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California Department of Insurance CA Life, Accident and Health or Sickness Examination - CA-Life-Accident-and-Health Exam Questions

QUESTION NO: 1
All of the following statements apply to the child coverage in a family policy EXCEPT

A. child coverage is term insurance. B. children are covered until reaching a specified age. C. coverage applies only to children born before the policy is issued. D. child coverage is convertible to whole life coverage.

Correct Answer: C

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QUESTION NO: 2
Why is an injury caused by an accident at an employee's workplace excluded from individual healthinsurance coverage?

A. It is covered by the state Workers' Compensation program. B. It is covered by the employer's group disability insurance plan. C. It is covered by Social Security benefits. D. It is covered by the employer's group health insurance plan.

Correct Answer: A

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QUESTION NO: 3
What happens if an insurer violates the Medical Loss Ratio rule and spends too much money on administrative costs?

A. Insurers that do not meet the Medical Loss Ratio standard will pay a tax penalty to the Health Benefits Exchange. B. Insurers that do not meet the Medical Loss Ratio standard will pay a tax penalty to the Federal government, n C. Insurers that do not meet the Medical Loss Ratio standard will only be required to reduce their spending on administrative costs. D. Insurers that do not meet the Medical Loss Ratio standard will be required to provide rebates to their customers and reduce spending on their administrative costs.

Correct Answer: D

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QUESTION NO: 4
Which type of life insurance coverage has both a savings element and a flexible premium option?

A. Term life. B. Universal life. C. There is currently no insurance product available in the standard market which has both of these features. D. Whole life.

Correct Answer: B

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QUESTION NO: 5
Who submits Medicare Part A claims?

A. Physicians B. Patients C. Hospitals D. Pharmacies

Correct Answer: C

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QUESTION NO: 6
A contract in which only one party to the contract is legally bound to do anything is

A. aleatory. B. personal. C. unilateral. D. conditional.

Correct Answer: C

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QUESTION NO: 7
A health insurance issuer offering coverage in the individual market must provide premium rebates if its medical loss ratio (MLR) is less than what percentage?

A. 70% B. 85% C. 80% D. 75%

Correct Answer: C

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QUESTION NO: 8
Which health insurance contract provision addresses the problem of over insurance?

A. Assignment of benefits. B. Incontestability. C. Reinstatement. D. Coordination of benefits.

Correct Answer: D

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QUESTION NO: 9
According to California Insurance Code, which of the following MUST be specified in an insurance contract?

A. Additional coverages. B. Insurer financial rating. C. Risks insured against. D. Policy exclusions.

Correct Answer: C

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QUESTION NO: 10
Which tax advantage is available for individual nonqualified annuities?

A. Tax-deferred accumulation of earnings. B. Fully taxable distributions. C. Deductibility of contributions. D. Penalty-free early withdrawals.

Correct Answer: A

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QUESTION NO: 11
Indexed annuities offer all of the following features EXCEPT

A. protection during stock market declines. B. an opportunity to participate in gains associated with the stock market. C. a minimum guarantee of interest rate. D. an annually increasing maximum rate of interest.

Correct Answer: D

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QUESTION NO: 12
A worker is entitled to Social Security disability benefits if all of the following are true EXCEPT the

A. worker is insured for disability benefits. B. worker is under age 65. C. worker cannot perform his or her current job, but is actively seeking other employment. D. disability is expected to continue for 12 months or result in death.

Correct Answer: C

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QUESTION NO: 13
As defined in the California Insurance Code, "insurance" is a

A. contract. B. gamble. C. risk. D. peril.

Correct Answer: A

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QUESTION NO: 14
Which of the following statements regarding risk is TRUE?

A. Both pure and speculative risks are insurable. B. Neither pure nor speculative risks are insurable. C. Only speculative risks are insurable. D. Only pure risks are insurable.

Correct Answer: D

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