplement policies? - --
ANSWERS---must include a minimum 20-day free-look
provision
In alabama, all health maintenance organizations must: - --
ANSWERS---have a complaint system to resolve written
complaints from enrollees
Rick owns a $100,000 life insurance policy with a cash value of
$10,000. How much can he borrow up to? - --ANSWERS---the
accumulated cash value ($10,000 less interest)
Susan owns a life insurance policy that has accumulated $10,000
in cash value in which she can no longer pay its premiums. If she
elects to take the extended term option, which of these actions
would she take? - --ANSWERS---uses the $10,000 to buy term
insurance of the same face amount as her original policy
Jackie took out a medicare supplement insurance policy and also
has a preexisting condition. In this situation, a preexisting
condition is defined as a condition for which medical advice was
given or received within _____ of the effective date of coverage. -
--ANSWERS---6 months
Rodney applies for an insurance policy and pays the first
premium. The receipt given for the first premium is called a(n): -
--ANSWERS---conditional receipt
,A policy owner with an automatic premium loan provision must:
- --ANSWERS---pay back the loan amount to keep the policy's
cash value at its maximum
Which of the following is not an example of insurable interest? -
--ANSWERS---an airline insuring the lives of its passengers
With key employee life insurance, - --ANSWERS---the company
is the owner of the policy
A cross purchase buy-sell agreement is in place for abc
company's four founding partners. What would this agreement
require if the agreement is funded with individual life insurance?
- --ANSWERS---each partner must own a policy on the other
partners
The notice of claim provision states that the insured notify the
insurance company within __ days of a claim. - --ANSWERS---20
Which of the following is not a factor typically used by insurers to
classify risk? - --ANSWERS---education level
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: - --ANSWERS---expressed authority
Under a health maintenance organization (hmo), service
providers are paid a fixed monthly fee for each member. This
concept is called: - --ANSWERS---capitation
The commissioner of insurance may not do which of the
following? - --ANSWERS---change insurance laws
, Within how many days of a written demand must the
commissioner of insurance hold a hearing? - --ANSWERS---30
The life and health insurance marketing system utilizing non-
employee agents that represent just one insurance company and
are often paid an allowance to cover office expense and staffing
is the: - --ANSWERS---general agency system
Which provision allows a disability income policy to remain in
force without further payments when the insured has become
totally and permanently disabled? - --ANSWERS---waiver of
premium
Which of the following is considered the "automatic"
nonforfeiture option that most insurers will use? - --ANSWERS-
--extended term
An insurance premium can be defined as: - --ANSWERS---
money paid to an insurance company for benefits provided in the
policy
Which of these statements accurately portray a whole life policy?
- --ANSWERS---endows at age 100 and paid up at a stated time
John is an annuitant who has surrendered his annuity at age 55.
What will he pay? - --ANSWERS---tax on the interest earned
A preferred provider organization (ppo) contract typically uses
which payment arrangement? - --ANSWERS---negotiated fee-
for-service
SCORE SOLUTION GUARANTEED PASS REVIEW
What is a certificate of insurance? - --ANSWERS---a certificate
issued to each individual covered by the group life insurance
Which is not true regarding medicare supplement policies? - --
ANSWERS---must include a minimum 20-day free-look
provision
In alabama, all health maintenance organizations must: - --
ANSWERS---have a complaint system to resolve written
complaints from enrollees
Rick owns a $100,000 life insurance policy with a cash value of
$10,000. How much can he borrow up to? - --ANSWERS---the
accumulated cash value ($10,000 less interest)
Susan owns a life insurance policy that has accumulated $10,000
in cash value in which she can no longer pay its premiums. If she
elects to take the extended term option, which of these actions
would she take? - --ANSWERS---uses the $10,000 to buy term
insurance of the same face amount as her original policy
Jackie took out a medicare supplement insurance policy and also
has a preexisting condition. In this situation, a preexisting
condition is defined as a condition for which medical advice was
given or received within _____ of the effective date of coverage. -
--ANSWERS---6 months
Rodney applies for an insurance policy and pays the first
premium. The receipt given for the first premium is called a(n): -
--ANSWERS---conditional receipt
,A policy owner with an automatic premium loan provision must:
- --ANSWERS---pay back the loan amount to keep the policy's
cash value at its maximum
Which of the following is not an example of insurable interest? -
--ANSWERS---an airline insuring the lives of its passengers
With key employee life insurance, - --ANSWERS---the company
is the owner of the policy
A cross purchase buy-sell agreement is in place for abc
company's four founding partners. What would this agreement
require if the agreement is funded with individual life insurance?
- --ANSWERS---each partner must own a policy on the other
partners
The notice of claim provision states that the insured notify the
insurance company within __ days of a claim. - --ANSWERS---20
Which of the following is not a factor typically used by insurers to
classify risk? - --ANSWERS---education level
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: - --ANSWERS---expressed authority
Under a health maintenance organization (hmo), service
providers are paid a fixed monthly fee for each member. This
concept is called: - --ANSWERS---capitation
The commissioner of insurance may not do which of the
following? - --ANSWERS---change insurance laws
, Within how many days of a written demand must the
commissioner of insurance hold a hearing? - --ANSWERS---30
The life and health insurance marketing system utilizing non-
employee agents that represent just one insurance company and
are often paid an allowance to cover office expense and staffing
is the: - --ANSWERS---general agency system
Which provision allows a disability income policy to remain in
force without further payments when the insured has become
totally and permanently disabled? - --ANSWERS---waiver of
premium
Which of the following is considered the "automatic"
nonforfeiture option that most insurers will use? - --ANSWERS-
--extended term
An insurance premium can be defined as: - --ANSWERS---
money paid to an insurance company for benefits provided in the
policy
Which of these statements accurately portray a whole life policy?
- --ANSWERS---endows at age 100 and paid up at a stated time
John is an annuitant who has surrendered his annuity at age 55.
What will he pay? - --ANSWERS---tax on the interest earned
A preferred provider organization (ppo) contract typically uses
which payment arrangement? - --ANSWERS---negotiated fee-
for-service
