Name: 
 

Long Term Care Insurance


Multiple Choice
Identify the choice that best completes the statement or answers the question.
 

 1. 
In most LTC policies, benefits will be payable when:
a.
 a physician determines the insured needs long term care
b.
family members can no longer care for the insured
c.
the insured is discharged from the hospital and needs follow-up care
d.
the insured is deemed “chronically ill”
 

 2. 
When issuing an individual LTC policy, the insurer may require which of the following from the applicant?
a.
blood and urine sample
b.
an application requiring disclosure of medical history
c.
attending physician’s statement (APS)
d.
all of the above
 

 3. 
When issuing a group LTC policy, the insurer may require which of the following from the proposed insured?
a.
blood and urine sample
b.
an application requiring disclosure of current medical condition
c.
attending physician’s statement (APS)
d.
all of the above
 

 4. 
Which of the following policy features will have the largest impact on the premium the LTC policyholder pays?
a.
elimination period
b.
guaranteed renewability
c.
guaranteed issue
d.
guaranteed purchase option
 

 5. 
Which inflation protection provision will result in the lowest premium cost to the policyholder?
a.
5% simple rate
b.
5% compound rate
c.
5% guaranteed purchase option
d.
there is no difference in the premium cost of these options
 

 6. 
Which of the following nonforfeiture options is provided on a LTC policy at no additional premium cost?
a.
cash surrender
b.
return of premium
c.
shortened benefit period
d.
 contingent nonforfeiture benefits
 

 7. 
A free look provision on a long-term care policy must be at least
a.
10 days
b.
30 days
c.
60 days
d.
10 days but can vary from state to state
 

 8. 
Janelle owns a LTC policy with a nursing home benefit of $150 per day with a maximum benefit period of one year.  Home health care is covered at 50%.  Janelle needs home health care, she will be covered for:
a.
$0, as she is not confined to a nursing home
b.
one year
c.
two years
d.
one or two years depending on the policy’s language
 

 9. 
Janelle owns a LTC policy using a pool of money approach with a nursing home benefit of $200 per day with a maximum lifetime benefit of one year.  Home health care is covered at 50%.  Janelle needs home health care, she will be covered for:
a.
$0, as she is not confined to a nursing home
b.
one year
c.
two years
d.
one or two years depending on the policy’s language
 

 10. 
What is the maximum benefit period allowable under a NAIC Model Act policy?
a.
one year
b.
three years
c.
five years
d.
unlimited
 

 11. 
What is the minimum benefit period allowable under a NAIC Model Act policy?
a.
one year
b.
three years
c.
five years
d.
unlimited
 

 12. 
All of the following are true regarding tax treatment of LTC policies EXCEPT:
a.
individuals may include LTC premiums in their itemized medical deductions
b.
benefits can be received tax free
c.
 there are age limits on the deductibility of individual LTC premiums
d.
all LTC policies qualify for federal tax deduction
 

 13. 
Which of the following is true about the pre-existing condition exclusion in LTC policy?
a.
 HIPAA allows LTC policies to exclude benefits up to 6 months for an condition manifesting itself within 6 months prior to application
b.
 most policies exclude benefits up to 6 months for any condition manifesting itself prior to application
c.
 most policies exclude benefits up to 3 months for an condition manifesting itself within 3 months of application
d.
most policies no longer exclude benefits for pre-existing conditions
 

 14. 
What are contingent nonforfeiture benefits?
a.
the only nonforfeiture benefit available at no additional cost
b.
in is a nonforfeiture required in some states
c.
is available only if the premium rate is significantly increased
d.
all of the above
 

 15. 
Which feature has the greatest impact on the premium the policyholder of a LTC will pay?
a.
elimination period
b.
daily benefit amount
c.
survivor benefit
d.
inflation protection
 

 16. 
Which of the following is NOT a required disclosure when selling LTC policies?
a.
Outline of Coverage
b.
Buyer’s Guide
c.
History of Rate Increases
d.
A.M. Best’s rating of the insurer
 

 17. 
Post-claims underwriting is:
a.
required under NAIC Model legislation
b.
a method to deny payment of claims
c.
only used when issuing group policies
d.
none of the above
 

 18. 
All of the following are customer protections afforded by the NAIC Model legislation on LTC policies EXCEPT
a.
guaranteed renewability
b.
no pre-existing condition exclusions
c.
third party notification of policy lapse
d.
incontestability clause
 

 19. 
Your client has the option of selecting a “service day” or “calendar day” methods to count the elimination period.  Which method will result in a higher premium?
a.
service day
b.
calendar day
c.
both will result in the same premium
d.
it depends on other policy provisions
 

 20. 
What period is also known as the deductible period?
a.
elimination period
b.
benefit period
c.
probationary period
d.
accumulation period
 

 21. 
The expense-incurred model of benefit payments is another name for the:
a.
reimbursement model
b.
disability model
c.
cash model
d.
indemnity model
 

 22. 
Which benefit model will pay benefits regardless of the amount of long-term care expenses actually incurred by the insured?
a.
disability model
b.
indemnity model
c.
cash model
d.
all of the above
 

 23. 
The most commonly issued LTC policies cover:
a.
comprehensive services
b.
services provided in nursing homes only
c.
home health care service only
d.
community-based health care services only
 

 24. 
The 90-day certification period:
a.
requires the inability to perform ADLs for at least 90 daysto trigger benefits
b.
is the maximum elimination period allowed on LTC group certificates
c.
is the NAIC mandated waiting period on partnership policies
d.
none of the above
 

 25. 
Who is able to determine when long-term care is needed?
a.
physician
b.
nurse
c.
medical social worker
d.
all of the above
 



 
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