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CA-Life-Accident-and-Health CA Life, Accident and Health or Sickness Examination Questions and Answers

Questions 4

What Medicare coverage automatically begins at age 65?

Options:

A.

Part A

B.

Part B

C.

Part C

D.

Part D

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Questions 5

Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), which of the following is a qualifying event?

Options:

A.

Divorce

B.

Marriage

C.

Promotion

D.

Relocation

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Questions 6

The type of health care provider that provides both the health care services and the health care coverage is called:

Options:

A.

a Preferred Provider Organization.

B.

a Health Maintenance Organization.

C.

a major medical organization.

D.

an EPO.

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Questions 7

Each of the following terms is an important characteristic of a Major Medical policy EXCEPT

Options:

A.

deductible.

B.

copayments.

C.

coinsurance.

D.

capitation fee.

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Questions 8

Your client has just bought a new home which he has financed with a $150,000, 7.5% interest, 30-year bank loan. He would like to be sure that if he dies prematurely, the unpaid balance of the mortgage would be paid. He wants a policy that will cover the mortgage balance - no more, no less - anytime during the life of the mortgage. Which policy is designed to meet this need?

Options:

A.

Level term policy.

B.

Home service policy.

C.

Increasing term policy.

D.

Decreasing term policy.

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Questions 9

Any situation that presents the possibility of a loss is known as

Options:

A.

consideration.

B.

a covered loss.

C.

a loss exposure.

D.

medical loss ratio.

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Questions 10

A contract of indemnity is one in which

Options:

A.

one party is restored to the same financial position the party was in before the loss occurred.

B.

one party is obligated to assume the legal liability of another party.

C.

one party must adhere to the agreements written by the other party.

D.

both parties are expected to act in complete honesty.

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Questions 11

Under the PPACA, which medical enrollment tier is 80% actuarial value?

Options:

A.

bronze

B.

gold

C.

platinum

D.

silver

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Questions 12

All of the following are requirements of a contract EXCEPT

Options:

A.

the contract must have a legal purpose.

B.

there must be equal consideration between the parties.

C.

the parties to the contract must be legally competent.

D.

there must be an offer and acceptance of the contract terms.

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Questions 13

What policy is a savings instrument designed to first accumulate funds and then systematically to liquidate the funds?

Options:

A.

Term life.

B.

Deferred annuity.

C.

Mortgage insurance.

D.

Disability income insurance.

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Questions 14

In the California Insurance Code, a fact that is so important it could determine the policy premium is cited for its

Options:

A.

expressness.

B.

materiality.

C.

representation.

D.

valuation.

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Questions 15

Regarding the Health Benefit Exchanges, as created by PPACA, all of the following statements are true EXCEPT

Options:

A.

the name of California's Exchange is Covered California.

B.

an individual enrolling in a bronze level plan is not eligible for reduced cost-sharing.

C.

an individual whose household income is 400% of the federal poverty level may receive a premium tax credit.

D.

an individual may only receive a premium tax credit for a plan if purchased through the Exchange.

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Questions 16

A contract in which only one party to the contract is legally bound to do anything is

Options:

A.

aleatory.

B.

conditional.

C.

personal.

D.

unilateral.

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Questions 17

When is the automatic loan provision activated?

Options:

A.

On the premium due date.

OB. At the end of the grace period.

B.

At the end of the free-look period.

C.

At the end of the incontestability period.

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Questions 18

Specified disease insurance covers all of the following EXCEPT

Options:

A.

costs covered by medical expense insurance.

B.

noncovered medical expenses.

C.

out-of-pocket payments.

D.

incidental costs.

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Questions 19

According to the Employee Retirement Income Security Act of 1974 (ERISA) fiduciary standards, benefit plans are operated for

Options:

A.

plan employees.

B.

plan sponsors and employees.

C.

plan sponsors and beneficiaries.

D.

plan participants and beneficiaries.

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Questions 20

Loss retention is an effective risk management technique when all of the following conditions exist EXCEPT the

Options:

A.

losses are highly predictable.

B.

probability of loss is unknown.

C.

worst possible loss is not serious.

D.

insured chooses to assume the losses involved.

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Questions 21

It representation in an insurance contract qualifies as which of the following?

Options:

A.

An amendment.

B.

A policy provision.

C.

An implied warranty.

D.

An express warranty.

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Questions 22

All of the following statements are true regarding Health Insurance Counseling Advocacy Program (HICAP) counselors EXCEPT HICAP counselors

Options:

A.

provide information about the Medicare program.

B.

must complete an intensive training program.

C.

are qualified to give legal advice.

D.

are volunteers.

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Questions 23

How does the cost recovery rule apply when a life insurance policy is surrendered for its cashvalue?

Options:

A.

The insurer retains the cost basis.

B.

The entire surrender value is taxable.

C.

The insured receives only the cost basis.

D.

The cost basis of the policy is exempt from taxation.

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Questions 24

According to the California Insurance Code, an illustration used to sell life insurance must include all of the following information EXCEPT

Options:

A.

the probability that illustrated nonguaranteed scenarios will occur.

B.

a label that identifies it as an illustration.

C.

insurer's policy name and form number.

D.

name and address of the producer.

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Questions 25

Which report about an insurance applicant's creditworthiness and personal characteristics may influence eligibility for life and health insurance?

Options:

A.

Agent's report.

B.

Consumer report.

C.

Attending physician's statement.

D.

Medical Information Bureau disclosure.

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Questions 26

An insured replaces an existing annuity with a new one and must pay a surrender charge for cancelling the existing annuity. The new policy holds no greater financial benefits to the insured than the existing contract. This is an example of

Options:

A.

nonforferture.

B.

a deferred annuity.

C.

a substandard annuity.

D.

an unnecessary replacement.

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Questions 27

Insurance solicitation includes all of the following activities EXCEPT

Options:

A.

coverage and rate quotations.

B.

bulk mailings introducing an agency.

C.

recommending other insurance products.

D.

publishing a newspaper in which one of the advertisers is an insurance agent.

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Questions 28

Vision insurance usually limits coverage in all of the following ways EXCEPT

Options:

A.

one examination per year.

B.

one set of lenses per year.

C.

a specific dollar amount for frames.

D.

a specific dollar amount for examinations.

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Questions 29

In order to be qualified to sell long-term care insurance in the State of California, agents must comply with all of the following EXCEPT

Options:

A.

all licensees are required to pass a long-term care knowledge exam every 10 years.

B.

eight hours each year prior to each renewal for licenses issued prior to January 1,1992.

C.

non-resident licensees must complete an approved California long-term care education requirement.

D.

for licenses issued after Jan 1,1992, eight hours of training in each of the first, four 12-month periods beginning from the date of the original license issuance and thereafter eight hours of training prior to each license renewal.

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Questions 30

What is the definition of premium?

Options:

A.

Bonus paid by an agent to convince an insured to buy a policy.

B.

Money an insured pays an insurer to obtain benefits provided in the policy.

C.

Money an insurer pays to an insured to obtain the benefits provided in the policy.

D.

Amount the insured pays per unit of coverage (e.g., $10 per $1,000 of coverage).

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Questions 31

When medical expense policies do not state specific dollar benefit amounts, but instead base payments upon the charges for like services in the same geographical area, benefits are designated as

Options:

A.

usual, customary, and reasonable charges.

B.

a percentage of stated charges.

C.

designated charges.

D.

stated charges.

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Questions 32

Every individual annuity policy that is sold to a senior in the State of California MUST include which of the following free look information?

Options:

A.

The insured forfeits any premiums paid if cancelled.

B.

The policy has a 30-day return for cancellation feature.

C.

The insurer has the right to cancel if less than 30 days.

D.

The premiums will not be invested during the return period.

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Questions 33

It is considered an unfair method of competition for an agent to advertise that the insurer the agent is appointed with is

Options:

A.

highly rated by A.M. Best Company.

B.

an admitted insurer in the state of California.

C.

a member of the Insurance Guarantee Association.

D.

fully authorized by certification to sell insurance.

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Questions 34

A life insurance policy written after 1988 that fails to meet the seven-pay test is known as

Options:

A.

an endowment policy.

B.

a modified life policy.

C.

a single premium contract.

D.

a modified endowment contract.

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Questions 35

All of the following statements about Health Maintenance Organizations (HMOs) are true EXCEPT

Options:

A.

Members pay fixed monthly fees to the HMO.

B.

Members receive care from providers in the HMO network.

C.

Out-of-pocket expenses are limited as long as the network is utilized.

D.

Members pay higher monthly fees when out-of-network providers are utilized.

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Questions 36

What rights do individuals have if they disagree with a decision on the amount Medicare will pay?

Options:

A.

They can change Medicare carriers.

B.

They can ask the Medicare carrier to review the decision.

C.

They can request a second opinion by the state medical examiner.

D.

They can terminate making premium payments until the claim is resolved.

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Questions 37

In financial planning, the human life value concept is based on an individual's

Options:

A.

age.

B.

education.

C.

health.

D.

income

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Questions 38

How many days does the California Insurance Code give an individual to return a life policy for cancellation?

Options:

A.

Less than 10 days.

B.

Not less than 30 nor more than 60 days.

C.

Between 10 and 30 days.

D.

Between 60 and 90 days.

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Questions 39

When a family policy covers children, all of the following are true EXCEPT

Options:

A.

the coverage is term insurance for a fixed amount.

B.

there is no additional charge for covering new additions to the family.

C.

evidence of insurability is required to convert coverage for children to permanent insurance.

D.

all children living with the family are covered even if adopted or born after the policy is issued.

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Questions 40

An emergency medical technician can return to gainful employment as a telephone solicitor and continue to collect disability under which clause of a disability policy?

Options:

A.

Work indemnity.

B.

Own occupation.

C.

Partial payment.

D.

Recovery period.

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Questions 41

In health insurance the coinsurance is

Options:

A.

a percentage of the cost for covered expenses paid by more than one insurer.

B.

a portion of the premium paid by the insured and insurer for each covered service.

C.

a payment shared by the insured and provider of covered service minus the deductible.

D.

a percentage paid for covered expenses by the insured and insurer after the deductible is satisfied.

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Questions 42

Which health insurance contract provision addresses the problem of over insurance?

Options:

A.

Reinstatement.

B.

Incontestability.

C.

Assignment of benefits.

D.

Coordination of benefits.

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Questions 43

Which group provides information about health-related issues to the elderly in California?

Options:

A.

Medicare supplement insurers.

B.

Long-term care insurance providers.

C.

The National Health Care Anti-Fraud Association.

D.

The Health Insurance Counseling and Advocacy Program (HICAP).

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Questions 44

According to California Insurance Code, an insurance policy must be

Options:

A.

negotiated between the agent and the insured.

B.

approved by the Insurance Commissioner.

C.

economically feasible for the insured.

D.

in writing.

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Questions 45

What factor supports the principle of indemnity?

Options:

A.

Utmost good faith.

B.

Insurable interest.

C.

Contract of adhesion.

D.

Reasonable expectations.

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Questions 46

All of the following statements apply to the child coverage in a family policy EXCEPT

Options:

A.

child coverage is term insurance.

B.

children are covered until reaching a specified age.

C.

child coverage is convertible to whole life coverage.

D.

coverage applies only to children born before the policy is issued.

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Exam Name: CA Life, Accident and Health or Sickness Examination
Last Update: Dec 13, 2024
Questions: 155

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