Final Exam - Michigan Life and Health
Questions With Complete Solutions
Making a statement that is false or maliciously critical of the financial
| | | | | | | | | | | |
condition of an insurer is known as - CORRECT ANSWER✔✔-defamation
| | | | | | | | |
Which type of business insurance is meant to cover the costs of
| | | | | | | | | | | |
continuing to do business while the owner is disabled? - CORRECT
| | | | | | | | | | |
ANSWER✔✔-Business overhead expense policy | | |
Dorian exercised a nonforfeiture option by using his life policy's cash
| | | | | | | | | | |
value to purchase an extended term insurance option. When the term
| | | | | | | | | | |
insurance expires, - CORRECT ANSWER✔✔-the protection ends
| | | | | |
To receive proceeds from a death benefit, a minor - CORRECT
| | | | | | | | | | |
ANSWER✔✔-must have an appointed guardian | | | |
Under a life insurance policy, what does the insuring clause state? -
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CORRECT ANSWER✔✔-The insurer's obligation to pay a death benefit
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upon an approved death claim
| | | |
,When can a group health policy renewal be denied according to the
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Health Insurance Portability and Accountability Act (HIPAA)? - CORRECT
| | | | | | | | |
ANSWER✔✔-When contribution or participation rules have been | | | | | | |
violated
What is the purpose for having an accelerated death benefit on a life
| | | | | | | | | | | | |
insurance policy? - CORRECT ANSWER✔✔-It allows for cash advances to
| | | | | | | | |
|be paid against the death benefit if the insured becomes terminally ill
| | | | | | | | | | |
Which type of life insurance offers flexible premiums, a flexible death
| | | | | | | | | | |
benefit, and the choice of how the cash value will be invested? -
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CORRECT ANSWER✔✔-Variable universal policy | | |
An immediate annuity has been purchased with a single premium.
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When does the annuitant typically begin receiving benefit payments? -
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CORRECT ANSWER✔✔-1 month | |
Consumer privacy regulations permit the release of an insured's
| | | | | | | | |
financial information when - CORRECT ANSWER✔✔-an authorized
| | | | | | |
agency makes a written request to the insurer during an insurance fraud
| | | | | | | | | | |
|investigation
The free-look provision gives the policyowner - CORRECT ANSWER✔✔-
| | | | | | | |
the right to return the policy for a full refund within a specified number
| | | | | | | | | | | | | |
of days
|
,Joanne has a $100,000 whole life policy with an accumulated $25,000 of
| | | | | | | | | | |
cash value. She would like to borrow $15,000 against the cash value.
| | | | | | | | | | | | |
Which of the following statements is TRUE? - CORRECT ANSWER✔✔-
| | | | | | | | |
Net death benefit will be reduced if the loan is not repaid
| | | | | | | | | | |
Tara the producer is delivering a specified disease insurance policy to a
| | | | | | | | | | | |
new policyowner. Upon delivery, she may be expected to collect all of
| | | | | | | | | | | |
the following EXCEPT a(n) - CORRECT ANSWER✔✔-modified application
| | | | | | | |
with a new signature
| | |
Which of the following is considered to be the period when the
| | | | | | | | | | | |
accumulated value in an annuity is paid out? - CORRECT ANSWER✔✔-
| | | | | | | | | |
Annuitization phase |
The entity that has the power to revoke a producer's insurance license is
| | | | | | | | | | | |
the - CORRECT ANSWER✔✔-Department of Insurance and Financial
| | | | | | | | |
Services (DIFS) |
The statement which best describes the relationship between the
| | | | | | | | |
premiums of a whole life policy and the premium payment period is -
| | | | | | | | | | | | |
CORRECT ANSWER✔✔-The shorter the payment period, the higher the
| | | | | | | | |
premium
, A life insurance policy that is subject to a contract interest rate is
| | | | | | | | | | | | |
referred to as - CORRECT ANSWER✔✔-universal life
| | | | | |
Which of these factors would an insurer consider when determining
| | | | | | | | | |
whether to accept a group life plan? - CORRECT ANSWER✔✔-Average
| | | | | | | | | |
age
According to HIPAA, when an insured individual leaves an employer and
| | | | | | | | | | |
immediately begins working for a new company that offers group health
| | | | | | | | | |
|insurance, the individual - CORRECT ANSWER✔✔-is eligible for
| | | | | | | |
coverage upon hire | |
An insured has a stop-loss limit of $5,000, a deductible of $500, and an
| | | | | | | | | | | | | |
80/20 coinsurance. The insured incurs $25,000 of covered losses. How
| | | | | | | | | |
much will the insured have to pay? - CORRECT ANSWER✔✔-$5,000
| | | | | | | | |
Barbara's policy includes a rider which allows her to purchase additional
| | | | | | | | | |
insurance at specific dates or events without evidence of insurability.
| | | | | | | | | | |
This rider is called a(n) - CORRECT ANSWER✔✔-Guaranteed insurability
| | | | | | | | |
rider
What is an insurer required to do when faced with an error made under
| | | | | | | | | | | | | |
the Misstatement of Age provision? - CORRECT ANSWER✔✔-Pay age-
| | | | | | | |
corrected benefits |
Questions With Complete Solutions
Making a statement that is false or maliciously critical of the financial
| | | | | | | | | | | |
condition of an insurer is known as - CORRECT ANSWER✔✔-defamation
| | | | | | | | |
Which type of business insurance is meant to cover the costs of
| | | | | | | | | | | |
continuing to do business while the owner is disabled? - CORRECT
| | | | | | | | | | |
ANSWER✔✔-Business overhead expense policy | | |
Dorian exercised a nonforfeiture option by using his life policy's cash
| | | | | | | | | | |
value to purchase an extended term insurance option. When the term
| | | | | | | | | | |
insurance expires, - CORRECT ANSWER✔✔-the protection ends
| | | | | |
To receive proceeds from a death benefit, a minor - CORRECT
| | | | | | | | | | |
ANSWER✔✔-must have an appointed guardian | | | |
Under a life insurance policy, what does the insuring clause state? -
| | | | | | | | | | | |
CORRECT ANSWER✔✔-The insurer's obligation to pay a death benefit
| | | | | | | | |
upon an approved death claim
| | | |
,When can a group health policy renewal be denied according to the
| | | | | | | | | | | |
Health Insurance Portability and Accountability Act (HIPAA)? - CORRECT
| | | | | | | | |
ANSWER✔✔-When contribution or participation rules have been | | | | | | |
violated
What is the purpose for having an accelerated death benefit on a life
| | | | | | | | | | | | |
insurance policy? - CORRECT ANSWER✔✔-It allows for cash advances to
| | | | | | | | |
|be paid against the death benefit if the insured becomes terminally ill
| | | | | | | | | | |
Which type of life insurance offers flexible premiums, a flexible death
| | | | | | | | | | |
benefit, and the choice of how the cash value will be invested? -
| | | | | | | | | | | | |
CORRECT ANSWER✔✔-Variable universal policy | | |
An immediate annuity has been purchased with a single premium.
| | | | | | | | | |
When does the annuitant typically begin receiving benefit payments? -
| | | | | | | | | |
CORRECT ANSWER✔✔-1 month | |
Consumer privacy regulations permit the release of an insured's
| | | | | | | | |
financial information when - CORRECT ANSWER✔✔-an authorized
| | | | | | |
agency makes a written request to the insurer during an insurance fraud
| | | | | | | | | | |
|investigation
The free-look provision gives the policyowner - CORRECT ANSWER✔✔-
| | | | | | | |
the right to return the policy for a full refund within a specified number
| | | | | | | | | | | | | |
of days
|
,Joanne has a $100,000 whole life policy with an accumulated $25,000 of
| | | | | | | | | | |
cash value. She would like to borrow $15,000 against the cash value.
| | | | | | | | | | | | |
Which of the following statements is TRUE? - CORRECT ANSWER✔✔-
| | | | | | | | |
Net death benefit will be reduced if the loan is not repaid
| | | | | | | | | | |
Tara the producer is delivering a specified disease insurance policy to a
| | | | | | | | | | | |
new policyowner. Upon delivery, she may be expected to collect all of
| | | | | | | | | | | |
the following EXCEPT a(n) - CORRECT ANSWER✔✔-modified application
| | | | | | | |
with a new signature
| | |
Which of the following is considered to be the period when the
| | | | | | | | | | | |
accumulated value in an annuity is paid out? - CORRECT ANSWER✔✔-
| | | | | | | | | |
Annuitization phase |
The entity that has the power to revoke a producer's insurance license is
| | | | | | | | | | | |
the - CORRECT ANSWER✔✔-Department of Insurance and Financial
| | | | | | | | |
Services (DIFS) |
The statement which best describes the relationship between the
| | | | | | | | |
premiums of a whole life policy and the premium payment period is -
| | | | | | | | | | | | |
CORRECT ANSWER✔✔-The shorter the payment period, the higher the
| | | | | | | | |
premium
, A life insurance policy that is subject to a contract interest rate is
| | | | | | | | | | | | |
referred to as - CORRECT ANSWER✔✔-universal life
| | | | | |
Which of these factors would an insurer consider when determining
| | | | | | | | | |
whether to accept a group life plan? - CORRECT ANSWER✔✔-Average
| | | | | | | | | |
age
According to HIPAA, when an insured individual leaves an employer and
| | | | | | | | | | |
immediately begins working for a new company that offers group health
| | | | | | | | | |
|insurance, the individual - CORRECT ANSWER✔✔-is eligible for
| | | | | | | |
coverage upon hire | |
An insured has a stop-loss limit of $5,000, a deductible of $500, and an
| | | | | | | | | | | | | |
80/20 coinsurance. The insured incurs $25,000 of covered losses. How
| | | | | | | | | |
much will the insured have to pay? - CORRECT ANSWER✔✔-$5,000
| | | | | | | | |
Barbara's policy includes a rider which allows her to purchase additional
| | | | | | | | | |
insurance at specific dates or events without evidence of insurability.
| | | | | | | | | | |
This rider is called a(n) - CORRECT ANSWER✔✔-Guaranteed insurability
| | | | | | | | |
rider
What is an insurer required to do when faced with an error made under
| | | | | | | | | | | | | |
the Misstatement of Age provision? - CORRECT ANSWER✔✔-Pay age-
| | | | | | | |
corrected benefits |
