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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. Total Disability
A condition which does not allow a person to perform the duties of any occupation for payment as a result of injury or sickness.
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.
An insurance contract that the insured has a right to continue in force by payment of premiums that remain the same for a substantial period of time.

2. Medicare Supplement Insurance
An unfair trade practice in which one person refuses to do business with another until he or she agrees to certain conditions.
A type of individual or group insurance that fills the gaps in the protection provided by Medicare - but that cannot duplicate any Medicare benefits.
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 provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.

3. Approved Amount
The date when the face amount of the life insurance becomes payable.
The act that stipulates federal standards for private pension plans.
The amount Medicare determines to be reasonable for a service that is covered under part B of Medicare.
Insurance that pays dividends to policyholders.

4. Explanation of Medicare Benefits
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.
A ledger or proposal used in the sale of a life insurance policy that shows both guaranteed and nonguaranteed elements.
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.
An insurance company that is incorporated in another state.

5. Supplemental Illustration
The portion of the loss that is to be paid by the insured before any claim benefits may be paid by the insurer.
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.
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.
Lessening the possibility or severity of a loss.

6. Adjuster
The head of the state department of insurance.
A basic principle of insurance under which the risk of financial loss is assigned to another party.
A life or health insurance policy that is underwritten based on the insured's statement of health rather than a medical examination.
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.

7. Insolvent organization
The person or organization that is protected by insurance; the party to be indemnified.
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.
The uncertainty or chance of a loss occurring in a situation that can only result in a loss or no change.
The transfer of ownership rights of a life insurance policy from one person to another.

8. Agent's Authority
An entity that obtains and possesses a license solely for the purpose of writing business on the owner - immediate family - relatives - employer and employees.
A choice of ways of receiving policy dividends - nonforfeiture values - death benefits - or cash values.
Special powers granted to an agent by his or her agency contract.
A physical or mental impairment - either congenital or resulting from an injury or sickness.

9. Implied Authority
An agreement between an insurance company and an individual that states that insurance policies cover the individual's insurable interest.
The length of time over which the insurance benefits will be paid for each illness - disability or hospital stay.
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.
An agreement between two or more parties enforceable by law.

10. Payment of Claims
A provision that specifies to whom claims payments are to be made.
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.
A type of insurance that pays benefits for medical - surgical - and hospital costs.
An employer-funded account linked to a high deductible medical insurance plan.

11. Effective Date
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.
A combination of a flexible premium and adjustable life insurance.
A provision that spells out an insured's duty to provide the insurer with reasonable notice in the event of a loss.
The date when an insurance policy begins (also known as the inception date). The period of time in which an employee may enroll in a group health care plan without having to provide evidence of insurability.

12. Actual Charge
A contract whereby one party (insurer) agrees to indemnify or guarantee another party (insured) against a loss by a specified future contingency or peril in return for payment of a premium.
A choice of ways of receiving policy dividends - nonforfeiture values - death benefits - or cash values.
A type of insurance that covers a group of individuals against loss of pay due to accident or sickness.
The amount a physician or supplier actually bills for a particular service or supply.

13. Broker
A circumstance that increases the likelihood of a loss.
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.
An individual who represents an insured in the process of purchasing and negotiating a contract of insurance.
A legal impediment to denying a fact or restoring a right that has been previously waived.

14. Coordination of Benefits
An injury or disease which occurs suddenly and requires treatment within 24 hours.
A basic policy that charges a level annual premium for the lifetime of the insured and provides a level - guaranteed death benefit.
The act that stipulates federal standards for private pension plans.
A provision that helps determine the primary provider in situations where an insured is covered by more than one policy - thus avoiding claims overpayments.

15. Cafeteria Plan
A combination of a flexible premium and adjustable life insurance.
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 selection of health care benefits from which an employee may choose the ones that he/she needs.
A percentage of the principal amount of a policy paid to the insured if he/she suffered the loss of an appendage.

16. Controlled Business
Any life insurance written on the life of a minor.
An entity that obtains and possesses a license solely for the purpose of writing business on the owner - immediate family - relatives - employer and employees.
A type of insurance that covers a group of individuals against loss of pay due to accident or sickness.
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.

17. Issue Age

18. Insured
A life or health insurance policy that is underwritten based on the insured's statement of health rather than a medical examination.
The person or organization that is protected by insurance; the party to be indemnified.
An infectious and incurable disease caused by the human immunodeficiency virus (HIV).
The maximum amount a physician may charge a Medicare beneficiary for a covered service if the physician does not accept assignment of the Medicare approved amount.

19. Accumulation Period
A provision that allows coverage to continue beyond the policy's expiration date for employees who are not actively at work due to disability or who have dependents hospitalized on that date. This coverage continues only until the employee returns to
The time over which the annuitant makes paymenrs or investments in an annuity - and when those payments earn interest tax deferred.
A form changing the provisions of and attached to a life insurance policy (also known as a rider).
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.

20. Proof of Loss
A contract that provides income for a specified period of years - or for life.
A claim form that a claimant must submit after a loss occurs.
The appearance or the assumption of authority based on the actions - words - or deeds of the principal or because of circumstances the principal created.
A detailed financial report that an insurance company must submit every year to the insurance department of state(s) in which it conducts business.

21. Lump Sum
Additional - miscellaneous services provided by a hospital - such as x-rays - anesthesia - and lab work - but not hospital room and board expenses.
The amount a physician or supplier actually bills for a particular service or supply.
A life insurance policy designed to provide a level death benefit to the insured's age 100 for a one-time - lump sum payment.
Settlement method that pays the beneficiary the entire proceeds of a life insurance policy in one payment rather than in installments.

22. Nonmedical

23. Level Premium
A table showing the probability of death at specified ages.
The tendency or likelihood of insurance policies not lapsing or being replaced with insurance from another insurer.
A mortality table used in life insurance that mathematically predicts the likelihood of death.
A policy premium that remains the same over the period of time premiums are paid.

24. Commingling
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 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.
A provision that allows coverage to continue beyond the policy's expiration date for employees who are not actively at work due to disability or who have dependents hospitalized on that date. This coverage continues only until the employee returns to
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.

25. Natural Premium
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 reduction - decrease - or disappearance of value of the person or property insured in a policy - by a peril insured against.
An applicant or insured who has a higher than normal probability of loss - and who may be subject to an increased premium.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.

26. Health Insurance
Protection against loss due to sickness or bodily injury.
A circumstance that increases the likelihood of a loss.
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
The withholding of known facts which - if material - can void a contract.

27. Rescission
The uncertainty or chance of a loss occurring in a situation that can only result in a loss or no change.
An applicant or insured who has a higher than normal probability of loss - and who may be subject to an increased premium.
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.
A termination of a policy by an insurer on the anniversary or renewal date.

28. Limited-Pay Whole Life

29. Short-Rate Cancellation
Termination of a policy because the premium has not been paid by the end of the grace period.
Life insurance which permits changes in the face amount - premium amount - period of protection - and the duration of the premium payment period.
The portion of premium for which policy protection has not yet been given.
Canceling the policy with a less than proportionate return of premium.

30. Legal Reserve

31. Ancillary
Daily nursing care or skilled care - such as administration of medication - diagnosis - or minor surgery that is performed by or under the supervision of a skilled professional.
Additional - miscellaneous services provided by a hospital - such as x-rays - anesthesia - and lab work - but not hospital room and board expenses.
Period of time after the premium due date during which premiums may still be paid - and the policy and its riders remain in force.
A special field in dentistry which involves treatment of natural teeth to prevent and/or correct dental anomalies with braces or appliances.

32. Fiduciary

33. Physical Exam and Autopsy
To reach the maturity date or time at which the face amount equals cash values.
A policy with a high maximum limit that covers certain diseases named in the contract (such as polio and meningitis).
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.
An unplanned - unforeseen event which occurs suddenly and at an unspecified place.

34. Group Disability Insurance
An unincorporated group of individuals who mutually insure one another - each separately assuming a share of each risk.
A type of insurance that covers a group of individuals against loss of pay due to accident or sickness.
A material stipulation in the policy that if breached may void coverage.
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.

35. Hazard - Morale

36. Rate Service Organization
A detailed financial report that an insurance company must submit every year to the insurance department of state(s) in which it conducts business.
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.
The head of the state department of insurance.
A combination of a flexible premium and adjustable life insurance.

37. Commission
Health coverage provided to members of a group.
Type of disability income policy that provides benefits for loss of income when a person returns to work after a total disability - but is still not able to perform at the same level as before becoming disabled.
A special area of dentistry that involves the replacement of missing teeth with artificial devices like bridgework or dentures.
The payment made by insurers to agents or brokers for the sale and service of policies.

38. Nonqualified Pla
A contract which has not yet been fulfilled by one or both parties that promises action in the event of a specified future occurrence.
A type of benefit plan that may discriminate - is not required to be filed with the IRS - and does not provide a current tax deduction for contributions.
Causes of loss - exposures - conditions - etc. listed in the policy for which the benefits will not be paid.
Health insurance that provides periodic payments to replace an insured's income when he/she is injured or ill.

39. Fair Credit Reporting Act
A federal law that established procedures that consumer-reporting agencies must follow in order to ensure that records are confidential - accurate - relevant and properly used.
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.
An agreement between an insurer and insured in which both parties are expected to pay a certain portion of the potential loss and other expenses.
The individual's age when a policy is issued.

40. Grace Period
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).
An insurance classification for applicants who have a lower expectation of incurring loss - and who - therefore - are covered at a reduced rate.
Period of time after the premium due date during which premiums may still be paid - and the policy and its riders remain in force.
Benefits required by state law to be paid to an employee by an employer in the case of injury - disability - or death as the result of an on-the-job hazard.

41. Basic Medical Expense Insurance
Coverage for doctor visits - x-rays - lab tests - and emergency room visits; benefits - however - are limited to specified dollar amounts.
A legal contract that determines what will be done with a business in the event that an owner dies or becomes disabled.
A termination of a policy by an insurer on the anniversary or renewal date.
A physical condition that existed before the effective date of the policy - usually excluded from coverage.

42. Rollover
An act of identifying the name of the producer - representative or firm - limited insurance representative - or temporary insurance producer on any policy solicitation.
Withdrawing the money from a qualified plan and placing it into another qualified plan.
A general statement that identifies the basic agreement between the insurance company and the insured - usually located on the first page of the policy.
A contract which has not yet been fulfilled by one or both parties that promises action in the event of a specified future occurrence.

43. Long-Term Care (LTC)
An entity that indemnifies against losses - provides benefits - or renders services (also known as "company" or "insurance company").
Type of care in which part-time nursing or home health aide services - speech therapy - physical or occupational therapy services are given in the home of the insured.
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
Life insurance provided for members of a group.

44. Non-participating Policies (Non-par)
A legal document that indicates that an insurance policy has been issued - and that states both the amounts and types of insurance provided.
Insurance that does not pay dividends.
Insurance that pays benefits for inability to work because of disability resulting from accidental bodily injury or sickness.
A group of small employers who do not qualify for group insurance individually - formed to establish a group health plan or self-funded plan.

45. Long-Term Disability Insurance
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 demand of a person to stop committing an action that is in violation of a provision.
Period of time after the premium due date during which premiums may still be paid - and the policy and its riders remain in force.
The portion of the loss that is to be paid by the insured before any claim benefits may be paid by the insurer.

46. Disability Income Insurance

47. Term Insurance
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.
A contract that pays a stated amount in the event of a loss (disability insurance/life insurance).
Insurance that provides protection for a specific period of time.
The United States federal government plan for paying certain hospital and medical expenses for persons who qualify.

48. Capital Amount
Amounts an insured must pay for coinsurance and deductibles before the insurer will pay its portion.
A temporary contract that puts an insurance policy into force before the premium has been paid.
A percentage of the principal amount of a policy paid to the insured if he/she suffered the loss of an appendage.
A table showing the probability of death at specified ages.

49. Persistency
The tendency or likelihood of insurance policies not lapsing or being replaced with insurance from another insurer.
An infectious and incurable disease caused by the human immunodeficiency virus (HIV).
Insurance whereby premiums are paid for protection in the event of death or disability - not for cash value accumulation.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.

50. Recurrent Disability
A type of life insurance that features a level premium and a death benefit that decreases each year over the duration of the policy.
A policy provision that specifies the period of time during which the recurrence of an injury or illness will be considered a continuation of a prior period of disability.
The reduction - decrease - or disappearance of value of the person or property insured in a policy - by a peril insured against.
Time between the beginning of a disability and the start of disability insurance benefits.