EXAMINATION CONTENT OUTLINE NEW MEXICO LIFE, ACCIDENT AND HEALTH INSURANCE EXAMINATION SERIES 18-27 # of Questions Minimum Passing Score Time Allowed 150 70% (105 correct) 165 Minutes CONTENT OUTLINE Insurance Regulation 5% Licensing NMSA 59A-11, 59A-12 Process NMSA 59-11, 59A-12 Types of Licensees NMSA 59A-11, 59A-12 Agents Brokers Solicitors Consultants Resident versus Nonresident Temporary Maintenance and Duration NMSA 59A-11 Disciplinary Actions NMSA 59A 11-18 State Regulation Superintendent's General Duties and Powers NMSA 59A-1, 59A-2 Company Regulation NMSA 59A-5 Certificate of Authority Unfair Claims Settlement Practices Agent Regulation Unfair Insurance Trade Practices NMSA-16 Examination of Books and Records NMSA 59A-12-21 Insurance Fraud Regulation NMSA 59A-16 Consumer Privacy Regulation Federal Regulation USC Title 15 and Title 18, CFR Title 16 Fair Credit Reporting Act Patriot Act Violent Control Act General Insurance 5% Concepts Risk Management Key Terms Risk Exposure Hazard Peril Loss Methods of Handling Risk Avoidance Retention Sharing Reduction Transfer Elements of Insurable Risks Adverse Selection Law of Large Numbers Reinsurance Insurers Types of Insurers Stock Companies Mutual Companies Fraternal Benefit Societies Reciprocals Risk Retention Groups Private versus Government Insurers Authorized versus Unauthorized Insurers Domestic, Foreign, and Alien Insurers Financial Status (independent rating services) Marketing (distribution) Systems Agents and General Rules of Agency Insurer as Principal Producer/Insurer Relationship Authority and Powers of Producers Responsibilities to the Applicant/Insured Contracts Elements of a Legal Contract Distinct Characteristics of an Insurance Contract Legal Interpretations affecting Contracts Life Insurance Basics 10% Insurable Interest (59A-18-4, 5, 7, 8) Viatical Settlements Regulation of Variable Products Solicitation and Sales Presentations 1
Selection Criteria and Unfair Discrimination Personal Uses of Life Insurance Survivor Protection Estate Creation Cash Accumulation Security Liquidity Estate Conservation Determining Amount of Personal Life Insurance Human Life Value Approach Needs Approach Business Uses of Life Insurance Including Key Person Buy-Sell Funding Key Person Executive Bonuses Corporate-Owned Life Insurance Classes of Life Insurance Policies Group versus Individual Permanent versus Term Participating versus Nonparticipating Fixed versus Variable Life Insurance and Annuities Premiums Factors in Premium Determination Premium Payment Mode Agent Responsibilities Field Underwriting Delivery Individual Underwriting by the Insurer Information Sources and Regulation Life Insurance Policies 11% Term Life Insurance Level Term Decreasing Term Whole Life Insurance Continuous Premium (straight life) Limited Payment Single Premium Graded Premium Modified Life Interest Sensitive Equity Index Flexible Premium Policies Adjustable Life Specialized Policies Joint Life (first-to-die) Survivorship Life (second-to-die) Juvenile Life Group Life Insurance Characteristics of Group Plans Types of Plan Sponsors Group Underwriting Requirements Credit Life Insurance (individual versus group) Group Life Conversion to Individual Policy Universal Life Life Insurance Policy Provisions, Options, and Riders 12% Individual Standard Provisions Ownership Assignment Modifications Right to Examine (Free Look) Payment of Premiums Grace Period Reinstatement Incontestability Misstatement of Age Or Gender Exclusions and Restrictions Interest on Insurance Proceeds Beneficiaries Designation Options Succession Facility of Payment Clause Revocable versus Irrevocable Common Disaster Clause Spendthrift Clause Settlement Options Cash Payment Interest Only Fixed-Period Installments Fixed-Amount Installments Life Income Nonforfeiture Options 2
Cash Surrender Value Extended Term Reduced Paid-Up Insurance Policy Loan and Withdrawal Options Cash Loans Automatic Premium Loans Withdrawals Or Partial Surrenders Dividend Options Cash Payment Reduction of Premium Payments Accumulation at Interest One-Year Term Option Paid-Up Additions Disability Riders Waiver of Premium/Waiver of Stipulated Premium (Universal Life) Waiver of Cost of Insurance Disability Income Benefit Payor Benefit Life/Disability (Juvenile Insurance) Accelerated (Living) Benefit Provisions/Riders Accelerated Long-Term Care Riders Covering Additional Insureds Spouse/Other-Insured Term Rider Children's Term Rider Family Term Rider Riders Affecting the Death Benefit Amount Accidental Death Guaranteed Insurability Cost of Living Return of Premium Annuities 8% Annuity Principles and Concepts Accumulation Period versus Annuity Period Owner, Annuitant, and Beneficiary Insurance Aspects of Annuities Immediate versus Deferred Annuities Single Premium Immediate Annuities (SPIAs) Deferred Annuities Annuity (Benefit) Payment Options Life Contingency Options Annuities Certain (Types) Annuity Products Fixed Annuities Equity Indexed Annuities Market Value Adjusted Annuities (Modified Guaranteed Annuities) Uses of Annuities Lump Sum Settlements Qualified Retirement Plans Personal Uses Federal Tax Considerations for Life Insurance and Annuities 3% Taxation of Personal Life insurance Amounts Available to Policyowner Amounts Received By Beneficiary Values included in insured's Estate Modified Endowment Contracts (MECs) Modified Endowment versus Life insurance Seven-Pay Test Distributions Taxation of Non-Qualified Annuities Individually-Owned Corporate-Owned Taxation of individual Retirement Accounts (IRAs) Traditional IRAs Roth IRAs Rollovers and Transfers (IRAs and Qualified Plans) Section 1035 Exchanges Qualifed Plans 1% General Requirements Federal Tax Considerations Tax Advantages for Employers and Employees Taxation of Distributions (Age-Related) Plan Types, Characteristics, and Purchasers Simplified Employee Pensions (SEPs) Self-Employed Plans (HR 10 or Keogh Plans) Profit-Sharing and 401(k) Plans SIMPLE Plans 403(b) Tax-Sheltered Accounts (TSAs) Health Insurance Basics 7% Definitions of Perils Accidental Injury 3
Sickness Principal Types of Losses and Benefits Loss of Income from Disability Hospital/Medical Expense Dental Expense Long-Term Care Expense/Home Health Care Classes of Health Insurance Policies Individual versus Group Private versus Government Limited versus Comprehensive Self-Funded Coverage/ERISA Limited Policies Limited Benefits Required Notice to Insured Types of Limited Policies Common Exclusions from Coverage Producer Responsibilities in Individual Health Insurance Marketing Requirements Field Underwriting Common Situations for Errors/Omissions Individual Underwriting by the Insurer Underwriting Criteria Sources of Underwriting Information Unfair Discrimination Classification of Risks Considerations in Replacing Health Insurance Pre-Existing Conditions Credit for Previously Satisfied Pre-Existing Condition Exclusion Benefits, Limitations, and Exclusions Underwriting Requirements Producer Liability for Errors and Omissions Individual Health Insurance Policy General Provisions 7% Required Provisions Entire Contract; Changes Time Limit on Certain Defenses Grace Period Reinstatement Claim Procedures Physical Examinations and Autopsy Legal Actions Change of Beneficiary Right to Examine (free look) Optional Provisions Change of Occupation Misstatement of Age Other Insurance in this Insurer Insurance with other Insurers Unpaid Premium Conformity with State Statutes Illegal Occupation Other General Provisions Insuring Clause Consideration Clause Renewability Clause Disability Income and Related Insurance 5% Qualifying for Disability Benefits Inability to Perform Duties Pure Loss of Income (income replacement contracts) Presumptive Disability Requirement to be under Physician Care Individual Disability Income Insurance Basic Total Disability Plan Coordination with Social Insurance and Workers' Compensation Benefits At-Work Benefits Other Provisions affecting Income Benefits Other Cash Benefits Refund Provisions Exclusions Unique Aspects of Individual Disability Underwriting Occupational Considerations Benefit Limits Policy Issuance Alternatives Group Disability Income Insurance Group versus Individual Plans Short-Term Disability (STD) Long-Term Disability (LTD) Business Disability Insurance Key Person Disability Income Disability Buy-Sell Policy Social Security Disability Qualification for Disability Benefits 4
Definition of Disability Waiting Period Disability Income Benefits Workers' Compensation Eligibility Benefits Medical Plans 9% Medical Plan Concepts Fee-for-Service Basis versus Prepaid Basis Specified Coverages versus Comprehensive Care Benefit Schedule versus Usual/Reasonable/Customary Charges Any Provider versus Limited Choice of Providers Insureds versus Subscribers/Participants Types of Providers and Plans Major Medical Insurance (indemnity plans) Health Maintenance Organizations (HMOs) Preferred Provider Arrangements and Point-of-Service (POS) Plans Cost Containment in Health Care Delivery Cost-Saving Services Utilization Review New Mexico Eligibility Requirements and benefit offers (individual and/or group) Dependent Child Age Limit Child Enrollment; Non-Custodial Parents Newborn Child Coverage Adopted Children Health Insurance Portability and Accountability Act (HIPAA) Requirements Eligibility Guaranteed Issue Pre-Existing Conditions Creditable Coverage Renewability Medical Savings Accounts (MSAs), Flexible Savings Accounts (FSAs), Health Savings Accounts (HSAs), Health Reimbursement Accounts (HRAs) Group Health Insurance 6% Characteristics of Group Insurance Group Contract Certificate of Coverage Experience Rating versus Community Rating Types of Eligible Groups Employment-Related Groups Associations (alumni, professional, other) Customer Groups (depositors, creditor-debtor, other) Marketing Considerations Advertising Regulatory Jurisdiction/Place of Delivery Employer Group Health Insurance Insurer Underwriting Criteria Eligibility for Coverage Coordination of Benefits Provision Change of Insurers or Loss of Coverage Small Employer Medical Plans Definition of Small Employer Eligibility of Employees Renewability Dental Insurance 2% Types of Dental Treatment Diagnostic and Preventive Restorative Oral Surgery Endodontics Periodontics Prosthodontics Orthodontics Indemnity Plans Choice of Providers Scheduled versus Nonscheduled Plans Benefit Categories Deductibles and Coinsurance Combination Plans Exclusions Limitations Predetermination of Benefits Employer Group Dental Expense Integrated Deductibles versus Stand-Alone Plans Minimizing Adverse Selection Insurance for Senior Citizens and Special Needs Individuals 6% Medicare Nature, Financing, and Administration Part A - Hospital Insurance Part B - Medical Insurance 5
Part C - Medicare Advantage Part D - Prescription Drug Insurance Medicare Supplements Purpose Open Enrollment Standardized Medicare Supplement Plans New Mexico Regulations and Required Provisions Medicare Select Other Options for Individuals with Medicare Employer Group Health Plans Medicaid Long-Term Care (LTC) Insurance Eligibility for Benefits Levels of Care Benefit Periods Benefit Amounts Optional Benefits Qualified LTC Plans (state and federal) Exclusions Underwriting Considerations New Mexico Regulations and Required Provisions New Mexico Medical Insurance Pool and Health Insurance Alliance (59A-56-1 4, 14; Reg 13.10.10.1.24; Bul 2008-006) Federal Tax Considerations for Health Insurance 3% Personally-Owned Health Insurance Disability Income Insurance Medical Expense Insurance Dental Insurance Long-Term Care Insurance FSAs, HRAs, and HSAs Employer Group Health Insurance Disability Income (STD, LTD) Medical and Dental Expense Long-Term Care Insurance Accidental Death and Dismemberment Medical Expense Coverage for Sole Proprietors and Partners Business Disability Insurance Key Person Disability Income Buy-Sell Policy Medical Savings Accounts (MSAs), Flexible Savings Accounts (FSAs), Health Savings Accounts (HSAs), Health Reimbursement Accounts (HRAs) 6