Life and Health Insurance Random Flashcards
7 cards from real Life & Health Insurance Exam practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Life and Health Insurance Random flashcards as text
Under the Health Insurance Portability and Accountability Act (HIPAA), a special enrollment period is triggered when:
Answer: An employee gains a new dependent through marriage or birth
HIPAA requires group health plans to offer special enrollment periods when employees experience qualifying life events such as marriage, birth, or adoption of a child.
In a whole life insurance policy, what is the relationship between cash value growth and the net amount at risk for the insurer?
Answer: As cash value increases, the net amount at risk decreases
As the policy's cash value builds over time, the amount the insurer is actually at risk (death benefit minus cash value) decreases correspondingly.
Which of the following is an example of a third-party ownership arrangement in life insurance?
Answer: A business owns a life insurance policy on a key employee
Third-party ownership occurs when the policy owner and the insured are different parties, such as a business owning a key person policy on an employee.
A health insurance policy with an '80/20 coinsurance' provision means:
Answer: After the deductible, the insurer pays 80% of covered expenses and the insured pays 20%
An 80/20 coinsurance split means that after the deductible is satisfied, the health plan pays 80% of covered costs and the insured is responsible for the remaining 20%.
Which of the following would most likely cause an insurance company to rescind a health insurance policy?
Answer: The insured fails to disclose a material pre-existing condition on the application
Rescission is allowed when an applicant intentionally misrepresents or conceals a material fact, such as a significant pre-existing health condition, on the application.
The 'waiver of premium' rider in a life insurance policy provides that:
Answer: Premiums are waived if the insured becomes totally disabled for a specified period
A waiver of premium rider keeps the policy in force without premium payments if the insured suffers a qualifying total disability, typically after a 6-month elimination period.
What is the purpose of the 'misstatement of age or sex' provision in a life insurance policy?
Answer: It adjusts the death benefit to the amount the premium would have purchased at the correct age or sex
Rather than voiding the policy, the misstatement of age or sex provision adjusts the death benefit to what the actual premium paid would have bought at the insured's true age and sex.