Kentucky Life and Health Final Exam
Questions and Correct Answers
Question 1
The situation in which a group of physicians are salaried employees and conduct
business in an HMO facility is called a
Correct Answer
closed panel
Question 2
Which of the following statements BEST describes what the Legal Actions provision of
an Accident and Health policy requires?
Correct Answer
An insured must wait at least 60 days after Proof of Loss has been submitted
before a lawsuit can be filed
Question 3
A school teacher has contributed $80,000 into a Tax Sheltered Annuity. At the time
she surrendered the contract, the account value was $180,000 and her tax bracket was
30%. The resultant tax amounts to?
Correct Answer
$54,000
Question 4
What does a fixed annuity offer protection against?
Correct Answer
savings depletion because of longevity
Page 1 of 31
,Question 5
In Major Medical Expense policies, what is the intent of a Stop Loss provision?
Correct Answer
Limits an insured's out-of-pocket medical expenses.
Question 6
When does the agent give a premium receipt for a life insurance application?
Correct Answer
when the initial premium has been paid with the application
Question 7
On health insurance applications, statements made on the application are considered:
Correct Answer
representations
Question 8
An insurer owned by its policyholders best describes:
Correct Answer
mutual company
Question 9
When an insurance company sends a policy to the insured with an attached
application, the element that makes the application part of the contract between the
insured and the insurer is called the:
Correct Answer
entire contract provision
Page 2 of 31
,Question 10
J is a subscriber to plan which contracts with doctors and hospitals to provide medical
benefits at a predetermined price. What type of plan does J belong to?
Correct Answer
A Health Maintenance Organization
Question 11
The premiums for continued health insurance coverage under COBRA are paid for by
the:
Correct Answer
employee
Question 12
The reason for a business having a Business Overhead Expense Disability Plan is to
cover:
Correct Answer
fixed business expenses
Question 13
Who does the Spousal Improverishment Rule protects?
Correct Answer
the spouse living in the community
Question 14
Which of these licensees MUST be appointed in order to conduct insurance business?
Correct Answer
adjuster
Page 3 of 31
, Question 15
A policyowner is allowed to pay premiums more than once a year which provision
Correct Answer
Mode of Premium
Question 16
If the applicant for a Medicare supplement policy is an eligible person, which of the
following statements is true?
Correct Answer
all of the choices are correct
Question 17
An insured covered by life insurance has just died. What will happen if the primary
beneficiary had already died before the insured and contingent beneficiary?
Correct Answer
proceeds will go to the contingent beneficiary
Question 18
Which of these are NOT an example of Nonforfeiture option?
Correct Answer
life income
Question 19
An insurance agent who replaces an existing policy by making false written or oral
statements is committing the act of:
Correct Answer
twisting
Page 4 of 31
Questions and Correct Answers
Question 1
The situation in which a group of physicians are salaried employees and conduct
business in an HMO facility is called a
Correct Answer
closed panel
Question 2
Which of the following statements BEST describes what the Legal Actions provision of
an Accident and Health policy requires?
Correct Answer
An insured must wait at least 60 days after Proof of Loss has been submitted
before a lawsuit can be filed
Question 3
A school teacher has contributed $80,000 into a Tax Sheltered Annuity. At the time
she surrendered the contract, the account value was $180,000 and her tax bracket was
30%. The resultant tax amounts to?
Correct Answer
$54,000
Question 4
What does a fixed annuity offer protection against?
Correct Answer
savings depletion because of longevity
Page 1 of 31
,Question 5
In Major Medical Expense policies, what is the intent of a Stop Loss provision?
Correct Answer
Limits an insured's out-of-pocket medical expenses.
Question 6
When does the agent give a premium receipt for a life insurance application?
Correct Answer
when the initial premium has been paid with the application
Question 7
On health insurance applications, statements made on the application are considered:
Correct Answer
representations
Question 8
An insurer owned by its policyholders best describes:
Correct Answer
mutual company
Question 9
When an insurance company sends a policy to the insured with an attached
application, the element that makes the application part of the contract between the
insured and the insurer is called the:
Correct Answer
entire contract provision
Page 2 of 31
,Question 10
J is a subscriber to plan which contracts with doctors and hospitals to provide medical
benefits at a predetermined price. What type of plan does J belong to?
Correct Answer
A Health Maintenance Organization
Question 11
The premiums for continued health insurance coverage under COBRA are paid for by
the:
Correct Answer
employee
Question 12
The reason for a business having a Business Overhead Expense Disability Plan is to
cover:
Correct Answer
fixed business expenses
Question 13
Who does the Spousal Improverishment Rule protects?
Correct Answer
the spouse living in the community
Question 14
Which of these licensees MUST be appointed in order to conduct insurance business?
Correct Answer
adjuster
Page 3 of 31
, Question 15
A policyowner is allowed to pay premiums more than once a year which provision
Correct Answer
Mode of Premium
Question 16
If the applicant for a Medicare supplement policy is an eligible person, which of the
following statements is true?
Correct Answer
all of the choices are correct
Question 17
An insured covered by life insurance has just died. What will happen if the primary
beneficiary had already died before the insured and contingent beneficiary?
Correct Answer
proceeds will go to the contingent beneficiary
Question 18
Which of these are NOT an example of Nonforfeiture option?
Correct Answer
life income
Question 19
An insurance agent who replaces an existing policy by making false written or oral
statements is committing the act of:
Correct Answer
twisting
Page 4 of 31
