California Life, Accident, and Health Licensing 232 Questions with Answers
Co-insurance - CORRECT ANSWER The policy provision which requires the
... [Show More] insurer and the insured to share in the cost of services rendered
Exclusion ratio - CORRECT ANSWER The formula which is used by the IRS to determine how much is taxable to an annuitant during the pay out period.
Occupational policy - CORRECT ANSWER When a disability income policy provides coverage for injuries which occur on and off the job
Most disability income policies are non occupational, meaning - CORRECT ANSWER They only cover the insured if they become disabled while away from work.
Self employed individuals doesn't have - CORRECT ANSWER workers compensation coverage. They need coverage both on and off the job (occupational).
A life agent who offers for sale or sells any financial product on the basis of its treatment under the MediCal Program must provide - CORRECT ANSWER The Notice Regarding Standards for Medi-Cal Eligibility. Must be signed by applicant.
A widow or widower without any children is eligible for social security survivors benefits at age - CORRECT ANSWER 60
A surviving spouse is eligible for social security survivor's benefits at age - CORRECT ANSWER 60
An authorized, or admitted carrier (insurer) - CORRECT ANSWER one which is under compliance with the California Insurance Code (CIC) and can operate legally in California
Which type of life insurance utilizes the "level premium concept" - CORRECT ANSWER Traditional whole life
Disability income policy proceeds must be paid out at least - CORRECT ANSWER monthly
What life insurance rider will pay a monthly benefit to the insured when they become disabled - CORRECT ANSWER The disability income rider. It is a type of health (disability) insurance
Dread (Specified) Disease policies, such as cancer insurance, covers - CORRECT ANSWER Treatment for one specific disease
The benefit paid out for a residual disability in a disability income policy is based upon - CORRECT ANSWER a loss of a minimum of 20% of income
Agent may be either - CORRECT ANSWER Captive (Exclusive) or independent
Captive agents - CORRECT ANSWER agents who agree by contract to represent only one insurer in the sale of insurance
Independent agents - CORRECT ANSWER usually self-employed and often represent several insurance companies
Under state law, agents must have at least - CORRECT ANSWER one appointment in order to keep their license active
Agents are prohibited from engaging in any of the following activities - CORRECT ANSWER 1. using a business name that implies that they are an insurer
2. advertising on behalf of a non-admitted insurer
3. offering free insurance as an inducement to purchase or sale
Under a group insurance plan a certificate of insurance is issued to - CORRECT ANSWER the participants, usually employees. The policy owner, usually employer, gets the master policy
Domestic insurer - CORRECT ANSWER one that domiciled (organized) in this state
Foreign insurer - CORRECT ANSWER one that organized in another state
Alien insurer - CORRECT ANSWER one that organized in another country.
All insurers need to obtain - CORRECT ANSWER a Certificate of Authority from the Commissioner in order to be admitted to transact insurance in this state, except for Surplus Line insurers
Indemnity plans allow - CORRECT ANSWER the insured to select any provider they wish.
Traditional indemnity plan - CORRECT ANSWER the insured generally is supposed to submit their claims directly to an insurer, in reality an "assignment of benefits" form is utilized and the medical care provider submits the claim on the insured's behalf
Participants in a managed care indemnity plan - CORRECT ANSWER select a provider and submits claims to the insurer
When an insurer wants to have the applicant complete an HIV test, they must do - CORRECT ANSWER 1) Have the applicant sign a consent form
2) Find out which doctor they should provide the results to
3) Provide information on where they can receive counseling
When an insurer wants to have the applicant complete an HIV test, they do not need to - CORRECT ANSWER go over a privacy notice
75% of all eligible employees must enroll in a contributory plan. All eligible employees are required to enroll in a - CORRECT ANSWER non contributory plan
Loss exposure - CORRECT ANSWER a situation which presents the possibility of loss
Deductibles, co-payments and co-insurance are all features of health insurance which are called - CORRECT ANSWER cost sharing
Life insurance death benefit policy proceeds paid from an insurer are - CORRECT ANSWER Federal tax free when paid to a beneficiary
When an insured with a cash value elects to take the reduced paid-up non-forfeiture option, the cash value will be - CORRECT ANSWER used to buy him a new hole life policy with a reduced face amount that is paid-up for life
The traditional net cost method of evaluating the true cost of insurance does not take into consideration - CORRECT ANSWER the time value of money
The primary difference between using the interest adjusted net cost method and the net cost method when evaluating the true cost of a life insurance policy - CORRECT ANSWER time value of money
Dividends may never be - CORRECT ANSWER guaranteed
All are true about "stock" insurance companies - CORRECT ANSWER 1) Dividends are taxable
2) The stockholders own the company
3) They may pay dividends to share holders out of divisible surplus
4) they issue non-participating policies
Under the Family and Medical Leave Act, how many weeks of leave must be provided per year for a qualifying person - CORRECT ANSWER 12 weeks
ESOP invest in - CORRECT ANSWER Stock of the employer
Riders may be added to a policy at issue for an additional premium charge. Examples of riders - CORRECT ANSWER 1) accidental Death benefit
2) Cost of living
3) Waiver of Premium
as used in the CIC the word "shall" is mandatory and the word "may" is - CORRECT ANSWER permissive
Agents own a policyholder or a prospective policyholder a duty of - CORRECT ANSWER honesty, good faith, and fair dealing
Insurance underwriters are responsible for - CORRECT ANSWER risk selection and classification.
The goal of the underwriter is to make sure that - CORRECT ANSWER the insurer makes a reasonable underwriting profit at the premium rate charged for the risk accepted
Long Term Care insurance include - CORRECT ANSWER Skilled nursing, custodial care, home health care
but not convalescent care
Medicare claim, the first step in the process is - CORRECT ANSWER the individual's provider files the claim with a local Medicare carrier
In the original Medicare program, it is the provider which is responsible for - CORRECT ANSWER submitting the claim
403(b) are available to - CORRECT ANSWER employees of public educational institutions and certain non-profit charitable or religious organizations. Contributions are made in before tax dollars on a payroll deduction basis
Renewable term has a level death benefit and - CORRECT ANSWER increasing premium. Each time the policy renews, the premium will go up
The automatic premium loan rider will go into effect at the end of - CORRECT ANSWER the grace period. It can only be added to a cash value policy and was created to keep the policy in force if the insured forgets to pay their premium
HMOs are required to cover all of the following - CORRECT ANSWER preventive services, physician services, emergency services.
Except prescription drugs
Insurance contracts must identify 6 required specifications - CORRECT ANSWER 1) the parties between whom the contract is made
2) the property or life insured
3) the interest of the insured in the property insured
4) the risks (perils) insured against
5) the policy period
6) the premium
Primary (also known as "ceding") insurers who elect to offer insurance coverage for high risk exposures, such as earthquake, often buy reinsurance from larger reinsurance companies (reinsurers) in an effort to lower their exposure to - CORRECT ANSWER catastrophic risk.
Under the CIC, an insured may cover a child attending an educational institutional as a dependent on their group life insurance policy through - CORRECT ANSWER age 24
What does a deferred annuity have that an immediate annuity does not? - CORRECT ANSWER an accumulation period
Standard levels of care provided by LTC insurance does not include - CORRECT ANSWER Medical expenses
Part A of Medicare covers - CORRECT ANSWER Hospital services. For example, Hospitalization, Hospice care, home health care
Part B of Medicare covers - CORRECT ANSWER Physician services
Life annuity - CORRECT ANSWER a product that will pay out every year for the rest of a person's life
To be considered as disability for social security - CORRECT ANSWER a person must be total disability
Flexible premium variable life - CORRECT ANSWER also known as variable universal life. Allows the insured to pay a flexible premium and direct the case value into a varying selection of investments
Distributions taken from modified endowment contracts (MECs) are subject to a - CORRECT ANSWER 10% IRS penalty
Eligibility of Social Security is based upon - CORRECT ANSWER the total number of quarters worked. 40 quarters is needed for fully insured status
Under a 7 year graded vesting schedule, the IRS requires that employer contributions to the plan be - CORRECT ANSWER vested (owned by the employee) at least 40% after 4 years, 60% after 5 years, 80% after 6 years and 100% after 7 years
Three types of ordinary life insurance - CORRECT ANSWER WET
Whole life
Endowment
Term
A disability recurs within 90 days, the insurer will waive waiting (elimination) period. Nonetheless, since the disability recurs 6 months later, a new - CORRECT ANSWER elimination (waiting) period and benefit period will apply. A new policy need not be written
If an employee is receiving benefits under a policy and still able to work, they have a - CORRECT ANSWER partial disability
A guaranteed renewable disability policy is one where the insurer - CORRECT ANSWER has the right to change the premiums, but may not change any of the policy terms
Accidental death benefit rider - CORRECT ANSWER Double indemnity
If the owner of the policy has named on irrevocable beneficiary, they cannot - CORRECT ANSWER assign the policy without their consent
underwriting risk classification - CORRECT ANSWER preferred, standard, non-standard
Frequency pricing principle - CORRECT ANSWER Determining how frequently or how often a loss will occur within a group of individuals, how these loses will effect rates
Non medical life insurance applications - CORRECT ANSWER usually buy low amount of coverage, need not take a physical exam, usually young.
but they have to answer medical questions on the application
If a person returns a variable annuity invested in mutual funds during the free look, they will receive a return of - CORRECT ANSWER the value of the account on the date of cancellation
In an insurance contract, a representation qualifies as - CORRECT ANSWER an implied warranty
If a whole life policy is being kept in-force by the Waiver of Premium rider - CORRECT ANSWER the cash value will continue to increase as if the insured paid the premium
Roth IRA - CORRECT ANSWER Contributions are not tax deductible, qualified distributions are not taxable
A qualified distribution for Roth IRA is - CORRECT ANSWER one made to a participant who has been participating in the Roth for at least 5 years and is at least age 59 and a half
When a disability income policy provides occupational coverage and the insured has 2 jobs, the insurer will base the premium on - CORRECT ANSWER the most hazardous job
AD&D (Accidental Death and Dismemberment) insurance - CORRECT ANSWER is not a life insurance
AD&D (Accidental Death and Dismemberment) insurance - CORRECT ANSWER has both a Capital and Principal sum.
Principal sum pays a lump sum for accidental death. Capital Sum pays a lump sum for accidental dismemberment
Principle of indemnity - CORRECT ANSWER the insured should not profit from a loss or damage but should be returned (as near as possible) to the same financial position that existed before the loss or damaged occurred
Managing General Agents (MGA) - CORRECT ANSWER Fire and Casualty broker/ agent or a life agent who represents one or more admitted insurers and manages the transaction of insurance by those insurers in a specific territory
Surplus Lines Broker - CORRECT ANSWER a person licensed by the Commissioner to solicit and place insurance with non-admitted insurers when the insurance cannot be procured from admitted insurers
Proof of loss - CORRECT ANSWER must be provided in order to collect on a valid claim
In Group Health insurance, the period of time that starts when a new employee is hired and ends on the date they become eligible for the employer's Group Health plan - CORRECT ANSWER Probationary period
Disability income policy covers - CORRECT ANSWER only loss of income due to disability, not medical expenses.
Medical expense policies exclude coverage for losses resulting at work in order to reinforce the principle of indemnity, which states - CORRECT ANSWER the insured cannot recover more than they actually lost
Equity indexed annuity - CORRECT ANSWER an annuity that has a fixed guaranteed minimum rate of return but has an excess rate of return which could also keep up with the performance of stock market
Variable annuity - CORRECT ANSWER the owner of an annuity has to multiply the value of accumulation unit held in the separate account by the number of accumulation units owned
In regards to an organizational license, what occurs when a corporation is dissolved - CORRECT ANSWER it is terminated
Under the CIC, if a person refuses to submit books and records to the commissioner they would be guilty of - CORRECT ANSWER misdemeanor
Characteristics of Ideally insurable risk - CORRECT ANSWER Loss must not be catastrophic in nature, must create economic hardship, must be definable. EXCEPT loss must be certain. Death is certain but it is okay because time of death is uncertain
Coordination of benefits - CORRECT ANSWER the provision that applies in group insurance when an insured has coverage under multiple plans at one time
Industrial life insurance has a face amount of - CORRECT ANSWER 2000 or less
Industrial life is sold by - CORRECT ANSWER debit insurance agents who call the clients in person on a weekly basis. Policies accrue a cash value. Premiums are paid weekly, the grace period is 28 days
a supplementary benefit in a dread disease policy - CORRECT ANSWER Treatment, travel and lodging expenses when treatment is far from home, and normal living expenses such as a car payment, mortgage/rent and utility bills
Medicare Supplement insurance policies - CORRECT ANSWER Insurers may offer plans that contain only the "core" benefits. (Plan A)
There are 12 standardized Medicare Supplement policies, identified as - CORRECT ANSWER Plans A through L
Medicare Supplements are sold by private insurers to supplement Medicare, which is generally only available to those who are at least age - CORRECT ANSWER 65
In disability income insurance in order for bodily injury to be classife3d as accidental - CORRECT ANSWER the cause may be intentional but the result must be accidental
Which of the following best illustrates the Principle of Indemnity - CORRECT ANSWER Insurable Interest
Factors used to underwrite group medical expense insurance policies - CORRECT ANSWER the location of the group, term of the probationary period, the age and gender of those making up the group
morbidity - CORRECT ANSWER the likelihood of illness or injury
The minimum number of employees which must be covered in a group life insurance plan in California is - CORRECT ANSWER 2
Persistency - CORRECT ANSWER the continued existence of a policy being in force.
At what point in time may a representation be altered or withdrawn - CORRECT ANSWER Prior to the insurance going into effect only
During the waiting (elimination period) - CORRECT ANSWER the insured is not eligible for benefits. They have to wait after becoming totally disabled before receiving any benefits
Concealment - CORRECT ANSWER The failure to disclose a material fact that a party knows and ought to communicate
Concealment, whether intentional or not, entitles - CORRECT ANSWER the injured party to rescind (void) the contract
A material fact is on that is important to the - CORRECT ANSWER underwriter
Fraud - CORRECT ANSWER 1) claims forms must contain a warning that false representations are subject to a penalty of perjury
2) requires the intent to deceive
3) every admitted insurer must maintain a fraud unit to investigate possible fraudulent claims
An agent can only provide this statement during a tax qualified Long Tern Care insurance policy presentation - CORRECT ANSWER The plan may receive federal and state tax advantages
The Doctrine of Utmost Good Faith - CORRECT ANSWER All parties, including the insurer, the agent and the insured, are honest and acting in good faith.
The Doctrine of Adhesion - CORRECT ANSWER since the insurer wrote the contract, any vague language will be construed in favor of the insured, since they had no choice when they bought it.
The Doctrine of Reasonable Expectations reinforces - CORRECT ANSWER the Doctrine of Adhesion.
Waiver and Estoppel are legal doctrines that state - CORRECT ANSWER once an insurer gives up the right to deny a claim (a waiver), they can no longer deny it (estoppel)
An insurer who provides for all of its liabilities and purchases reinsurance on all of its outstanding risks is considered to be - CORRECT ANSWER Insolvent
On a fully contributory group disability income policy, the benefits payable to disabled employees are - CORRECT ANSWER not taxable
On what type of Life insurance is the beneficiary also the policyholder - CORRECT ANSWER Credit Life
Survivorship life - CORRECT ANSWER Policies pays a death benefit when the second insured person dies
Equity Indexed Annuity - CORRECT ANSWER an annuity with a fixed minimum rate of return with the potential for excess stock market like returns
Required duties regarding the organizational license of a co-partnership whose membership has changed - CORRECT ANSWER 1) pay the required fees
2) must file within 30 days an application for registering the change in membership signed by a general partner
3) at least one person authorized to exercise the agency powers of the original partnership must continue with the surviving partnership
When membership has changed in a co-partnership for the organizational license - CORRECT ANSWER they do not need to return the old license with the signatures of all the original member to the co-partnership to the commissioner
Joint Life - CORRECT ANSWER Policies pays a death benefit when the first insured person dies
Incontestability - CORRECT ANSWER the provision which keeps a policy which has been in force for two years from being rescinded by the insurer
A difference between group and individual life insurance plans - CORRECT ANSWER Insurers use experience rating for group life policies
Cost of Living rider - CORRECT ANSWER increase coverage relative to cost of living changes in the economy. Once an upward adjustment occurs, coverage will never be decreased.
If the face amount is adjusted up, the premium will increase
It is the materiality of the concealment which will ultimately determine the importance of a - CORRECT ANSWER representation
the insurer require what when an applicant reveals conditions that require more information - CORRECT ANSWER Attending physicians statement
The elimination period in a disability income policy is most similar to - CORRECT ANSWER deductible in a medical expense policy
if there is a loan outstanding at the time of death, and the Fixed period settlement option by the beneficiary, what effect will it have on payout - CORRECT ANSWER it will reduce the value of the payments made only
An avocation is a another name for - CORRECT ANSWER a hobby
The Facility of Payment clause in a group life policy allows the policy proceeds to be paid to - CORRECT ANSWER The guardian of a child who is the beneficiary
The Facility of Payment clause - CORRECT ANSWER allows the insurer to elect to choose who to pay the policy proceeds to if the beneficiary named in the policy is a minor, or is deceased
Features of major medical insurance - CORRECT ANSWER Deductibles, co-insurance, high lifetime limits
Capitation fee - CORRECT ANSWER also known as a per head fee. A fee that some HMO's pay their providers to service their subscribers
Under the CIC, if an agent receives a notice of claim, they are supposed to - CORRECT ANSWER send the insured proper forms
A stock insurer - CORRECT ANSWER owned by stockholders who have the right to any dividends declared and also have the right vote for the board of directors
CLHIGA (California Life and Health Insurance Guarantee Association) covers - CORRECT ANSWER disability income policies, group term insurance, individual annuities.
Not self funded employer plans
Best ethical behavior - CORRECT ANSWER always putting the best interests of clients and policyholders first
If a corporation uses life insurance to buy shares under a buy-sell agreement, this is true regarding taxation - CORRECT ANSWER The IRS will treat the sale of the shares as a loss or gain depending on the purchase and sale price, if the stock is common.
COBRA - CORRECT ANSWER federal law that enable employees covered by group health insurance to continue their group coverage by paying their own premiums, generally for up to 18 months.
Job termination for gross misconduct cause no eligibility - CORRECT ANSWER for COBRA
Mortality tables - CORRECT ANSWER the annual probability of death
Group stop-loss plans does not covered by - CORRECT ANSWER the Life and Health Insurance Guaranty Fund
The commissioner may deny an application for an agent's license, without hearing if - CORRECT ANSWER the applicant has had a previously issued license revoked with the past 5 years
The underwriting department - CORRECT ANSWER responsible for the evaluation, distribution and selection of risks
Annual mode of premium payment has the lowest - CORRECT ANSWER overall cost for the customer
The guaranteed insurability rider - CORRECT ANSWER allows the insured to purchase additional amounts of life insurance at specific points in the future without having to prove insurability
Under the CIC an insured may cover an unmarried child as a dependent on their group life insurance policy up to - CORRECT ANSWER age 21
Variable annuity premiums may be invested in - CORRECT ANSWER mutual funds, money markets, fixed income investments
Worker Compensation - CORRECT ANSWER 1) it covers occupational injury or sickness
2) it requires that employers be responsible for their employees
3) there are no time or dollar limits on covered expenses
Under the California Insurance Code, anyone who diverts or appropriates customer funds while acting in a fiduciary capacity to their own use is guilty of - CORRECT ANSWER theft
Fiduciary - CORRECT ANSWER the trust that is placed in an agent with regard to the handling of funds in a capable responsible and honest manner
Foreign company - CORRECT ANSWER An insurance company domiciled in another state but transacting business in California
A person may not transact insurance without a valid license from the Commissioner. To do so would be - CORRECT ANSWER a misdemeanor
Miscellaneous insurance - CORRECT ANSWER insurance written to indemnify the producer of any motion picture, television, theatrical, sporting event or exhibition against loss by reason of interruption, postponement, or cancellation due to death, accidental injury, or sickness that prevents a performer from commencing or continuing their performance or duties.
For insurance purposes, it is "unfair" to discriminate - CORRECT ANSWER race, religion, national origin, etc.
For insurance purposes, it is "fair" to justify rate differentials between - CORRECT ANSWER young and old, sick and healthy, male and female
Lowest to highest premiums in the early year - CORRECT ANSWER Modified life, Traditional life, single premium life
Mortgage redemption - CORRECT ANSWER a Life insurance policy that will always provide enough protection to pay off your mortgage
Medical Information Bureau (MIB) members must report - CORRECT ANSWER Health conditions discovered during the underwriting process
State Guarantee Fund - CORRECT ANSWER 1) Up to certain limits, it protects the customers of insolvent (bankruptcy) insurers
2) Funded by assessments on member insurers
3) All admitted insurers are required to participate
Vesting means - CORRECT ANSWER ownership
Insured - CORRECT ANSWER The person upon whose life a Life insurance policy
Probationary period
(also known as the preexisting condition clause) - CORRECT ANSWER there is no coverage if a pre-existing sickness that the insured was treated for during a specified time prior to the new policy's effective date reoccurs within a specified time after the new policy was issued.
Optometrist - CORRECT ANSWER is not a physician
Social Security "black-out" period affect - CORRECT ANSWER Surviving spouse
On a Major Medical Expense policy, the purpose of co-insurance is to - CORRECT ANSWER require that the insured and the insurer share the claim after the deductible has been paid
Currently insured under Social Security means - CORRECT ANSWER a worker must have at least 6 quarters of coverage paid in out of the last 13-quarter period ending with the quarter resulting in their death, disability or retirement. They only currently insured status, they are eligible for only certain reduced benefits.
Fully insured status means - CORRECT ANSWER a person has paid in 40 quarters of coverage. They are eligible for all Social Security benefits.
An application for life insurance become part of the Entire Contract - CORRECT ANSWER when attached to the policy at issue
Coordination of Benefits (COB) provision - CORRECT ANSWER Protect against over insurance.
COB - CORRECT ANSWER If you are covered by more than one Group Medical Expense policies, the one that covers you as an employee is primary and the one that covers you as a dependent is excess
A license renewal application - CORRECT ANSWER filed on or before the last day of the current license period entitles the applicant to continue operating for 60 days after expiration
Case value Life insurance policies allow the policy owner to select their choice of 3 non-forfeiture options any time the policy lapses - CORRECT ANSWER cash surrender, reduced paid up, or extended term.
The Federal law COBRA applies to employers with a minimum of - CORRECT ANSWER 20 employees
The purpose of a 75% participation requirement on a contributory Group Health insurance plan is - CORRECT ANSWER to prevent adverse selection
If non-contributory, meaning the employer pays it all, then - CORRECT ANSWER 100% of those eligible must enroll in the group insurance plan
Buy-Sell Agreement - CORRECT ANSWER When a corporation enters into an agreement with their shareholders to buy their shares back in the event of their death
A life Agent represents - CORRECT ANSWER Insurance Company
Hospital Confinement Indemnity - CORRECT ANSWER A policy that will pay the insured a flat daily rate for each day they are hospitalized
Speculative risk - CORRECT ANSWER it has a chance for gain or loss
Defined benefits plans (money purchase plans) - CORRECT ANSWER qualified corporate pension plans usually set up by large employers.
Conditional Receipts - CORRECT ANSWER No coverage is in effect until the applicant has satisfied all the conditions and the underwriter has approved the application
Binding Receipts - CORRECT ANSWER used by some insurers to provide the applicant with a small amount of coverage while the results of the physical exam and underwriting process are pending. Neither type of receipt may be given out unless the applicant has paid the premium.
Medicare is part of Social Security and beneficiaries - CORRECT ANSWER Part A hospital Insurance at age 65 at no premium charge.
Part B is designed to cover Physicians and related services for an additional premium charge
Long Term Care insurance covers custodial nursing which is not covered by - CORRECT ANSWER Medicare or Medicare Supplement insurance policy
Low income Californians may obtain custodial care through - CORRECT ANSWER Medi-Cal if they fail an income/asset test.
Medi-cal - CORRECT ANSWER Taxpayer funded public assistance program
Medi-Cal is - CORRECT ANSWER California's version of Medicaid
A qualified Employee Benefit plan that gives employees part ownership in the company for which they work - CORRECT ANSWER Employee Stock Ownership plan
Medicare covers - CORRECT ANSWER medical expenses
Long Term Care covers - CORRECT ANSWER custodial care in a nursing home
After a 5 month waiting period, Social Security provide - CORRECT ANSWER disability income benefits for those whose disability is expected to last at least 12 months or result in their death and are incapable of performing the duties of any occupation
Medical Information Bureau (MIB) members consist of - CORRECT ANSWER Life and Health insurers
Hospice care - CORRECT ANSWER coverage for the care and counseling of the terminally ill. Include in Part A of Medicare
An agent must report a change of address to the state Department of Insurance - CORRECT ANSWER Immediately
Agents who sell LTC must meet the following LTC continuing education requirements in California - CORRECT ANSWER 8 hours every year for the first 4 years, then 8 hours each licensing period
Nolo contendere - CORRECT ANSWER leaving the determination of guilt up to the opinion of the Commissioner
Non-contributory employee group insurance premiums paid by employers on behalf of their employees are - CORRECT ANSWER tax deductible for the employer and tax free to the employee
An insurance company owned by policyholders is - CORRECT ANSWER mutual company
The Rehabilitation Benefit under Disability Income insurance is designed to - CORRECT ANSWER pay for necessary vocational training to help the insured resume his normal occupation or prepare for a new career
Implied authority - CORRECT ANSWER the authority an agent needs to carry out his duties, even though they are not expressed in the contract
Express authority - CORRECT ANSWER the authority written down in an agent's contract
Apparent authority - CORRECT ANSWER the authority that a customer believes that an agent has, whether they actually have it or not
Waiver of premium - CORRECT ANSWER Life insurance rider that will pay the premium if the insured becomes disabled for a specific period of time
Self-fund or self insure for Group Medical Expense works only - CORRECT ANSWER Losses are predictable
A life insurance policy which will allow the insured to self direct the case value into different sub-account - CORRECT ANSWER Variable life
California Insurance Guarantee Association (CIGA) does not include - CORRECT ANSWER Life and annuity. California Life and Health Insurance Guarantee Association covers it.
an optional Health coverage that is generally available only to persons age 65 or more - CORRECT ANSWER Medicare part B
Life settlements are accomplished through - CORRECT ANSWER absolute assignment
Multiple Employer Trust (MET) - CORRECT ANSWER an entity that allows small employers to obtain the advantages of group coverage when they would otherwise not be eligible
One unit of life insurance is - CORRECT ANSWER 1000 dollars of coverage
Retirement benefits under Social Security are based primarily upon - CORRECT ANSWER average monthly wages
The primary Insurance Amount
Term insurance - CORRECT ANSWER less expensive than whole life at issue because it is pure protection and has no cash value.
Employee Retirement Income Security Act (ERISA) of 1974 was passed to protect - CORRECT ANSWER plan participants and beneficiaries
A deferred compensation plan - CORRECT ANSWER a non-qualified plan
Aleatory means - CORRECT ANSWER have an unequal exhange
% they are vested right the way in 401 k is - CORRECT ANSWER 100%
Which of the Life insurance conversions are permitted - CORRECT ANSWER Term Life to Whole Life
On group coverage, Tax implications of Disability Income insurance - CORRECT ANSWER premiums are deductible and benefits are taxed
On individual disability income insurance, Tax implication is - CORRECT ANSWER insured cannot deduct the premiums paid, but benefits are deductible.
Non-contributory employee group insurance premiums paid by employers on behalf of their employees - CORRECT ANSWER tax deductible for the employer and tax free to employee
Morbidity table - CORRECT ANSWER The actuarial table used by insurers to determine product benefits and pricing
A dividend option - CORRECT ANSWER paid-up additions
Employers may obtain the coverage of Worker Compensation from - CORRECT ANSWER the competitive State Compensation Fund, elect to self insure, any insurer admitted to sell it
Part A Medicare covers - CORRECT ANSWER Hospital
Part B Medicare covers - CORRECT ANSWER Physicians and related services with additional premium charge
Defined benefit - CORRECT ANSWER type of qualified retirement plan that tied to length of service and salary level [Show Less]