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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. Waiver of Premium
A type of health insurance that usually carries a large deductible and pays covered expenses up to a high limit whether the insured is in or out of the hospital.
Insurance that pays dividends to policyholders.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.
The United States federal government plan for paying certain hospital and medical expenses for persons who qualify.

2. Foreign Insurer
An insurance company that is incorporated in another state.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.
Special powers granted to an agent by his or her agency contract.
A condition which does not allow a person to perform the duties of any occupation for payment as a result of injury or sickness.

3. Accidental Death Insurance

4. Fraternal Benefit Societies
A physical illness - disease - or pregnancy - but not a mental illness.
Life or health insurance companies formed to provide insurance for members of an affiliated lodge - religious organization - or fraternal organization with a representative form of government.
Choices available to the insured/owner for distribution of insurance proceeds.
Statements made by the applicant on the insurance application that are believed to be true - but are not guaranteed to be true.

5. Accident Insurance
A type of insurance that protects the insured against loss due to accidental bodily injury.
A method of dealing with risk by deliberately keeping away from it (e.g. if a person wanted to avoid the risk of being killed in an airplane crash - he/she might choose never to fly in a plane).
Withdrawing the money from a qualified plan and placing it into another qualified plan.
Life or health insurance companies formed to provide insurance for members of an affiliated lodge - religious organization - or fraternal organization with a representative form of government.

6. Commingling
A percentage of the principal amount of a policy paid to the insured if he/she suffered the loss of an appendage.
Life or health insurance companies formed to provide insurance for members of an affiliated lodge - religious organization - or fraternal organization with a representative form of government.
A practice in which a person in a fiduciary capacity illegally mixes his/her personal funds with funds he/she is holding in trust.
Coverage that provides benefits for room - board and miscellaneous hospital expenses for a certain number of days during a hospital stay.

7. Morbidity Table
The effect a person's indifference concerning loss has on the risk to be insured.
Ability to perform some - but not all - of the duties of the insured's occupation as a result of injury or sickness.
A table showing the incidence of sickness at specified ages.
Insurance that pays benefits for inability to work because of disability resulting from accidental bodily injury or sickness.

8. Fraud
Intentional misrepresentation or deceit with the intent to induce a person to part with something of value.
A professional liability insurance that protects the insurer from claims by the insured for errors or oversights on the part of the insurer.
Any inducement offered in the sale of insurance products that is not specified in the policy.
An insurance policy which pays a specified amount or a specified multiple of the insured's benefit if the insured dies - loses his/her sight - or loses two limbs due to an accident.

9. Director (Commissioner - Superintendent)
Lessening the possibility or severity of a loss.
An insurance company that conducts business in the state of incorporation.
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.
The head of the state department of insurance.

10. Spendthrift Clause
An insurance company that is incorporated outside the United States.
Organizations that process inpatient and outpatient claims on individuals by hospitals - skilled nursing facilities - home health agencies - hospices and certain other providers of health services.
A clause that prevents the debtors of a beneficiary from collecting the benefits before he/she receives them.
The required amount to pay damages or for property loss - which is calculated based on the property's current replacement value minus depreciation.

11. Accidental Bodily Injury
Insurance that provides protection for a specific period of time.
Unplanned - unforeseen traumatic injury to the body.
An agent licensed in a state in which he or she is not a resident.
A circumstance that increases the likelihood of a loss.

12. Principal Amount
Coverage for doctor visits - x-rays - lab tests - and emergency room visits; benefits - however - are limited to specified dollar amounts.
The amount payable upon the death of the person whose life is insured.
An insurance company that is incorporated outside the United States.
The full face value of a policy.

13. Annuity
A covered expense under Part A of Medicare in which a licensed home health agency provides home health care to an insured.
An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance.
A contract that provides income for a specified period of years - or for life.
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.

14. Natural Premium
Time between the beginning of a disability and the start of disability insurance benefits.
A medical benefits program jointly administered by the individual states and the federal government.
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 single policy that is designed to insure two or more lives.

15. Agent's Authority
Special powers granted to an agent by his or her agency contract.
An organization of medical professionals and hospitals who provide services to an insurance company's clients for a set fee.
A provision that states that the insurer and the insured will share the losses covered by the policy in a proportion agreed upon in advance.
Life insurance provided for members of a group.

16. Insolvent organization
The amount payable by the insurance company - usually in at the insured's death or when the policy matures.
A plan that provides a package of health care services - including preventive care - routine physicals - immunization - outpatient services and hospitalization.
An insurance policy that provides payment if the insured's death is the result of an accident.
A member organization which is unable to pay its contractual obligations and is placed under a final order of liquidation or rehabilitation by a court of competent jurisdiction.

17. Comprehensive Major Medical
Insurance organizations that have no capital stock - but are owned by the policyholders.
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
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.
The first page of a policy.

18. Broker
An unplanned - unforeseen event which occurs suddenly and at an unspecified place.
An individual who represents an insured in the process of purchasing and negotiating a contract of insurance.
A patient who is expected to die within an amount of time specified in the policy.
Canceling the policy with a less than proportionate return of premium.

19. Cafeteria Plan
Insurance that provides protection for a specific period of time.
A selection of health care benefits from which an employee may choose the ones that he/she needs.
A policy on which all premiums have been paid but which has not matured due either to death or endowment.
Average number of years remaining for a person of a given age to live - as shown on the mortality table.

20. Nonresident Agent
Policies which replace a certain percentage of the insured's pure loss of income due to a covered accident or sickness.
A type of insurance that covers a group of individuals against loss of pay due to accident or sickness.
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.
An agent licensed in a state in which he or she is not a resident.

21. Contract
A medical benefits program jointly administered by the individual states and the federal government.
Organizations that process claims and pay benefits in an insurance policy
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).
An agreement between two or more parties enforceable by law.

22. Valued Contract
A provision that states that the insurer and the insured will share the losses covered by the policy in a proportion agreed upon in advance.
The withholding of known facts which - if material - can void a contract.
A contract that pays a stated amount in the event of a loss (disability insurance/life insurance).
The cause of a possible loss.

23. Co-Pay
A booklet that describes insurance policies and concepts - and provides general information to help an applicant make an informed decision.
Insurance that pays dividends to policyholders.
An arrangement in which an insured must pay a specified amount for services "up front" and the provider pays the remainder of the cost.
A person making application for - or offering him/herself or another to be insured under an insurance contract.

24. Settlement Options
Choices available to the insured/owner for distribution of insurance proceeds.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
The portion of premium for which policy protection has not yet been given.
Lessening the possibility or severity of a loss.

25. Dependent
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 person who relies on another for support and maintenance.
Companies owned by the stockholders whose investments provide the capital necessary to establish and operate the insurance company.
An illustration furnished in addition to a basic illustration that may be presented in a different format than the basic illustration - but may only depict a scale of nonguaranteed elements that is permitted in a basic illustration.

26. Sharing
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.
A fee charged at the time of a sale - transfer or withdrawal from an annuity or a life insurance policy.
The legal process by which an insurance company seeks recovery of the amount paid to the insured from a third party who may have caused the loss.
Any life insurance written on the life of a minor.

27. Implied Authority
Insurance that does not pay dividends.
Causes of loss - exposures - conditions - etc. listed in the policy for which the benefits will not be paid.
An area of dentistry that involves treatments that restore functional use to natural teeth such as fillings or crowns.
Authority that is not expressed or written into the contract - but which the agent is assumed to have in order to transact the business of insurance for the principal.

28. Out-of-Pocket Costs
The legal process by which an insurance company seeks recovery of the amount paid to the insured from a third party who may have caused the loss.
Amounts an insured must pay for coinsurance and deductibles before the insurer will pay its portion.
An arrangement in which an insured must pay a specified amount for services "up front" and the provider pays the remainder of the cost.
Unplanned - unforeseen traumatic injury to the body.

29. Rescission
The termination of an insurance contract due either to material misrepresentation by the insured or by fraud - misrepresentation - or duress on the part of the agent/insurer.
The authority granted to an agent by means of the agent's written contract.
A detailed financial report that an insurance company must submit every year to the insurance department of state(s) in which it conducts business.
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

30. Multiple-Employer Trust (MET)
The amount payable upon the death of the person whose life is insured.
A group of small employers who do not qualify for group insurance individually - formed to establish a group health plan or self-funded plan.
An unfair trade practice in which one person refuses to do business with another until he or she agrees to certain conditions.
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.

31. Waiver of Cost
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
An area of dentistry that involves treatments that restore functional use to natural teeth such as fillings or crowns.
A disability rider - found in Universal Life Insurance - that waives the cost of the insurance but does not waive the cost of premiums necessary to accumulate cash values.
Riders attached to life insurance policies which allow death benefits to be used to cover nursing or convalescent home expenses.

32. Sickness
A method of dealing with risk by deliberately keeping away from it (e.g. if a person wanted to avoid the risk of being killed in an airplane crash - he/she might choose never to fly in a plane).
Intentional misrepresentation or deceit with the intent to induce a person to part with something of value.
The portion of the loss that is to be paid by the insured before any claim benefits may be paid by the insurer.
A physical illness - disease - or pregnancy - but not a mental illness.

33. Authorized (Admitted) Insurer
A basic - fundamental insurance policy which pays first with respect to other outstanding policies.
A method of dealing with risk by deliberately keeping away from it (e.g. if a person wanted to avoid the risk of being killed in an airplane crash - he/she might choose never to fly in a plane).
An insurance company authorized and licensed to transact business in a particular state.
The age of the insured at a determined date.

34. Long-Term Disability Insurance
An illustration furnished in addition to a basic illustration that may be presented in a different format than the basic illustration - but may only depict a scale of nonguaranteed elements that is permitted in a basic illustration.
A type of individual or group insurance that provides coverage for illness until the insured reaches age 65 and for life in the case of an accident.
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.
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.

35. Flexible Premium
An insurance policy which pays a specified amount or a specified multiple of the insured's benefit if the insured dies - loses his/her sight - or loses two limbs due to an accident.
The binding force in a contract that requires something of value to be exchanged for the transfer of risk. The consideration on the part of the insured is the representations made in the application and the payment of premium; the consideration on th
A policy that provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.
A policy feature that allows the policyholder to vary premium payments in the amount and/or timing.

36. Transfer
A basic principle of insurance under which the risk of financial loss is assigned to another party.
An insurance policy that provides payment if the insured's death is the result of an accident.
A false statement or lie that can render the contract void.
Insurance organizations that have no capital stock - but are owned by the policyholders.

37. Rebating
Settlement method that pays the beneficiary the entire proceeds of a life insurance policy in one payment rather than in installments.
Any inducement offered in the sale of insurance products that is not specified in the policy.
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.
The accounting measurement of an insurer's future obligations to pay claims to policyowners.

38. Coercion
A provision that helps determine the primary provider in situations where an insured is covered by more than one policy - thus avoiding claims overpayments.
An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance.
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).
The act of signing an insurance policy by a licensed resident agent.

39. Fiduciary

40. Living Benefits Rider
A rider attached to a life insurance policy that provides LTC benefits or benefits for the terminally ill by using available life insurance benefits.
A provision that helps determine the primary provider in situations where an insured is covered by more than one policy - thus avoiding claims overpayments.
A circumstance that increases the likelihood of a loss.
A provision that specifies to whom claims payments are to be made.

41. Free Look
A situation in which two parties provide the same help or advantages to each other (for example - Producer A living in State A can transact business as a nonresident in State B if State B's resident producers can transact business in State A).
The effect a person's indifference concerning loss has on the risk to be insured.
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 circumstance that increases the likelihood of a loss.

42. Probationary Period
An entity that indemnifies against losses - provides benefits - or renders services (also known as "company" or "insurance company").
A provision that helps determine the primary provider in situations where an insured is covered by more than one policy - thus avoiding claims overpayments.
The period of time between the effective date of a health insurance policy and the date coverage for all or certain conditions begins.
Authority that is not expressed or written into the contract - but which the agent is assumed to have in order to transact the business of insurance for the principal.

43. Proof of Loss
A claim form that a claimant must submit after a loss occurs.
Similar to consumer reports in that they also provide information on the consumer's character - reputation - and habits.
A legal impediment to denying a fact or restoring a right that has been previously waived.
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.

44. Proceeds

45. Attained Age
A ledger or proposal used in the sale of a life insurance policy that shows both guaranteed and nonguaranteed elements.
The age of the insured at a determined date.
A type of health insurance that usually carries a large deductible and pays covered expenses up to a high limit whether the insured is in or out of the hospital.
A provision that spells out an insured's duty to provide the insurer with reasonable notice in the event of a loss.

46. Accidental Death Benefits
A practice in which a person in a fiduciary capacity illegally mixes his/her personal funds with funds he/she is holding in trust.
A policy rider that states that the cause of death will be analyzed to determine if it complies with the policy description of accidental death.
An insurance company authorized and licensed to transact business in a particular state.
Causes of loss - exposures - conditions - etc. listed in the policy for which the benefits will not be paid.

47. Intermediaries
Coverage for doctor visits - x-rays - lab tests - and emergency room visits; benefits - however - are limited to specified dollar amounts.
A false statement or lie that can render the contract void.
Health insurance that provides periodic payments to replace an insured's income when he/she is injured or ill.
Organizations that process inpatient and outpatient claims on individuals by hospitals - skilled nursing facilities - home health agencies - hospices and certain other providers of health services.

48. Term Insurance
Insurance that provides protection for a specific period of time.
An illustration furnished in addition to a basic illustration that may be presented in a different format than the basic illustration - but may only depict a scale of nonguaranteed elements that is permitted in a basic illustration.
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.

49. Orthodontics
An amount representing actual or potential liabilities kept by an insurer in a separate account to cover debts to policyholders.
A special field in dentistry which involves treatment of natural teeth to prevent and/or correct dental anomalies with braces or appliances.
A type of insurance that pays benefits for medical - surgical - and hospital costs.
Health insurance that provides periodic payments to replace an insured's income when he/she is injured or ill.

50. Employee RetirementIncome Security Act (ERISA)
A facility which is licensed by the state to provide 24 hour nursing care.
The act that stipulates federal standards for private pension plans.
A legal document that indicates that an insurance policy has been issued - and that states both the amounts and types of insurance provided.
A physical condition that existed before the effective date of the policy - usually excluded from coverage.