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Alabama Insurance Final Exam Questions
with Detailed Verified Answers (100%
Correct Answers) /Already Graded A+
Bart is injured and provides notice of a health claim to his insurer. He later
receives the required claims forms. Within how many days of the loss must Bart
file proof of loss with the insurance company?
Ans: 90
Which welfare program provides assistance to the needy?
Ans: medicaid
Who is considered the individual that retains all rights, values, and options of an
insurance policy?
Ans: the policy owner
Long Term Care policies normally provide benefits for:
Ans: home health care
A Long-Term Care (TLC) policy has a minimum renewability level of:
Ans: guaranteed renewable
Which of these statements accurately portray a whole life policy?
No cash value accumulates
Requires a conversion for coverage extending past age 70
Endows at age 70 and paid up at a stated time
Endows at age 100 and paid up at a stated time
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Ans: endows at age 100 and paid up at a stated time
Paula has an insurance policy that has a guaranteed minimum cash value, a
guaranteed death benefit, fixed premiums, and grows at a rate reflected by a
selected fund index. Which type of life policy fits this description?
Ans: equity indexed life
How long must a producer keep complete records pertaining to his/her insurance
transactions?
Ans: three years
A policyowner can collect the face amount on what type of policy?
Ans: endowment policy
Which of these statements regarding an insurance application is true?
All statements made on an application are considered to be warranties
A representation is valid as long as it is true
A representation made by an applicant is guaranteed to be true
A warranty is not guaranteed to be true
Ans: a representation is valid as long as it is true
A life insurance producer’s agency agreement normally authorizes the license to
do all of the following, EXCEPT:
solicit insurance
sell insurance
issue policies
collect premiums
Ans: issue policies
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What will the insurance company pay once the stop-loss is exceeded on a Major
Medical policy?
Ans: 100% of covered expenses
With Renewable Term Insurance,
Ans: the premium increases at renewal
The Alabama Life and Disability Insurance Guaranty has the power to:
loan money to an insolvent insurance company
guarantee the obligations of an insurance company
provide money to satisfy the obligations of an insurance company
all of these
Ans: all of these
Periodic benefit payments must be made no less frequently than:
Ans: monthly
Which of these statements concerning COBRA is correct?
Ans: Under COBRA, dependents of employees covered by group plans have the same
extension and conversion privileges available to them as the employee
Medicare supplement policies marketed in Alabama:
cannot offer benefits that simply duplicate Medicare benefits
cannot be more restrictive than Medicare
cannot treat a loss due to injury differently than a loss due to illness
all of these
Ans: all of these
If an individual would like to sell insurance for an insurance company, he/she
must:
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have passed the state exam for the lines of authority in which licensure is sought
be licensed as an insurance producer
be appointed by an insurer
all of these
Ans: all of these
Bert purchased an immediate annuity with quarterly payments. When will this
annuity start making payments?
Ans: 3 months after the annuity is bought
A Cross Purchase Buy-Sell Agreement is in place for ABC Company’s four
founding partners. What would this agreement require if the agreement is
funded with individual life insurance?
Ans: Each partner must own a policy on the other partners
Which of the following best describes a Health Maintenance Organization
(HMO)?
Ans: Provides full medical services that stress preventative medicine
What does renewable term guarantee?
Ans: The insured’s insurability
Which of these statements is true regarding the Medical Information Bureau
(MIB)?
Reports given to member companies contain information regarding the
insurability of insurance applicants
The proposed insured must give authorization before information can be given to
member companies
The MIB is a nonprofit agency which aids in underwriting insurance policies
All of the above
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Ans: All of the above
A dependent child can receive continuation of coverage under the parents’
policy for which of the following conditions?
Ans: Physical or mental disability
The period of time during which a surviving spouse does not qualify for Social
Security survivor or retirement benefits is called:
Ans: the blackout period
Which type of life insurance policy combines insurance protection with an
accumulation of cash value?
Ans: Permanent insurance
Wayne is covered under a nonoccupational group health policy. He is hurt while
traveling for business and requires a lengthy hospital stay. His group health
policy refuses to pay for hospital expenses because
Ans: this is considered a job-related accident
According to Required Provision 4, when an insured applies for reinstatement of
a health policy and receives a conditional receipt, how long does the insurer
have to approve or deny?
Ans: with 45 days of the date of application
Which entity is responsible for the majority of regulations imposed on the
insurance industry?
Ans: state government
All of these are correct concerning group life insurance, EXCEPT:
Whole life insurance is the form of insurance typically used in group life
insurance
Term life insurance is the form of insurance typically used in group life insurance
Group life insurance can cover a spouse and dependents
