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Life And Health Insurance Exam

Instructions:

Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Capital Amount
A percentage of the principal amount of a policy paid to the insured if he/she suffered the loss of an appendage.
An insurance sales office or company.
An individual appointed by a court as a fiduciary to settle the financial affairs and estate of a deceased person.
The length of time over which the insurance benefits will be paid for each illness - disability or hospital stay.

2. Option
A choice of ways of receiving policy dividends - nonforfeiture values - death benefits - or cash values.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.
A fee charged at the time of a sale - transfer or withdrawal from an annuity or a life insurance policy.
Those guaranteed values in a life insurance policy that cannot be taken from the insured - even if he or she ceases to pay premiums.

3. Custodial Car
Written and /or oral statements regarding a consumer's credit - character - reputation - or habits collected by a reporting agency from employment records - credit reports - and other public sources.
Care that is rendered to help an insured complete his/her activities of daily living.
The person who receives the proceeds from the policy when the insured dies.
An entity that indemnifies against losses - provides benefits - or renders services (also known as "company" or "insurance company").

4. Certificate of Authority
A document that authorizes a company to start conducting business and specifies the kind(s) of insurance a company can transact. It is illegal for an insurance company to transact insurance without this certificate.
An employer-funded account linked to a high deductible medical insurance plan.
A mortality table used in life insurance that mathematically predicts the likelihood of death.
A contract that legally binds only one party to contractual obligations after the premium is paid.

5. Primary Policy
A basic - fundamental insurance policy which pays first with respect to other outstanding policies.
An insurance policy that provides payment if the insured's death is the result of an accident.
A fee or commission charged at the time of purchase of an annuity or a security.
The reduction - decrease - or disappearance of value of the person or property insured in a policy - by a peril insured against.

6. Alzheimer's Disease
A period of time - usually required by law - during which a policyowner may inspect a newly issued individual life or health insurance policy for a stated number of days and surrender it in exchange for a full refund of premium if not satisfied for a
A retirement plan that meets the IRS guidelines for receiving favorable tax treatment.
A disease that causes the victim to become dysfunctional due to degeneration of brain cells causing severe memory loss.
A claim to a provider or medical supplier to receive payments directly from Medicare.

7. Nonadmitted (Nonauthorized)
A contract that pays a stated amount in the event of a loss (disability insurance/life insurance).
A variation of whole life insurance that charges a level annual premium and provides a level - guaranteed death benefit to the insured's age 100 and will endow for the face amount if the insured lives to age 100. Limited-pay life is designed so that
The person who has possession of the policy - usually the insured.
An insurance company that has not applied for - or has applied and been denied a Certificate of Authority and may not transact insurance in a particular state.

8. Adjuster
A principle stating that the larger the number of similar exposure units considered - the more closely the losses reported will equal the underlying probability of loss.
A policy that provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.
A representative of an insurance company who investigates and acts on the behalf of the company to obtain agreements for the amount of the insurance claim.
An injury or disease which occurs suddenly and requires treatment within 24 hours.

9. Approved Amount
The amount Medicare determines to be reasonable for a service that is covered under part B of Medicare.
Activities individuals must do every day such as moving about - getting dressed - eating - bathing - etc.
A period of time - usually required by law - during which a policyowner may inspect a newly issued individual life or health insurance policy for a stated number of days and surrender it in exchange for a full refund of premium if not satisfied for a
An insurance company that conducts business in the state of incorporation.

10. Free Look
A type of insurance that covers a group of individuals against loss of pay due to accident or sickness.
Period of time after the premium due date during which premiums may still be paid - and the policy and its riders remain in force.
An entity certified by the insured's health plan that provides health care services under contract.
A period of time - usually required by law - during which a policyowner may inspect a newly issued individual life or health insurance policy for a stated number of days and surrender it in exchange for a full refund of premium if not satisfied for a

11. Loan Value
A model of HMO and PPO organizations that uses the insured's primary care physician (the gatekeeper) as the initial contact for the patient for medical care and for referrals.
An individual who represents an insured in the process of purchasing and negotiating a contract of insurance.
A group insurance plan that requires the employees to pay part of the premium.
The amount of money an insured can borrow using the cash value of his/her life insurance policy as collateral.

12. Superintendent (Commissioner - Director)
The head of the state department of insurance.
A person who evaluates and classifies risks to accept or reject them on behalf of the insurer.
The method of determining primary coverage for a dependent child - under which the plan of the parent whose birthday occurs first in the calendar year is designated as primary.
Riders attached to life insurance policies which allow death benefits to be used to cover nursing or convalescent home expenses.

13. Renewable Term
A retirement plan that meets the IRS guidelines for receiving favorable tax treatment.
A liability insurance company owned by its members - which are exposed to similar liability risks by virtue of being in the same business or industry.
Insurance which can - at the election of the policyowner - be renewed at the end of a term without evidence of insurability.
A type of hazard that arises from the physical characteristics of an individual - such as a physical disability due to either current circumstance or a condition present at birth.

14. Policy Loan
A nonforfeiture value in which an insurer loans a part or all of the cash value of the policy assigned as security for the loan to the policyowner.
A policy that may be exchanged for another type of policy by contractual provision - at the option of the policyowner - and without evidence of insurability (i.e. term life changed to a form of permanent life).
A single policy that is designed to insure two or more lives.
An insurance company that has not applied for - or has applied and been denied a Certificate of Authority and may not transact insurance in a particular state.

15. Certificate
A person trained in the technical aspects of insurance and related fields - particularly in the mathematics of insurance; a person who - on behalf of the company - determines the mathematical probability of loss.
An act of identifying the name of the producer - representative or firm - limited insurance representative - or temporary insurance producer on any policy solicitation.
Plans that allow employers to set aside funds for reimbursing employees for qualified medical expenses.
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.

16. Policyholder
The person who has possession of the policy - usually the insured.
Unplanned - unforeseen traumatic injury to the body.
An organization that is formed by - or on behalf of - a group of insurers to develop rates for those insurers - and to file the rates with the insurance department on behalf of its members. They may also act as a collection point for actuarial data.
An entity that indemnifies against losses - provides benefits - or renders services (also known as "company" or "insurance company").

17. Executory Contract
A retirement plan that meets the IRS guidelines for receiving favorable tax treatment.
A contract which has not yet been fulfilled by one or both parties that promises action in the event of a specified future occurrence.
An unfair trade practice in which one person refuses to do business with another until he or she agrees to certain conditions.
The required amount to pay damages or for property loss - which is calculated based on the property's current replacement value minus depreciation.

18. Domestic Insurer
A percentage of the principal amount of a policy paid to the insured if he/she suffered the loss of an appendage.
An insurance company that conducts business in the state of incorporation.
Companies owned by the stockholders whose investments provide the capital necessary to establish and operate the insurance company.
An individual who represents an insured in the process of purchasing and negotiating a contract of insurance.

19. Surrender
An excessive amount of insurance that would result in overpayment to the insured in the event of a loss.
A temporary contract that puts an insurance policy into force before the premium has been paid.
An act of giving up a life policy - in which the insurer will pay the insured the cash value the policy has built up.
Withdrawing the money from a qualified plan and placing it into another qualified plan.

20. Express Authority

21. Mutual Companies
A material stipulation in the policy that if breached may void coverage.
Insurance agent or broker.
Insurance organizations that have no capital stock - but are owned by the policyholders.
Medicare supplement plans issued by private insurance companies that are designed to fill some of the gaps in Medicare.

22. Periodontics
Health coverage provided to members of a group.
A specialty of dentistry that involves treatment of the surrounding and supporting tissue of the teeth such as treatment for gum disease.
A detailed financial report that an insurance company must submit every year to the insurance department of state(s) in which it conducts business.
The full face value of a policy.

23. Credit Life Insurance
A prepaid medical service plan in which specified medical service providers contract with the HMO to provide services. The focus of the HMO is preventive medicine.
A method of dealing with risk for a group of individual persons or businesses with the same or similar exposure to loss who share the losses that occur within that group.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.

24. Emergency
An injury or disease which occurs suddenly and requires treatment within 24 hours.
A contract offered on a "take-it-or-leave-it" basis by an insurer - in which the insured's only option is to accept or reject the contract. Any ambiguities in the contract will be settled in favor of the insured.
A contract in which participating parties exchange unequal amounts. Insurance contracts are aleatory in that the amount the insured will pay in premiums is unequal to the amount the insurer will pay in the event of a loss.
An insurance sales office or company.

25. Risk - Substandard
An applicant or insured who has a higher than normal probability of loss - and who may be subject to an increased premium.
An arrangement that allows someone living with a life threatening condition to sell their existing life insurance policy and use the proceeds when and where they are most needed - before death.
The amount of premium that must be collected from each member of a group composed of the same age - sex and risk in order to pay $1 -000 for each death that will occur in the group each year.
A provision that allows an insurer - at its own expense - to have an insured physically examined when a claim is pending or to have an autopsy performed where not prohibited by law.

26. Reciprocity

27. Renewability Clause

28. Cease and Desist Order
A demand of a person to stop committing an action that is in violation of a provision.
The amount a physician or supplier actually bills for a particular service or supply.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.

29. Orthodontics
Any supplemental agreement attached to and made a part of the policy indicating the policy expansion by additional coverage - or a waiver of a coverage or condition.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
A group or individual policy that covers disabilities of 13 to 26 weeks - and in some cases for a period of up to two years.
A special field in dentistry which involves treatment of natural teeth to prevent and/or correct dental anomalies with braces or appliances.

30. Medical Information Bureau (MIB)
The uncertainty or chance of a loss occurring in a situation that involves the opportunity for either loss or gain.
A nonforfeiture value in which an insurer loans a part or all of the cash value of the policy assigned as security for the loan to the policyowner.
A type of individual or group insurance that fills the gaps in the protection provided by Medicare - but that cannot duplicate any Medicare benefits.
An information database that stores the health histories of this database for underwriting purposes.individuals who have applied for insurance in the past. Most insurance companies subscribe to

31. Concealment
A policy with a high maximum limit that covers certain diseases named in the contract (such as polio and meningitis).
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.
A method of dealing with risk for a group of individual persons or businesses with the same or similar exposure to loss who share the losses that occur within that group.
The withholding of known facts which - if material - can void a contract.

32. Disclosure
An organization of medical professionals and hospitals who provide services to an insurance company's clients for a set fee.
An agreement between an insurance company and an individual that states that insurance policies cover the individual's insurable interest.
Any life insurance written on the life of a minor.
An act of identifying the name of the producer - representative or firm - limited insurance representative - or temporary insurance producer on any policy solicitation.

33. Life Expectancy
Insurance whereby premiums are paid for protection in the event of death or disability - not for cash value accumulation.
A medical benefits program jointly administered by the individual states and the federal government.
Average number of years remaining for a person of a given age to live - as shown on the mortality table.
An entity that obtains and possesses a license solely for the purpose of writing business on the owner - immediate family - relatives - employer and employees.

34. Restorative Care
A condition which does not allow a person to perform the duties of any occupation for payment as a result of injury or sickness.
An area of dentistry that involves treatments that restore functional use to natural teeth such as fillings or crowns.
The amount to which a policyowner is entitled if the policy is surrendered before maturity.
A principle stating that the larger the number of similar exposure units considered - the more closely the losses reported will equal the underlying probability of loss.

35. Natural Premium
The fair and equal bargaining by both parties in forming the contract - where the applicant must make full disclosure of risk to the company - and the insurance company must be fair in underwriting the risk.
An arrangement in which an insured must pay a specified amount for services "up front" and the provider pays the remainder of the cost.
The amount of premium that must be collected from each member of a group composed of the same age - sex and risk in order to pay $1 -000 for each death that will occur in the group each year.
The effect a person's indifference concerning loss has on the risk to be insured.

36. Short-Term Disability Insurance
A group or individual policy that covers disabilities of 13 to 26 weeks - and in some cases for a period of up to two years.
A model of HMO and PPO organizations that uses the insured's primary care physician (the gatekeeper) as the initial contact for the patient for medical care and for referrals.
The person or organization that is protected by insurance; the party to be indemnified.
A type of temporary health or medical care provided either by paid workers who come to the home or by a nursing facility where a patient stays to give a caregiver a short rest.

37. Basic Illustration
A policy that provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.
Operative treatment of the mouth such as extractions of teeth and related surgical treatment.
An act that is intended to cause injury. Self- inflicted injuries are not covered under accident insurance; intentional injuries inflicted on the insured by another are covered.
A ledger or proposal used in the sale of a life insurance policy that shows both guaranteed and nonguaranteed elements.

38. Medicare Supplement Insurance
A type of individual or group insurance that fills the gaps in the protection provided by Medicare - but that cannot duplicate any Medicare benefits.
Termination of a policy because the premium has not been paid by the end of the grace period.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.
A group insurance plan that requires the employees to pay part of the premium.

39. Nonrenewal
A selection of health care benefits from which an employee may choose the ones that he/she needs.
A termination of a policy by an insurer on the anniversary or renewal date.
Insurance that is kept in force for a person's entire life and pays a benefit upon the person's death - whenever that may be.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.

40. Policyowner
A variation of whole life insurance that charges a level annual premium and provides a level - guaranteed death benefit to the insured's age 100 and will endow for the face amount if the insured lives to age 100. Limited-pay life is designed so that
The person who is entitled to exercise the rights and privileges in the policy. This person may or may not be the insured.
An unfair trade practice in which one person refuses to do business with another until he or she agrees to certain conditions.
An organization that is formed by - or on behalf of - a group of insurers to develop rates for those insurers - and to file the rates with the insurance department on behalf of its members. They may also act as a collection point for actuarial data.

41. Dual Choice
A federal requirement that employers who have 25 or more employees - who are within the service area of a qualified HMO - who pay minimum wage - and offer a health plan - must offer HMO coverage as well as an indemnity plan.
A life or health insurance policy that is underwritten based on the insured's statement of health rather than a medical examination.
The law that provides for the continuation of group health care benefits for the insured for up to 18 months if he/she terminates employment or is no longer eligible - and for the insured's dependents for up to 36 months in cases of loss of eligibili
A rider found in juvenile policies which waives the premiums if the person paying them (often the parent) is disabled or dies while the child is still a minor.

42. Transfer
The act of signing an insurance policy by a licensed resident agent.
The person who is named to receive benefits upon the death of the insured if the (primary) first-named beneficiary is no longer alive or does not collect all the benefits due to his/her own death.
A basic principle of insurance under which the risk of financial loss is assigned to another party.
A type of individual or group insurance that fills the gaps in the protection provided by Medicare - but that cannot duplicate any Medicare benefits.

43. Long-Term Care (LTC)
Health and social services provided under the supervision of physicians and medical health professionals for persons with chronic diseases or disabilities. Care is usually provided in a Long-Term Care Facility which is a state licensed facility that
The process of reviewing - accepting or rejecting applications for insurance.
The person who receives the proceeds from the policy when the insured dies.
A physical illness - disease - or pregnancy - but not a mental illness.

44. Defamation

45. Benefit Period
A contract that legally binds only one party to contractual obligations after the premium is paid.
The process of reviewing - accepting or rejecting applications for insurance.
The length of time over which the insurance benefits will be paid for each illness - disability or hospital stay.
A provision that is found in most disability income policies which specifies the conditions that will automatically qualify the insured for full disability benefits.

46. Home Health Services
Organizations that process claims and pay benefits in an insurance policy
A rule that states a contract may not be altered without written consent of both parties; in other words - the contract may not be altered by an oral agreement.
Ability to perform some - but not all - of the duties of the insured's occupation as a result of injury or sickness.
A covered expense under Part A of Medicare in which a licensed home health agency provides home health care to an insured.

47. Commissioner (Superintendent - Director)
The chief executive and administrative officer of a state insurance department.
The person or organization that is protected by insurance; the party to be indemnified.
A provision that spells out an insured's duty to provide the insurer with reasonable notice in the event of a loss.
A method of dealing with risk by intentionally or unintentionally keeping a portion of it for the insured's account; the amount of responsibility assumed but not reinsured by the insurance company.

48. Unearned Premium
The portion of premium for which policy protection has not yet been given.
A provision that is found in most disability income policies which specifies the conditions that will automatically qualify the insured for full disability benefits.
The accounting measurement of an insurer's future obligations to pay claims to policyowners.
The amount Medicare determines to be reasonable for a service that is covered under part B of Medicare.

49. Morbidity Table
A facility which is licensed by the state to provide 24 hour nursing care.
A financial interest in the life of another person; a possibility of losing something of value if the insured should die. In life and health insurance - insurable interest must be stated at the time of policy issue.
The ratio of the incidence of sickness to the number of well persons in a given group of people over a given period of time.
A table showing the incidence of sickness at specified ages.

50. Errors and Omissions Policy (E&O)
Any group or individual who provides health care services.
A professional liability insurance that protects the insurer from claims by the insured for errors or oversights on the part of the insurer.
A financial interest in the life of another person; a possibility of losing something of value if the insured should die. In life and health insurance - insurable interest must be stated at the time of policy issue.
Coverage that provides benefits for room - board and miscellaneous hospital expenses for a certain number of days during a hospital stay.