Chapter 4

The minimum number of credits required for partially insured status for social security disability benefits is?

6 credits

Which of the following is required number of participants in a contributory group plan?

75%

In group life policies, a certificate of insurance is given to?

Each insured person

In a direct transfer, how is money transferred from one retirement plan to a traditional IRA?

From trustee to trustee

Two attorneys operate their practice as a partnership. They want to start a program through their practice that will provide retirement benefits for themselves and three employees. They would likely choose

HR-10 (Keogh Plan)

Which of the following is an eligibility requirement for all social security disability income benefits?

Have attained fully insured status

When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income?

Interest only

If an insured surrenders his life insurance policy, which statement is true regarding the cash value of the policy?

It is only taxable if the cash value exceeds the amount paid for premiums.

Which of the following is not true regarding a nonqualified retirement plan?

It needs IRS approval

An employee has group life insurance through her employer. After 5 years, she decides to leave the company and work independently. How can she obtain an individual policy?

She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan.

The premiums paid by the employer in a business life insurance policy are

Tax deductible by the employer

The advantage of qualified plans to employers is

Tax-deductible contributions

All of the following would be different between qualified and nonqualified retirement plans except

Taxation on accumulation

All of the following are characteristics of a group life insurance plan EXCEPT?

There is a requirement to prove insurability on the part of the participants.