Free South Carolina Accident & Health insurance exam practice test

Correct answer: A. A written designation of another person to get lapse notices, or a signed waiver

• A. Correct. Section 7A(1) bars issuing the policy until the insurer receives a written designation of at least one other person to receive notice of lapse for nonpayment, or a dated, signed written waiver.
• B. Incorrect. Section 7A(1) concerns who receives notice of lapse or termination, not beneficiary designations.
• C. Incorrect. The rule calls for a designee to receive lapse notices (or a waiver), not a power of attorney to pay premiums.
• D. Incorrect. Section 7A(1) does not require a medical statement; it requires a notice designee or a signed waiver.

Section 7. Unintentional Lapse [...] No individual long-term care policy or certificate shall be issued until the insurer has received from the applicant either a written designation of at least one person, in addition to the applicant, who is to receive notice of lapse or termination of the policy or certificate for nonpayment of premium, or a written waiver dated and signed by the applicant electing not to designate additional persons to receive notice.

Correct answer: C. No later than 60 days before the date the change takes effect

• A. Incorrect. Notice must come before the change, not after it.
• B. Incorrect. The statute requires notice not later than 60 days before the effective date.
• C. Correct. The plan or issuer must notify enrollees not later than 60 days prior to the date the modification becomes effective.
• D. Incorrect. Notice must be given before the change becomes effective, not at a later open enrollment.

If a group health plan or health insurance issuer makes any material modification in any of the terms of the plan or coverage involved (as defined for purposes of section 1022 of title 29) that is not reflected in the most recently provided summary of benefits and coverage, the plan or issuer shall provide notice of such modification to enrollees not later than 60 days prior to the date on which such modification will become effective.

Correct answer: A. No; an HRA may receive contributions only from the employer

• A. Correct. Publication 969 states that an HRA must receive contributions from the employer only and that employees may not contribute.
• B. Incorrect. Employees may not contribute to an HRA at all; the HSA limit does not apply to HRAs.
• C. Incorrect. Employees may not contribute to an HRA, including through salary reductions.
• D. Incorrect. HDHP enrollment does not permit employee contributions to an HRA.

An HRA must receive contributions from the employer only. Employees may not contribute.

Correct answer: C. The premium each company charges

• A. Incorrect. Policies with the same letter have the same benefits; only the price differs.
• B. Incorrect. Benefits, including deductible coverage, are the same for the same letter.
• C. Correct. Medicare.gov says the price is the only difference between policies with the same plan letter sold by different companies.
• D. Incorrect. Medicare.gov names price as the only difference between same-letter policies.

The price is the only difference between policies with the same plan letter sold by different companies.

Correct answer: B. Limited benefit health coverage

• A. Incorrect. Section 7K(1) expressly applies to a policy other than one covering only a specified disease or diseases.
• B. Correct. Section 7K(1) defines limited benefit health coverage as a policy or contract, other than one covering only a specified disease or diseases, that provides benefits less than the minimum standards required under the listed subsections.
• C. Incorrect. Accident only coverage is a separate category for coverage of losses caused by accident; the described policy is defined by falling below the minimum standards.
• D. Incorrect. Hospital confinement indemnity coverage is one of the categories with its own minimum standard (Subsection D), not the category for policies falling below the standards.

"Limited benefit health coverage" is a policy or contract, other than a policy or contract covering only a specified disease or diseases, that provides benefits that are less than the minimum standards for benefits required under Subsections B, C, D, E, F, G, I and K.

Correct answer: D. 30 days after receiving the claim

• A. Incorrect. The regulation allows a reasonable period of time, but not later than 30 days, for a post-service adverse determination.
• B. Incorrect. Ninety days is longer than the 30-day outside limit for post-service claims.
• C. Incorrect. The 72-hour limit applies to urgent care claims, not post-service claims.
• D. Correct. Paragraph (f)(2)(iii)(B) requires notice of an adverse determination on a post-service claim not later than 30 days after receipt of the claim.

Post-service claims. In the case of a post-service claim, the plan administrator shall notify the claimant, in accordance with paragraph (g) of this section, of the plan's adverse benefit determination within a reasonable period of time, but not later than 30 days after receipt of the claim.

Correct answer: D. 365 days

• A. Incorrect. Ninety days is the limit for coverage providing a benefit of one year or less.
• B. Incorrect. 180 days is the limit for benefits of more than one year but not more than two years.
• C. Incorrect. Section 7G(2) caps the elimination period at 365 days.
• D. Correct. Section 7G(2)(c) allows an elimination period of up to three hundred sixty five (365) days in all cases other than benefits of two years or less.

(2) Contains an elimination period no greater than: [...] (a) Ninety (90) days in the case of a coverage providing a benefit of one year or less; [...] (b) One hundred and eighty (180) days in the case of coverage providing a benefit of more than one year but not greater than two (2) years; or [...] (c) Three hundred sixty five (365) days in all other cases during the continuance of disability resulting from sickness or injury;

Correct answer: B. The insurer owes nothing for a loss that the felony helped cause

• A. Incorrect. The illegal occupation provision states the insurer is not liable for the loss; it does not scale benefits down to what the premium would have bought.
• B. Correct. The insurer is not liable for any loss to which a contributing cause was the insured's commission of or attempt to commit a felony.
• C. Incorrect. The provision removes the insurer's liability for the loss; it does not require full payment.
• D. Incorrect. The provision applies when a felony or attempted felony was a contributing cause; it does not turn on a later acquittal.

The insurer shall not be liable for any loss to which a contributing cause was the insured's commission of or attempt to commit a felony [...] or to which a contributing cause was the insured's being engaged in an illegal occupation

Correct answer: D. At its own expense, where autopsy is not forbidden by law

• A. Incorrect. The provision says the insurer acts at its own expense; it does not require beneficiary payment or consent.
• B. Incorrect. The provision ties the right to the pendency of the claim and the law, not a 20-day window.
• C. Incorrect. The provision expressly includes the right to make an autopsy in case of death.
• D. Correct. The provision gives the insurer, at its own expense, the right to make an autopsy in case of death where it is not forbidden by law.

The insurer at its own expense shall have the right and opportunity to examine the person of the insured when and as often as it may reasonably require during the pendency of a claim hereunder and to make an autopsy in case of death where it is not forbidden by law.

Correct answer: D. 60 days

• A. Incorrect. 72 hours is not the stated period for an appeal about a service already received.
• B. Incorrect. 30 days applies when the appeal is for a service not yet received.
• C. Incorrect. 180 days is the time to file an internal appeal, not to complete one.
• D. Correct. HealthCare.gov says internal appeals must be completed within 60 days if the appeal is for a service already received (30 days for a service not yet received).

Your internal appeal must be completed within 30 days if your appeal is for a service you haven't received yet. [...] Your internal appeals must be completed within 60 days if your appeal is for a service you've already received.

Correct answer: D. They shield a set share of the couple's resources for her

• A. Incorrect. Medicaid.gov says a certain amount of the couple's combined resources is protected for her; the protection is not limited to the home.
• B. Incorrect. The provisions look at the couple's combined resources and protect a certain amount for her; they do not set aside everything titled in her name.
• C. Incorrect. The provisions protect a certain amount of the couple's combined resources for the spouse living in the community, not his income for his own needs.
• D. Correct. Medicaid.gov says a certain amount of the couple's combined resources is protected for the spouse living in the community.

Under the Medicaid spousal impoverishment provisions, a certain amount of the couple's combined resources is protected for the spouse living in the community.

Correct answer: B. Medicare Part B

• A. Incorrect. Part A helps cover inpatient hospital care, skilled nursing facility care, hospice care, and home health care.
• B. Correct. Part B helps cover services from doctors and other health care providers, outpatient care, home health care, durable medical equipment, and many preventive services.
• C. Incorrect. Part D helps cover the cost of prescription drugs.
• D. Incorrect. Part C (Medicare Advantage) is an alternative to Original Medicare offered through private plans; this client is in Original Medicare.

Part B helps cover: Services from doctors and other health care providers, Outpatient care, Home health care, Durable medical equipment [...] Many preventive services

Correct answer: A. No, it may look just at his relationship to Tom

• A. Correct. The regulation says a plan may not define dependent other than by the relationship between the child and the participant, and may not deny coverage based on residency, student status, or financial dependency.
• B. Incorrect. Residency with the participant is one of the factors the regulation says may not be used to deny coverage of a child under 26.
• C. Incorrect. Student status is a listed factor that may not be used to deny or restrict coverage for a child under 26.
• D. Incorrect. Financial dependency is a listed factor that may not be used to deny or restrict coverage for a child under 26.

Restrictions on plan definition of dependent [...] With respect to a child who has not attained age 26, a plan or issuer may not define dependent for purposes of eligibility for dependent coverage of children other than in terms of a relationship between a child and the participant. Thus, for example, a plan or issuer may not deny or restrict dependent coverage for a child who has not attained age 26 based on the presence or absence of the child's financial dependency (upon the participant or any other person); residency with the participant or with any other person; whether the child lives, works, or resides in an HMO's service area or other network service area; marital status; student status; employment; eligibility for other coverage; or any combination of those factors.

Correct answer: A. It is excluded from the employee's gross income

• A. Correct. Except as otherwise provided in section 106, gross income of an employee does not include employer-provided coverage under an accident or health plan.
• B. Incorrect. Section 106(a) excludes employer-provided accident or health coverage from the employee's gross income.
• C. Incorrect. Section 106(a) contains no dollar threshold for accident or health coverage; the coverage is excluded.
• D. Incorrect. Section 106(a) excludes the coverage itself from gross income; filing a claim does not make it taxable.

Except as otherwise provided in this section, gross income of an employee does not include employer-provided coverage under an accident or health plan.

Correct answer: D. Any right or option to get the record on paper

• A. Incorrect. 7001(c)(1)(B)(i)(I) concerns the option to receive records on paper, not agent compensation.
• B. Incorrect. The required statement concerns the right or option to get paper records, not a premium change.
• C. Incorrect. The required statement concerns the consumer's paper option, not a list of state laws.
• D. Correct. Before consenting, the consumer must be given a clear and conspicuous statement informing the consumer of any right or option to have the record provided on paper or in nonelectronic form.

Notwithstanding subsection (a), if a statute, regulation, or other rule of law requires that information relating to a transaction or transactions in or affecting interstate or foreign commerce be provided or made available to a consumer in writing, the use of an electronic record to provide or make available (whichever is required) such information satisfies the requirement that such information be in writing if [...] the consumer, prior to consenting, is provided with a clear and conspicuous statement [...] any right or option of the consumer to have the record provided or made available on paper or in nonelectronic form

Correct answer: B. Insurer X only, as the long-term care issuer

• A. Incorrect. The definition expressly excludes a nursing home fixed indemnity policy, so Insurer Y is not a health plan for that policy.
• B. Correct. 45 CFR 160.103 includes an issuer of a long-term care policy as a health plan but excludes a nursing home fixed indemnity policy.
• C. Incorrect. Only the long-term care issuer is included; the nursing home fixed indemnity policy is specifically carved out.
• D. Incorrect. The definition expressly includes an issuer of a long-term care policy, so Insurer X is a health plan.

Health plan means an individual or group plan that provides, or pays the cost of, medical care. [...] An issuer of a long-term care policy, excluding a nursing home fixed indemnity policy,

Correct answer: D. No, since it did not materially affect the risk or the hazard

• A. Incorrect. Under Section 5C, only a false statement that materially affected the risk or hazard can bar recovery.
• B. Incorrect. Section 5C turns on materiality to the risk or hazard, not on when the insurer finds the falsity.
• C. Incorrect. Section 5C does not depend on who wrote the answer; it depends on whether the falsity was material.
• D. Correct. Section 5C says a false statement in the application may not bar recovery unless it materially affected either the acceptance of the risk or the hazard assumed by the insurer.

The falsity of any statement in the application for any policy covered by this Act may not bar the right to recovery thereunder unless such false statement materially affected either the acceptance of the risk or the hazard assumed by the insurer.

Correct answer: C. For as long as the Director chooses

• A. Incorrect. The definition sets no fixed term of years.
• B. Incorrect. The deputy serves at the Director's pleasure, not the Governor's.
• C. Correct. Section 38-1-20(18) says the designee or deputy director serves at the will and pleasure of the director.
• D. Incorrect. No Senate removal vote is part of the definition.

(18) "Designee or deputy director" means the person or persons appointed by the director, serving at the will and pleasure of the director as his designee, to supervise and carry out the functions and duties of the department as provided by law.

Correct answer: B. An appointed producer of that insurer

• A. Incorrect. Surplus lines brokers are largely outside the chapter; the statute requires an appointed producer.
• B. Correct. Section 38-43-10(A)(5) lists receiving, collecting, or transmitting premium, and such a person must be an appointed producer of the insurer unless Section 38-43-20 provides otherwise.
• C. Incorrect. Being an insurer employee does not remove the requirement; the acts must be done by an appointed producer.
• D. Incorrect. The statute requires an appointed producer, not a premium finance company.

(A) A person who: [...] (5) receives, collects, or transmits any premium of insurance; or (6) performs any other act in the making of an insurance contract for or with an insurer, other than for himself; whether these acts are done by an employee of an insurer or at the instance or request of an insurer, must be an appointed producer of the insurer for which the act is done or the risk is taken unless provided otherwise in Section 38-43-20.

Correct answer: D. 10 days' notice

• A. Incorrect. The notice period is ten days, not five.
• B. Incorrect. Twenty days is the investigatory hearing notice for examinations.
• C. Incorrect. Thirty days is the general hearing notice in Section 38-3-170, not this one.
• D. Correct. Section 38-43-130(A) allows probation, revocation, or suspension after ten days' notice.

(A) The director or his designee may place on probation, revoke, or suspend a producer's license after ten days' notice or refuse to issue or reissue a license when it appears that a producer has been convicted of a crime involving moral turpitude, has violated this title or any regulation promulgated by the department, or has wilfully deceived or dealt unjustly with the citizens of this State.

Correct answer: A. The amount insured

• A. Correct. Section 38-43-250 requires records showing the number, date, term, amount insured, premiums, and person to whom issued.
• B. Incorrect. A credit score is not a listed item.
• C. Incorrect. The insured's employer is not a listed item.
• D. Incorrect. Medical history is not a listed item.

All producers shall make and keep a full and correct record of the business done by them, showing the number, date, term, amount insured, premiums, and the person to whom issued of every policy or certificate of renewal.

Correct answer: B. An order to cease and desist and an order imposing penalties

• A. Incorrect. License revocation is not one of the two orders this section requires.
• B. Correct. The director issues an order to cease and desist from the practice and an order imposing penalties provided in Section 38-2-10.
• C. Incorrect. The section requires the director's own orders, not only a referral.
• D. Incorrect. Restitution is not one of the orders named in this section.

If, after a hearing, the director or his designee determines that a method of competition or an act or practice is unfair or deceptive as defined in this title and that the person complained of has engaged in the method of competition, act, or practice in violation of this title, he shall reduce his finding to writing and shall issue and cause to be served upon the person charged with the violation: (1) an order requiring the person to cease and desist from engaging in the method of competition, act, or practice; and (2) an order imposing penalties provided in Section 38-2-10.

Correct answer: D. 6 months

• A. Incorrect. The standard is six months, not three.
• B. Incorrect. The standard is six months, not twelve.
• C. Incorrect. The standard is six months, not twenty-four.
• D. Correct. Section 8.A(1) bars excluding or limiting benefits for losses incurred more than six months from the effective date because of a preexisting condition.

A. General Standards. The following standards apply to Medicare Supplement policies and certificates and are in addition to all other requirements of this regulation. (1) A Medicare Supplement policy or certificate shall not exclude or limit benefits for losses incurred more than six (6) months from the effective date of coverage because it involved a preexisting condition.

Correct answer: C. Cognitive impairment and ADL limitations

• A. Incorrect. A hospital stay is not one of the required measures; physician certification is mentioned only if the policy requires it.
• B. Incorrect. Age and prior admissions are not the required measures.
• C. Correct. Section 8.G requires activities of daily living and cognitive impairment to be used to measure need for long term care.
• D. Incorrect. Medicare eligibility and income are not the required measures.

G. Benefit Triggers. Activities of daily living and cognitive impairment shall be used to measure an insured's need for long term care and shall be described in the policy or certificate in a separate paragraph and shall be labeled "Eligibility for the Payment of Benefits."

Correct answer: C. 10-point

• A. Incorrect. 38-71-330(4) sets a minimum of ten-point type.
• B. Incorrect. 38-71-330(4) sets a minimum of ten-point type.
• C. Correct. 38-71-330(4) requires type of uniform size not less than ten-point.
• D. Incorrect. 38-71-330(4) sets a minimum of ten-point type.

No policy of accident and health insurance may be delivered or issued for delivery to any person in this State unless: [...] (4) The style, arrangement, and overall appearance of the policy give no undue prominence to any portion of the text and every printed portion of the text of the policy and of any endorsements or attached papers is plainly printed in light-faced type of a style in general use, the size of which must be uniform and not less than ten-point with a lower-case unspaced alphabet length not less than one-hundred-and-twenty-point (the "text" includes all printed matter except the name and address of the insurer, name or title of the policy, the brief description, if any, and captions and subcaptions).