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XCEL Final Exam Questions and Answers (Graded A)
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XCEL Final Exam Questions and Answers
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XCEL Final Exam Questions andAnswers
Which of the following does Medicare Part D cover? - Answer -prescription drugs
Without a Section 125 Plan in place, what would happen to an employee's payroll
contribution to an HSA? - Answer -It would be considered taxable income to the
employee
A whole life policy option where extended term insurance is selected is called a(n) -
Answer -nonforfeiture option
Michigan requires that a licensee complete ___ hours of continuing education on the
subject of ethics every reporting period - Answer -3
A producer's license is required for all of these activities EXCEPT - Answer -
Underwriting Insurance
Upon policy delivery, which of the following must a producer have an applicant sign if no
initial premium was collected with the life insurance application? - Answer -A good
health statement
Premiums paid that exceed 7 1/2% of an insured's Adjusted Gross Income (AGI) are
tax-deductible when paid for which of the following plans? - Answer -Qualified Long-
Term Care Plan
Medicare Part A does not pay for medical benefits provided for treatment in a skilled
nursing facility beyond _______ days - Answer -100 Days
In order for contract to be valid, it must - Answer -contain an offer and acceptance
XYZ Insurance Company receives satisfactory proof of loss for a claim. If XYZ does
NOT pay the claim within 60 days of receipt, the insurer MUST pay simple interest of
___ per annum. - Answer -12%
An error was made on Mary's life insurance application. Which of the following areas
are errors commonly made on applications for which the incontestable clause does
NOT apply?
,Marital status
Age
Address
Income - Answer -Age
A Universal Life policyowner must receive a notice of cash surrender value at LEAST
every - Answer -Year
What is the tax liability for employer contributions in Health Savings Accounts (HSA's)? -
Answer -No tax payment needed
Which of these is considered to be a document that describes the critical segments of a
life insurance policy?
Buyer's Guide
Policy Summary
Consumer Report
Buyer's Summary - Answer -Policy Summary
Ken is a producer who has obtained Consumer Information Reports under false
pretenses. Under the Fair Credit Reporting Act, what is the maximum penalty that may
be imposed on Ken? - Answer -$5000
An attending physician's statement would be appropriate for which life insurance
purpose? - Answer -At the request of the insurer to assist in the underwriting decision
The ________ must notify the producer in the event of the producer's insurance
appointment being terminated.
Insurer
NAIC
DIFS
Commissioner - Answer -Insurer
Which type of long-term care benefit would be most appropriate for a stroke victim who
requires speech therapy administered at her home? - Answer -Home Health Care
,An example of an unfair claims settlement practice is - Answer -failing to promptly
provide a reasonable explanation for the denial of claims
Which type of policy combines the flexibility of a universal life policy with investment
choices? - Answer -Variable Universal Life Policy
A newborn must be covered under an existing health policy - Answer -at the moment of
birth
Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value.
She would like to borrow $15,000 against the cash value. Which of the following
statements is TRUE?
Net death benefit will be reduced if the loan is not repaid
No interest will be charged on loan balance
Term Life policies are the only type of insurance that allows policy loans
A loan can be taken out for up to the face amount of the policy - Answer -Net death
benefit will be reduced if the loan is not repaid
An insured dies from what appears to be accidental causes. When confirming the cause
of death, which of these actions by the insurer takes precedence?
Autopsy
Eyewitness account
Police report
Physician notes - Answer -Autopsy
An individual who removes the risk of losing money in the stock market by never
purchasing stocks is said to be engaging in - Answer -Risk avoidance
A beneficiary change can occur - Answer -normally at any time during the policy term
Fixed period settlement options are considered to be a form of a(n) - Answer -Annuity
Karen is a producer who has obtained personal information about a client without
having a legitimate reason to do so. Under the McCarran-Ferguson Act, what is the
minimum penalty for this? - Answer -$10,000
Which of the following is considered to be the period when the accumulated value in an
annuity is paid out?
, Annuitization phase
Accumulation phase
Principal phase
Period certain phase - Answer -Annuitization phase
Justin is receiving disability income benefits from a group policy paid for by his
employer. How are these benefits treated for tax purposes? - Answer -Taxable income
An example of a primary care physician would be a(n) - Answer -internist
Under which circumstance may a deferred insurance commission be paid to an
individual? - Answer -Individual was a licensed producer at the time of the sale
A life insurance policy normally contains a provision that restricts coverage in the event
of death under all of the following situations EXCEPT - Answer -fare-paying passenger
After an insured gives notice of loss, what must he/she do if the insurer does not furnish
forms? - Answer -File written proof of loss
Proceeds from a life insurance policy are protected from the beneficiary's creditors by
which clause? - Answer -spendthrift trust clause
An insurer would be committing Unfair Discrimination if coverage was denied based
upon - Answer -Sex
What are an applicant's statements concerning occupation, hobbies, and personal
health history regarded as? - Answer -representation
Which of the following is an example of a producer's fiduciary duty?
Recording receipt and remittance of premiums due to the insurance company
Determine the rate classification of the insured
Reviewing policy summary of benefits
Witnessing applicant's signature - Answer -Recording receipt and remittance of
premiums due to the insurance company
Under the Health Insurance Portability and Accountability Act (HIPAA), the employee's
new Group Health Plan will verify Creditable Coverage so that the - Answer -employee's
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