WorksheetsInsurance 3
Total questions: 97
Worksheet time: 51mins
An agent does NOT need to notify the Bureau of Insurance of a
name change
change in financial status
felony conviction
change of address
An agent may be personally liable if he or she engages in acts
that are an unfair practice
detrimental to the industry
that are not part of the agency or agent contract
that are derogatory concerning a competitor
Which of the following would prevent a person from obtaining a Virginia resident agent license?
Residing in Virginia less than five years
Being under the age of 25
Not graduating from high school
Residing in a state outside of Virginia
Once a child is born and covered under an accident and health insurance plan, any reduction in benefits on the newborn is
prohibited only under high-deductible plans
allowed under specific conditions
strictly prohibited
allowed in any situation
An action by an agent that would NOT likely result in license suspension or revocation is:
Following all state regulations and ethical guidelines.
Committing fraud in a real estate transaction.
Misrepresenting material facts to a client.
Failing to disclose a conflict of interest.
An agent MUST notify the Bureau of Insurance for
not reaching a sales quota
sharing commissions with another licensee
conducting business under an assumed name
a change in marital status
Once an insured notifies an insurer of a claim, what must the insurer do?
Send out a claim form
Investigate the claim
Pay the claim
Conduct a physical examination
If an agent replaces a client's existing life insurance policy with a new one, which of these actions is advisable?
Pay for new policy's premium by borrowing 100% of the existing policy's cash value
Wait until the new policy is issued and delivered before surrendering existing policy
Notify the existing insurer after the new policy is issued
Surrender the existing life insurance policy immediately upon submitting the application
If dividend option choices are offered on a whole life insurance policy, the policy MUST
contain a statement that dividends are NOT guaranteed
be treated as a variable insurance product
have an extended free-look period of 60 days
contain a statement that dividends ARE guaranteed
Which of these is NOT an Unfair Claims Settlement Practice?
Refusing to pay claims without conducting a reasonable investigation
Failing to acknowledge and act promptly with respect to insurance claims
Compelling insureds to initiate a lawsuit by offering less on insurance claims
Offering to settle a claim by arbitration
The ______ is responsible for determining the appropriateness of a Medicare Supplement policy for an applicant.
underwriter
policyholder
beneficiary
claims adjuster
The free look period provided in a life insurance policy is usually ___ days.
10
20
30
40
The premiums for a group life credit policy must be paid for by the
State
debtor
creditor
agent
An example of rebating would be
using intimidation in order to restrain or monopolize the business of insurance
a mutual insurance company paying dividends to its policyowners
splitting the commission with the buyer on a sale of insurance
reducing the premiums across the board for a specific risk class
A long-term care policy in Virginia must be issued on which of the following basis?
Guaranteed renewable
Noncancelable
Conditionally renewable
Optionally renewable
An independent agent may
Represent the SCC
Represent several clients
Represent several insurers without paying an appointment fee
Represent several insurers
The Virginia Life, Accident, and Sickness Insurance Guaranty Fund protects an insured in the event of
disability
high inflation
unemployment
the insurer's insolvency
According to the Affordable Care Act (ACA), dependent children may remain on their parent's plan until what age?
Age 27
Age 26
The application is part of the annuity contract according to the
Entire Contract clause
Conversion provision
Incontestable clause
Free-look provision
A group health plan covers employees in Virginia, Maryland, and Tennessee. The state regulatory jurisdiction established for this plan does NOT affect which plan aspect?
Minimum enrollment percentages
Required contract provisions
Qualifications for eligibility
COBRA continuation of coverage
An agent's license may only be suspended or revoked if the agent ________
filed for bankruptcy
has been afforded a right to a hearing
did not meet a sales quota
has engaged in replacement of an existing policy
The free look period provided in a life insurance policy is usually
60 days
10 days
45 days
31 days
An example of misrepresentation is
falsifying the terms, benefits, advantages, or conditions of an insurance policy
offering a premium rebate or a special advantage of any kind to consumers as an inducement to purchase a contract of insurance
charging different premiums for policyholders in the same risk classification
making any public statement or advertisement that contains false information or unsubstantiated criticisms about an insurance company
The pre-existing conditions exclusion under a small employer medical plan
may only be satisfied by paying a fee
may NOT be partially or fully satisfied by having creditable coverage with a previous employer
is illegal in this State
Which of these is NOT an Unfair Claims Settlement Practice?
Compelling insureds to initiate a lawsuit by offering less on insurance claims
Refusing to pay persons bringing false or fraudulent claims
Misrepresenting pertinent policy provisions relating to coverage after a loss
Failing to acknowledge and act promptly with respect to insurance claims
James the agent has sold a life insurance contract to a client without using an illustration, even though his insurer offers one. For this particular transaction, the applicant
is not guaranteed the terms of the contract
is entitled to monetary compensation
will be automatically declined for coverage
must sign a statement that no illustration was provided
Life insurance replacement can be best defined as
a transaction in which a new life insurance policy is purchased and an existing life insurance policy is surrendered
reducing the face value of an existing policy
accepting a reduced paid-up policy
converting existing term coverage to a permanent policy
Which of these would likely be considered an Unfair Claims Settlement Practice?
Offering settlements that are less than the fair value to offset insurer expenses
Making it mandatory that proof of loss be provided for each claim
Paying claims in a timely matter
Requiring a time limit for submitting claims
Proceeds of a life insurance policy claim may be issued to a minor ONLY if
the minor has completed an accredited money management course
the minor is at least 12 years of age
the proceeds are immediately invested in US Savings bonds and held until the child turns 18
a guardian has been appointed to receive proceeds on behalf of the minor
An agent's insurance records must be provided to the State Corporation Commission
An agent who attempts to intimidate is engaging in
twisting
coercion
discrimination
defamation
Which of these is NOT an Unfair Claims Settlement Practice?
Failing to acknowledge and act promptly with respect to insurance claims
Denying unsubstantiated claims on a timely basis
Compelling insureds to initiate a lawsuit by offering less on insurance claims
Refusing to pay claims without conducting a reasonable investigation
An agent who informs an applicant that there are no exclusions in an insurance policy has engaged in
Misrepresentation
Rebating
Coercion
Defamation
An agent who makes derogatory remarks about another insurance company during the sale of insurance has engaged in
Defamation
Coercion
Misrepresentation
Rebating
In Virginia, once a life insurance policy has been in force for ___ year(s), it becomes incontestable.
3
2
4
1
An agent who willfully violates the insurance code may, after a hearing, pay up to _____ per violation as a penalty.
$5,000
$1,500
$10,000
$3,000
An insurance company or agent must respond within ___ days to an insured's request to access personal information collected on him/her by the insurer.
45
60
15
30
Any person who unknowingly violates Virginia insurance law may be punished for each violation by a penalty not to exceed
1,000with 10,000 Cap
750,with 10,000 Cap
1,000with 5,000 Cap
500,with 10,000 Cap
Virginia offers an extended COBRA insurance plan for companies with
50 employees
2-19 employees
100 employees
20 to 50 employees
An agent recently replaced an existing Medicare Supplement policy with a new policy. The agent's compensation for the new policy
is not regulated
must equal the first year commission of the original policy
CAN exceed the renewal commission of the original policy
CANNOT exceed the renewal commission of the original policy
Before an individual is permitted to act as an insurance agent, he/she must hold a valid insurance license and be _________ by an authorized insurer.
bonded
admitted
appointed
designated
When an insurer discovers (during the claim process) that the insured's age was accidentally misstated on the life insurance application, the insurer will likely
pay the full face amount
issue a $5,000 fine
cancel the policy
pay an amount the premiums would have purchased at the insured's actual age
Which of the following provisions is NOT required to be included in qualified long-term care policies?
Nonforfeiture option
Prior hospitalization
Inflation protection
Guaranteed renewability
In a speech to a local association, an agent incorrectly stated that XYZ Insurance Company is in financial difficulty and not paying claims. The agent may be guilty of
Defamation
Commingling
False advertising
Alienation
Why does Virginia law require an insurance agent to examine the existing Medicare Supplement policies of a prospective insured?
To determine the suitability of potential changes
To uncover instances of unfair trade practices
To increase the agent's practical knowledge of insurance
To monitor insurance company compliance
At what point must a newborn be covered under an individual or group accident and health insurance policy?
When the policyowner notifies the insurance company
No more than 10 days after date of birth
At the moment of birth
When the required additional premium is paid
A life insurance agent has the authority to
share commissions with a client
solicit, receive and forward applications to the insurer
misrepresent the provisions of an insurance policy
approve or deny claims
In Virginia, an insurance agent's appointment
expires after 5 years
must be filed by the insurer within 60 days of an agent's first insurance application
must be terminated by the licensee
is in effect until termination
Carlos' agent license has been suspended due to non-renewal. He may apply for reinstatement within the ___ month period following the date when the license should have been renewed.
6
12
24
3
When determining the suitability of an annuity for a consumer, the insurance provider is obligated to
Do nothing; it is up to the consumer to pick their own plan
Recommend the product that the insurance provider specializes in
Report the annuity rates of their competitors
Make reasonable efforts to fit the annuity with the consumer's needs
What must an agent do when replacing a long-term care policy with a new policy?
Notify the applicant that an annual premium must be paid for the new policy
Notify the applicant of any new waiting periods in the new policy
Have the applicant sign a statement of continued good health
Inform the applicant that he or she must name a new beneficiary to the policy
Carlos the agent has sold an insurance policy and will be sharing the commission with another individual. Which of the following individuals may Carlos share the commission with?
The underwriter
An unlicensed individual
Another licensed but unappointed agent
The client
Chuck and Shaquille are both licensed agents in the same line of insurance. Chuck provides Shaquille with a referral that results in a sale. Commissions on this sale will likely be
shared by both agents
given to the client
given only to Chuck
paid to neither
An individual currently owns a long-term care policy. At the time of application for similar coverage, which item must be signed by the applicant and retained by the insurer?
A cancellation notice
A substitution notice
A replacement notice
Which of the following situations would qualify an insured to receive funds from an accelerated (living) benefit rider?
Insured is recovering from a broken leg
Insured has entered a substance abuse facility
Insured is expected to remain in a nursing home for life
Insured has declared bankruptcy
A life insurance agent is required to give a disclosure notice about information practices to an applicant or proposed insured
When the insurer requests an attending physician's report
At time of policy delivery
Prior to or at the time of signing the application
After the insurer requests a full medical exam
In Virginia, an insurer must file a written notice of appointment with the State Corporation Commission within
15 days of the first insurance application submitted by the licensee
5 business days of the first insurance application submitted by the licensee
20 days of the first insurance application submitted by the licensee
30 days of the first insurance application submitted by the licensee
Autopsies may be requested by an accident and health insurer
only if not prohibited by state law
for any reason
only within 5 days of death
only with the beneficiary's consent
In Virginia, any person acting as an agent for an unlicensed insurer is
guilty of a Class B felony
permissible only if acting as a licensed surplus lines broker
guilty of a class A felony
never permissible
A life insurance policy advertisement may contain
the insurer's name
false information
mention of the Commission endorsing this product
references of protection guaranteed by the Virginia Life Accident, and Sickness Guaranty Association
Which of these is NOT considered advertising?
An agent's oral sales presentation
An AM Best company rating
Which is a role of the replacing insurer during a life insurance replacement transaction?
Match or beat the current premium of the existing policy
Waive all underwriting requirements of the replacing policy
Send notice of the proposed replacement transaction to the existing insurer
Nothing, the agent handles all aspects of the transaction
Which of the following entities does NOT establish regulations for variable insurance products?
Securities and Exchange Commission (SEC)
State attorney general
State securities authorities
Department of Insurance
When an insured contests the amount of a claim payment by the insurer, he or she has what period of time to bring legal action if necessary?
Two years
Three years
One year
Six months
An insurance company is marketing a health insurance policy in Virginia which contains a provision that is in conflict with Virginia insurance law. What remedy must be taken by the insurer?
The provision must be amended to conform to the maximum statutory requirements
The provision must be amended to conform to the minimum statutory requirements
The provision must be declared void and removed from the policy
The provision must be used as-is until the policy renewal date
Defamation can be best defined as
Unfairly discriminating against a person in any way on an insurance-related matter
Offering a premium rebate or a special advantage of any kind to consumers as an inducement to purchase a contract of insurance
Making a statement that is false or maliciously critical of the financial condition of an insurer
Restraining or monopolizing the business of insurance
425. Every ____ year(s), an agent's license in Virginia must be renewed.
two
one
three
five
In Virginia, false advertising is an example of
twisting
misrepresentation
coercion
concealment
A life insurance policy can be backdated before the application date for up to ___ month(s).
2
6
4
1
In Virginia, which of the following records are not required to be maintained by an agent?
Information used in making the recommendations that were the basis for insurance transactions
Premium quotes for policies not accepted
Information collected from the consumer
Advertisement
Licensed agents in Virginia are authorized to
solicit, receive, and forward applications to the insurer
classify rates
approve coverages
rate coverages
Misrepresenting pertinent policy provisions relating to coverage after a loss is a(n)
unfair discrimination between individuals
concealment in insurance application
violation of the principle of adhesion
unfair claims settlement practice
A life insurance policyowner sells her policy to a third party in a viatical settlement. Under this transaction, the policyowner
receives the policy's full death benefit
receives an amount less than the policy's death benefit
must pay income taxes on the full amount received
receives an amount more than the policy's death benefit
How often must the Commission examine each domestic insurance company?
Every 3 years
Every year
Every 2 years
Every 5 years
An insured MUST wait ___ days to bring legal action against an insurer after written proof of loss has been received by the insurer.
120
30
60
90
If an individual violates a cease and desist order issued by the State Corporation Commission, the individual will be subject to a fine of
$5,000
$1,000
$10,000
$2,500
Which of the following must clearly be illustrated in ALL sales material for market value adjusted annuities?
The market value adjustment can be either upward or downward
The market value adjustment must always be approved by the Commission
The market value adjustment is always downward
The market value adjustment is always upward
Which of the following is included in the entire contract according to the entire contract provision?
Application
Occupational rating
Clauses
Investigative report
If the State Corporation Commission believes that an agent is incompetent or untrustworthy, it has the authority to perform all of the following functions EXCEPT
Subpoena a respondent
Incarcerate the agent
Paul is an agent who is licensed in Virginia but a resident of Maryland. P is considered to be a(n) ______ agent.
alien
foreign
nonresident
reciprocal
Persuading an insured, to the insured's detriment, to switch policies is called
rebating
twisting
fraud
defamation
How long can an insurer exclude coverage for a preexisting condition on a Medicare Supplement Policy?
18 months
24 months
6 months
12 months
A statement MUST be signed by the ________ for any illustrations used in the sale of a life insurance policy.
agent
Governor
beneficiary
Commissioner
If a Medicare Supplement policy is cancelled by the insurer, which of these circumstances does NOT require prior approval by the State Corporation Commission?
Unsuitable coverage
Multiple Medicare Supplement policies on the same person
Cancelling a class of insureds
Nonpayment of premium
Rick the agent handles insurance premiums in an untrustworthy manner. His actions could find him guilty of
not acting as a fiduciary
an unfair claim settlement practice
subrogation
acting in good faith
A transaction in which a new annuity is purchased and an old one is terminated is called _______.
a replacement
an assignment
a rollover
a conversion
If an individual health insurance policy is paid monthly, the grace period is ___ days.
31
10
7
45
The ______ is required to notify the State Corporation Commission in the event of appointment termination.
producer
insured
insurer
underwriter
In a long-term care policy issued in Virginia, any provision limiting preexisting conditions may not exceed
12 months
30 days
3 months
6 months
The ______ is required to notify the Bureau of Insurance of a licensee's change of name or address.
licensee
agency
beneficiary
insurer
In Virginia, a long-term care policy which lapses may be reinstated within five months if
The insurer failed to send a termination notice
The insurer failed to send a second premium notice
The covered individual lost the premium notice
The covered individual was mentally incapacitated
The Affordable Care Act (ACA) established "exchanges" in order to
enforce every U.S. citizen to purchase health insurance
issue fines to those U.S. citizens who do not purchase health insurance
What is the actuarial value of a bronze level health plan?
60
70
90
80
According to the Affordable Care Act, new Health Insurance Marketplaces are established by the
CCIIOO
ICIICO
CCIIO
CCOII
A prepaid dental plan has an agreement in place with a network of dentists which
accepts an established amount as payment in full for the dental services rendered
requires all the dentists to be located within the same state
must cover 100% of all orthodontic treatments
allows the dentists to determine the deductible and coinsurance amounts
Jerry has an indemnity plan which covers dental expenses. Typically, these type of plans
never require a deductible for major services
cover preventative care once every six months
has a limited network of dentists to chose from
cover oral surgery as a result from an injury
According to the Federal Fraud and False Statements Act, which of these is considered to be an intentional violation?
Sharing commissions with a licensed agent
Writing controlled business
Making false entries in a company's books
Transacting insurance outside a licensee's home state
