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Texas Health and Life Insurance Exam
With Answers 2024
Why does an insurer have a 2-year suicide clause? a) because the commissioner of insurance requires it. b) suicide is never paid for in life insurance. c)to prevent payment of an immediate claim for a person contemplating suicide. d) to help an insurer be more profitable. - ✔️Answer: C To prevent payment of an immediate claim for a person contemplating suicide. Which of these could the owner of a life insurance policy do when there is a collateral assignment? a) determine how the dividends are used. b) cash surrender the policy. c) obtain another loan. d) cancel the policy. - ✔️Answer: A Determine how the dividends are used. When only the insurer is allowed to alter an insurance contract, the clause that provides this is called? a) ownership b) entire contract c) consideration d) incontestable - ✔️Answer: B Entire contract Which of these is required to reinstate a lapsed policy? a) obtain a loan b) fill out a new application c) pay a late fee d) provide evidence of insurability - ✔️Answer: D Provide evidence of insurability The insuring clause in an adjustable life policy has all the following EXCEPT? a) insured b) insurer c) amount of premium d) amount of death benefit - ✔️Answer: C Amount of premium Which of the following cannot request or make a change to alter a life insurance policy?
a) the agent who wrote the policy b) the policy owner c) an executive officer of the insurer d) a person who has absolute assignment - ✔️Answer: A The agent who wrote the policy Which of these cannot sign or request a change in an insurance contract? a) policy owner b) insured c) executive officer of insurer d) producer of insurer - ✔️Answer: D Producer of insurer When the policy owner pays a premium in exchange for the insurer's promise to pay, what provision is this? a) consideration b) entire contract c) insuring clause d) changes - ✔️Answer: A Consideration When the insurer cannot contest a claim after 2 years, that is called? a) suicide clause b) incontestability clause c) entire contract d) consideration clause - ✔️Answer: B Incontestability clause Misstatement of age or gender on the application will result in? a) the policy being considered void or cancelled b) return of premiums c) death benefit paid adjusted to fit true age and gender d) full death benefit regardless - ✔️Answer: C Death benefit paid adjusted to fit true age and gender. What happens if a person returns a policy during the free look period? a) the insured may apply for another policy without a medical exam b) the policy is immediately terminated; the insurer retains the premium for the underwriting costs c) a refund of premiums minus the number of days the policy was in effect d) a full refund of all premiums paid is returned - ✔️Answer: D A full refund of all premiums paid is returned.
c) g's next of kin d) wife's next of kin - ✔️Answer: B G's estate G has a life policy with his new wife listed as primary beneficiary and his son listed as contingent beneficiary. The whole family dies in the same accident. According to the Common Disaster Clause where will the policy proceeds be paid? a) wife's estate b) g's estate c) son's estate d) wife's and g's estate both share equally - ✔️Answer: B G's estate In which of these settlement options for life insurance would the death benefit not be paid out over a period of time? a) fixed period b) fixed amount c) life income only d) interest only - ✔️Answer: D Interest only Which of the following statements concerning settlement options is true? a) principal payments and interest are income taxable b) only the interest is taxable c) the policy owner may not elect the settlement option, only the beneficiary can d) principal payments and interest are not income taxable - ✔️Answer: B Only the interest is taxable When would the tertiary beneficiary receive death benefit in a life insurance policy? a) if the insured dies before the he contingent beneficiary b) if the primary and contingent beneficiary dies before the insured c) if the primary and contingent beneficiary dies after the insured d) if the contingent beneficiary dies after the insured - ✔️Answer: B If the primary and contingent beneficiary dies before the insured Cobra would cover dependents of an employee for how long after the death of the employee? a) no months b) 18 months c) 36 months d) 20 months - ✔️Answer: C 36 months What is the minimum number of employees to be eligible for Cobra coverage?
a) 50 b) 100 c) 10 d) 20 - ✔️Answer: D 20 A conversion privilege in a group health plan allows which of the following? a) 31 days to request Cobra coverage under your group health insurance policy without proof of insurability b) continuation of coverage for a dependent beyond age 26 for physical or mental handicap c) 31 days to convert the group coverage to an individual health insurance policy without proof of insurability d) the right to convert your ex-employers group health to your new employers group health - ✔️Answer: C 31 days to convert the group coverage to an individual health insurance policy without proof of insurability Flexible Spending Accounts FSA's pay for which of these? a) elective cosmetic surgeries b) reimbursed medical expenses c) cancer treatment only d) unreimbursed medical expenses - ✔️Answer: D Unreimbursed medial expenses A certificate would be given to which of these in a group health plan? a) spouses b) employee c) policy owner d) employer - ✔️Answer: B Employee M switched his job and enrolled on his new employers group health plan. 3 months laters M was prescribed a new allergy medication. The health insurer will? a) pay none of the new prescription b) void the policy for preexisting conditions c) pay the whole cost minus the deductible and coinsurance d) pay 1/2 of the new prescription - ✔️Answer: C Pay the whole cost minus the deductible and coinsurance Which of these is true for medicaid? a) part of social security b) sold by insurers c) federal and state funded d) for people 65 and older -
c) A the physical exam, B the hospital d) A the hospital, B physicians service - ✔️Answer: D A the hospital, B physicians service Of the following listed choices, which is true as it pertains to Medicare Part A? a) all recipients pay a monthly premium b) it is prepaid through FICA taxes c) it covers all prescription drugs d) provides coverage for outpatient services - ✔️Answer: B It is prepaid through FICA taxes All of the following are prohibited provisions in a long term care policy, except? a) limits or denies benefits to a policy holder who is diagnosed with any destructive brain tissue disease with will result in loss of brain function b) provides coverage for only skilled nursing care instead of lower levels of care c) canceling a policy due to nonpayment of premium d) cancels, non-renews, or terminates the policy on the grounds of age or deterioration of the mental or physical health of the insured - ✔️Answer: C Canceling a policy due to nonpayment or premium The OASDHI Old Age, Disability, and Health Insurance is also known as? a) medicaid b) medicare c) social security d) worker's compensation - ✔️Answer: C Social security What part of medicare pays for prescription drugs? a) part a b) part d c) part b d) part c - ✔️Answer: B Part D Long term care policies pay for all of these, EXCEPT? a) skilled nurses b) rehabilitation c) substance abuse d) home health care - ✔️Answer: C Substance abuse In order to have Medicare part C the individual must have? a) A, B and D b) A only
c) A and B d) B only - ✔️Answer: C A and B P is 65 years old, he has medical coverage that pays his doctors visits and his hospital bills. he most likely has? a) major medical b) medicare A and B c) Long term care d) cancer policy - ✔️Answer: B Medicare A and B Medicare A and B pays for? a) A the hospital, B physicians service b) A the doctor, B the hospital c) A the physical exam, B the hospital d) A the hospital, B prescription drugs - ✔️Answer: A A the hospital, B physicians service Which policy provides the most protection for the least amount of money? a) term life b) universal life c) equity indexed whole life d) adjustable life - ✔️Answer: A Term life Which policy is a 2nd or last to die policy? a) joint life b) variable life c) modified whole life d) joint survivor life - ✔️Answer: D Joint life survivor Where is the Straight Whole Life insurance policy will you find the parties in the contract? a) consideration clause b) common disaster clause c) incontestable clause d) insuring clause - ✔️Answer: D Insuring clause P wants a life policy with quick cash value accumulation. Which policy should the producer recommend? a) straight whole life
b) cash value and dividends continue to increase just as if the regular premium payments have been made c) it is increased for each payment made by the rider d) the cash value remains unchanged, until the insured is no longer disabled - ✔️Answer: B Cash value and dividends continue to increase just as if the regular premium payments have been made Which of the following life insurance policies provides protection for a limited period of time? a) single premium whole life policy b) universal life policy c) term policy d) limited pay whole life policy - ✔️Answer: C Term policy This rider guarantees a policy on a minor will continue even though the parent paying premiums became disabled? a) payor benefits b) guaranteed insurability c) return of premium d) waiver of premium - ✔️Answer: A Payor benefit Which of the following policies would be a limited pay whole life? a) premiums and policy expire after a limited period of time b) policy lasts for a limited time then expires c) premiums payable for a limited time then expire but the policy goes on d) premiums are limited for a while then they increase - ✔️Answer: C Premiums payable for a limited time then expire but the policy goes on The right to change a term policy to a permanent policy without proof of insurability if called? a) changeable b) convertible c) level d) renewable - ✔️Answer: B Convertible In which of the following policies is the cash value in the policy invested in stocks and/or bonds? a) universal life b) limited pay whole life c) single premium whole life d) variable life - ✔️Answer: D
Variable life An insurance company incorporated in New York selling polices in Texas would be called? a) domestic b) mutual c) alien d) foreign - ✔️Answer: D Foreign A person is told they won't receive any aid processing a claim unless they sign a release form. This is known as? a) coercion b) discrimination c) intimidation d) boycott - ✔️Answer: A Coercion An insurer wishing to dissolve their relationship with a producer would? a) terminate producers insurance license b) non renew producers insurance license c) file a law suit d) terminate producers appointment - ✔️Answer: D Terminate producers appointment For which if the following polices must an Outline of Coverage be delivered? a) major medical b) medicare supplement c) HMO d) disability - ✔️Answer: B Medicare supplement After an investigation, an insurer denies a false claim. The insurer must? a) terminate policy as of claim date b) provide a reasonable explanation c) immediately terminate the policy back to issue date d) wait until the renewal to non renew the policy - ✔️Answer: B Provide a reasonable explanation When a person or a company voluntarily surrenders a known right, this is known as? a) warranties b) waiver c) fraud d) agreement - ✔️Answer: B
✔️Answer: B Representation Statements made on a claim form or on an application for insurance that are believed to be true are? a) waivers b) misrepresentations c) warranties d) representations - ✔️Answer: D Representations S and W are partners in a business. They both buy and own policies on the other. 3 years later the business dissolved. S and W are both married. They don't change the beneficiaries on the policies. They no longer have insurable interest on each other. 5 months late S dies, who will receive the proceeds? a) W b) S's wife c) W's wife d) the partnership - ✔️Answer: A W Which of these is a requirement for licensing in Texas? a) U.S. citizen b) high school diploma c) must be honest, fair and in good standing d) must be 17 years old - ✔️Answer: C Must be honest, fair and in good standing If an applicant or insured discovers error in their credit report, the fair credit reporting act requires the following to correct the report? a) applicant/insured b) producer c) credit reporting agency d) underwriter - ✔️Answer: C Credit reporting agency AIDS testing requires all of these, EXCEPT? a) gathering of data on positive results for studies b) questions about HIV and AIDS are illegal c) underwriting required testing d) signed consent for testing - ✔️Answer: A Gathering of data on positive results for studies Which of these would be a requirement for obtaining a temporary license in Texas? a) pass these written exam
b) 21 years old c) be considered for appointment by an insurer d) U.S. citizen - ✔️Answer: C Be considered for appointment by an insurer A long term care policy will provide payment for which of these? a) pre-hospital doctor visit b) home health c) post hospital doctor visit d) hospitalization - ✔️Answer: B Home health How many hours of continuing education hours must be ethics per renewal period? a) 24 b) 10 c) 12 d) 2 - ✔️Answer: D 2 Which of these cannot request information about fraudulent health claims? a) local police b) insured c) district attorney d) commissioner of insurance - ✔️Answer: B Insured Dividends paid by stock insurers are paid to: a) service providers b) shareholders c) policy holders d) agencies - ✔️Answer: B Shareholders The department of insurance does all the following except? a) computes reinsurance reserves b) releases reinsurance reserves if needed c) administers the worker's compensation system d) ensures fair competition in the industry - ✔️Answer: B Releases reinsurance reserves if needed How long after passing your exam must you apply for your insurance license? a) 6 months b) 24 months c) 18 months
a) the insurer waived their right to use any information from the unanswered questions. b) the policy will later be found to be incomplete, it will be voided and all premiums refunded. c) The insurer issued a normal policy and all provisions will apply regardless of the unanswered questions. d) The insurer will deny a claim if the information from the unanswered questions were the result of the insured's death - ✔️Answer: A The insurer waived their right to use any information from the unanswered questions A corporation hires a new president. Concerned about losing him in an accident or to an illness. All of these would be true, except? a) the employer would request a key person plan b) the employee picks the beneficiary c) the employee must sign the application d) employer is the applicant/owner - ✔️Answer: B The employee picks the beneficiary V has a disability income policy paying $500 per month with a 30 day elimination period. V becomes disabled on May 1, returns to work on May 15. V becomes disabled again on June 1 and returns to work on December 1. How much did the disability income policy pay? a) 0 b) $ c) $ d) $2750 - ✔️Answer: B $ A business owner buys a disability income policy paying $2000 per month which of these riders could be used to increase the benefits as his business grows without having to prove insurability? a) elimination period b) guaranteed purchase option c) impairment rider d) waiver of premium - ✔️Answer: B guaranteed purchase option X is disabled for 3 1/2 months. His policy pays $500 per month for total disability with a 30 day elimination period. The benefit paid would be? a) $ b) $ c) $ d) $1750 - ✔️Answer: C $
J injures his lower back loading his furniture into a moving van. He recovers and then four months later reinjures the same area. What type of disability is this? a) temporary disability b) recurrent disability c) residual disability d) presumptive disability - ✔️Answer: B recurrent disability which rider in a disability income policy allows the insured to purchase additional monthly benefits at specific ages, dates or occurrences without providing proof of good health? a) guaranteed purchase option b) impairment rider c) elimination period d) waiver of premium - ✔️Answer: A guaranteed purchase option what is not used to determine premium in a disability income policy? a) Health history b) spouses occupation c) avocation d) income - ✔️Answer: B spouses occupation with a business overhead expense policy, all of the following are claims that are covered except? a) employee labor b) Office rent c) Utilities d) The salary or profit of the business owner - ✔️Answer: D The salary or profit of the business owner which of these annuities pays based on units? a) fixed annuity b) indexed annuity c) flexible annuity d) variable annuity - ✔️Answer: D variable annuity in which retirement plan, if the employer puts money in his own account must he also put money in his employees account? a) simple b) IRA c) SEP d) TSA -
✔️Answer: D 2 which provision in a health insurance plan is used to avoid over insurance when a person is covered by more than one plan? a) coordination of benefits b) schedule of benefits c) primary care coverage d) extension of benefits - ✔️Answer: A coordination of benefits this is the only accident and health insurance policy that pays out a lump sum benefit upon the death of the insured in certain situations. a) accidental death and dismemberment policy b) Long term care policy c) cancer policy d) disability income policy - ✔️Answer: A accidental death and dismemberment policy A person has a major medical policy with premiums due on the 1st of every month. The individual does not pay May or June's payment and goes into the hospital on June 18. the insurer will? a) deny the claim b) Pay the claim minus the premium due c) request May's payment d) request May and June's payment - ✔️Answer: A deny the claim which of the following would allow the insured to purchase additional insurance on a disability income policy in the event of marriage, promotion, or the birth of a child, without having to prove insurability? a) waiver of insurability b) guaranteed insurability c) additional insurance protection d) Family - ✔️Answer : B guaranteed insurability which provision states that the insurance company must pay claims immediately? a) Time of payment of claims b) payment of claims c) legal actions d) relation of earnings to insurance - ✔️Answer: A Time of payment of claims
fraudulent misstatements on a health policy causes claims to be denied because of which of these? a) entire contract b) payment of claims c) reinstatement d) Time limit on certain defenses - ✔️Answer: D Time limit on certain defenses Time payment of claims in health insurance means which of these? a) The insurer has 15 days to pay the claim once received b) The insurer has 20 days to pay the claim once received c) The insurer must pay the claim immediately d) The insurer has 90 days to pay the claim once received - ✔️Answer: C The insurer must pay the claim immediately A person is shot while committing a crime. What will the health insurer do? a) Pay the whole hospital bill b) Pay none of the hospital bill c) Pay the whole hospital bill minus the deductible d) Pay only half of the hospital bill - ✔️Answer: B Pay none of the hospital bill under the legal actions mandatory uniform provision, an insured must wait at least____days after providing proof of loss before he or she can take legal action against the insurer. a) 90 days b) 180 days c) 60 days d) 45 days - ✔️Answer: C 60 days When payment under a medical expense policy is based on the average fee charged by all doctors in a given geographical area, and the balance of any overcharges or cost of any disallowed services are the insured's responsibility, the payment is known as? a) scheduled payment b) usual, customary, reasonable (USR) payment. c) cash payment d) blanket payment - ✔️Answer: B usual, customary, reasonable (USR) payment A cancer policy covers all of these, except? a) chemotherapy b) immunotherapy c) Appendectomy
