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Michigan Life and Health Final Exam Questions and Answers
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Michigan Life and Health Final Exam Questions and Answers
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Michigan Life and Health Final ExamQuestions and Answers
defamation - Answer -Making a statement that is false or maliciously critical of the
financial condition of an insurer is known as
Business overhead expense policy - Answer -Which type of business insurance is
meant to cover the costs of continuing to do business while the owner is disabled?
the protection ends - Answer -Dorian exercised a nonforfeiture option by using his life
policy's cash value to purchase an extended term insurance option. When the term
insurance expires,
must have an appointed guardian - Answer -To receive proceeds from a death benefit,
a minor
The insurer's obligation to pay a death benefit upon an approved death claim - Answer -
Under a life insurance policy, what does the insuring clause state?
When contribution or participation rules have been violated - Answer -When can a
group health policy renewal be denied according to the Health Insurance Portability and
Accountability Act (HIPAA)?
It allows for cash advances to be paid against the death benefit if the insured becomes
terminally ill - Answer -What is the purpose for having an accelerated death benefit on a
life insurance policy?
Variable universal policy - Answer -Which type of life insurance offers flexible premiums,
a flexible death benefit, and the choice of how the cash value will be invested?
1 month - Answer -An immediate annuity has been purchased with a single premium.
When does the annuitant typically begin receiving benefit payments?
an authorized agency makes a written request to the insurer during an insurance fraud
investigation - Answer -Consumer privacy regulations permit the release of an insured's
financial information when
,the right to return the policy for a full refund within a specified number of days - Answer -
The free-look provision gives the policyowner
Net death benefit will be reduced if the loan is not repaid - Answer -Joanne has a
$100,000 whole life policy with an accumulated $25,000 of cash value. She would like
to borrow $15,000 against the cash value. Which of the following statements is TRUE?
modified application with a new signature - Answer -Tara the producer is delivering a
specified disease insurance policy to a new policyowner. Upon delivery, she may be
expected to collect all of the following EXCEPT a(n)
Annuitization phase - Answer -Which of the following is considered to be the period
when the accumulated value in an annuity is paid out?
Department of Insurance and Financial Services (DIFS) - Answer -The entity that has
the power to revoke a producer's insurance license is the
The shorter the payment period, the higher the premium - Answer -The statement which
best describes the relationship between the premiums of a whole life policy and the
premium payment period is
universal life - Answer -A life insurance policy that is subject to a contract interest rate is
referred to as
Average age - Answer -Which of these factors would an insurer consider when
determining whether to accept a group life plan?
is eligible for coverage upon hire - Answer -According to HIPAA, when an insured
individual leaves an employer and immediately begins working for a new company that
offers group health insurance, the individual
$5,000 - Answer -An insured has a stop-loss limit of $5,000, a deductible of $500, and
an 80/20 coinsurance. The insured incurs $25,000 of covered losses. How much will the
insured have to pay?
Guaranteed insurability rider - Answer -Barbara's policy includes a rider which allows
her to purchase additional insurance at specific dates or events without evidence of
insurability. This rider is called a(n)
Pay age-corrected benefits - Answer -What is an insurer required to do when faced with
an error made under the Misstatement of Age provision?
twisting - Answer -The unfair trade practice of replacing an insurance policy from one
insurer to another based on misrepresentation is called
, Life annuity - Answer -Which type of annuity stops all payments upon the death of the
annuitant?
liquidity - Answer -An insurer's ability to make unpredictable payouts to policyowners is
called
Exclusion Ratio - Answer -The taxable portion of each annuity payment is calculated
using which method?
adverse selection - Answer -Group dental plans will frequently place a limit on annual
benefits in order to minimize
subrogation - Answer -An insurer has the right to recover payment made to the insured
from the negligent party. These rights are called
The greater of the accumulated cash value or the total premium paid - Answer -What
will the beneficiary receive if an annuitant dies during the accumulation period?
time deductible - Answer -A disability elimination period is best described as a
have a legitimate non-insurance purpose - Answer -An association wanting to buy
insurance under a group health plan MUST
Talking - Answer -In a Long-Term Care policy, activities of daily living (ADL's) can be
each of the following EXCEPT
Stock purchase - Answer -All of the following are exempt from the 10% tax penalty for
early qualified plan withdrawals EXCEPT
represents the insurer - Answer -In the state of Michigan, a licensed producer
Giving the insured an article of merchandise printed with the producer's name costing
$5 - Answer -Which of the following is NOT an illegal inducement?
100% of his health insurance costs can be deducted from his gross income - Answer -
Lorenzo is self employed with an S corporation. He is unmarried and had a net profit for
the tax year. What are the tax ramifications of his health insurance premiums paid for
the year?
Long Term Care Insurance premiums - Answer -The IRS states that a taxpayer's
medical expenses that exceed 7.5% of their adjusted gross income is tax deductible.
Which of the following may be considered a medical expense under this rule?
Specified amount of money - Answer -What does a life insurance policy guarantee to
the stated beneficiary upon the death of the insured?
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