FL LIFE INSURANCE TEST QUESTIONS

Applicants past income

In classifying a risk, the Home Office underwriting department will look at all of the following EXCEPT

An applicant submits an application to the insurer

In insurance, an offer is usually made when

FINRA

An agent selling variable annuities must be registered with..

an applicant submits an application to the insurer

In insurance, an offer is usually made when

the person must have at least completed secondary education

In terms of parties to a contract, which of the following does NOT describe a competent party?

A debtor has an insurable interest in the life of a lender

Which of the following statements is NOT true concerning insurable interest as it applies to life insurance?

Standard risk is representative of the majority of people.

Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles?

An index like Standard & Poor's 500.

the current interest rate on an equity indexed annuity is often based on

protect private customer information filled with a financial institution

the gramm leach bliley act was passed to

conditional

the proposed insured makes the premium payment on a new insurance policy. if the insured should die the insurer will pay the death benefit to the beneficiary if the policy is approved. this is an example of what kind of contract

Fraudulent Statements

untrue statements on the application unintentionally made by insureds that if discovered would altar the underwriting decision of the insurance company are called

Underwriting

what process do insurance companies use to determine whether or not a particular applicant is insurable?

application

when an insurer begins underwriting procedures for an applicant what will be the main source for its underwriting information

When the insured reaches age 100

when would a 20 pay whole life policy endow

it is a non profit organization that maintains underwriting information on applicants for life and health insurance

which of the following best describes the MIB?

A policy summary

which of the following documents delivered to the policyowner includes information about premium amounts cash values surrender values and death benefits for specific policy years?

level term

which of the following is NOT a type of whole life insurance

standard

which of the following is a risk classification used by underwriters for life insurance

Warranty

which of the following is a statement that is guaranteed to be true and if untrue may breach an insurance contract

counteroffer

which of the following is not an essential element of an insurance contract

application

which of the following is the basic source of information used by the company in the risk selection process

the fair credit reporting act

which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information?

medical information

which part of an insurance application would contain information regarding the cause of death of the applicants deceased relatives

the producer

whose responsibility is it to make certain that an application for insurance is filled out completely and correctly

straight life

your client is planning to retire. she has accumulated 100,000 in a retirement annuity and now wants to select the benefit option that will pay the largest monthly amount for as long as she lives. as her agent you should recommend

Disputes regarding consumer report information

According to the fair Credit reporting act, all of the following would be considered negative information about a consumer except...

Change any incorrect statement on the application by personally initialing next to the corrected statement

All of the following are duties and responsibilities of producers at the time of application EXCEPT

Disclose commissions earned from the sale of the policy

A producer agent must do all of the following when delivering a new policy to the insured EXCEPT

Pay the policy proceeds only if it would have issued the policy.

A prospective insured receives a conditional receipt but dies before the policy is issued. The insurer will

Lower premiums than a person who receives a standard risk.

An applicant who receives a preferred risk classification qualifies for

It will increase because the insured will be 5 years older than when the policy was originally purchased.

An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium?

Universal Life

An insured owns a life insurance policy. To be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. There is a limit for a withdrawal and the insurer charges a fee. What type of policy does the insured most likely have?

aleatory

An insured pays a $100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. What characteristic of an insurance contract does this describe?

Inspection Report

An insurer receives a report regarding a potential insured that includes the insured's financial status, hobbies and habits. What type of a report is that?

inspection report

An insurer receives a report regarding a potential insured that includes the insured's financial status, hobbies and habits. What type of a report is that?

inspection report

An underwriter may obtain information on an applicant's hobbies, financial status, and habits by ordering a(n)

Conditions

Because an insurance policy is a legal contract it must conform to the state laws governing contracts which require all of the following elements except

Contracts of Adhesion

Contracts that are prepared by one party and submitted to the other party on a take it or leave it basis are classified as?

5 days

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

Erase the incorrect answer and record the correct answer

If a change needs to be made to the application for insurance, the agent may do all of the following EXCEPT

Whether an insurable interest exists between the individuals

If an applicant for a life insurance policy and person to be insured by the policy are two different people, the underwriter would be concerned about

the policy will be interpreted as if the insurer waived its right to have an answer on the application

If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE?

It will likely be higher because the applicant is a substandard risk

In the underwriting process, it was determined that the applicant for life insurance is in poor health and has some dangerous habits. Which of the following is true concerning the policy premium?

Loss

Insurance is a contract by which one seeks to protect another from...

adjusted to the insureds age at the time of renewal

Level term insurance provides a level death benefit and a level premium during the policy term. If the policy renews at the end of a specified period of time, the policy premium will be

Other Insurance coverages

Part 2 of the application for life insurance provides questions regarding all of the following EXCEPT

insurable interest

Stranger-originated life insurance (STOLI) policies are in direct opposition to the principle of

insurable interest

Stranger-originated life insurance (STOLI) policies are in direct opposition to the principle of...

Annually Renewable Term

The LEAST expensive first-year premium is found in which of the following policies?

insurance companies from adverse selection by high risk persons

The Medical Information Bureau (MIB) was created to protect...?

Annually Renewable Term

The death protection component of Universal Life Insurance is always..

As of the application date

The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?

insurance companies from adverse selection by high risk persons

The medical information bureau was created to protect

a presentation of nonguaranteed elements of a policy

The term "illustration" in a life insurance policy refers to

joint life

Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?

Respond to the consumer's complaint.

Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must...

Must be informed of the source of the report

Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report

signed waiver of premium

Upon policy delivery, the producer may be required to obtain any of the following EXCEPT

level fixed

Variable Whole Life insurance is based on what type of premium?

Policy Summary

What describes the specific information about a policy?

A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company.

What is a material misrepresentation?

2,500

What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?

It is intended to provide coverage on a date prior to the policy issue

What is the purpose of a conditional receipt?

to allow the consumer to compare the costs of different policies

What is the purpose of the buyer's guide?

within 30 days of initial discovery

What is the timeframe for filing relevant Suspicious Activity Reports?

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

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

Annuitant

When an annuity is written, whose life expectancy is taken into account?

conditional

When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is..

When the application is signed and a check is given to the agent.

When is the earliest a policy may go into effect?

Their premiums are lower

Which is generally true regarding insureds who have been classified as preferred risks?

return the application to the applicant for completion

Which is the appropriate action by the insurer if a prospective insured submitted an incomplete application?

aleatory

Which of the following best describes the concept that the insured pays a small amount of premium for a large amount of risk on the part of the insurance company?

Selection, classification, and rating of risks

Which of the following best details the underwriting process for life insurance?

Medical Background

Which of the following information about the applicant is NOT included in the General Information section of the application for insurance?

Debtor in the life of the creditor

Which of the following is NOT an example of a valid insurable interest?

the application given to a prospective insured

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

payments stop after the first death among the annuitants

Which of the following is NOT true about a joint and survivor annuity benefit option?

medical information

Which part of an insurance application would contain information regarding the cause of death of the applicant's deceased relatives?

Insurers

Who makes up the Medical Information Bureau?

To help the insured understand all aspects of the contract

Why should the producer personally deliver the policy when the first premium has already been paid?

3 days

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?

Fair Credit Reporting Act

an applicant is denied because of information found on a consumer report. which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company

The beneficiary will receive the full death benefit it is determined that the applicant qualified for the policy

an applicant signs an application for a 25000 life insurance policy pays the initial premium and receives a conditional receipt. if the applicant dies the following day which of the following is true

conditional

an insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. what contract characteristic does this describe?

50,000

an insured purchased a variable life insurance policy with a face amount of 50,000. over the life of the policy stock performance declined and the cash value fell to 10,000. if the insured dies how much will be paid out

Consideration

an insurer neglects to pay a legitimate claim that is covered under the terms of the policy. which of the following insurance principles has the insurer violated?

Issue the policy that is requested

as a field underwriter an agent is responsible for all of the following tasks except

ancestry

if an insurance company wishes to order a consumer report on an applicant to assist in the underwriting process and if a notice of insurance information practices has been provided the report may contain all of the following information except

the insurer

if an insurer requires a medical examination of an applicant in connection with the application for life insurance who is responsible for paying the cost of the examination?

upon the last death

in a survivorship life policy when does the insurer pay the death benefit

risk

insurance is the transfer of

adhesion

insurance policies are not drawn up through negotiations and an insured has little to say about its provisions. what contract characteristic does this describe?