Chapter 10- Complete 20 hours of Training
Explain the issue and collect an additional premium.
An insurance applicant submits an application with a premium. After underwriting, the insurer sends back the policy, rated, with an impairment rider. What should the producer tell the applicant at delivery? If the policy is rated, the producer needs to explain the issue and collect an additional premium.
Renewable term
Gregory recently purchased a one-year term insurance policy. At the end of the year, he can purchase an identical policy without having to show proof of insurability. Why type of policy did he purchase? It is a renewable term policy that allows the policyowner to purchase another identical policy at the end of the year without proving insurability.
State premium tax
A fraternal benefit society is exempt from: A fraternal benefit society is exempt from some state taxes, such as the state premium tax.
Flexible premium deferred annuity
Becky is a 31 years old and knows she needs to start a retirement plan. She currently works in a bakery and is worried about how inflation would affect her retirement plan. Which annuity would be a good fit for her needs? The flexible premium deferred annuity would probably be the best fit for her needs.
Yes, the interest can be paid annually, or added to the loan.
Does a loan on the cash value of a life insurance policy accrue interest, and if so, how is the interest handled? Yes, the loan does accrue interest. The interest can be paid annually, or added to the loan.
Variable annuity
If the cash values of an annuity are invested in securities, it is a:
The application does not include the premium.
In a life policy, a statement of good health is needed when: A statement of good health is needed when the application does not include the initial premium with the application.
Amends insurance statutes
The Commissioner performs all of the following duties, EXCEPT: Legislators, not the Commissioner, write and amend statutes and laws.
The entire contract
The fact that the application is part of the policy is stated in: The insurance policy itself (including any riders and endorsements/amendments) and the application, if attached to the policy, comprise the entire contract between all parties.
Consideration Clause
The policyowner's obligation to pay the premium is the: The consideration clause states that a policyowner must pay a premium in exchange for the insurer's promise to pay benefits, and the frequent premium payments.
Cost of death protection deducted and current interest rate credited
What are the two most common adjustments made during a month with a universal life insurance policy? Each month, the cost of the death protection is deducted from the cash value, and the current interest rate is credited.
A contract of insurance
What is an agreement by which the insurer is bound to pay money as reimbursement for the destruction, loss, or injury of something in which the other party has an interest? A contract of insurance is an agreement by which the insurer is bound to pay money or its equivalent or to do some act of value to the insured upon, and as an indemnity or reimbursement for the destruction, loss, or injury of something in which the other party has an interest.
Key person insurance
Which of the following plans was most likely purchased for the leading sales representative? The Bell Company purchased key person insurance. Shelly is a key employee, as she is responsible for the majority of the company's profitability.