Exam 2 corrections
All of the following are personal uses of life insurance EXCEPT
buy-sell agreement
An underwriter is reviewing the medical questions in the application and needs further information due to a medical situation the applicant had in the past. What will the underwriter require?
attending physician statement
Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to
10 years
within how many days must a producer respond to an inquiry from the Commissioner?
30 days
where would Long-Term care services be rendered?
a nursing home or one's own home
Which of the following would be deducted from the death benefit paid to a beneficiary, if a partial accelerated death benefit has been paid while the insured was still alive?
amount paid with the accelerated benefit, plus the earnings lost by the insurance company in interest income from the accelerated benefit
An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation?
decreasing term
Two individuals are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant. What is this called?
discrimination
Which of the following is an example of an unfair class settlement practice?
failure to promptly settle a claim when liability has been clearly established
Violation of unfair discrimination law may result in all of the following penalties EXCEPT
fines up to $1,000 for each act
All of the following are dividend options EXCEPT
fixed-period installments
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the
incontestability clause
An insurer invests the money it received from premiums paid by its insureds. Which of the following is TRUE regarding the interest earned on these investments?
it is used to lower premiums
Which of the following is true regarding a single life settlement option?
it provides income the beneficiary cannot outlive
The provision which prevents the insured form bringing any legal action against the company for at least 60 days after proof of loss is known as
legal actions
All of the following are true regarding key person disability income insurance EXCEPT
premiums are tax deductible as a business expense
The responsibility of making certain that an application for insurance is filled out completely, correctly, and to the best of his or her knowledge is the responsibility of whom?
the producer
In a survivorship life policy, when does the insurer pay the death benefit?
upon the last death
When is the insurability conditional receipt given?
when the premium is paid at the time of application
for the purpose of examination by the department, insurers must keep a record of all financial files for at least
5 years
All other factors being equal, the least expensive first-year premium payment is found in
annually renewable term
Which is TRUE about the cash surrender nonforfeiture option?
funds exceeding the premium paid are taxable as ordinary income
Which of the following is an eligibility requirement for all Social Security Disability Income benefits?
have attained fully insured status
An insured owes his insurer a premium payment. Since then, he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the different. What provision allows for this?
unpaid premium
Are insurance company underwriters allowed to discriminate?
yes, but not unfairly
