Life & Health Insurance Exam Life and Health Insurance Guide Exam 4

Question 1

A life insurance policy lapses due to non-payment of premium. The insured later requests reinstatement. Which of the following is NOT typically required for reinstatement?

Accepted Answer

Assignment of the policy to the insurer

Answer

Reinstatement generally requires payment of back premiums with interest, satisfying any policy loans, and proof of insurability, but does not require assigning the policy to the insurer.

Question 2

Which type of annuity guarantees a fixed payout for the annuitant's lifetime, with payments continuing to a beneficiary for a specified period if the annuitant dies early?

Accepted Answer

Life with period certain annuity

Answer

A life with period certain annuity pays for life but guarantees payments for a minimum period (e.g., 10 years) to a beneficiary if the annuitant dies before that period ends.

Question 3

An employer-sponsored group health plan that self-funds claims but purchases stop-loss coverage is known as a:

Accepted Answer

Self-insured (self-funded) plan

Answer

A self-insured plan means the employer bears the risk for employee health claims directly, often purchasing stop-loss insurance to limit catastrophic exposure.

Question 4

The 'free-look' period for a new individual life insurance policy is typically how many days?

Accepted Answer

10 days

Answer

Most states require a minimum 10-day free-look period during which the policyholder may return the policy for a full premium refund.

Question 5

An insured has a $500 deductible and 80/20 coinsurance with a $2,000 stop-loss. Total covered medical bills are $10,500. How much does the insured pay in total?

Accepted Answer

$2,500

Answer

The insured pays the $500 deductible plus 20% of the remaining $10,000 ($2,000), but the stop-loss caps out-of-pocket at $2,000; total = $500 + $2,000 = $2,500.

Life & Health Insurance Exam Practice Test

Life & Health Insurance Exam Practice Test

Life & Health Insurance Exam Life and Health Insurance Guide Exam 4