MD LIFE AND HEALTH FINAL EXAM WITH COMPLETE
SOLUTIONS. 2024-2025 ACTUAL EXAM UPDATE.
The difference between a Long Term Care Partnership Plan and a Non-Partnership Plan is
which of the following? - Ans: Asset Protection
All of the following are considered appropriate uses of life insurance for business purposes
EXCEPT - Ans: Protecting the business by covering entrylevel employees with life insurance
Susan is insured through her Group Health Insurance plan and changed her coverage to an
individual plan with the same insurer after her employment wasterminated. This change is
called a(n) - Ans: conversion
Maria is a Preferred Provider Organization (PPO) subscriber and received care from an out-
of-network provider. Which of the following is the likely result? - Ans: Care is covered
Which of these statements concerning Traditional IRAs is CORRECT? - Ans: Earnings are
taxable when withdrawn
Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), a terminated
employee's benefits must - Ans: be the same and the premiumcannot exceed 102%
A life insurance policy normally contains a provision that restricts coverage in the event of
death under all of the following situations EXCEPT - Ans: fare-paying passenger
According to the Health Insurance Portability and Accountability Act (HIPAA), when can a
group health policy renewal be denied? - Ans: Participation orcontribution rules have been
,violated
Who regulates the quality of care provided by a heath maintenance organization (HMO)? -
Ans: Secretary of the Department of Health andMental Hygiene
Under a disability income policy, which provision would be payable if the causeof an injury is
unexpected and accidental? - Ans: Accidental bodily injury provision
Shirley has a $500,000 10-year non-renewable level term life policy. If she dies15 years after
the policy's inception date, how much will her beneficiary receive? - Ans: Nothing
Tom has a rider on his disability income policy that guarantees the right toincrease his
benefits without a medical exam. What kind of rider is this? - Ans: Guaranteed
insurability rider
The deeds and actions of a producer indicate what kind of authority? - Ans:
Apparent
Jennifer is required to pay a specific sum out of pocket before any benefits arepaid in a year.
Her health policy most likely contains a(n) - Ans: deductible
An individual most likely will have an insurable interest in insuring a person'slife if - Ans: an
economic interest exists for the continuance of the insured's life
According to life insurance contract law, insurable interest exists - Ans: atthe time of
application
In an employer-sponsored contributory group Disability Income plan, the employer pays
,60% of the premium and each employee pays 40% of the premium. Any income benefits
paid are taxed to the employee at - Ans: 60% of the benefit
Which of the following is considered to be an alternative to a life settlement? - Ans:
Accelerated death benefit rider
A separate converted policy may, at the option of the insurance company, beissued to cover
a(n) - Ans: dependent
Which of the following decisions would a Health Savings Account (HSA) ownerNOT be able
to make? - Ans: The amount contributed by the employer
According to the Affordable Care Act, any plan in existence prior to which dateis considered a
grandfathered plan? - Ans: March 23, 2010
The taxable portion of each annuity payment is calculated using whichmethod? - Ans:
Exclusion Ratio
Medicare Part A does not pay for medical benefits provided for treatment in askilled nursing
facility beyond - Ans: 100 days
Who is eligible for insurance under a group policy issued to a labor union? - Ans: Every
member of that union
, Credit Accident and Health plans are designed to - Ans: help pay offexisting loans during
periods of disability
Key Person Disability Insurance pays benefits to the - Ans: employer
What happens when an insurance policy is backdated? - Ans: The policy'seffective date is
earlier than the present
According to the Affordable Care Act, what metal tier is required to have an actuarial value of
70% with covered individuals paying 30% through deductibles, co-pays, and other cost
sharing features? - Ans: Silver Plan
Which of the following is an annuity that is linked to a market-related index? - Ans: Equity-
indexed annuity
Which of these factors is NOT taken into consideration when determining thecost of a long-
term care policy? - Ans: Personal income
A person who, for a fee, gives advice or recommendations on benefits providedby an insurance
contract is called - Ans: an advisor
What type of policy would only provide coverage for specific types of illnesses(cancer, stroke,
etc)? - Ans: Dread disease insurance
When does a life insurance policy typically become effective? - Ans: Wheninitial premium is
collected and policy is issued
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