ALAHI Arizona Life Accident and Health Insurance Exam - Set 4 - Part 3

Test your knowledge of technical writing concepts with these practice questions. Each question includes detailed explanations to help you understand the correct answers.

Question 41: A long term care applicant is offered a feature that increases the daily benefit amount over time, so that the coverage keeps pace with rising care costs in future years. Which of the following describes this optional feature?

A shared care rider

Guaranteed renewability

Inflation protection

A restoration of benefits provision

Question 42: An insurer issues a long term care policy without reviewing readily available medical records, then scrutinizes the applicant's history only after a claim arrives in order to find grounds for rescission. Which of the following describes this practice?

Post claims underwriting

Utilization management

Field underwriting

Concurrent review

Question 43: A long term care policy allows the insured to name a third person who will be notified before the coverage lapses for nonpayment, protecting an insured whose memory is failing. Which of the following concerns does this provision address?

Coordination of benefits

Post claim rescission

Adverse selection

Unintentional lapse

Question 44: The owner of a deferred annuity dies during the accumulation period, before any income payments have started, and the contract names a surviving beneficiary. Which of the following describes what the beneficiary generally receives under such a contract?

Nothing, since payments never began

The accumulated value, with gain taxable

Only the premiums originally deposited

The accumulated value entirely tax free

Question 45: A candidate must distinguish an annuity funded with money that was never taxed from one funded with money on which tax was already paid, since the difference changes how payments are taxed later. Which of the following states that difference correctly?

Qualified payments are fully taxable

Both are taxed under the exclusion ratio

Nonqualified payments are fully taxable

Both are entirely tax free at payout

Question 46: A retiree worries about outliving accumulated savings and wants a product whose defining purpose is to guarantee an income stream that cannot be exhausted during the retiree's own lifetime. Which of the following products is designed to address that specific concern?

A long term care policy

A Medicare supplement policy

A life annuity

A life insurance policy

Question 47: A candidate is asked which party to an annuity contract holds the power to surrender it, to change the beneficiary, and to select the payout option when the accumulation phase finally ends. Which of the following parties holds those rights?

The beneficiary

The insurer

The annuitant

The owner

Question 48: A worker who paid into the federal system throughout an entire career becomes eligible for a monthly retirement benefit calculated from lifetime earnings, and asks what determines the amount received. Which of the following best describes that calculation?

The number of dependents at retirement

The state where the worker retires

The worker's average indexed lifetime earnings

The worker's total assets at retirement

Question 49: A long term care applicant compares two policies that pay the same daily amount, but one promises to keep paying for three years while the other promises payments for the insured's remaining lifetime. Which of the following provisions differs between them?

The inflation protection feature

The benefit period

The elimination period

The benefit trigger

Question 50: A whole life policyowner borrows against the accumulated cash value of a contract that is not a modified endowment, and asks whether the borrowed money must be reported as income on a federal return. Which of the following describes the tax result?

The loan is generally not taxable income

The loan is taxed as capital gain

Only the interest charged is taxable

The entire loan is taxable when received

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