XCEL Arizona Life and Health Insurance State Exam Questions
with Complete Solutions Graded A+
Under a long-term care inflation rider, the benefit levels - Correct Answersperiodically
increase without proof of insurability
In order for a health plan to be an "accountable health plan", who has to approve it? -
Correct Answersthe director
Medicare Part A coinsurance payments are covered by - Correct AnswersMedicare
Supplement Plan A
Employees generally receive workers compensation benefits for - Correct Answerslost
wages and medical expenses due to occupational accidents
What year was the Mental Health Parity and Addiction Equity Act established? - Correct
Answers2008
In what situation would disability income insurance premiums be a deductible expense? -
Correct AnswersCorporation paying for group disability income coverage for its
employees
John received a one-time distribution of $50,000 from his modified endowment contract
(MEC). Prior to that, the contract's cash value was $150,000, the contract investment
amount was $100,000, and the death benefit was $500,000. What percentage of the
$50,000 distribution was taxable as ordinary income? - Correct Answers100%
A survivorship life insurance policy usually covers how many lives? - Correct Answers2
,Mentally or physically handicapped dependent children MUST be covered under an
individual health insurance policy - Correct Answersuntil they become self-supportive
ERISA requires that a Summary Plan Description must be provided to a new plan member
within how many days following the new member's eligibility date? - Correct Answers90
days
A policyowner suffers an injury that renders him incapable of performing one or more
important job duties. Any decrease in income resulting from this injury would make him
eligible for benefits under which provision? - Correct AnswersPartial disability
What is the maximum number of employees (earning at least $5,000) that an employer can
have in order to start a SIMPLE retirement plan? - Correct Answers100 employees
Which of the following health plans pay benefits on a pre-paid service basis? - Correct
AnswersHMO
An individual may receive Medicare Part A Hospital benefits, regardless of age, as long as
the person has received which of the following benefits for at least 24 months? - Correct
AnswersSocial Security Disability
Which of the co-annuitants listed below would receive the largest monthly benefit
payments in a joint and 100% survivor annuity? - Correct AnswersAges 71 and 73
Kevin has an existing life insurance policy and assigns it to another insurer for a new
contract. How would this transaction be treated for tax purposes? - Correct AnswersAs a
Section 1035 exchange
Karen is considering replacing her individual accident and health insurance policy with
another individual policy. She has had issues in the past with her gall bladder that would be
considered a pre-existing condition. How will a pre-existing conditions exclusion affect
Karen's new insurance contract? - Correct AnswersMay reduce her benefits
, Greg had recently been terminated from his job that covered him for group life insurance.
How long does he have to convert his coverage to an individual policy? - Correct
Answers31 days
A policyowner with a terminal illness who sells his life insurance policy to a third party is
called a - Correct Answersviator
What is a juvenile life insurance policy? - Correct AnswersA life policy that covers the life of
a minor
ABC Partnership is a business with a limited number of partners. Which disability buy-sell
agreement is best suited for this business? - Correct AnswersCross purchase agreement
Which of the following involves sharing an uncertain risk with another similar group? -
Correct AnswersTransfer
The time limit an individual has to "rollover" funds from an IRA or qualified plan is - Correct
Answers60 days
A life annuity with period certain is characterized as - Correct Answersguaranteeing
benefit payments for a stated minimum number of years
James owns a business and purchased a policy that covers the business expense of
finding a permanent or temporary employee to replace a disabled one. This type of
disability coverage is called - Correct AnswersKey employee coverage
Kelly purchases a health insurance policy issued on a conditionally renewable basis. The
insurance company has a right to refuse renewal of the policy for - Correct Answersspecific
reasons stated in the contract
Who is the beneficiary in a life insurance policy? - Correct AnswersThe stated person or
entity who is designated to receive the death proceeds
The guarantee of insurability option provides a long-term care policyowner the ability to -
Correct Answersbuy additional coverage at a later date
with Complete Solutions Graded A+
Under a long-term care inflation rider, the benefit levels - Correct Answersperiodically
increase without proof of insurability
In order for a health plan to be an "accountable health plan", who has to approve it? -
Correct Answersthe director
Medicare Part A coinsurance payments are covered by - Correct AnswersMedicare
Supplement Plan A
Employees generally receive workers compensation benefits for - Correct Answerslost
wages and medical expenses due to occupational accidents
What year was the Mental Health Parity and Addiction Equity Act established? - Correct
Answers2008
In what situation would disability income insurance premiums be a deductible expense? -
Correct AnswersCorporation paying for group disability income coverage for its
employees
John received a one-time distribution of $50,000 from his modified endowment contract
(MEC). Prior to that, the contract's cash value was $150,000, the contract investment
amount was $100,000, and the death benefit was $500,000. What percentage of the
$50,000 distribution was taxable as ordinary income? - Correct Answers100%
A survivorship life insurance policy usually covers how many lives? - Correct Answers2
,Mentally or physically handicapped dependent children MUST be covered under an
individual health insurance policy - Correct Answersuntil they become self-supportive
ERISA requires that a Summary Plan Description must be provided to a new plan member
within how many days following the new member's eligibility date? - Correct Answers90
days
A policyowner suffers an injury that renders him incapable of performing one or more
important job duties. Any decrease in income resulting from this injury would make him
eligible for benefits under which provision? - Correct AnswersPartial disability
What is the maximum number of employees (earning at least $5,000) that an employer can
have in order to start a SIMPLE retirement plan? - Correct Answers100 employees
Which of the following health plans pay benefits on a pre-paid service basis? - Correct
AnswersHMO
An individual may receive Medicare Part A Hospital benefits, regardless of age, as long as
the person has received which of the following benefits for at least 24 months? - Correct
AnswersSocial Security Disability
Which of the co-annuitants listed below would receive the largest monthly benefit
payments in a joint and 100% survivor annuity? - Correct AnswersAges 71 and 73
Kevin has an existing life insurance policy and assigns it to another insurer for a new
contract. How would this transaction be treated for tax purposes? - Correct AnswersAs a
Section 1035 exchange
Karen is considering replacing her individual accident and health insurance policy with
another individual policy. She has had issues in the past with her gall bladder that would be
considered a pre-existing condition. How will a pre-existing conditions exclusion affect
Karen's new insurance contract? - Correct AnswersMay reduce her benefits
, Greg had recently been terminated from his job that covered him for group life insurance.
How long does he have to convert his coverage to an individual policy? - Correct
Answers31 days
A policyowner with a terminal illness who sells his life insurance policy to a third party is
called a - Correct Answersviator
What is a juvenile life insurance policy? - Correct AnswersA life policy that covers the life of
a minor
ABC Partnership is a business with a limited number of partners. Which disability buy-sell
agreement is best suited for this business? - Correct AnswersCross purchase agreement
Which of the following involves sharing an uncertain risk with another similar group? -
Correct AnswersTransfer
The time limit an individual has to "rollover" funds from an IRA or qualified plan is - Correct
Answers60 days
A life annuity with period certain is characterized as - Correct Answersguaranteeing
benefit payments for a stated minimum number of years
James owns a business and purchased a policy that covers the business expense of
finding a permanent or temporary employee to replace a disabled one. This type of
disability coverage is called - Correct AnswersKey employee coverage
Kelly purchases a health insurance policy issued on a conditionally renewable basis. The
insurance company has a right to refuse renewal of the policy for - Correct Answersspecific
reasons stated in the contract
Who is the beneficiary in a life insurance policy? - Correct AnswersThe stated person or
entity who is designated to receive the death proceeds
The guarantee of insurability option provides a long-term care policyowner the ability to -
Correct Answersbuy additional coverage at a later date
