Life And Health Insurance Practice Flashcards
7 cards from real Life & Health Insurance Exam practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Life And Health Insurance Practice flashcards as text
A universal life insurance policy has two death benefit options. Option B (increasing death benefit) pays:
Answer: The face amount plus the policy's accumulated cash value
Option B provides a death benefit equal to the face amount plus the accumulated cash value, resulting in an increasing total death benefit over time.
Which provision in a health insurance policy requires the insurer to reinstate a lapsed policy if the insured pays overdue premiums within a specified period, typically 10 days?
Answer: Reinstatement provision
The reinstatement provision allows a lapsed policy to be reinstated upon payment of overdue premiums, usually requiring evidence of insurability for health claims.
An employer-sponsored group health plan that self-insures its claims but uses an insurance company only for administrative services is called:
Answer: An ASO (Administrative Services Only) arrangement
In an ASO arrangement, the employer bears the risk for claims and pays an insurance company only to handle administrative tasks like claims processing.
Which Medicare supplement plan (Medigap) is the only plan that covers the Medicare Part A deductible for hospital stays for policies sold after January 1, 2020?
Answer: Plan G
After 2020, newly eligible Medicare beneficiaries can only purchase Plans G and N (not F or C), and Plan G covers the Part A deductible.
A life insurance policy that builds cash value using a fixed interest rate set by the insurer, with no direct investment choices for the policyholder, is best described as:
Answer: Whole life insurance
Whole life insurance accumulates cash value at a fixed interest rate guaranteed by the insurer, with no policyholder control over investment allocation.
What is the purpose of a 'free-look period' in an individual life insurance or annuity policy?
Answer: Gives the policyowner a set number of days to return the policy for a full refund
The free-look period (typically 10-30 days) gives the policyowner the right to return the policy and receive a full premium refund if dissatisfied.
A health insurance policy provision that prevents the insured from collecting more than 100% of actual covered medical expenses from all combined policies is called:
Answer: Coordination of benefits
Coordination of benefits (COB) ensures that when an insured has multiple health policies, total payments from all policies do not exceed 100% of actual covered expenses.