Florida 240 Practice exam questions and answers

A medical expense policy that establishes the amount of benefit paid based upon the prevailing charges which fall within the standard range of fees normally charged for a specific procedure by a doctor of similar training and experience in that geographic area is known as Usual, customary and reasonable What provision would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner? Payment of Claims All of the following are true about group disability Income insurance EXCEPT a) The longer the waiting period, the lower the premium. b) Coverage applies both on and off the job. c) Benefits are usually short term. d) The waiting period starts at the onset of the injury or sickness. Coverage applies both on and off the job. Which of the following statements regarding Business Overhead Expense policies is NOT true? a) Premiums paid for BOE are tax-deductible. b) Any benefits received are taxable to the business. c) Leased equipment expenses are covered by the plan. d) Benefits are usually limited to six months, d) Benefits are usually limited to six months In long-term care insurance, what type of care is provided with intermediate care? Occasional nursing or rehabilitative care After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true? a) The employee can convert from group to individual insurance within 31 days of termination. b) The premium of the individual health insurance policy can be higher than the original policy. c) By law, the new, individual policy must provide the same benefits as the group insurance policy. d) Continuation of group coverage need not include dental, vision, or prescription drug benefits. c) By law, the new, individual policy must provide the same benefits as the group insurance policy. An insured has endured multiple surgeries and hospitalizations for an illness during the last few months. Her insurer no longer bills her for medical expenses. Which of the following allows for that? a) Waiver of premium b) Maximum loss c) Stop-loss limit d) Grace period c) Stop-loss limit L has a major medical policy with a $500 deductible and 80/20 coinsurance. Lis hospitalized and sustains a $2.500 loss. What is the maximum amount that L will have to pay? $900 L would first pay the $500 deductible; out of the remaining $2,000, the insurer will pay 80% ($1,600) and the insured will pay 20% ($400). Which of the following entities has the authority to make changes to an insurance policy? a) Department of Insurance b) Broker c) Producer d) Insurer's executive officer d) Insurer's executive officer Only an executive officer of the company, not an agent, has authority to make any changes to the policy. The insurer must have the insured's written agreement to the change. All of the following statements about Medicare supplement insurance policies are correct EXCEPT a) They cover the cost of extended nursing home care. b) They cover Medicare deductibles and copayments. c) They supplement Medicare benefits. d) They are issued by private insurers. a) They cover the cost of extended nursing home care. Long-term care coverage may be available as any of the following options EXCEPT: a) Endorsement to a life policy. b) Endorsement to a health policy. c) Group long-term care d) Individual long-term care. b) Endorsement to a health policy. LTC policies may be purchased on an individual or group basis, or as an endorsement to a life insurance policy. An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy? 10 days. The grace period is 7 days if the premium is paid weekly, 10 days if paid monthly, and 31 days for all other modes. Aninsurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe? Conditional A conditional contract requires both the insurer and policyowner to meet certain conditions before the contract can be executed, unlike other types of policies which put the burden of condition on either the insurer or the policyowner. How are HMO territories typically divided? Geographic areas A participating insurance policy may do which of the following? a) Provide group coverage b) Pay dividends to the stockholder c) Require 80% participation d) Pay dividends to the policyowner d) Pay dividends to the policyowner. When may an insurer require an insured to provide genetic information? Never. Insurers are prohibited from requesting a person or relative of a person to supply genetic information. If an insurance company offers Medicare supplement policies, it must offer which of the following plans? a) В-N b) A-D c) A d) A & B c) A An insurance company must make available to each applicant a policy form offering the basic core benefits (Plan A) if it will offer any Medicare Supplement policies. An insurance company does not have to issue all or any of the plans B through N. The Florida Health Insurance Coverage Continuation Act requires insurers that sell health plans to small employers to offer in those plans a right to elect to continue coverage, without providing evidence of insurability, to employees who lose their coverage and are unable to replace it. The premium rate for this coverage may NOT exceed: 115% of the regular group rate. The coverage may be extended for a period of up to 18 months at a rate not to exceed 115% of the regular group rate. An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of? False advertising False advertising is the illegal practice of advertising or circulating materials that are untrue, deceptive, or misleading.