Virginia-Life-Annuities-and-Health-Insurance Exam Dumps - Virginia Life, Annuities, and Health Insurance Examination Series 11-01

Medicare supplement policies in Virginia are guaranteed renewable. This means the insurer cannot cancel coverage as long as premiums are paid on time, regardless of the insured’s health status or claim history. Exact extract: “Every Medicare supplement policy shall be guaranteed renewable and may not be terminated except for nonpayment of premium or material misrepresentation.” This provides strong consumer protection for seniors relying on supplemental coverage.

The "insurance with other insurers" provision, addressed in Virginia Code § 38.2-3514, is a coordination of benefits (COB) mechanism in individual health insurance policies designed to prevent over-insurance and duplicate payments when an insured has multiple policies covering the same loss. This provision allows the insurer to prorate benefits—paying a share based on the total coverage—when certain conditions are met. Option C states that the insurer wasn’t notified prior to the claim of other coverage, which triggers proration. This aligns with standard COB rules: if the insurer isn’t informed of other policies, it may assume primary liability initially but adjust to a pro-rata share upon discovery, ensuring equitable payment across insurers. Option A (within 31 days of renewal) is irrelevant; renewal proximity doesn’t affect benefit coordination. Option B (grace period) relates to premium payment timing, not other insurance, and doesn’t trigger proration. Option D ($2,000 claim threshold) is arbitrary and not a standard condition in Virginia law or study materials for this provision. The study guide likely emphasizes notification as key to COB, as Virginia follows NAIC model regulations requiring disclosure of other coverage (e.g., via application or claim forms). Without prior notice, the insurer applies proration retroactively, making C the correct choice.

In the underwriting process for life insurance, as governed by Virginia Code § 38.2-1800 et seq., the agent’s primary role is to act as a field underwriter, ensuring the application provides accurate and complete information to the insurer (option A). This includes collecting personal data (e.g., age, health history) and verifying its correctness—e.g., asking about smoking habits or past surgeries—to enable the home office underwriter to assess risk properly. Option B (binding coverage immediately) is incorrect; agents typically lack authority to bind life insurance without insurer approval, unlike some property/casualty lines, unless a conditional receipt with premium is issued (Virginia Code § 38.2-3106), which isn’t “immediate” or primary. Option C (issuing the policy) is false; only the insurer’s home office issues policies after underwriting approval, not the agent. Option D (securing MIB information) is an underwriter’s task; agents don’t directly access the Medical Information Bureau—though they may note MIB codes if disclosed, their role is data collection, not retrieval. The study guide likely emphasizes the agent’s frontline duty with examples—e.g., ensuring a 45-year-old applicant discloses diabetes—making A the primary role, aligning with Virginia’s agency framework where agents facilitate, not finalize, underwriting.

The extended term nonforfeiture option uses the cash value to purchase term insurance for the full face amount ($35,000) for as long a term as the cash value allows. The face amount remains unchanged; only the term length varies.

Exact Extract (Virginia Life Insurance Study Guide): “Extended term—uses cash value to buy term insurance equal to the original face amount for a period determined by cash value.”

References (Virginia Documents / Study Guide):

— Virginia Life Insurance Examination Outline, Nonforfeiture Options

Virginia insurance regulations require insurers and agents to protect consumer privacy while also allowing insureds access to their personal information. When an insured submits a written request to review personal information collected by the insurer or agent, the request must be addressed within 45 business days. This timeframe ensures consumers have reasonable access to their records while allowing insurers sufficient time to retrieve and verify the information. The regulation balances consumer rights with administrative practicality. Shorter or longer timeframes are not consistent with Virginia insurance privacy requirements, making 45 business days the correct response.

Virginia law uses the term viatical settlement contract for an agreement in which compensation (or anything of value) that is less than the expected death benefit is paid in exchange for the policyowner/“viator” transferring ownership or benefits of a life insurance policy. This matches the question’s description: a terminally ill person sells a life policy at a discount to obtain cash—often to cover medical or living expenses—while the purchaser assumes premium payments and receives the death benefit later. Virginia’s administrative definitions also clarify that viatical settlements are distinct from accelerated death benefit riders contained within the life insurance policy itself (those are governed under different rules).

The other answer choices do not fit. “Nonforfeiture” refers to benefits/options available when a policy with cash value lapses, such as cash surrender, reduced paid-up insurance, or extended term—these do not involve selling the policy to a third party. “Living wills” are advance medical directives, not insurance transactions. “Repurchase agreements” are unrelated financial arrangements. Because the described transaction is a sale/transfer of a life policy for less than the expected death benefit, the correct term in Virginia is viatical settlement.

In individual health insurance underwriting, factors such as age, sex, and occupation can influence the decision to offer coverage, the premium rates, and any exclusions or limitations. However, religion is not a factor that can be considered, as it is prohibited by law to discriminate based on religious beliefs in the underwriting process. The inclusion of religion as a factor would be considered discriminatory.

In an HMO, members designate a primary care physician (PCP) who coordinates care and issues referrals to specialists. This gatekeeper function is a hallmark of HMO plans.

Exact Extract (Virginia HMO Study Guide): “HMO members select a primary care physician responsible for providing and coordinating all medical care.”

References (Virginia Documents / Study Guide):

— Virginia Health Insurance Examination Outline, HMO Characteristics