Exam (elaborations)
Washington Life and Health Insurance Exam Verified 2024
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Washington Life and Health Insurance Exam Verified 2024
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Washington Life and Health InsuranceExam Verified 2024
401 (k) - ANSWER-Portion of pre-tax salaries into investment accounts where it grows
tax deferred. Matching from employer is common. Investment choice directed by
employee. Cap on contributions.
403 (b) - ANSWER-Public schools and non profits. Pre-tax contributions and tax
deferred growth.
a contract is to be
valid, its purpose must be legal - ANSWER-only people who
are capable of understanding the terms of a contract and who are
not under duress may become parties to a contract
absolute assignment - ANSWER-Owner transfers the owner's entire interest in the
policy to the assignee
Accelerated Death Benefit Rider - ANSWER-requires the Insurer to pay out part of the
death benefit
(usually 50%) if the Insured has a diagnosis of a particular illness
likely to cause death within 12 months
Accident only polocies - ANSWER-Helps pay the health care costs that result from an
accident
Accumulate at interest dividend option - ANSWER-The dividends are left in a sales
account to accumulate interest at a set amount specified in the policy. Dividends are not
taxable, but the interest is.
actuary - ANSWER-A person who tracks the lifespan and chance of illness or accident
based on specific factors
AD&D Rider - ANSWER-Accidental death and dismemberment (Add-ons), Accidental
loss of life, limb or vision, pays benefits in a lump sum only when medical problems are
direct result of an accident (not sickness), death within 90 days of accident or policy
won't pay, if accident is triggered by illness - no payout, value policy not indemnity
policy, at least one hand, one foot or vision in one eye will pay capital sum (100%), if
two hands, two feet or vision in both eyes, policy will pay full amount, when attached to
life or health policy, the rider pays over and above overriding policy
Additional Children coverage - ANSWER-Covered from the moment of birth until 31
days. Adopted children are treated just like newborns.
,Additional insured term rider - ANSWER-Whole life to insured, convertible term life
riders on family members, or business partners
Additional paid-up insurance dividend option (Paid-up additions dividend option) -
ANSWER-Dividend used as a single net premium payment on a miniature paid up
whole life policy. This is the automatic dividend option when no other option is selected.
Adjustable life - ANSWER-Components of the policy are adjustable to meet the needs
of the policy holder. If the insured wants to increase the death benefit, proof of
insurability is required.
Adult dependent children - ANSWER-A continuation privilege allows adult children up to
the limiting age to be covered as long as they are full-time students.
Adult disabled children can be covered their whole lives as long as they are incapable of
supporting themselves and dependent upon the parents. An adult standard premium
may be charged at age 18. Proof of incapacity or dependency is necessary within 31
days of reaching their 18th birthday. Annual proof of handicap may be required to
continue dependent coverage.
Adverse selection - ANSWER-people who need
insurance the most are the ones most likely to buy it - and buy
more of it causing more loss claims
Adverse selection - ANSWER-the tendency for high
risk people to be more likely to apply for insurance than low risk
people.
Agent responsibilities - ANSWER-Explain the underwriting process to the applicant and
provide disclosures as required by law.
• If the applicant does not complete a portion of the appli-
cation, the applicant must personally make the changes
and sign or initial them.
• If the agent makes a mistake on the agent's portion
of the application, the agent should correct the change
and sign or initial the correction.
• Remember, if an incomplete application gets by the agent
and the underwriters, and a policy is issued and delivered,
the company is bound by the policy under the concept of
waiver.
• Make certain that premium checks are filled out correctly,
signed, and made payable to the company, not to the agent.
• If a check is mistakenly made payable to the agent, the
agent should ask the client to destroy it and write a new
check.
• If a check is unsigned, the agent must return it to the
, client for signature.
• If a check is invalid, the agent should explain that the
conditional receipt will not be valid until proper payment is
received.
• If an agent collects a premium check while out of the
office, the agent should give the client a temporary hand-
written receipt and then mail or a deliver an official receipt.
• Many companies require the agent to deliver a policy in
person. The reason for this is to explain the terms of the
policy and, if a policy is rated, to explain the reason why.
• Unless a conditional receipt is used, the agent should
explain that the Insured will not be covered until the policy
is delivered, no matter how many good faith delivery
attempts are made by the agent.
agent/producer - ANSWER-acts as a legal representative
of the insurance company
Agreement = - ANSWER-offer + acceptance
Aleatory - ANSWER-When one party or another has the potential to recieve
dramatically different level of benefits relative to the cost of receiving those benifits
Annual stop-loss limit - ANSWER-A measure that limits the maximum amount for which
the insurance can be responsible for in a stated time period.
Annually renewable term - ANSWER-After the level term policy can extend coverage
without providing proof of insurability. The premium will go up each year, due to higher
attained age and no proof of insurability. Max age of 65.
Reentry term - Two premium levels for renewal for people who can prove insurability
and for folks who cant
Annuity certain options - ANSWER-Either the time period payments will be received or
the amount of each payment, to be decided by the annuitant.
Annuity settlement option - ANSWER-...
Assignment - ANSWER-Having payments go directly from health care companies to the
providers at with the permission of the insured
assignment clause - ANSWER-The procedure by which the transfer is accomplished
Automatic premium loan rider - ANSWER-if the policy owner
does not pay the premium and the grace period expires, the
company will automatically make a loan against the cash value to
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