Passing Virginia Insurance Virginia-Life-Annuities-and-Health-Insurance Exam Using 2026 Practice Tests
Virginia-Life-Annuities-and-Health-Insurance Study Guide Brilliant Virginia-Life-Annuities-and-Health-Insurance Exam Dumps PDF
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NEW QUESTION # 82
What is the primary role of medical expense and disability insurance?
- A. Provision for dismemberment benefits
- B. Protection against the costs of medical care and the loss of earning power
- C. Payment of death benefits
- D. Payment for rehabilitation costs following a life-threatening injury
Answer: B
Explanation:
Detailed Answer in Step-by-Step Solution:
* Medical expense insurance covers healthcare costs, while disability insurance replaces lost income, together protecting against medical costs and earning power loss (B).
* Death benefits (A) are for life insurance. Dismemberment (C) is specific to AD&D. Rehabilitation (D) may be included but isn't primary.
The Virginia study guide defines the core purpose of medical expense and disability insurance as mitigating financial loss from healthcare and income interruption. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Health Insurance Basics."
NEW QUESTION # 83
(In accordance with IRS regulations, which of the following is the MAXIMUM percentage of an employee's pay that is allowed through a simplified employee pension (SEP) plan?)
- A. 30%
- B. 5%
- C. 25%
- D. 15%
Answer: C
Explanation:
A simplified employee pension (SEP) plan is a retirement plan that allows employers to make tax-deductible contributions to individual retirement accounts established for employees. Under IRS regulations, employer contributions to a SEP plan are limited to a maximum of 25% of an employee's compensation, subject to an overall annual dollar limit. SEP plans are popular among small businesses because they are easy to establish and administer and have minimal reporting requirements. Contributions are made solely by the employer, not the employee, and must be allocated using the same percentage of compensation for all eligible employees. The exam tests the maximum allowable percentage of pay, which is 25%.
NEW QUESTION # 84
Which statement about an adjustable life insurance policy is true?
- A. The plan of coverage may be changed only if the new form of coverage has a lower premium
- B. It is a form of variable annuity
- C. It is most appropriate for people who are over age 50
- D. Evidence of insurability may be required when the amount of insurance is increased
Answer: D
Explanation:
Adjustable life allows policyholders to adjust face amount, premium, or coverage period. Increases in coverage may require proof of insurability. Exact extract: "Adjustable life permits increases in coverage, subject to evidence of insurability." Reference:
NEW QUESTION # 85
Which policy provision allows an employee to change from group coverage to an individual life insurance policy?
- A. Conversion
- B. Incontestability
- C. Nonforfeiture
- D. Assignment
Answer: A
Explanation:
Virginia Code § 38.2-3330 requires group life insurance policies to include a conversion provision,allowing an employee to convert group coverage to an individual policy without evidence of insurability, typically within 31 days after termination of employment or group eligibility. Option B (conversion) directly describes this right, ensuring continued protection. Option A (nonforfeiture) applies to cash value options (e.g., reduced paid-up insurance) in individual policies, not group-to-individual transitions. Option C (assignment) transfers policy ownership, unrelated to conversion. Option D (incontestability) limits the insurer's ability to deny claims after a period (e.g., 2 years), not a conversion mechanism. The study guide likely highlights conversion as a key group life feature, with scenarios like an employee leaving a job and converting to a whole life policy, making B the precise answer.
NEW QUESTION # 86
Which of the following statements about the contestability of a life insurance policy is true?
- A. The policy cannot be contested by the insurer once it is paid for and issued
- B. The policy can be contested by the insurer only during the first two years of the contract
- C. The policy can be contested by the insurer at all times
- D. The policy can be contested only if the insured is convicted of a felony
Answer: B
Explanation:
Virginia requires an incontestability clause in life policies. After a policy has been in force for two years, it becomes incontestable except for nonpayment of premium.
Exact Extract (Virginia Law): "A life insurance policy shall be incontestable after it has been in force during the lifetime of the insured for two years, except for nonpayment of premiums." Reference (Virginia Documents / Study Guide):
- Code of Virginia §38.2-3107 (Incontestability clause requirement)
NEW QUESTION # 87
A life insurance agent is normally responsible for all of the following EXCEPT:
- A. Approving policies for issue on behalf of the insurer
- B. Delivering newly issued policies to applicants
- C. Collecting the initial premium from the applicant
- D. Notifying the company if a new policy will replace an existing policy
Answer: A
Explanation:
In Virginia, the responsibilities of a licensed life insurance agent (also called a producer) are clearly distinguished from those of the insurance company.
Delivery of policies: The agent must deliver newly issued policies to the applicant. Virginia regulations require that, upon policy delivery, the agent must also provide required disclosures and obtain any necessary signed statements (such as delivery receipts).
Replacement notification: If an agent is aware that a new policy will replace an existing one, the agent must notify the insurance company and comply with Virginia's replacement regulations, which include providing written notices and ensuring that applicants are fully informed.
Collection of premiums: An agent is authorized to collect the initial premium from the applicant at the time of application or upon delivery of the policy, provided the insurer allows such practice.
However, approving policies for issue is not within the authority of an agent. Only the insurer has the legal authority to underwrite and approve policies for issue. Agents are producers and representatives of the insurer, but they do not possess underwriting authority to approve or reject applications.
This distinction is reinforced by the Virginia Bureau of Insurance regulations, which specify that the insurer is responsible for policy issuance and underwriting decisions, while agents are responsible for solicitation, policy delivery, disclosure, and premium collection.
Reference (Virginia official documents and study materials):
Code of Virginia § 38.2-1825 (Agent's authority and responsibilities)
Code of Virginia § 38.2-1834 (Duties in policy replacement - notice requirements) Virginia Administrative Code 14VAC5-200-110 (Replacement regulations and disclosure duties) Virginia Life, Annuities & Health Insurance Study Guide - Producer responsibilities section
NEW QUESTION # 88
Policy loan provisions may be found in all of the following life insurance policies EXCEPT:
- A. Universal life
- B. Five year life
- C. Whole life
- D. Twenty payment life
Answer: B
Explanation:
Policy loan provisions are typically found in whole life and universal life policies, where the policyholder can borrow against the cash value of the policy. A twenty payment life policy is a type of whole life insurance where premiums are paid for 20 years, and it may include loan provisions. However, a five-year life policy is typically a limited-pay policy, and policy loans are generally not available under this type because there is insufficient cash value accumulation in such a short time frame.
NEW QUESTION # 89
Under which one of the following life insurance policies would it be possible to include an automatic premium loan provision?
- A. Level term
- B. Credit insurance
- C. Decreasing term
- D. Whole life
Answer: D
Explanation:
An automatic premium loan provision is typically found in whole life insurance policies. This provision allows the insurer to automatically pay the premium from the cash value of the policy if the policyholder fails to pay the premium on time. This is a feature unique to permanent life insurance, like whole life, where the policy builds cash value over time. Credit insurance, decreasing term, and level term policies generally do not include such provisions because they are term-based policies and do not accumulate cash value.
Reference:
NEW QUESTION # 90
The preventive medical care benefit sometimes provided in a Medicare supplement policy covers:
- A. Home health care
- B. Annual physical exams
- C. Skilled nursing care
- D. Hospitalization
Answer: B
Explanation:
Certain Medicare supplement policies in Virginia may include preventive benefits not fully covered by Medicare, such as annual physical exams. These benefits are limited and distinct from core Medicare Part A (hospitalization) and Part B (medical) services.
Exact Extract (Virginia Medicare Supplement Study Guide): "Preventive medical care benefit may include annual physical exams and preventive screening tests, which are not part of basic Medicare coverage." Reference (Virginia Documents / Study Guide):
- Virginia Health Insurance Examination Outline, Medicare Supplement Provisions
NEW QUESTION # 91
All of the following factors influence the underwriting of group health insurance for an association EXCEPT:
- A. Type of trade or occupation of the association's members
- B. Prior claims experience of the association
- C. The average age of the membership
- D. Marital status of the members
Answer: D
Explanation:
Detailed Answer in Step-by-Step Solution:
* Group health underwriting considers average age (A), claims history (B), and occupation type (D) to assess risk, but marital status (C) is typically irrelevant for group policies, unlike individual underwriting.
The Virginia study guide notes that group underwriting focuses on collective risk factors like age, claims experience, and occupation, not personal details like marital status. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Group Insurance Underwriting."
NEW QUESTION # 92
A health insurer must generally pay for all of the following types of claims EXCEPT:
- A. Those related to mental or nervous disorders
- B. Those incurred after termination of coverage
- C. Those incurred before termination of coverage
- D. Those less than $20 above the deductible amount
Answer: B
Explanation:
Detailed Answer in Step-by-Step Solution:
* Health insurance covers claims incurred during the policy period (A), not after termination (B), unless extended benefits (e.g., COBRA) apply, which is not indicated here.
* Claims above the deductible (C), regardless of amount, are payable if covered.
* Mental or nervous disorder claims (D) are typically covered unless excluded by the policy, which is not specified.
* Thus, claims after termination (B) are the exception.
The Virginia study guide states that health insurance liability ends upon policy termination, barring specific continuation provisions, making post-termination claims generally non-payable. Reference:Virginia Life, Annuities, and Health Insurance study guide, section on "Health Insurance Coverage Terms."
NEW QUESTION # 93
(Which group forms the membership of the Medical Information Bureau?)
- A. Insurance companies
- B. Physicians
- C. Consumers
- D. Insurance agents
Answer: A
Explanation:
The Medical Information Bureau (MIB) is an organization whose members are insurance companies, primarily life and health insurers. Its purpose is to help insurers detect misrepresentation and fraud during underwriting by sharing coded medical and application history data.
Consumers, agents, and physicians are not members of MIB. However, consumers have rights to access and correct their MIB records under privacy laws.
Virginia exam content emphasizes the role of MIB in underwriting accuracy and risk management while also stressing consumer privacy protections and disclosure requirements.
NEW QUESTION # 94
Which term refers to the period of time from the beginning of confinement to the beginning of benefits under a long-term care insurance policy?
- A. The exclusion period
- B. The qualifying period
- C. The elimination period
- D. The trial period
Answer: C
Explanation:
In long-term care (LTC) insurance, the elimination period, per Virginia Code § 38.2-5202, is the waiting period between the onset of a qualifying condition (e.g., confinement due to inability to perform ADLs) and the start of benefit payments. It's akin to a deductible in days (e.g., 30, 60, or 90 days), during which the insured must cover costs. Option D correctly names this period. Option A (trial period) isn't a standard LTC term. Option B (exclusion period) might confuse with pre-existing condition exclusions, but it's not the waiting period for benefits. Option C (qualifying period) could imply eligibility determination, but
"elimination period" is the precise industry term. The study guide likely defines this as a cost-sharing feature, with examples illustrating how longer periods reduce premiums, solidifying D as the answer.
NEW QUESTION # 95
An individual purchased an annuity with a series of premium payments continuing over a period of twenty years. The purchase payments were made during the:
- A. Accumulation period
- B. Annuity period
- C. Period certain
- D. Liquidation period
Answer: A
Explanation:
Detailed Answer in Step-by-Step Solution:
* The accumulation period (D) is the phase in a deferred annuity where premiums are paid to build value before payouts begin.
* The liquidation period (A) is not a standard term here; it might imply payout but isn't correct.
* The annuity period (B) is when payments are received, not paid.
* Period certain (C) refers to a payout option, not premium payment phase.
The Virginia study guide defines the accumulation period as the time during which premium payments are made into a deferred annuity, accumulating value until the payout phase. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Annuities."
NEW QUESTION # 96
All the following are considered Essential Health Benefits under the ACA, EXCEPT:
- A. Adult dental services
- B. Preventive care services
- C. Laboratory services
- D. Hospitalization
Answer: A
Explanation:
Detailed Answer in Step-by-Step Solution:
* The Affordable Care Act (ACA) mandates 10 Essential Health Benefits, including hospitalization (A), laboratory services (B), and preventive care (D), but adult dental services (C) are not included (pediatric dental care is, however).
* Adult dental is often an optional or separate coverage, not a required benefit.
The Virginia study guide, aligned with ACA regulations, lists the 10 Essential Health Benefits, excluding adult dental services while including pediatric dental and vision as distinct categories. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Affordable Care Act."
NEW QUESTION # 97
(How long does an agent's license remain active without appointments?)
- A. 90 business days
- B. There is no appointment requirement
- C. 30 calendar days
- D. 15 business days
Answer: C
Explanation:
In Virginia, an insurance agent's license remains active for 30 calendar days without an appointment. During this period, the agent may not transact insurance business until an appointment is in place.
Appointments link the agent to an insurer and authorize the agent to act on the insurer's behalf. Virginia regulations require insurers to file appointments promptly, and failure to secure an appointment within the allowed timeframe may result in license inactivity.
This rule ensures regulatory oversight and consumer protection by confirming that agents operate only under authorized insurer relationships.
NEW QUESTION # 98
(Under which marketing system do insurers solicit customers by mass media advertising and mail without the services of an agent?)
- A. Direct response
- B. Contingent
- C. Captive agent
- D. Branch office
Answer: A
Explanation:
The direct response marketing system involves insurers selling insurance directly to consumers through mass media advertising, mail, telephone, or internet communication, without using insurance agents. This system relies on advertisements that invite prospects to apply directly to the insurer.
Branch office and captive agent systems involve licensed agents who represent the insurer. Contingent systems are related to compensation structures, not distribution methods.
Virginia licensing standards identify direct response marketing as a legitimate method of insurance distribution, with the insurer assuming responsibility for underwriting, policy issuance, and customer service. Because no agent is involved, commissions are typically not paid, which can lower policy costs.
NEW QUESTION # 99
What are long-term care insurance "ADL's"?
- A. Aggregate days limitation
- B. Approved doctor lists
- C. Activities of daily living
- D. Aggregate dollar limits
Answer: C
Explanation:
Virginia Code § 38.2-5200 defines ADLs (Activities of Daily Living, option C) as essential tasks-e.g., bathing, dressing, eating-used to determine LTC benefit eligibility (typically inability to perform 2 of 6).
Option A (aggregate dollar limits) refers to coverage caps, not ADLs. Option B(aggregate days limitation) might confuse with elimination periods, not ADLs. Option D (approved doctor lists) relates to provider networks, not functional criteria. The study guide likely details ADLs with examples-e.g., needing help with mobility-emphasizing their role in claims, making C the correct term.
NEW QUESTION # 100
To cancel a health insurance policy, which one of the following must the insured do?
- A. Notify the insurer in writing
- B. Replace the current policy with another
- C. Challenge at least two uniform mandatory provisions
Answer: A
Explanation:
Virginia Code § 38.2-3508 governs cancellation of individual health insurance policies. For the insured to cancel, they must notify the insurer in writing (option A), specifying intent to terminate, typically effective upon receipt or a stated date, per policy terms. This formal notice ensures clarity and protects both parties, aligning with contract law principles. Option B (replace with another policy) is a practical choice but not a legal requirement; cancellation can occur without replacement. Option C (challenge mandatory provisions) is nonsensical; uniform provisions (e.g., grace period, per § 38.2-3503) are standard and unrelated to cancellation. The study guide likely outlines this process in a policyholder rights section, with examples-e.g., a letter stating "Cancel effective 5/1/2025"-emphasizing written notice as the sole requirement, making A the correct action.
NEW QUESTION # 101
Assuming no indebtedness or dividend accumulations, how much will the insurer pay under a life insurance policy if the insured dies during the grace period without having paid the premium?
- A. The face amount of the policy less the premium due
- B. The face amount of the policy
- C. The reduced amount of paid-up insurance provided under the nonforfeiture provisions
- D. The cash value of the policy
Answer: B
Explanation:
Detailed Answer in Step-by-Step Solution:
* The grace period in a life insurance policy (typically 30 or 31 days) allows the policy to remain in force even if the premium is unpaid, provided the insured dies during this period.
* If death occurs during the grace period, the insurer must pay the full death benefit (face amount), minus any unpaid premium, but only if explicitly stated. In this question, no indebtedness or dividends complicate the scenario, and standard practice assumes full payment unless otherwise specified.
* Option B (cash value) applies to surrender, not death claims.
* Option C (face amount less premium due) is a possibility in some policies, but absent specific policy language here, the default is full payment.
* Option D (nonforfeiture provisions) applies if the policy lapses, not during the grace period.
* Thus, the insurer pays the face amount (A).
The Virginia study guide states that the grace period provision protects the policyholder by keeping coverage active for a short period after a missed premium, and upon death during this time, the full face amount is payable unless loans or specific deductions apply. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Standard Policy Provisions - Grace Period."
NEW QUESTION # 102
All of the following statements about tax-sheltered annuities (TSAs) are true EXCEPT:
- A. The annuitant may have an individual account or contract.
- B. They are also known as 403(b) plans.
- C. The investment gain each year is included in the participant's gross income.
- D. Accumulation payments often come from voluntary salary reductions.
Answer: C
Explanation:
Tax-sheltered annuities (TSAs), per IRC § 403(b) and Virginia Code § 38.2-3100 et seq., are retirement plans for nonprofit employees. Option A is true; they're synonymous with 403(b) plans. Option B is true; contributions often come from voluntary salary reductions, tax-deferred until withdrawal. Option C is true; participants can have individual contracts or accounts. Option D is false; investment gains are tax-deferred, not included in gross income annually, only taxed upondistribution. The study guide highlights TSAs' tax advantages, making D the incorrect statement.
NEW QUESTION # 103
Group term insurance coverage can usually be converted to:
- A. Another group term policy
- B. A yearly renewable term policy
- C. A permanent individual life insurance policy
- D. A decreasing term policy
Answer: C
Explanation:
Group term insurance can typically be converted to a permanent individual life insurance policy without the need for a medical exam or evidence of insurability. This option is especially valuable when an employee leaves a company or the group plan ends, as it allows them to retain coverage without having to go through underwriting.
NEW QUESTION # 104
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