NJ Life and Health Insurance Test
Questions and Answers
Medical Information and Consumer Reports - Answer-Policies with higher amounts of
coverage of if additional questions are raised concerning the prospective insured's
health, underwriter may require medical examination of the insured
Paramedical Report- completed by a paramedic or registered nurse.
Attending Physician's Statement (APS) - a medical practitioner who treated the
applicant for a prior medical problem.
Medical Information Bureau (MIB) - Answer-Nonprofit org.(membership corporation)
which receives adverse medical information from insurance companies and maintains
confidential medical impairment information on individuals.
Application signatures - Answer-If proposed insured and policy owner are not same
person, such as in a business purchasing insurance on a an employee, then the policy
owner must also sign the application.
Changes on the Application - Answer-An agent should never erase or white out an
application. Applicant should complete new one or initial the change.
Consequences of Incomplete Applications - Answer-If Incomplete before issued insurer
must return it to the applicant for completion.
If a policy is issued with questions left unanswered, the contract will be interpreted as if
the insurer waived its right to have an answer to the question.
Premiums with the Application - Answer-Agents attempt to collect the initial premium
and submit to insurer. Collecting initial premium at the time of the application increases
the chance that the applicant will accept the policy once issued
Medical examantions and lab Tests Including HIV - Answer-It is common among
insurers to require an HV test when applicant is applying for a large amount of
coverage.
HIPAA - Answer-The Health Insurance Portability Accountability Act is a federal law that
protects health information. HIPAA regulations provide protection for the privacy of
certain individually identifiable health information (protected health Information).
HIPAA Privacy Rule - Answer-Patients have right to view their own medical records as
well as the right to know who has accessed those records over the previous 6 years.
, Use and Disclosure of Insurance Informaltion - Answer-Will state the insurer's practice
regarding collection and use of personal information.
Must be written in plain language and approved by the head of the Department of
Insurance.
Fair Credit Reporting Act - Answer-Established procedures that consumer-reporting
agencies must follow in order to ensure that records are confidential, accurate, relevant,
and properly used.
Fair credit reporting Act two categories - Answer-Consumer reports - include written
and/or oral information regarding a consumer's credit,character,reputation,or habits
collected by a reporting agency from employment records, credit records, and other
public sources.
Investigative Consumer reports - difference is that the information is obtained through
an investigation and interviews with associates, friends and neighbors of the consumer.
Risk Classification (Standard) - Answer-Standard - persons who, according to a
company's underwriting standards, are entitled to insurance protection without extra
rating or special restrictions. representative of the Majority of people at their age and
with similar lifestyles.
They are the average risk.
Risk Classification (substandard) - Answer-Applicants are not acceptable at standard
rates because of physical condition, personal or family history of disease, occupation, or
dangerous habits.
These policies are also referred to as "rated because they could be issued with the
premium rated-up resulting in a higher premium.
Risk Classification (preferred) - Answer-those individuals who meet certain
requirements and quality fir lower premiums than the standard risk. These applicants
have a superior physical condition, lifestyle, and habits.
Premium Determination - Answer-Once the company determines that an applicant is
insurable, they need to estb. and appropriate policy premium. The premium will be used
to cover the costs and expenses to keep the policy in force. PREMIUMS ARE PAID IN
ADVANCE.
What are the three factors used in in premium determination - Answer-Morality
Interest
Expense
Questions and Answers
Medical Information and Consumer Reports - Answer-Policies with higher amounts of
coverage of if additional questions are raised concerning the prospective insured's
health, underwriter may require medical examination of the insured
Paramedical Report- completed by a paramedic or registered nurse.
Attending Physician's Statement (APS) - a medical practitioner who treated the
applicant for a prior medical problem.
Medical Information Bureau (MIB) - Answer-Nonprofit org.(membership corporation)
which receives adverse medical information from insurance companies and maintains
confidential medical impairment information on individuals.
Application signatures - Answer-If proposed insured and policy owner are not same
person, such as in a business purchasing insurance on a an employee, then the policy
owner must also sign the application.
Changes on the Application - Answer-An agent should never erase or white out an
application. Applicant should complete new one or initial the change.
Consequences of Incomplete Applications - Answer-If Incomplete before issued insurer
must return it to the applicant for completion.
If a policy is issued with questions left unanswered, the contract will be interpreted as if
the insurer waived its right to have an answer to the question.
Premiums with the Application - Answer-Agents attempt to collect the initial premium
and submit to insurer. Collecting initial premium at the time of the application increases
the chance that the applicant will accept the policy once issued
Medical examantions and lab Tests Including HIV - Answer-It is common among
insurers to require an HV test when applicant is applying for a large amount of
coverage.
HIPAA - Answer-The Health Insurance Portability Accountability Act is a federal law that
protects health information. HIPAA regulations provide protection for the privacy of
certain individually identifiable health information (protected health Information).
HIPAA Privacy Rule - Answer-Patients have right to view their own medical records as
well as the right to know who has accessed those records over the previous 6 years.
, Use and Disclosure of Insurance Informaltion - Answer-Will state the insurer's practice
regarding collection and use of personal information.
Must be written in plain language and approved by the head of the Department of
Insurance.
Fair Credit Reporting Act - Answer-Established procedures that consumer-reporting
agencies must follow in order to ensure that records are confidential, accurate, relevant,
and properly used.
Fair credit reporting Act two categories - Answer-Consumer reports - include written
and/or oral information regarding a consumer's credit,character,reputation,or habits
collected by a reporting agency from employment records, credit records, and other
public sources.
Investigative Consumer reports - difference is that the information is obtained through
an investigation and interviews with associates, friends and neighbors of the consumer.
Risk Classification (Standard) - Answer-Standard - persons who, according to a
company's underwriting standards, are entitled to insurance protection without extra
rating or special restrictions. representative of the Majority of people at their age and
with similar lifestyles.
They are the average risk.
Risk Classification (substandard) - Answer-Applicants are not acceptable at standard
rates because of physical condition, personal or family history of disease, occupation, or
dangerous habits.
These policies are also referred to as "rated because they could be issued with the
premium rated-up resulting in a higher premium.
Risk Classification (preferred) - Answer-those individuals who meet certain
requirements and quality fir lower premiums than the standard risk. These applicants
have a superior physical condition, lifestyle, and habits.
Premium Determination - Answer-Once the company determines that an applicant is
insurable, they need to estb. and appropriate policy premium. The premium will be used
to cover the costs and expenses to keep the policy in force. PREMIUMS ARE PAID IN
ADVANCE.
What are the three factors used in in premium determination - Answer-Morality
Interest
Expense
