Choose wisely. There is only one correct answer to each question.
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1.
If you are turned down for life insurance, you will not qualify for long-term care insurance either.
False. Some people who have unsuccessfully applied for life insurance incorrectly assume they cannot qualify for long-term care insurance either.
2.
With long-term care insurance, sound underwriting is crucial to all of the following except _______.
Investing cash reserves. Sound underwriting is crucial to forecasting and setting adequate premiums.
3.
Which of the following is NOT a variable that influences the premium charge for insurance coverage?
Uninsurable conditions. An uninsurable condition would make it impossible to set a premium. It is not a variable; it is a roadblock.
4.
Which of the following is true about long-term care policies with low premiums and permissive medical standards?
All of the above are true. Some companies that were "easy-issue" or competed most aggressively on price have had to sharply increase premiums, or left the business entirely.
5.
The objective of good insurance underwriting is to eliminate customers who are likely to have a claim.
False. The underwriters do not expect to issue policies to only those people who will never file a claim.