XCEL Health & Life Insurance EXTRA
PRACTICE - Exam Review (Alabama)
What is the applicant's consideration in an insurance contract? ANS: Premiums
At certain ages or dates, an insured can increase the stated benefit (within limits) under their disability
income policy, regardless of health. Which policy rider BEST describes this? ANS: Futre Income Option
Which of these statements regarding an insurance application is true? ANS: A representation is valid as
long as it is true
Who does a disability income policy normally cover? ANS: Wage earners
A business owner has disability coverage that covers business expenses (other than income, the cost of
capital goods, and other specified expenses). What kind of disability coverage is this? ANS: Business
overhead expense insurance
Trent has a permanent partial disability where he is paid 50% of his previous income. Trent is covered by
a: ANS: Residual disability benefit
Which of the following is a true statement? ANS: TRUE - The withholding of information that should
have been provided to an insurer is called concealment.
The number of an insurance company's health insureds that is expected to become sick or injured is
called: ANS: Morbidity experience
Bart is injured and provides notice of a health claim to his insurer He later receives the required claims
forms. Within how many days of the loss must Bart file proof of loss with the insurance company? ANS:
90
,Julio, the insurance producer, has allowed his license to lapse. He would like to reinstate his license
without taking the course and passing the exam. To do this they must reinstate the license within how
many months from the renewal date? ANS: 12
A life insurance policyowner has just exercised the policy's reduced paid-up option. Which of these
statements is true? ANS: The amount of coverage would be less than the original coverage
An individual unable to perform two or more Activities of Daily Living (ADLs) will trigger coverage from a
_____ policy. ANS: Long Term Care (LTC)
The notice of claim provision states that the insured notify the insurance company within ____ days of a
claim. ANS: 20
Which is NOT true regarding Medicare Supplement policies? ANS: Must include a minimum 20-day
Free-Look provision
Which of these is NOT a reason the insurance application is important? ANS: When attached to the
policy, the application becomes part of the insurance clause
Michael has a universal life policy with an increasing death benefit option. With an initial face amount of
$50,000, what would the actual death benefit be? ANS: $55,000
How are employer-paid premiums for employee group health insurance normally treated for tax
purposes? ANS: Tax deductible to the employee / Nontaxable to the employee
An insurance producer who offers a potential client something of value as an incentive to purchase
insurance is engaging in: ANS: Rebating
Katherine is a retiree and was recently hospitalized for 10 days. Which type of insurance policy would
best cover her for excess hospital expenses? ANS: Medicare Supplement
, Which welfare program provides assistance to the needy? ANS: Medicaid
Medicare is NOT available to a(n): ANS: 61-year old Medicaid recipient
Who does the insurance agent legally represent? ANS: The insurance company
Why are insurance contracts said to be contracts of adhesion? ANS: One party writes the contract and
the other party must accept the contract as written
Alabama's annuity disclosure regulation: ANS: Requires the delivery of a buyer's guide and a disclosure
document to an annuity applicant
Who would most likely own a Medicare Supplemental policy? ANS: 69-year old female covered by
Medicare
Which of the following provisions may NOT be adjusted in an adjustable life policy? ANS: The insured
A departing employee has decided to continue his group coverage through COBRA. Who pays the
premium in this situation? ANS: Employee
A group disability income policy will: ANS: Usually pay short-term benefits of less than 2 years in
duration
Jan is named irrevocable beneficiary of Jim's life insurance policy. Which of the following statements is
correct? ANS: Jim needs jan's permission to borrow the policies loan value
PRACTICE - Exam Review (Alabama)
What is the applicant's consideration in an insurance contract? ANS: Premiums
At certain ages or dates, an insured can increase the stated benefit (within limits) under their disability
income policy, regardless of health. Which policy rider BEST describes this? ANS: Futre Income Option
Which of these statements regarding an insurance application is true? ANS: A representation is valid as
long as it is true
Who does a disability income policy normally cover? ANS: Wage earners
A business owner has disability coverage that covers business expenses (other than income, the cost of
capital goods, and other specified expenses). What kind of disability coverage is this? ANS: Business
overhead expense insurance
Trent has a permanent partial disability where he is paid 50% of his previous income. Trent is covered by
a: ANS: Residual disability benefit
Which of the following is a true statement? ANS: TRUE - The withholding of information that should
have been provided to an insurer is called concealment.
The number of an insurance company's health insureds that is expected to become sick or injured is
called: ANS: Morbidity experience
Bart is injured and provides notice of a health claim to his insurer He later receives the required claims
forms. Within how many days of the loss must Bart file proof of loss with the insurance company? ANS:
90
,Julio, the insurance producer, has allowed his license to lapse. He would like to reinstate his license
without taking the course and passing the exam. To do this they must reinstate the license within how
many months from the renewal date? ANS: 12
A life insurance policyowner has just exercised the policy's reduced paid-up option. Which of these
statements is true? ANS: The amount of coverage would be less than the original coverage
An individual unable to perform two or more Activities of Daily Living (ADLs) will trigger coverage from a
_____ policy. ANS: Long Term Care (LTC)
The notice of claim provision states that the insured notify the insurance company within ____ days of a
claim. ANS: 20
Which is NOT true regarding Medicare Supplement policies? ANS: Must include a minimum 20-day
Free-Look provision
Which of these is NOT a reason the insurance application is important? ANS: When attached to the
policy, the application becomes part of the insurance clause
Michael has a universal life policy with an increasing death benefit option. With an initial face amount of
$50,000, what would the actual death benefit be? ANS: $55,000
How are employer-paid premiums for employee group health insurance normally treated for tax
purposes? ANS: Tax deductible to the employee / Nontaxable to the employee
An insurance producer who offers a potential client something of value as an incentive to purchase
insurance is engaging in: ANS: Rebating
Katherine is a retiree and was recently hospitalized for 10 days. Which type of insurance policy would
best cover her for excess hospital expenses? ANS: Medicare Supplement
, Which welfare program provides assistance to the needy? ANS: Medicaid
Medicare is NOT available to a(n): ANS: 61-year old Medicaid recipient
Who does the insurance agent legally represent? ANS: The insurance company
Why are insurance contracts said to be contracts of adhesion? ANS: One party writes the contract and
the other party must accept the contract as written
Alabama's annuity disclosure regulation: ANS: Requires the delivery of a buyer's guide and a disclosure
document to an annuity applicant
Who would most likely own a Medicare Supplemental policy? ANS: 69-year old female covered by
Medicare
Which of the following provisions may NOT be adjusted in an adjustable life policy? ANS: The insured
A departing employee has decided to continue his group coverage through COBRA. Who pays the
premium in this situation? ANS: Employee
A group disability income policy will: ANS: Usually pay short-term benefits of less than 2 years in
duration
Jan is named irrevocable beneficiary of Jim's life insurance policy. Which of the following statements is
correct? ANS: Jim needs jan's permission to borrow the policies loan value
