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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. Renewability Clause

2. Viatical Settlement
The third in line to receive the benefits of a life insurance policy.
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).
The process of reviewing - accepting or rejecting applications for insurance.
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.

3. Principal Amount
The full face value of a policy.
The tendency or likelihood of insurance policies not lapsing or being replaced with insurance from another insurer.
A rider that is added to a life insurance policy to pay log-term care benefits. The amount of benefits available for LTC depends upon the life insurance benefits available; however - the benefits paid toward LTC will reduce the life insurance policy'
An act of giving up a life policy - in which the insurer will pay the insured the cash value the policy has built up.

4. Annual Statement
A temporary contract that puts an insurance policy into force before the premium has been paid.
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.
A facility which is licensed by the state to provide 24 hour nursing care.

5. Actuary
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
Average number of years remaining for a person of a given age to live - as shown on the mortality table.
Insurance that provides protection for a specific period of time.
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.

6. Nonresident Agent
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.
An agent licensed in a state in which he or she is not a resident.
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.
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.

7. Insolvent organization
A unit of measure used to determine rates charged for insurance coverage.
An entity that indemnifies against losses - provides benefits - or renders services (also known as "company" or "insurance company").
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.
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.

8. Exclusions
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 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.
Causes of loss - exposures - conditions - etc. listed in the policy for which the benefits will not be paid.
A salary reduction cafeteria plan that uses employee funds to provide various types of health care benefits.

9. Natural 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.
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 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.

10. Defamation

11. Medicaid
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 medical benefits program jointly administered by the individual states and the federal government.
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.
The period of time between the effective date of a health insurance policy and the date coverage for all or certain conditions begins.

12. Workers Compensation
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.
A claim form that a claimant must submit after a loss occurs.
A provision that is found in most disability income policies which specifies the conditions that will automatically qualify the insured for full disability benefits.
Continuation of life insurance coverage if the insured becomes totally disabled and is unable to pay the premiums.

13. Nonrenewal
Unplanned - unforeseen traumatic injury to the body.
A legal document that indicates that an insurance policy has been issued - and that states both the amounts and types of insurance provided.
Average number of years remaining for a person of a given age to live - as shown on the mortality table.
A termination of a policy by an insurer on the anniversary or renewal date.

14. Long-Term Care (LTC)
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 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.
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.
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

15. Liquidation
Selling assets as a method of raising capital.
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.
Any group or individual who provides health care services.
A physical illness - disease - or pregnancy - but not a mental illness.

16. CSO Table (The Commissioner's Standard Ordinary Table)
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 mortality table used in life insurance that mathematically predicts the likelihood of death.
Medicare supplement plans issued by private insurance companies that are designed to fill some of the gaps in Medicare.
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.

17. Retention

18. Authorized (Admitted) Insurer
An insurance company authorized and licensed to transact business in a particular state.
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.
A life insurance policy designed to provide a level death benefit to the insured's age 100 for a one-time - lump sum payment.
A single policy that is designed to insure two or more lives.

19. Dependent
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 person who relies on another for support and maintenance.
A type of insurance that pays benefits for medical - surgical - and hospital costs.
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.

20. Accumulation Period
The time over which the annuitant makes paymenrs or investments in an annuity - and when those payments earn interest tax deferred.
A policy with a high maximum limit that covers certain diseases named in the contract (such as polio and meningitis).
A policy that provides benefits for all medical costs - including doctor visits - hospitalization - and drugs.
Amounts an insured must pay for coinsurance and deductibles before the insurer will pay its portion.

21. Fixed Annuity
A fee or commission charged at the time of purchase of an annuity or a security.
An annuity that offers fixed payments and guarantees a minimum rate of interest to be credited to the purchase payment or payments.
Selling assets as a method of raising capital.
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.

22. Intermediate Care
A level of care that is one step down from skilled nursing care; provided under the supervision of physicians or registered nurses.
Plans that allow employers to set aside funds for reimbursing employees for qualified medical expenses.
Insurance that pays dividends to policyholders.
An insurance company that is incorporated outside the United States.

23. Consideration
A disease that causes the victim to become dysfunctional due to degeneration of brain cells causing severe memory loss.
A statement sent to a Medicare patient indicating how the Medicare claim will be settled.
An optional disability income rider that waives the elimination period when an insured is hospitalized as an inpatient.
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

24. Long-Term Disability Insurance
The full face value of a policy.
A demand of a person to stop committing an action that is in violation of a provision.
A statement (or booklet) that confirms that a policy has been written and that describes the coverage in general.
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.

25. Fraternal Benefit Societies
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.
Insurance whereby premiums are paid for protection in the event of death or disability - not for cash value accumulation.
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.
The person who has possession of the policy - usually the insured.

26. Commissioner (Superintendent - Director)
An insurance company that is incorporated outside the United States.
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.
A practice in which a person in a fiduciary capacity illegally mixes his/her personal funds with funds he/she is holding in trust.
The chief executive and administrative officer of a state insurance department.

27. Alien Insurer
An insurance company that is incorporated outside the United States.
Average number of years remaining for a person of a given age to live - as shown on the mortality table.
Coverage for doctor visits - x-rays - lab tests - and emergency room visits; benefits - however - are limited to specified dollar amounts.
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.

28. Prosthodontics
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.
The payment made by insurers to agents or brokers for the sale and service of policies.
The accounting measurement of an insurer's future obligations to pay claims to policyowners.
A special area of dentistry that involves the replacement of missing teeth with artificial devices like bridgework or dentures.

29. Credit Life Insurance
A material stipulation in the policy that if breached may void coverage.
A special type of coverage written to pay off the balance of a loan in the event of the death of the debtor.
A combination of a flexible premium and adjustable life insurance.
An unfair trade practice in which one person refuses to do business with another until he or she agrees to certain conditions.

30. Over Insurance
An excessive amount of insurance that would result in overpayment to the insured in the event of a loss.
A fee or commission charged at the time of purchase of an annuity or a security.
A selection of health care benefits from which an employee may choose the ones that he/she needs.
A single policy that is designed to insure two or more lives.

31. Settlement Options
Choices available to the insured/owner for distribution of insurance proceeds.
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 waiting period that is imposed on the insured from the onset of disability until benefit payments begin.
Termination of a policy because the premium has not been paid by the end of the grace period.

32. Excess Charge
Any life insurance written on the life of a minor.
The difference between the Medicare approved amount for a service or supply and the actual charge.
An insurance company that is incorporated in another state.
An agent/broker who handles insurer's funds in a trust capacity.

33. Loss of Income 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.
Insurance that pays benefits for inability to work because of disability resulting from accidental bodily injury or sickness.
To restore the insured to the same condition as prior to loss with no intent of loss or gain.
An act of identifying the name of the producer - representative or firm - limited insurance representative - or temporary insurance producer on any policy solicitation.

34. Term Insurance
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 waiting period that is imposed on the insured from the onset of disability until benefit payments begin.
A specialty of dentistry that involves treatment of the surrounding and supporting tissue of the teeth such as treatment for gum disease.
Insurance that provides protection for a specific period of time.

35. Buy-Sell Agreement
A legal contract that determines what will be done with a business in the event that an owner dies or becomes disabled.
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.
Statements made by the applicant on the insurance application that are believed to be true - but are not guaranteed to be true.
Lessening the possibility or severity of a loss.

36. Nonadmitted (Nonauthorized)
An employer-funded account linked to a high deductible medical insurance plan.
Any entity of at least two employers - other than a duly admitted insurer - that establishes an employee benefit plan for the purpose of offering or providing accident and sickness or death benefits to the employees.
A covered expense under Part A of Medicare in which a licensed home health agency provides home health care to an 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.

37. Waiver of Cost
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 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.
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.
A detailed financial report that an insurance company must submit every year to the insurance department of state(s) in which it conducts business.

38. Parol Evidence Rule
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.
Coverage that provides benefits for room - board and miscellaneous hospital expenses for a certain number of days during a hospital stay.
The date when the face amount of the life insurance becomes payable.

39. Free Look
Health coverage provided to members of a group.
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 portion of the loss that is to be paid by the insured before any claim benefits may be paid by the insurer.
A circumstance that increases the likelihood of a loss.

40. Reinsurance
A material stipulation in the policy that if breached may void coverage.
The inclusion of causes of loss (perils) which are covered within a scope of a policy.
A form of insurance whereby one insurance company (the reinsurer) in consideration of a premium paid to it - agrees to indemnify another insurance company (the ceding company) for part or all of its liabilities from insurance policies it has issued.
The amount payable upon the death of the person whose life is insured.

41. Payment of Claims
Uncertainty as to the outcome of an event when two or more possibilities exist.
Insurance furnished by nongovernmental insuring organizations.
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 provision that specifies to whom claims payments are to be made.

42. Pre-Existing Condition
An entity that obtains and possesses a license solely for the purpose of writing business on the owner - immediate family - relatives - employer and employees.
The difference between the Medicare approved amount for a service or supply and the actual charge.
An optional disability income rider that waives the elimination period when an insured is hospitalized as an inpatient.
A physical condition that existed before the effective date of the policy - usually excluded from coverage.

43. Health Savings Accounts (HSAs)
The length of time over which the insurance benefits will be paid for each illness - disability or hospital stay.
A specialty of dentistry that involves treatment of the surrounding and supporting tissue of the teeth such as treatment for gum disease.
A waiting period that is imposed on the insured from the onset of disability until benefit payments begin.
Plans designed to help individuals save for qualified health expenses.

44. Stock Companies
A specialty of dentistry that involves treatment of the surrounding and supporting tissue of the teeth such as treatment for gum disease.
Companies owned by the stockholders whose investments provide the capital necessary to establish and operate the insurance company.
The amount of money an insured can borrow using the cash value of his/her life insurance policy as collateral.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.

45. Partial Disability

46. Assignment (Life)
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
The transfer of ownership rights of a life insurance policy from one person to another.
The required amount to pay damages or for property loss - which is calculated based on the property's current replacement value minus depreciation.
An unincorporated group of individuals who mutually insure one another - each separately assuming a share of each risk.

47. Annuity
Care that is rendered to help an insured complete his/her activities of daily living.
Unplanned - unforeseen traumatic injury to the body.
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.
A contract that provides income for a specified period of years - or for life.

48. Transfer
A false statement or lie that can render the contract void.
A program for impaired adults that attempts to meet their health - social - and functional needs in a setting away from their homes.
A life or health insurance policy that is underwritten based on the insured's statement of health rather than a medical examination.
A basic principle of insurance under which the risk of financial loss is assigned to another party.

49. Risk - Standard
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 person making application for - or offering him/herself or another to be insured under an insurance contract.
An applicant or insured who is considered to have an average probability of a loss based on health - vocation and lifestyle.
A combination of basic coverage and major medical coverage that features low deductibles - high maximum benefits - and coinsurance.

50. Health Reimburse
Health insurance that provides periodic payments to replace an insured's income when he/she is injured or ill.
A statement usually obtained from the applicant's doctor.
The effect of a person's reputation - character - living habits - etc. on his/her insurability.
Plans that allow employers to set aside funds for reimbursing employees for qualified medical expenses.