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
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.
A life or health insurance policy that is underwritten based on the insured's statement of health rather than a medical examination.
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.
A single policy that is designed to insure two or more lives.


2. Superintendent (Commissioner - Director)
An area of dentistry that deals with diagnosis - prevention and treatment of the dental pulp within natural teeth at the root canal.
The person who has possession of the policy - usually the insured.
The head of the state department of insurance.
Insurance that provides protection for a specific period of time.


3. Claim
A request for payment of the benefits provided by an insurance contract.
An insurance company authorized and licensed to transact business in a particular state.
A provision that specifies to whom claims payments are to be made.
The head of the state department of insurance.


4. Substandard Risk
A contract that legally binds only one party to contractual obligations after the premium is paid.
Any group or individual who provides health care services.
An applicant or insured who has a higher than normal probability of loss - and who may be subject to an increased premium.
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.


5. Supplemental Illustration
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.
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.
Ability to perform some - but not all - of the duties of the insured's occupation as a result of injury 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.


6. Nonqualified Pla
The amount payable by the insurance company - usually in at the insured's death or when the policy matures.
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.
An agent/broker who handles insurer's funds in a trust capacity.
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.


7. Pro Rata Cancellation
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.
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.
Termination of an insurance policy - with an adjustment of the premium charge in proportion to the exact coverage that has been in force.
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.


8. Peril
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 cause of a possible loss.
Insurance organizations that have no capital stock - but are owned by the policyholders.
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.


9. Accidental Death Benefits
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.
Withdrawing the money from a qualified plan and placing it into another qualified plan.
The cause of a possible loss.
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.


10. Ancillary
The portion of premium for which policy protection has not yet been given.
An agreement between an insurance company and an individual that states that insurance policies cover the individual's insurable interest.
Additional - miscellaneous services provided by a hospital - such as x-rays - anesthesia - and lab work - but not hospital room and board expenses.
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.


11. Certificate
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.
An area of dentistry that deals with diagnosis - prevention and treatment of the dental pulp within natural teeth at the root canal.
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 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.


12. Prosthodontics
A special area of dentistry that involves the replacement of missing teeth with artificial devices like bridgework or dentures.
A contract that provides income for a specified period of years - or for life.
Insurance plans where the health care services rendered are the benefits instead of monetary benefits.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.


13. Basic Medical Expense Insurance
A disease that causes the victim to become dysfunctional due to degeneration of brain cells causing severe memory loss.
The individual's age when a policy is issued.
A selection of health care benefits from which an employee may choose the ones that he/she needs.
Coverage for doctor visits - x-rays - lab tests - and emergency room visits; benefits - however - are limited to specified dollar amounts.


14. Avoidance
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 individual appointed by a court as a fiduciary to settle the financial affairs and estate of a deceased person.
A fee charged at the time of a sale - transfer or withdrawal from an annuity or a life insurance policy.
A false statement or lie that can render the contract void.


15. Legal Reserve

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16. Surrender
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.
Additional - miscellaneous services provided by a hospital - such as x-rays - anesthesia - and lab work - but not hospital room and board expenses.
A table showing the probability of death at specified ages.
An act of giving up a life policy - in which the insurer will pay the insured the cash value the policy has built up.


17. Natural Premium
Riders attached to life insurance policies which allow death benefits to be used to cover nursing or convalescent home expenses.
A federal law which extends the minimum COBRA continuation of group health care coverage from 18 to 29 months for qualified beneficiaries who are disabled at the time of qualification.
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.


18. Reserve
Organizations that process claims and pay benefits in an insurance policy
An amount representing actual or potential liabilities kept by an insurer in a separate account to cover debts to policyholders.
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 part of the insurance contract that states that both parties must give something of value for the transfer of risk - and specifies the conditions of the exchange.


19. Representations
Statements made by the applicant on the insurance application that are believed to be true - but are not guaranteed to be true.
The amount a physician or supplier actually bills for a particular service or supply.
A special area of dentistry that involves the replacement of missing teeth with artificial devices like bridgework or dentures.
Policies which replace a certain percentage of the insured's pure loss of income due to a covered accident or sickness.


20. Major Medical Insurance
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.
Selling assets as a method of raising capital.
Insurer's location of incorporation and the legal ability to write business in a state.
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.


21. Juvenile Life
An amount representing actual or potential liabilities kept by an insurer in a separate account to cover debts to policyholders.
Any life insurance written on the life of a minor.
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).
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.


22. Conditional Contract
A combination of a flexible premium and adjustable life insurance.
A group of small employers who do not qualify for group insurance individually - formed to establish a group health plan or self-funded plan.
The time over which the annuitant makes paymenrs or investments in an annuity - and when those payments earn interest tax deferred.
A type of an agreement in which both parties must perform certain duties and follow rules of conduct to make the contract enforceable.


23. Nonforfeiture Values
Those guaranteed values in a life insurance policy that cannot be taken from the insured - even if he or she ceases to pay premiums.
The person who has possession of the policy - usually the insured.
Any inducement offered in the sale of insurance products that is not specified in the policy.
Amounts an insured must pay for coinsurance and deductibles before the insurer will pay its portion.


24. Policyowner
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.
Organizations that process claims and pay benefits in an insurance policy
Any group or individual who provides health care services.
The person who is entitled to exercise the rights and privileges in the policy. This person may or may not be the insured.


25. Indemnify
Insurance whereby premiums are paid for protection in the event of death or disability - not for cash value accumulation.
A statement usually obtained from the applicant's doctor.
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.
To restore the insured to the same condition as prior to loss with no intent of loss or gain.


26. Insuring Clause
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 person who relies on another for support and maintenance.
Requirements approved by state law that must appear in all insurance policies.
A policy on which all premiums have been paid but which has not matured due either to death or endowment.


27. Income Replacement Contracts

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28. Risk - Speculative
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.
A physical condition that existed before the effective date of the policy - usually excluded from coverage.
The uncertainty or chance of a loss occurring in a situation that involves the opportunity for either loss or gain.
Companies owned by the stockholders whose investments provide the capital necessary to establish and operate the insurance company.


29. Admitted (Authorized) Insurer
A salary reduction cafeteria plan that uses employee funds to provide various types of health care benefits.
The person who has possession of the policy - usually the insured.
Average number of years remaining for a person of a given age to live - as shown on the mortality table.
An insurance company authorized and licensed to transact business in a particular state.


30. Exposure
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.
Organizations that process claims and pay benefits in an insurance policy
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 unit of measure used to determine rates charged for insurance coverage.


31. Accident
An agreement between two or more parties enforceable by law.
The amount payable upon the death of the person whose life is insured.
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.
An unplanned - unforeseen event which occurs suddenly and at an unspecified place.


32. Hospice
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 facility for the terminally ill that provides supportive care such as pain relief and symptom management to the patient and his/her family. Hospice care is covered under Part A of Medicare.
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 person who is entitled to exercise the rights and privileges in the policy. This person may or may not be the insured.


33. Insolvent organization
Insurance which can - at the election of the policyowner - be renewed at the end of a term without evidence of insurability.
Termination of an insurance policy - with an adjustment of the premium charge in proportion to the exact coverage that has been in force.
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.
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.


34. Excess Insurance
A type of an agreement in which both parties must perform certain duties and follow rules of conduct to make the contract enforceable.
The person who is entitled to exercise the rights and privileges in the policy. This person may or may not be the insured.
The inclusion of causes of loss (perils) which are covered within a scope of a policy.
Insurance that pays over and above or in addition to basic policy limits.


35. Limiting Charge
The tendency or likelihood of insurance policies not lapsing or being replaced with insurance from another insurer.
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.
The person who is named as first to receive benefits from a policy.
Any inducement offered in the sale of insurance products that is not specified in the policy.


36. Coordination of Benefits
Health insurance policies that cover only specific accidents or diseases.
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.
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 professional liability insurance that protects the insurer from claims by the insured for errors or oversights on the part of the insurer.


37. Medical Savings Account
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.
An employer-funded account linked to a high deductible medical insurance plan.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance.


38. Explanation of Medicare Benefits
The date when the face amount of the life insurance becomes payable.
A waiting period that is imposed on the insured from the onset of disability until benefit payments begin.
A temporary contract that puts an insurance policy into force before the premium has been paid.
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.


39. Permanent Disability
A ledger or proposal used in the sale of a life insurance policy that shows both guaranteed and nonguaranteed elements.
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
Settlement method that pays the beneficiary the entire proceeds of a life insurance policy in one payment rather than in installments.
Disability from which the insured does not recover.


40. Limited-Pay Whole Life

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41. Out-of-Pocket Costs
A policy with a high maximum limit that covers certain diseases named in the contract (such as polio and meningitis).
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
Amounts an insured must pay for coinsurance and deductibles before the insurer will pay its portion.
An insurance company authorized and licensed to transact business in a particular state.


42. Integrated LTC Rider

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43. Adverse Selection
Insurance organizations that have no capital stock - but are owned by the policyholders.
A type of insurance that protects the insured against loss due to accidental bodily injury.
The tendency of risks with higher probability of loss to purchase and maintain insurance more often than the risks who present lower probability.
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.


44. Renewable Term
Insurance which can - at the election of the policyowner - be renewed at the end of a term without evidence of insurability.
Lessening the possibility or severity of a loss.
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.
Medicare supplement plans issued by private insurance companies that are designed to fill some of the gaps in Medicare.


45. Maturity Date
A policy that provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.
An agreement between an insurance company and an individual that states that insurance policies cover the individual's insurable interest.
The date when the face amount of the life insurance becomes payable.
The appearance or the assumption of authority based on the actions - words - or deeds of the principal or because of circumstances the principal created.


46. Express Authority

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47. Coinsurance
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.
An individual who is licensed to sell - negotiate - or effect insurance contracts on behalf of an insurer.
A physical illness - disease - or pregnancy - but not a mental illness.
The person or organization that is protected by insurance; the party to be indemnified.


48. Single Premium Whole Life (SPWL)

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49. Co-Pay
An arrangement in which an insured must pay a specified amount for services "up front" and the provider pays the remainder of the cost.
Insurance organizations that have no capital stock - but are owned by the policyholders.
The inclusion of causes of loss (perils) which are covered within a scope of a policy.
A type of individual or group insurance that fills the gaps in the protection provided by Medicare - but that cannot duplicate any Medicare benefits.


50. Disability
The person or organization that is protected by insurance; the party to be indemnified.
A physical or mental impairment - either congenital or resulting from an injury or sickness.
The cause of a possible loss.
Activities individuals must do every day such as moving about - getting dressed - eating - bathing - etc.