07/13/21 Practice 1

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?

50,000

Which of the following is NOT the consideration in a policy ?

The application given to a prospective insured.

The primary beneficiary of her husbands life policy found that no settlement option was stated in the policy on the date of her husband's death. Who will select the settlement option in this case?

The beneficiary

Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid

for 20 years or until death whichever happens first

which of the following is correct concerning the taxation of premiums in a key-person life insurance policy ?

premiums are not tax deductible as a business expense

The Medical Information Bureau (MIB) was created to protect

Insurance companies from adverse selection by high risk selection

which provision of a life insurance policy states the insurers duty to pay benefits upon the death of the insured and to whom the benefits will be paid ?

Insuring clause

When Y applied for insurance and paid the initial premium on August 14, he was issued a conditional receipt. During the underwriting process, the insurance company found no reason to reject the risk or classify it other than as standard. Y was killed in an automobile accident on August 22, before the policy was issued. In this case, the insurance company will

Issue the policy anyway and pay the face value to the beneficiary.

an insurer purchased a life policy in 2010 and died in 2017. The insurance company discovers at the time of the insured has misstated information during the application process. What can they do ?

Pay the death benefit

which of the following when attached to a permanent life insurance policy, allows the policyowner to customize the policy to provide an additional amount of temporary insurance on the insured or allow other amounts temporary insurance to cover other family members?

Term rider

Which of the following would provide an underwriter with information concerning an applicant's health history ?

The Medical Information Bureau

An applicant signs an application for a $25,000 life insurance policy, pays the initial premium, and receives a conditional receipt. If the applicant is killed in an automobile accident the next day,

The beneficiary will receive the full death benefit if it is determined

if an insured withdraws a portion of the face amount in the form of accelerated benefits because of terminal illness how will that affect the payable death benefit from the policy ?

The death benefit will be smaller

which of the following is INCORRECT concerning a noncontributory group plan?

The employees receive individual policies

Which of the following products need a Securities license ?

Variable Annuity

When would a 20-pay whole life policy endow?

When the insured reaches age 100

What is the timeframe for filing relevant Suspicious Activity Reports ?

Within 30 days of the initial discovery

Which is NOT true about beneficiary designations ?

The beneficiary must have insurable interest in the insured. A beneficiary is the person or interest to whom the policy proceeds will be paid upon the death of the insured. Beneficiaries do not have interest in the policy holder.

which of the following is the closet term to an authorized insurer?

admitted

what type of insurance would be used for a return of premium rider?

increasing term

A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this?

level term

Which of the following information will be stated in the consideration clause of a life insurance policy ?

the amount of premium paid

what is the purpose the disclosure statement in life insurance policies ?

to explain features and benefits of a proposed policy to the consumer