Chapter Quizzes

And insured purchased a 15 year level term life insurance policy with a face amount of $100,000. The policy contained an accidental death rider, offering a double indemnity benefit. The insured was severely injured in an auto accident, and after 10 weeks of hospitalization, died from the injuries. What amount with his beneficiary receive as a settlement? $0 $100,000 $200,000 $100,000 plus the total of paid premiums

$200,000

A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then The benefit is received tax free. The benefit is subject to the exclusionary rule. CIRS has no jurisdiction. The benefit is received as taxable income

The benefit is received tax free

All of the following are true about variable products except: The cash value is not guaranteed Policy owners bare the investment risk The premiums are invested in the insurer's general account The minimum death benefit is guaranteed

The premiums are invested in the insurer's general account

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit? Equity Indexed Universal Life Variable Universal Life Universal Life - Option A Universal Life - Option B

Universal Life - Option A

When would a 20-pay whole life policy endow? When the insured reaches age 100 At the insured's age 65 After 20 payments In 20 years

When the insured reaches age 100

A straight life policy has what type of premium? An increasing annual preem for the life of the insured A decreasing annual premium for the life of the insured A variable annual premium for the life of the insured A level annual premium for the life of the insured

A level annual premium for the life of the insured

The death protection component of universal life insurance is always: Decreasing term Annually renewable term Whole life Adjustable life

Annually renewable term

Which of the following features of the indexed whole life policy is not fixed? Death benefit Policy period Cash value growth Premium

Cash value growth

Which of the following must an insurer obtain in order to transact insurance within a given state? Certificate of authority Producer's certificate Business entity license Insurer's license

Certificate of authority

An individual has been making periodic premium payments on an annuity. The annuity income payments are scheduled to begin after 1 year since the annuity was purchased. What type of annuity is it? Deferred Fixed Flexible premium Immediate

Deferred

Which writer, when attached to a permanent life insurance policy, provides an amount of insurance on every family member? Spouse rider Children's rider Additional insured rider Family term rider

Family term rider

What type of premium do both Universal Life and Variable Universal Life policies have? Decreasing Increasing Flexible Level fixed

Flexible

An insured purchased a life insurance policy on his life naming his wife as primary beneficiary, and his daughter as contingent beneficiary. Under what circumstances could the daughter collect the death benefit? If the insured died from accidental means If the primary beneficiary predeceased the insured When the insured dies, the primary and contingent beneficiary share death benefits equally With the primary beneficiaries written consent

If the primary beneficiary predeceased the insured

Which provision of a life insurance policy states the insurars duty to pay benefits upon the death of the insured, and to whom the benefits will be paid? Beneficiary clause Consideration clause Insuring clause Entire contract clause

Insuring clause

All of the following are nonforfeiture options except: Cash surrender Extended term Reduced paid-up Interest only

Interest only

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy? Reciprocal Nonprofit service organization Stock Mutual

Mutual

To sell variable life insurance policies an agent must receive all of the following except: A securities license A life insurance license SEC registration FINRA registration

SEC registration

Which of the following is called a "second-to-die" policy? Juvenile life Joint life Survivorship life Family income

Survivorship life

Which of the following, when attached to a permanent life insurance policy, allows the policy owner to customize the policy to provide an additional amount of temporary insurance on the insured, or allows amounts of temporary insurance to cover the other family members? Guaranteed insurability rider Change of insured rider Term rider Accidental death and dismemberment rider

Term rider

All of the following statements about equity index annuities are correct except: The interest rate is tied to an index such as the Standard and Poor's 500 They invest on a more aggressive basis aiming for higher returns The annuitant receives a fixed amount of return They have a guaranteed minimum interest rate

The annuitant receives a fixed amount of return