Alabama Health Insurance Exam ACTUAL
Questions and CORRECT Answers
Pure - CORRECT ANSWER - Insurance is defined as the transfer of ______________
risk to the insurance company in consideration for a premium.
Pure Risk - CORRECT ANSWER - The chance of loss without any chance of gain is
called ___________
Speculative Risk - CORRECT ANSWER - has the possibility for gain or loss and is not
insurable.
Risk - CORRECT ANSWER - is defined as the chance of loss.
Exposure - CORRECT ANSWER - A condition that could result in a loss is known as
Hazard - CORRECT ANSWER - is something that increases the chance of loss.
Physical Hazard - CORRECT ANSWER - The presence of a _____________ increases the
chance of a loss occurring.
Peril - CORRECT ANSWER - defined as a cause of loss, such as fire.
Calculable - CORRECT ANSWER - To be insurable, losses must be ___________.
Law of Large Numbers - CORRECT ANSWER - allows insurers to predict claims more
accurately.
,Groups of people, not individuals - CORRECT ANSWER - The law of large numbers
applies to ___________.
the more accurate the predictions are - CORRECT ANSWER - The law of large numbers
applies to groups of people, not to individuals. The more people in the group ______________.
reinsurance , catastrophic loss - CORRECT ANSWER - Most insurers buy_____________
to protect themselves in the event of a_______________.
Insurance laws - CORRECT ANSWER - are not required to be uniform from one state to
another.
Stock insurer may pay - CORRECT ANSWER - dividends to its shareholders
(stockholders), but they may not be guaranteed.
No - CORRECT ANSWER - Stock insurers pay the dividends to its shareholders
(stockholders), are they guaranteed.
attorney-in-fact - CORRECT ANSWER - A reciprocal insurance company is managed by
an
Reciprocal Insurers - CORRECT ANSWER - An unincorporated association of
individuals who insure each other is known as a
social needs, such as flood insurance and workers compensation - CORRECT ANSWER -
The government offers insurance primarily based upon
preventing fraud - CORRECT ANSWER - The government offers insurance primarily
based upon social needs and not
Foreign - CORRECT ANSWER - company has their home office in another state
,Alien - CORRECT ANSWER - company has their home office in another country
Are made by the business and are not tax-deductible - CORRECT ANSWER - Key Person
disability income policy, premium payments
insured or the insured's estate - CORRECT ANSWER - Claims other than death benefits
are to be paid to the_____________, unless otherwise assigned by the insured.
unilateral - CORRECT ANSWER - An insurance contract is___________ in that only one
of the parties to the contract is legally bound to do anything.
If forms are not furnished, written proof of the occurrence, nature of the loss, and extent of loss
must be submitted to the - CORRECT ANSWER - insurer
20% tax - CORRECT ANSWER - If a distribution is made for a reason other than to pay
for qualified medical expenses, the amount withdrawn will be subject to an income tax and an
additional
extended nursing home care - CORRECT ANSWER - Medicare supplement policies
(Medigap) do not cover the cost of
Medigap plans are designed - CORRECT ANSWER - to fill the gap in coverage
attributable to Medicare's deductibles, copayment requirements, and benefit periods. These plans
are issued by private insurance companies.
If a person is still employed at the age of 65, he or she may choose - CORRECT
ANSWER - to either continue group coverage and defer Medicare until retirement, or
switch to Medicare.
, The purpose of a license is to primarily write - CORRECT ANSWER - non-controlled
business
Defamation - CORRECT ANSWER - When producer was reviewing a potential customers
coverage written by another company the producer made several remarks that were maliciously
critical of that other insurer. The producer count be found guilty of (oral or written remarks)
Low maximum limits - CORRECT ANSWER - What policy characteristics of a Major
Medical Expense don't EXCEPT
High Maximum Limits - CORRECT ANSWER - Characteristics of a Major Medical
Expense
Blanket Coverage - CORRECT ANSWER - Characteristics of a Major Medical Expense
Coinsurance - CORRECT ANSWER - Characteristics of a Major Medical Expense
Deductible - CORRECT ANSWER - Characteristics of a Major Medical Expense
Lower than individual policies, but higher than group policies - CORRECT ANSWER - In
franchise insurance, premiums are usually
Physical examination and autopsy - CORRECT ANSWER - Mandatory provision in
individual health insurance policies stating that the insurer, at its own expense, has the right and
opportunity and is
Workers Compensation - CORRECT ANSWER - state programs that benefits are payable
when workers suffer work-related injury regardless of fault or negligence
Only if its part of treatment for covered illness or injury - CORRECT ANSWER - When
does Medicare cover nursing home care?
Questions and CORRECT Answers
Pure - CORRECT ANSWER - Insurance is defined as the transfer of ______________
risk to the insurance company in consideration for a premium.
Pure Risk - CORRECT ANSWER - The chance of loss without any chance of gain is
called ___________
Speculative Risk - CORRECT ANSWER - has the possibility for gain or loss and is not
insurable.
Risk - CORRECT ANSWER - is defined as the chance of loss.
Exposure - CORRECT ANSWER - A condition that could result in a loss is known as
Hazard - CORRECT ANSWER - is something that increases the chance of loss.
Physical Hazard - CORRECT ANSWER - The presence of a _____________ increases the
chance of a loss occurring.
Peril - CORRECT ANSWER - defined as a cause of loss, such as fire.
Calculable - CORRECT ANSWER - To be insurable, losses must be ___________.
Law of Large Numbers - CORRECT ANSWER - allows insurers to predict claims more
accurately.
,Groups of people, not individuals - CORRECT ANSWER - The law of large numbers
applies to ___________.
the more accurate the predictions are - CORRECT ANSWER - The law of large numbers
applies to groups of people, not to individuals. The more people in the group ______________.
reinsurance , catastrophic loss - CORRECT ANSWER - Most insurers buy_____________
to protect themselves in the event of a_______________.
Insurance laws - CORRECT ANSWER - are not required to be uniform from one state to
another.
Stock insurer may pay - CORRECT ANSWER - dividends to its shareholders
(stockholders), but they may not be guaranteed.
No - CORRECT ANSWER - Stock insurers pay the dividends to its shareholders
(stockholders), are they guaranteed.
attorney-in-fact - CORRECT ANSWER - A reciprocal insurance company is managed by
an
Reciprocal Insurers - CORRECT ANSWER - An unincorporated association of
individuals who insure each other is known as a
social needs, such as flood insurance and workers compensation - CORRECT ANSWER -
The government offers insurance primarily based upon
preventing fraud - CORRECT ANSWER - The government offers insurance primarily
based upon social needs and not
Foreign - CORRECT ANSWER - company has their home office in another state
,Alien - CORRECT ANSWER - company has their home office in another country
Are made by the business and are not tax-deductible - CORRECT ANSWER - Key Person
disability income policy, premium payments
insured or the insured's estate - CORRECT ANSWER - Claims other than death benefits
are to be paid to the_____________, unless otherwise assigned by the insured.
unilateral - CORRECT ANSWER - An insurance contract is___________ in that only one
of the parties to the contract is legally bound to do anything.
If forms are not furnished, written proof of the occurrence, nature of the loss, and extent of loss
must be submitted to the - CORRECT ANSWER - insurer
20% tax - CORRECT ANSWER - If a distribution is made for a reason other than to pay
for qualified medical expenses, the amount withdrawn will be subject to an income tax and an
additional
extended nursing home care - CORRECT ANSWER - Medicare supplement policies
(Medigap) do not cover the cost of
Medigap plans are designed - CORRECT ANSWER - to fill the gap in coverage
attributable to Medicare's deductibles, copayment requirements, and benefit periods. These plans
are issued by private insurance companies.
If a person is still employed at the age of 65, he or she may choose - CORRECT
ANSWER - to either continue group coverage and defer Medicare until retirement, or
switch to Medicare.
, The purpose of a license is to primarily write - CORRECT ANSWER - non-controlled
business
Defamation - CORRECT ANSWER - When producer was reviewing a potential customers
coverage written by another company the producer made several remarks that were maliciously
critical of that other insurer. The producer count be found guilty of (oral or written remarks)
Low maximum limits - CORRECT ANSWER - What policy characteristics of a Major
Medical Expense don't EXCEPT
High Maximum Limits - CORRECT ANSWER - Characteristics of a Major Medical
Expense
Blanket Coverage - CORRECT ANSWER - Characteristics of a Major Medical Expense
Coinsurance - CORRECT ANSWER - Characteristics of a Major Medical Expense
Deductible - CORRECT ANSWER - Characteristics of a Major Medical Expense
Lower than individual policies, but higher than group policies - CORRECT ANSWER - In
franchise insurance, premiums are usually
Physical examination and autopsy - CORRECT ANSWER - Mandatory provision in
individual health insurance policies stating that the insurer, at its own expense, has the right and
opportunity and is
Workers Compensation - CORRECT ANSWER - state programs that benefits are payable
when workers suffer work-related injury regardless of fault or negligence
Only if its part of treatment for covered illness or injury - CORRECT ANSWER - When
does Medicare cover nursing home care?
