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ARKANSAS HEALTH INSURANCE EXAM (
DIFFERENT VERSIONS) | ALL QUESTIONS
AND CORRECT ANSWERS | GRADED A+ |
VERIFIED ANSWERS
ARKANSAS HEALTH INSURANCE EXAM (FIRST EXAM)
Tom has a rider on his disability income policy that guarantees the right to increase his benefits without a medical exam. What kind of rider is this? Waiver of premium rider Guaranteed benefit rider Payor benefit rider Guaranteed insurability rider ------CORRECT ANSWER--------------- Guaranteed insurability rider An insurer may pay commissions directly to any person for services as a producer provided the producer is licensed and insured appointed annointed registered ------CORRECT ANSWER---------------Appointed An insurer has the right to recover payment made to the insured from the negligent party. These rights are called contributory indemnity estoppel subrogation ------CORRECT ANSWER---------------Subrogation
Which provision states that a group accident and health policy must provide a continuation of benefits for an individual insured if the policy is terminated or replaced? Continuation of Coverage Conversion Privilege Continuation Privilege Continuation of Benefits ------CORRECT ANSWER---------------Continuation of Benefits The Arkansas Insurance Department may take each of the following actions EXCEPT: Issue Cease and Desist Order Impose fines Revoke licenses Incarceration ------CORRECT ANSWER---------------Incarnation Bill the producer is collecting the initial premium on a health policy. Which of the following statements is true? The contract is not in force without the initial premium being paid A partial initial premium is acceptable The insured has no advantage to pay the initial premium at the time of application A claim must be honored by the insurer even if an initial premium is not paid ------CORRECT ANSWER---------------The contract is not in force without the initial premium being paid In contrast to a guaranteed renewable policy, a noncancellable policy may cancel the policy only at renewal may raise premiums at policy renewal
Anyone who willfully violates a cease and desist order from the Commissioner is subject to a fine of up to: $100 per violation $500 per violation $1,000 per violation $10,000 per violation ------CORRECT ANSWER---------------$1000 per violation Any person who knows or suspects that an insurance transaction or life settlement may be fraudulent has a duty to report it to the Commissioner within: 10 days 15 days 30 days 45 days ------CORRECT ANSWER---------------30 days An insurer may pay a commission in which of the following scenarios? To a licensed non-appointed producer who has sold, solicited, or negotiated a policy of insurance on behalf of the insurer To an unlicensed person who has sold, solicited, or negotiated a policy of insurance on behalf of the insurer To a licensed producer who is appointed with the insurer When a policy is canceled back to inception ------CORRECT ANSWER------ ---------To a licensed non-appointed producer who has sold, solicited, or negotiated a policy of insurance on behalf of the insurer A policy that provides coverage for a dependent child of an employee or other member of the covered group MUST provide coverage up to a limiting age of 26 years old
28 years old 29 years old 30 years old ------CORRECT ANSWER---------------26 years old Which of the following basics is a producer's fiduciary responsibility? Collecting premiums and paying them to the insurance company Maintaining a separate bank account for each insurance company the producer represents Acting as a referee in the event of a disagreement between an insured and the insurance company Advising prospective insureds of the lowest rates available ------CORRECT ANSWER---------------Collecting premiums and paying them to the insurance company An insured may continue coverage under a group plan during their total disability if the premiums are paid for how long? 30 days 90 days 4 months 6 months ------CORRECT ANSWER---------------6 months A producer who sells insurance in Arkansas but resides in another state is called a(n) unauthorized producer alien producer nonresident producer authorized producer ------CORRECT ANSWER---------------Nonresident producers
Which of the following constitutes grounds for suspending an Arkansas producer's license? Summary Action conviction Felony conviction Failure to comply with underwriting guidelines Failure to maintain insurance transaction records for at least 10 years ------ CORRECT ANSWER---------------Felony Conviction ___ is any insurance carrier providing disability benefit plans for a small employer's eligible employees. Employer Adjuster Employer Carrier Broker ------CORRECT ANSWER---------------Employer Carrier An accident and health insurer has just received written proof of loss from one of its insureds. The insured must now wait 60 davs before submitting another claim bringing legal action against the insurer the insurer will pay the claim purchasing more insurance from this insurer ------CORRECT ANSWER------ ---------Bringing legal action against the insurer Kathy pays a monthly premium on her health insurance policy. How long is her grace period? 10 days 7 davs 31 davs 45 days ------CORRECT ANSWER---------------10 days
The time limit for filing claim disputes is addressed in which provision of an accident and health policy? Legal actions Entire contract Time of payment of claims Payment of claims ------CORRECT ANSWER---------------legal actions All of the following are functions of an insuring clause EXCEPT States the conditions under which the policy will pay Outlines the kind of benefits provided Primarily describes the free-look period Provides the policy's scope and limits of coverage ------CORRECT ANSWER---------------Primarily describes the free-look period The reinstatement provision in a health insurance policy is mandatory optional voluntary discretionary ------CORRECT ANSWER---------------mandatory Which of the following actions may an insurance company NOT do in a health policy that contains a guaranteed renewable premium benefit? Stop renewing policy when the insured reaches a specified age Cancel policy if premiums are not paid Increase the premiums on an individual basis Increase the premiums on the basis of an entire classification ------ CORRECT ANSWER---------------Increase the premiums on an individual basis
noncancelable policy ------CORRECT ANSWER---------------guaranteed renewable policy In which of the following situations would the insurer be liable for a loss? The insured skipped a payment beyond the 31 day grace period The insured was injured while participating in an illegal occupation The insured was given a notice of cancellation from the insurer The insured suffered an injury as an innocent bystander during a bank robbery ------CORRECT ANSWER---------------The insured suffered an injury as an innocent bystander during a bank robbery All of the following are included as part of a contract in the entire contract provision EXCEPT the Riders application changes made by the producer policy ------CORRECT ANSWER---------------Change made by the producer Signatures for an insurance application MUST be obtained by the producer from all of the following sources EXCEPT the producer the insured the policyowner the beneficiary ------CORRECT ANSWER---------------the beneficiary An insurance applicant with a below-average likelihood of loss is typically considered to be a preferred risk
subpar risk declined risk standard risk ------CORRECT ANSWER---------------preferred risk Which of these characteristics of an applicant is NOT taken into consideration when assessing risk for Disability coverage? health of applicant gender of applicant number of children occupation of applicant ------CORRECT ANSWER---------------number of children Which of the following would be a valid reason why a policy premium would be higher than the standard premium? The insurer is not a member of the MIB The agent quoted the wrong price The insured does not have the necessary financial reserves The insured does not meet established underwriting requirements ------ CORRECT ANSWER---------------The insured does not meet established underwriting requirements An insured was injured as an innocent bystander when someone committed a felony. The insurer is likely to void the policy partially liable for the loss not liable for the loss liable for the loss ------CORRECT ANSWER---------------liable for the loss
A person covered with an individual health plan is issued a policy is issued a certificate of medical costs does not contract directly with the insurance company is not subject to medical underwriting ------CORRECT ANSWER--------------- Is issued a policy Which of the following is typically NOT eligible for coverage in a group health policy? Full-time employee Temporary employee Business owner Partner in a partnership ------CORRECT ANSWER---------------Temporary Employee How many employees must an employer have for a terminated employee to be eligible for COBRA? 20 30 40 50 ------CORRECT ANSWER---------------20 employees The election of COBRA for continuation of health coverage will increase the coverage and lower premium maintain the same coverage and increase premium increase out-of-pocket costs and lower premium decrease out-of-pocket costs and maintain same premium ------CORRECT ANSWER---------------maintain the same coverage and increase premium
Justin is receiving disability income benefits from a group policy paid for by his employer. How are these benefits treated for tax purposes? Partially taxable income Non-taxable income Taxable income Conditionally taxable income ------CORRECT ANSWER---------------Taxable income Health insurance involves two perils, accident and death sickness disability liability ------CORRECT ANSWER---------------sickness The limited period of time given to all members to sign up for a group health plan is called the enlistment period sign-up period probationary period enrollment period ------CORRECT ANSWER---------------enrollment period Under group health insurance, a certificate of coverage is issued to the emplover employee producer sponsor ------CORRECT ANSWER---------------Employee
avoid overpayment of claims reduce out-of-pocket costs reduce adverse selection lower the cost of premiums ------CORRECT ANSWER---------------avoid overpayment of claims When can a group health policy renewal be denied according to the Health Insurance Portability and Accountability Act (HIPAA)? When a change of management has occurred within the group When the annual number of claims has increased by 25% When contribution or participation rules have been violated When group participation has increased by 25% ------CORRECT ANSWER---------------When contribution or participation rules have been violated Credit Accident and Health plans are designed to permit creditors the ability to require that coverage be purchased through insurers of their choice provide permanent protection help pay off existing loans during periods of disability not permit free choice of coverage selection ------CORRECT ANSWER------ ---------help pay off existing loans during periods of disability Which of the following decisions would a Health Savings Account (HSA) owner NOT be able to make? The amount contributed by the employer The amount contributed by the owner The underlying account investments used The medical expenses paid for by the HSA ------CORRECT ANSWER------- --------The amount contributed by the employer
Medicaid is a government-funded program designed to provide health care to all individuals over the age of 65 all individuals who carry Medicare supplemental insurance anyone who does not have a proper caregiver poor people ------CORRECT ANSWER---------------poor people How does one become eligible for Part D: Prescription Drug coverage? Must meet certain underwriting guidelines Must have a valid prescription Must have Medicare coverage Must have Medicaid coverage ------CORRECT ANSWER---------------Must have Medicare coverage Part A Hospital expense coverage provided under Medicare is automatically made available to each of the following EXCEPT A 50-year old individual who has qualified for SSDI in the last 24 months A 70-year old NOT eligible for Social Security A 55-year old suffering from kidney failure A 65-year old retiree ------CORRECT ANSWER---------------A 70-year old NOT eligible for Social Security Which of these will typically authorize treatment from a specialist? Administrator Policyowner Insurance company Gatekeeper ------CORRECT ANSWER---------------gatekeeper
Small employers who are sponsored by an insurer to provide group benefits to its employees are called Fraternal Benefit Society Surplus lines brokers Lloyd of London MEWA ------CORRECT ANSWER---------------MEWA Which of the following is NOT taken into consideration when determining eligibility for Medicare benefits? Chronic kidney disease Income Age Social Security disability ------CORRECT ANSWER---------------income The open enrollment period for Medicare Part B is January 1 through March 31 January 1 through April 30 January 1 through May 31 January 1 through June 30 ------CORRECT ANSWER---------------January 1 through March 31 Ted has a health insurance plan that requires him to pay a specific sum out of pocket before any benefits are paid in a calendar year. Which of these does his health plan have? Calendar-year deductible Coinsurance provision Stop-loss feature Integrated deductible ------CORRECT ANSWER---------------Calendar-year deductible
A pharmacy benefit covers prescription drugs derived from a list called a(n) administrative drug list drug formulary controlled substance list generic benefit manager ------CORRECT ANSWER---------------drug formulary An indemnity plan pays both the insured and health care provider provides the insured a specific dollar amount for services pays the health care provider directly for services rendered is typically issued as a group plan ------CORRECT ANSWER--------------- provides the insured a specific dollar amount for services Which of the following types of deductibles would apply a single deductible to both medical and dental insurance coverage? Standard deductible Combined deductible Integrated deductible Blended deductible ------CORRECT ANSWER---------------Integrated deductible An insured under a Major Medical expense plan with a zero deductible and 80/20 coinsurance provision files a $1,000 claim. How much of this claim is the insured responsible for? $ $ $
