Missouri Life & Health Insurance Exam Answers

Why would the Director of Insurance examine the records of an insurance company? {Ans: To determine the solvency of the company}How do life insurance companies handle cases where the insured commits suicide within the contract's stated Contestable period? {Ans: Claims are denied under the Suicide clause of the policy}Which of the following dividend options results in taxable income to the policy owner? 1)paid up additions 2)cash 3)accumulation of interest 4)reduced premium {Ans: Accumulation of interest because while policy dividends are not taxable, any interest paid on them is taxable income in the year the interest is credited to the policy}Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy? 1)Limited 2)Special risk 3)Blanket 4)Reimbursement {Ans: reimbursement}What is the purpose of the Missouri Life and Health Insurance Guaranty Association? {Ans: Ensures that claims filed against insolvent insurance companies will be paid}According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options? 1)Annually 2)Semiannually 3)Quarterly 4)Monthly {Ans: Monthly The time of payment for claims is usually specified in different policies as 60 days, 45 days, or 30 days.