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KY LIFE & HEALTH COMPREHENSIVE EXAM 202 5 -
2026 /200 QUESTIONS AND ANSWERS|ALREADY
GRADED A+
All of the following are producer responsibilities to the applicant, except: ANSWER Offering and selling only the lowest premium policy manufacture and sell insurance coverage in the form of policies or contracts of insurance. ANSWER Insurers When both parties must perform certain duties and follow certain rules of conduct to make a contract enforceable refers to a(n) contract. ANSWER Conditional insurance allows for insurance coverage to be obtained when not available from admitted carriers. ANSWER Surplus lines The field underwriter is the and is not a determiner of insurability. ANSWER Producer To address adverse selection what can an insurer legally do? ANSWER Establish and enforce sound underwriting practices A contract that is drafted by an insurer and receives no input or alteration from the
insured, is considered a(n): ANSWER Contract of Adhesion Which of the following parties does not sign an application for life insurance? ANSWER The beneficiary The market is a private source of coverage of last resort for individuals or businesses that have been rejected by voluntary market insurers. ANSWER Residual Which of the following is NOT considered one of the essential elements of a contract? - ANSWER Conditions An insurer NOT authorized to do business within this state is considered what type of insurer? - ANSWER Non-Admitted Which of the following describes Fiduciary Responsibilities? ANSWER Anyone acting as an insurance producer or agent for an insurer shall be held responsible in a trust or fiduciary capacity for any money collected or received for the insurer The relationship of a person who acts on behalf of a company whereby the person's actions can bind the company is known as: ANSWER The law of agency
If a copy of the application, which led to a life insurance policy being issued, is attached to the policy : ANSWER It is considered part of the entire contract Which of the following products are offered by insurers to protect families from the financial setback of a family member's premature death? ANSWER Life Insurance The HIV Consent Form specifies which types of individuals may receive. ANSWER The test results Confidential information shared by the producer to the insurer and does not become part of the policy is the. ANSWER Agent's Report A is the insured under a $100,000 10 year term life insurance policy with her spouse named as her beneficiary. If she dies in year 9, what will her spouse receive? ANSWER The face amount of the policy Which of the following statements about Equity Indexed Life insurance is TRUE? ANSWER The interest credited to the policy is based off of the performance of a stock market index like the S&P 500
A policyowner would like more coverage than the $100,000 Whole Life policy being proposed, but does not have enough discretionary income to pay a lot more money to do so. What can a producer recommend that will allow the policy owner to have the Whole Life policy, but with more total death benefit at an affordable price? ANSWER Add a term rider All of the following are correct pertaining to Decreasing Term, except: ANSWER The premium declines throughout the term of the policy All of the following are statements are true of a juvenile policy, except: ANSWER The insured is the premium payor Term Life insurance is designed to provide coverage for. ANSWERA specified period of time Which of the following is TRUE of a term rider when attached to a permanent life policy? ANSWERIt can provide additional temporary coverage on the insured or on other members of the family Whole Life is also known as protection. ANSWERPermanent
enough funds to maintain their standard of living but want to accomplish this in the most economical way. Which of the following recommendations is best suited to accomplish their goal? ANSWER Purchase a Joint life policy Which of the following provisions commence at the time of the delivery of the policy to the insured? ANSWER Free Look Period Jeanne has a $100,000 whole life insurance policy that has $1,000 of dividend additions, a $6,000 outstanding loan that includes unpaid interest, and a monthly premium of $500. If she dies during the grace period, which of the following insurance settlements would be permitted? ANSWER$94, When are dividend payments received by a policyholder fully taxable? ANSWERWhen all the premiums paid in have been fully recovered Which provision requires the application, the contract itself and any riders to be attached to establish a complete contract? ANSWERThe Entire Contract Provision The surrender charge schedule for a variable universal life policy generally over time.
ANSWERDecreases Dividends if declared are paid. ANSWERAnnually A client purchases an individual disability income policy and receives the policy from the insurer 45 days after application. Upon receipt of the policy, the client typically has days to review and return the policy to receive a full refund for any reason. ANSWER The bank may require its borrowers to have a life insurance policy to secure a loan in the event of the borrower's death. Which provision gives the bank proportional protection but not control of the policy? ANSWERCollateral Assignment Which of the following overall is the least expensive premium mode? ANSWERAnnually An insured with a participating life insurance policy receives annual dividends. She has opted for the insurer to use these funds to increase her overall amount of insurance. This would refer to which option: ANSWERPaid-Up Additions On a variable universal life policy what is the difference between the cash value and the cash surrender values? ANSWERThe surrender charge
Which of the following Annuities is generally not backed by the insurer's general account assets? ANSWER Variable How can an annuity payout an income benefit income tax free? ANSWER Purchase the annuity within a Roth IRA account Generally, which of the following Annuities is not designed to guarantee the principal value of the policy in stable interest rate environments? ANSWERVariable During the accumulation phase of this annuity premium dollars buy more accumulation units, then the annuity must be. ANSWERVariable The period of time over which a single sum or periodic deposits grow within an annuity is referred to as the: ANSWERAccumulation Period Proceeds from a buy-sell agreement are received. ANSWERIncome tax free Who or what restricts the insurer's underwriting criteria for group policies? ANSWERState and Federal Laws When an underwriter evaluates the risks presented with a particular group life application, which of the following is considered the most important?
ANSWERGroup size, turnover, average age and purpose of the group How is the funding for Social Security provided? ANSWERThrough FICA taxes that are paid by both employers and employees Which of the following is NOT an example of Third-Party Ownership? ANSWERA business owner buying a life policy on his own life All of the following are TRUE regarding non-qualified retirement plans, except: - ANSWERContributions are immediately tax deductible A permanent policy is surrendered for its cash value, and that sum is greater than the amount of premiums paid in. How is the excess taxed? ANSWERTaxed as ordinary income All of the following transactions qualify for IRC Section 1035 exchange tax treatment, except: - ANSWERNonqualified tax deferred annuities may be exchanged for life insurance policies If a corporation owns an annuity, what is the tax ramifications? ANSWERThere is no tax deferral benefit on any earnings Qualified plan employer contributions are tax deductible when. ANSWERThey
All of the following describe the responsibilities of an agent or producer, except: - ANSWERDetermine the rate the insurer will charge the applicant/insured Which of the following terms and definitions do not match? ANSWERBlanket payments - a lump sum payment for a maximum number of days When a policy is mailed to an insured by an insurer, it is considered to be: ANSWERDelivered If the insurer issues a policy after receiving an application for health insurance in which preexisting conditions were inadvertently omitted, what would be the consequence to the insured's coverage if a preexisting condition caused a claim shortly after being issued? - ANSWERCoverage would be as stipulated in the policy because the company issued the policy even though the question was left blank Which of the following is NOT a common rating classification? ANSWERSubrated In the event a policy is delivered by an agent to the insured, and the premium payment is to be collected at the time of this delivery, normally what else must the agent obtain to make the delivery complete? ANSWERA statement of good health
If an insured pays a premium that is lower than others that are in the same class, this insured is considered to be rated as? ANSWER Preferred Individuals covered under a Blue Cross/Blue Shield HMO plan are typically referred to as: - ANSWER Subscribers HMOs may provide one or more of the following supplemental benefits, except: ANSWER Private hospital rooms Which of the following is the best definition of a Limited Accident Policy? ANSWER Provides specific benefits for specific injuries from specific causes When Jim traveled from Hereville to There City, his plane crashed and he was slightly injured. Who paid for his medical expenses? He flew Slow Air. ANSWER His accident and health personal policy If an insured is hospitalized and incurs a daily room charge of $492 and his Medical Expense Policy stipulated coverage for a hospital room up to $550 per day. How much will the insurer pay? ANSWER$ Clarice pays a $99 monthly health insurance premium, due on the first day of each month. After paying her premium on April 1, how much of her premium has been earned by the insurance company on April 10. ANSWER$
Under a Key Employee Disability Income Policy, the employer is the: ANSWERAll of the answers listed A Disability Income Policy has a period of deductibility immediately following a disability during which time benefits are not payable. This period is called a(n): ANSWERElimination Period An insured may find it more difficult to qualify for benefits, but will enjoy a lower premium, when a more restrictive definition of is found in a Disability Income policy. - ANSWERDisability If an insured is not able to work full-time as a result of a current disability, and is receiving a disability income based upon this partial loss, it is considered a: ANSWERPartial Disability In Individual Disability Income underwriting, the single most important rating factor from an underwriting standpoint is the applicant's: ANSWEROccupation Most 'blue collar' group Disability Income contracts are offered on a/an:
ANSWERNonoccupational basis A Short-Term Disability Policy generally is for a disability lasting for: ANSWERNot more than 2 years An insured is hospitalized for at least 3 days. How long will Medicare pay for confinement in a skilled nursing facility? ANSWERUp to 100 days Of the following listed choices, which is true as it pertains to Medicare Part A? ANSWERIt is prepaid through FICA taxes and is automatic when that worker qualifies for Social Security retirement benefits ('fully insured') Which of the following is true concerning the Benefit Period of a LTC Policy? ANSWEROnce the elimination period has been satisfied, it is how long benefits will be payable With Long-Term Care Insurance coverage, the longer the is, the higher the premium is. ANSWERBenefit Period The insured may select a managed care version of a traditional Medicare Supplement Policy at a lower premium by choosing a policy that limits care to a specific list of hospitals and physicians. This would be called a: ANSWERMedicare Select Policy
Law Part B of Medicare excludes which of the following medical expenses? ANSWERA regular dental checkup A Medicare Supplement Policy must include, as a core benefit, Medicare Part B coinsurance in the amount of. ANSWER20% Under the Legal Actions Mandatory Uniform Provision, an insured must wait at least days after providing proof of loss before he or she can take legal action against the insurer. - ANSWER60 days Based upon Optional Uniform Provisions, an insurer would have the right to deny claim payment in all of the following circumstances, except: ANSWERMisstatement of age on the application Which of the following best describes the consideration on the part of an insurer? ANSWERThe promise to pay in the event of a covered claim Precertification, Mandatory Second Surgical Opinion, and Concurrent Review are provisions in health insurance policies known as: ANSWERCase Management Provisions
All states have adopted the Uniform Individual Accident and Sickness Policy Provision Law. If an insurer changes any of these provisions, they must make sure it does not: ANSWERAlter the minimum requirements of any provision If the insurer cancels an individual health plan, what happens to the unearned premium? - ANSWERIt is refunded on a pro rata basis An insured should receive necessary claim forms within days after notice of claim. - ANSWER Guaranteed Renewable means: ANSWERRenewable with adjustable premiums, by classification only Once issued, the application becomes part of the , when attached. ANSWEREntire contract Right to Examine is the same as: ANSWERFree Look Period If Mr. Stanley is injured while attempting to escape from the police after committing a bank robbery, his A & H coverage will probably pay:
