03/18/24
How long is the grace period for an individual life insurance policy?
1 month
An Agent is hand delivering an insurance policy to a policyowner. What must the agent obtain to complete the transaction?
A signed delivery receipt
Which of the following indicates the person upon whose life the annuity income amount is determined?
Annuitant
When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?
Extended term
Who is the annuity owner?
The person who purchases the annuity
An IRA contribution can be made from which of the following?
cash
Which of the following is NOT a type of a hazard?
exposure
Which method of dealing with risk is applied when insurance is purchased?
to transfer
An aleatory contract is based on what kind of exchange?
unequal exchange of values
What guarantees that the information explained in the insurance contract is true?
warranty
With Adjustable Life, the owner can change all of the following EXCEPT
insured
Which of the following individuals would be a likely candidate to purchase a deferred annuity?
Someone who wants to grow retirement funds tax deferred
If a life insurance policy is purchased by someone who has no insurable interest in the insured, it is considered
Stoli
What is the exclusion ratio used to determine?
The annuity benefit to be excluded from taxes
An insured decides to surrender his Whole Life insurance policy. The cash value at surrender is higher than the premiums paid into the policy, due to interest. What part of the surrender value would be income taxable?
The difference between the premiums paid and the cash value
What happens to the face amount of a whole life policy if the insured reaches the age of 100?
The face amount is paid to the insured
All of the following are considerations under the needs approach planning for life insurance EXCEPT
The insured's income
All of the following are general requirements of a qualified plan EXCEPT
The plan must be temporary
Which of the following has the right to change a settlement option in a life insurance policy?
The policy owner at any time during the life of the insured
All of the following are true regarding the waiver of cost of insurance rider EXCEPT
The rider expires when the insured reaches age 60
Which of the following policies can be described as a flexible premium adjustable life policy?
Universal Life
Considering the principles of liquidity, how would the policyowner use today's cash values in a life insurance policy?
Use it for emergency expenses
Which of the following types of insurance is investment based, has a level fixed premium, and a non guaranteed cash value?
Variable Whole Life
What type of an interest rate is guaranteed in universal life policies?
contract interest rate
If a loan request is for payment of due premiums on the policy, how soon must the insurer issue a loan?
immediately
An annuitant pays the annuity premium on the 14th of each month. Which of the following best describes this arrangement?
level
Contributions to Roth IRAS are
not tax deductible
Key person insurance can provide protection for all of the following economic losses to a business EXCEPT
pay the death benefit to the estate of the insured
Annuities certain limit the amount paid by the annuity to a certain fixed
period or fixed amount
Wagering on a sporting event is an example of what type of risk?
speculative
Which of the following are characteristics of term life insurance ?
temporary protection, renewability, no cash value
Which of the following terms is used to define the period of time during which an annuitant makes payments into an annuity?
Accumulation period
Refusing to pay claims without conducting a reasonable investigation based upon all available information is an example of
An unfair claims practice
Which of the following is correct statement about annuities?
Fixed annuities do not provide protection against inflation
In a life insurance application, all of the following signatures will be required EXCEPT
Home office underwriter
Under which of the following conditions would life insurance proceeds be taxable by the federal government?
If there is a transfer for value
Which of the following is not true regarding a deferred annuity?
Income payments begin within 1 year from the date of purchase
Who would be allowed catch-up contributions into an IRA plan?
Individuals age 50 or older
Which of the following best describes life annuity with period certain option?
It guarantees benefit payments for life of the annuitant and for a specified period for the beneficiary
Which of the following is true regarding pure life annuity settlement option?
It provides the highest monthly benefit
Which of the following best describes pure life annuity?
It provides the highest monthly benefits
For a contract to be enforceable by law, the purpose of the contract must be
Legal and not against public policy
The Human Life Value approach to determining Life Insurance needs is based upon which of the following ideas?
Loss of the breadwinners income
Guaranteeing future dividends is considered to be an unfair or deceptive act known as
Misrepresentation
Which of the following is NOT one of the independent rating services that publishes guides to insurance companies financial integrity?
NAIC
What is a specific requirement regarding the number of employees in a SIMPLE plan?
No more than 100 employees
Which of the following best defines the unfair trade practice of rebating?
Offering an inducement of something of value not specified in the policy
When the owner of a participating whole life policy uses the dividend to provide more life insurance coverage, which of the following dividend options is being used?
Paid-up additions
The frequency and the amount of the premium payment are known as what?
Premium Mode
Which of the following is a provision found in life insurance policies?
Reinstatement
Who acts on behalf of the principal?
agent
Which of the following premium modes would result in the lowest overall premium?
annual
Who does the spendthrift clause in a life insurance policy protect?
beneficiary
A lender who conditions approval of a loan on the condition that the borrower purchase insurance from that lender may be guilty of
coercion
Which of the following is NOT a characteristic of variable insurance and annuities?
Benefits are determined solely based on the policy premium
