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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: General Insurance Concepts | 15% | - Contract law and principles - Insurable interest and risk management - Underwriting, premium calculation, and taxation |
| Topic 2: Accident and Health / Sickness Insurance | 20% | - Health insurance basics and policy provisions - HMO, PPO, group vs individual coverage - Disability income, medical expense, and long-term care - Mandatory benefits and state-specific health rules |
| Topic 3: Annuities and Retirement Products | 10% | - Fixed, indexed, and variable annuities - Tax treatment and suitability standards |
| Topic 4: Life Insurance Basics and Policies | 25% | - Policy provisions, riders, and options - Beneficiaries, claims, and settlement options - Types of life insurance: term, whole, universal, variable |
| Topic 5: Insurance Regulation | 30% | - Policy delivery, replacement rules, and disclosure - Ethics, unfair trade practices, and consumer protection - Licensing requirements and procedures - State insurance laws and Maryland regulations |
1. The Maryland Insurance Administration may suspend an agent's license for all of the following reasons EXCEPT:
A) Violating a regulation or order of the Maryland Insurance Administration
B) Sharing commissions with agents holding the same license type
C) Mishandling premium payments
D) Engaging in fraudulent or dishonest practices
2. An insurance producer provided several examples to the applicant, persuasively demonstrating that the insurance coverage offered under the producer's company policy was superior to a competitor's product. The insurance producer knew he was misrepresenting or stretching the truth in order to induce the applicant to forfeit her current policy and purchase a similar but inferior insurance policy from him. The insurance producer is involved in which one of the following unfair trade practices?
A) Fraud
B) Discrimination
C) Twisting
D) Rebating
3. If the owner makes a withdrawal from a tax-sheltered annuity, or TSA, at age 56, the amount of federal taxes owed normally will be:
A) Nothing, since under a qualified plan the taxes are deferred
B) The usual tax on ordinary income, plus 10% of the amount withdrawn
C) Only 10% of the amount withdrawn
D) Only the usual tax on ordinary income
4. After completing an application for insurance, the insurance producer collects the premiums but deposits the check in the insurance producer's checking account. What crime has been committed?
A) Fraud
B) Twisting
C) Rebating
D) Replacement
5. How does the payment of an accelerated benefit affect a life insurance policy?
A) It increases the cash value.
B) It increases the policy premium.
C) It decreases the death benefit.
D) It decreases the grace period.
Solutions:
| Question # 1 Answer: B | Question # 2 Answer: C | Question # 3 Answer: B | Question # 4 Answer: A | Question # 5 Answer: C |
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