GA Life/Health Insurance Exam
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act? A. Revocation of license B. $2,500 C. $1,000 D. $100 per violation
B. $2,500
Once an agent has met the requirements to sell long-term care insurance partnership policies, how often must the agent complete the 4 hours of ongoing training courses? A. Every 6 months B. Every 12 months C. Every 24 months D. Never
C. Every 24 months
All of the following are true regarding the convertability option under a term life insurance policy EXCEPT A. Most term policies contain a convertability option B. Upon conversion, the premium for the permanent policy will be based upon attained age. C. Upon conversion, the death benefit of the permanent policy will be reduced by 50% D. Evidence of insurability is not required.
C. Upon conversion, the death benefit of the permanent policy will be reduced by 50%.
The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called A. Waiver of cost of insurance B. Payor benefit C. Waiver of premium D. Guaranteed insurability
C. Waiver of premium.
When the policyowner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option? A. Fixed period B. Life income period certain C. Extended term D. Fixed amount
D. Fixed amount
Which of the following terms means a result of a calculation based on the average number of months the insured is projected to live due to medical history and mortality factors? A. Mortality rate B. Risk exposure C. Morbidity D. Life expectancy
D. Life expectancy
If a business owner becomes totally disabled, a Business Overhead Expense policy will pay all of the following EXCEPT A Rent B. Utilities C. Employee payroll D. Loss of the owner's income
D. Loss of the owner's income
Individual and group accident and sickness policies that cover what kinds of losses must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children? A. specified child-related losses. B. Health-related losses for the mother C. Maternity Losses D. Losses that happen to family members.
D. Losses that happen to family members until 31 days.
Which of the following programs expands individual public assistance programs for people with insufficient income and resources? A. Medicare B. Social Security C. Unemployment compensation D. Medicaid
D. Medicaid - is a needs tested program administered by the states to provide assistance to persons who are not able to provide for themselves.
Types of Term Life
Level, Increasing, Decreasing
Face Amount
The amount of benefit stated in the life insurance policy.
Suitability
a requirement to determine if an insurance product is appropriate for a customer
Qualified plan
a retirement plan that meets IRS guidelines for receiving favorable tax treatment
variable life insurance
contracts in which the cash values accumulate based upon specific portfolio of stocks without guarantees of performance.
Fixed life insurance
contracts that offer guaranteed minimum or fixed benefits.
Liquidation of an estate
converting a person's net worth into a cash flow.
Level term insurance
is the most common type. the word level refers to the death benefit that does not change throughout the life of the policy.
Level Premium
the premium that does not change throughout the life of a policy.
Deferred
with-held or postponed until a specified time or event in the future.
Cash Value
A policy's savings element or living benefit.
On a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are A. Not taxable since the IRS treats them as a return of a portion of the premium paid. B. Paid at a fixed rate every year C. Taxable as ordinary income D. Guaranteed
A. Not taxable since the IRS treats them as a return of a portion of the premium paid. (because they are considered a return of excess premiums).
Qualifications for soliciting, selling or negotiating a long-term care partnership policy include all of the following EXCEPT A. Obtaining a partnership policy license from the Commissioner. B. Being appointed. C. Completing an initial 8hour training. D. Completing ongoing 4hour training every 24 months
A. Obtaining a partnership policy license from the Commissioner.
Which statement is NOT true regarding underwriting group health insurance? A. The group is assessed individually for insurability B. The premium can be made retroactive for the year. C. The cost of the policy is partially determined by the ratio of males to females in the group. D. Everyone in the group is covered, regardless of their medical history.
A. The group is assessed individually for insurability.
In a life settlement contract, whom does the life settlement broker represent? A. The owner B. The insurer C. The beneficiary D. The life settlement intermediary
A. The owner (Life settlement broker is a person who, for compensation, solicits, negotiates, or offers to negotiate a life settlement contract. Life settlement brokers represent only the policy-owners).
Which of the following is true regarding inpatient hospital care for HMO members? A. Inpatient hospital care is not part of HMO services B. Care can be provided outside of the service area C. Care can only be provided in the service area D. Services for treatment of mental disorders are unlimited.
B. Care can be provided outside of the service area. - the HMO provides the member with inpatient hospital care, in or out of the service area. The services may be limited for treatment of mental, emotional or nervous disorders, including alcohol or drug rehabilitation or treatment.
When would misrepresentation on the insurance application be considered fraud? A. Any misrepresentation is considered fraud. B. If it is intentional and material C. Never; statements by the applicant are only representations. D. When the application is incomplete.
B. If it is intentional and material.
Which of the following statements is TRUE about a policy assignment? A. It authorizes an agent to modify the policy B. It transfers rights of ownership from the owner to another person C. It is the same as a beneficiary designation D. It permits the beneficiary to designate the person to receive the benefits.
B. It transfers rights of ownership from the owner to anther person.
If an applicant does not receive a new insurance policy, who would be held responsible? A. The applicant B. The agent C. The state D. The insurer
B. The agent - it is the responsibility of the agent to deliver the policy.
An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT? A. The premium for individual coverage will be based upon the insured's attained age. B. The insured may choose to convert to term or permanent individual coverage. C. The insured would not need to prove insurability for a conversion policy. D. The insured may convert coverage to an individual policy within 31 days.
B. The insured may choose to convert to term or permanent individual coverage. - when group coverage is converted to an individual policy, the insurer will determine the type of coverage, usually permanent insurance.
A father owns a life insurance policy on his 15-year old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disables, what will happen to the life insurance premiums? A. The insured will have to pay premiums for 6 months. If at the end of this period the father is still disabled, the insured will be refunded the premiums. B. The insured's premiums will be waived until she is 21. C. The premiums will become tax deductible until the insured's 18th birthday. D. Since it is the policyowner, and not the insured, who has become disabled, the life insurance policy will not be affected.
B. The insured's premiums will be waived until she is 21.
All of the following and dividend options except? A. Reduction of premium B. Paid-up additions C. Fixed-period installments D. Accumulated at interest
C. Fixed-period installments
Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policyowner? A. Entire Contract Clause B. Proof of Loss C. Payment of Claims D. Change of beneficiary
C. Payment of Claims - states the claims must be paid to the policyowner, unless the death proceeds need to be paid to a beneficiary.
When an insured under a life insurance policy died, the designated beneficiary received the face amount of the policy as well as a refund of all of the premiums paid. Which rider is attached the policy? A. Decreasing term B. Premature death C. Return of premium D. Cost of living
C. Return of premium - stipulates that death must occur prior to a certain age in order for the premium amount to be returned. The return of premium rider is funded by using increasing term insurance.
A hospital indemnity policy will pay A. Income lost while the insured is in the hospital B. All expenses incurred by the stay in the hospital C. Any expenses incurred by the stay in the hospital, minus coinsurance payments and deductibles D. A benefit for each day the insured is in a hospital
D. A benefit for each day the insured is in a hospital. - hospital confinement indemnity policies pay specific amounts that depend on the amount of time the insured is confined to the hospital.
If an annuitant dies before annuitization occurs, what will the beneficiary receive? A. Either the amount paid into the pan or the cash value of the plan, whichever is the lesser amount B. Amount paid into the plan C. Cash value of the plan D. Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount
D. Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount.
Policy maturity
in life policies, the time when the face value is paid out.
Attained Age
insured's age at the time the policy is issued or renewed.
L has a major medical policy with a $500 deductible and 80/20 coinsurance. L is hospitalized and sustains a $2,500 loss. What is the maximum amount that L will have to pay? A. $900 (deductible + 20% of the bill after the deductible [20% of $2,000). B. $500 amount of deductible C. $1000 (deductible + 20% of the entire bill) D. $2500 (the entire bill).
A. $900 ($500 deduct + 20% of remaining 2000).
What document describes an insured's medical history, including diagnoses and treatments? A. Attending Physician's Statement B. Physician's Review C. Individual Medical Summary D. Comprehensive Medical History
A. Attending Physician's Statement (APS) is the best way for an underwriter to evaluate an insured's medical history. The report includes past diagnoses, treatments, length of recovery time, and prognoses.
Which provision allows the policyholder a period of time, while coverage is in force, to examine a health insurance policy and determine whether or not to keep it? A. Free Look Period B. Grace Period C. Elimination Period D. Probationary Period
A. Free Look Period
Life income joint and survivor settlement option guarantees A. Income for 2 or more recipients until they die. B. Payment of interest on death proceeds. C. Payout of the entire death benefit. D. Equal payments to all recipients.
A. Income for 2 or more recipients until they die.
In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party? A. Insurer to the insured B. Insured to the insurer C. Insurer to the Department of Insurance D. Insured to the the Department of Insurance
A. Insurer to the insured - upon receipt of a notice of claim, the company must supply claims forms to the insured within a specified number of days.
When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount on the policy? A. It is reduced to the amount of what the cash value would buy as a single premium. B. It is increased when extra premiums are paid C. It decreases over the term of the policy D. It remains the same as the original policy, regardless
A. It is reduced to the amount of what the cash value would buy as a single premium.
Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client? A. Limited pay whole life B. Interest-sensitive whole life C. Life annuity with period certain D. Increasing term
A. Limited pay whole - premium payment will cease at her age 65, but coverage will continue to her death or age 100.
Which of the following provisions is mandatory for health insurance policies? A. Physical examination and autopsy B. Illegal Occupation C. Unpaid premiums D. Intoxicants and narcotics
A. Physical examination and autopsy is mandatory provision required by law. The other answer choices are optional provisions.
An employee insured under a group health plan has been paying $25 monthly premium for his group health coverage. The employer has been contributing $75, for the total monthly cost of $100. If the employee leaves the company, what would be his maximum monthly premium for COBRA coverage? A. $100 B. $102 C. $25 D. $25.50
B. $102 : The employer is permitted to collect a premium from the terminated employee at a rate of no more than 102% of the individual's group premium rate (in this scenario 102% of $100 total premium is $102. The 2% charge is to cover the employer's administrative costs.
All of the following are true regarding Key Employee Disability Income insurance EXCEPT A. Premiums are not tax deductible for the employer. B. Benefits are taxable to the employer. C. The employer owns the policy. D. Benefits are paid to the employer to retrain a new person.
B. Benefits are taxable to the employer. - key person disability income premiums are not tax deductible to the business, but the benefits are received income tax free by the business.
Which of the following would be considered violation of life insurance advertising regulations? A. Making oral sales presentations B. Calling a variable insurance policy an investment plan C. Informing the applicant that the sole subject of the sale is insurance D. Not guaranteeing dividends.
B. Calling a variable insurance policy an investment plan.
If the policyowner, the insured, and the beneficiary under a life insurance policy are three different people, who has the ownership rights? A. Insured B. Policyowner C. The insured and the policyowner D. Beneficiary
B. Policyowner - has the ownership rights under the policy, and not the insured or the beneficiary.
When an insurer combines two periods of disability into one, the insured must have suffered a A. Presumptive disability B. Recurrent disability C. Partial disability D. Residual disability
B. Recurrent disability - is the period of time (usually within 3-6 months) during which the recurrence of an injury or illness will be considered as a continuation of a prior period of disability.
Which of the following is true regarding health insurance underwriting for a person with HIV? A. The person may only be declined if he/she has symptoms. B. The person may not be declined for medical coverage solely based on HIV status C. A person may be declined for HIV but not AIDS D. The person may be declined.
B. The person may not be declined for medical coverage solely based on HIV status.
If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE? A. The insurer may deny coverage later, because of the information missing on the application. B. The policy will be interpreted as if the insurer waived its right to have an answer on the application. C. The policy will be interpreted as if the insured did not have an answer to the question. D. The policy will be voided.
B. The policy will be interpreted as if the insurer waived its right to have an answer on the application.
An agent and an applicant for a life insurance policy fill out and sign the application. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. When will coverage begin? A. When the agent submits the application to the company and the company issues a conditional receipt. B. When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health. C. On the designated effective date. D. On the application date.
B. When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health.
An 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 would his beneficiary receive as a settlement? A. $0 B. $100,000 C. $200,000 D. $100,000 plus the total of paid premium
C. $200,000 - the beneficiary would most likely receive twice the face value of the policy, since his fatal injuries were caused by an accident and he died within the 90day benefit limit stipulated in most policies.
If $100,000 of life insurance proceeds were used in a settlement option, which paid $13,000 per year for ten years, which of the following would be taxable annually? A. $10,000 B. $7,000 C. $3,000 D. $13,000
C. $3,000
An insured has a primary group health plan and an excess plan, each covering losses up to $10,000. The insured suffered a loss of $15,000. Disregarding any copayments or deductibles, how much will the excess plan pay? A. $10,000 B. $7,500 C. $5,000 D. $0
C. $5,000 (covering the excess).
Once an individual is licensed as an insurance producer for life or accident and health insurance, how many hours of training must the producer complete initially to sell long-term care insurance partnership policy? A. 4 hours B. 6 hours C. 8 hours D. 12 hours
C. 8 hours
The probationary period is A. The stated amount of time when the benefits may be reduced under a certain conditions B. The number of days that must expire after the onset of an illness before benefits will be earned. C. A specified period of time that a person joining a group has to wait before becoming eligible for coverage. D. The number of days the insured has to determine if he/she will accept the policy as received.
C. A specified period of time that a person joining a group has to wait before becoming eligible for coverage.
After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true? A. The employee can convert from group to individual insurance within 31 days of termination. B. The premium of the individual health insurance policy can be higher than the original policy. C. By law, the new, individual policy must provide the same benefits as the group insurance policy. D. Continuation of group coverage need not include dental, vision, or prescription drug benefits.
C. By law, the new, individual policy must provide the same benefits as the group insurance policy.
A small business owner is the insured under a disability policy that funds a buy-sell agreement. If the owner dies or becomes disabled, the policy would provide which of the following? A. The business manager's salary. B. Disability insurance for the owner C. Cash to the owner's business partner to accomplish a buyout D. The rent money for the building
C. Cash to the owner's business partner to accomplish a buyout.
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? A. Representation B. Adhension C. Consideration D. Good faith
C. Consideration - the binding force in any contract is consideration. Consideration on the part of the insured is the payment of premiums and the health representations made in the application. Consideration on the part of the insurer is the promise to pay in the event of loss.
At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. This rider is called A. Supplemental add on B. Cost of living C. Guaranteed insurabilty D. Waiver of cost of insurance
C. Guaranteed insurability
What are the two components of a universal policy? A. Mortality cost and interest. B. Separate account and policy loans C. Insurance and cash account D. Insurance and investments
C. Insurance and cash account - the insurance component of a universal life policy is always annual renewable term insurance; the cash account accumulates on a tax deferred basis each year and earns either the guaranteed contract rate or the current rate, whichever is higher.
The section of a health policy that states the causes of eligible loss under which an insured is assumed to be disabled is the A. Consideration clause B. Probationary period C. Insuring clause D. Incontestability clause
C. Insuring clause
In a disability income policy, all of the following are considered presumptive disabilities EXCEPT A. Loss of two limbs B. Loss of speech C. Loss on one eye D. Loss of hearing
C. Loss of one eye
An applicant for a health insurance policy returns a completed application to her agent, along with a check for the first premium. She receives a conditional receipt two weeks later. Which of the following has the insurer done by this point? A. Approved the application B. Issued the policy C. Neither approved the application nor issued the policy. D. Both approved the application and issued the policy.
C. Neither approved the application nor issued the policy.
The Ownership provision entitles the policyowner to do all of the following EXCEPT A. Assign the policy B. Designate a beneficiary C. Set premium rates D. Receive a policy loan
C. Set premium rates
Which of the following insurers are owned by stockholdrers who have the usual rights of ownership , including the right of voting? A. Reciprocal B. Fraternal C. Stock D. Mutual
C. Stock
Which of the following would help prevent a universal life policy from lapsing? A. Adjustable premium B. Corridor of insurance C. Target premium D. Face amount
C. Target premium : is a recommended amount that should be paid on a policy in order to cover the cost of insurance protection and to keep the policy in force throughout its lifetime.
Which of the following is true regarding elimination periods and the cost of coverage? A. The longer the elimination period, the higher the cost of coverage B. Elimination periods have no effect on the cost of coverage C. The longer the elimination period, the lower the cost of coverage D. The shorter the elimination period, the lower the cost of coverage.
C. The longer the elimination period, the lower the cost of coverage. - the elimination period is a period of days which must expire after the onset of an illness or occurrence of an accident before benefits will be payable.
Which of the following named beneficiaries would NOT be able to receive the death benefit directly from the insurer in the event of the insureds' death? A. A business partner of the insured B. The wife of the deceased insured C. The former wife of the deceased insured D. A minor son of the insured.
D. A minor son of the insured. - Because a minor does not have the legal capacity to release the insurer from further obligation, benefits normally have to be passed through guardian or trustee.
Which is NOT a characteristic of group health insurance? A. Dependents of insureds can be covered under group health plans B. Group coverage may be converted to individual coverage if the group contract is ended. C. The actual policy is called the "master contract" D. A policy is issued to each insured individual.
D. A policy is issued to each insured individual.
When the insured purchased his health policy he was a window washer. He has since changed occupations and now manages a library. If the insurer is notified of the insured's change of occupation, the insurer should A. Increase the benefit B. Return any unearned premium C. Consider decreasing the premium D. Adjust the benefit in accordance with the decreased risk.
D. Adjust the benefit in accordance with the decreased risk.
An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued? A. Deny any claims and cancel the policy. B. Deny paying a claim based on misrepresentation. C. Pay the full amount of a claim because the contestable period has ended. D. Adjust the claim benefit to reflect the insured's true age.
D. Adjust the claim benefit to reflect the insured's true age.
An agent is ready to deliver a policy to an applicant but has not yet received payment. Upon delivery, the agent collects the applicant's premium check, answers any questions the applicant may have, and then leaves. What did he forget to do? A. Offer her a secondary policy. B. Ask the applicant to sign a statement that acknowledges that the policy had been delivered C. Collect a late payment fee D. Ask her to sign a statement of good health
D. Ask her to sign a statement of good health.
A policyowner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision? A. Waiver of premium B. Incontestability period C. Assignment D. Automatic premium loan
D. Automatic premium loan
Which of the following provides coverage on a first-dollar basis? A. Accident expense B. Supplementary major medical C. Limited major medical D. Basic expense
D. Basic expense - will provide coverage on a first-dollar basis (no deductible). After the limits of the basic policy are exhausted, the insured must pay a corridor deductible before the major medical coverage will pay benefits.
An insured pays an annual premium to his insurer. In return, the insurer promises to pay benefits in accordance with the terms of the contract. This is called A. conditions B. utmost good faith C. Acceptance D. Consideration
D. Consideration : is the value offered by the insured to the insurer, and vice versa.
How are HMO territories typically divided? A. Type of physician services available B. Community rating system C. By where the HMO can find the least expensive physicians D. Geographic areas
D. Geographic areas
Most LTC plans have which of the following features? A. No elimination period B. Variable premiums C. Open enrollment D. Guaranteed renewability
D. Guaranteed renewability
An insurer publishes intimidating brochures that portray the insured's competition as financially and professionally unstable. Which of the following best describes this act? A. Legal, provided that the information can be verified B. Illegal until endorsed by the Guaranty association C. Legal, provided that the other insurers are paid royalties for the usage of their names D. Illegal under any circumstances
D. Illegal under any circumstances.
Which of the following statements is TRUE concerning the Accidental Death Rider? A. It is also known as a triple indemnity rider B. This rider is only available to insureds over the age of 65 C. It is only available in group insurance D. IT WILL PAY DOUBLE OR TRIPLE THE FACE AMOUNT
D. It will pay double or triple the face amount.
All of the following statements concerning Medicaid are correct EXCEPT A. Individual states design and administer the Medicaid program under broad guidelines established by the federal government. B. Have the ability or means to pay for their own medical care C. Persons, at least 65 years of age, who are blind or disables and financially unable to pay, may qualify for Medicaid Nursing Home benefits. D. Medicaid is a state funded program that provides heath care to persons over age 65, only.
D. Medicaid is a state funded program that provides health care to persons over age 65, only. - Medicaid is a government funded (both state and federal) program designed to provide health care to poor people of all ages.
An insured pays her major medical insurance premium annually on March 1. Last March she forgot to mail her premium to the company. On March 19, she had an accident and broke her leg. The insurance company would A. Hold the claim as pending until the end of the grace period B. Deny the claim C. Pay half of her claim because the insured had an outstanding premium D. Pay the claim
D. Pay the claim - because the accident occurred during the grace period, the insurance company will pay the claim.
Which of the following is correct regarding Business Overhead Expense insurance? A. Benefits received are received tax free. B. Benefits received are taxable income the employee. C. Premiums are not tax deductible. D. Premiums are tax deductible.
D. Premiums are tax deductible.
Another name for a substandard risk classification is A. Controlled B. Declined C. Elevated D. Rated
D. Rated - substandard risk classification is also referred to as a "rated" since these policies could be issued with the premium rated-up, resulting in a higher premium.
Insurers may change which of the following on a guaranteed renewable health insurance policy? A. Coverage B. Individual rates C. No changes are permitted D. Rates by class
D. Rates by class. (on a guaranteed renewable health insurance policy, the insurer may increase premiums on a class basis only, and not on an individual policy.
An insured wants to name her husband as the beneficiary of her health policy. She also wishes to retain all of the rights of ownership. The insured should have her husband name as what type of beneficiary? A. Primary B. Contingent C. Irrevocable D. Revocable
D. Revocable.
An insured has endured multiple surgeries and hospitalizations for an illness during the summer months. Her insurer no longer bills her for medical expenses. What term best describes the condition she has met? A. Out-of-pocket limit B. Maximum Loss Threshold C. Maximum Loss D. Stop-loss Limit
D. Stop-loss Limit : A specified dollar amount beyond which the insured no longer participates in the sharing of expenses.
Which of the following is TRUE regarding variable annuities? A. The funds are invested in the company's general account. B. The company guarantees a minimum interest rate C. A person selling variable annuities is required to have only a life agent's license. D. The annuitant assumes the risks on investment.
D. The annuitant assumes the risks on investment. - the payments that the annuitant invests into the variable annuity are invested in the insurer's separate account. The separate account under many annuities provides the annuitant with a dozen or more investment options ranging from "money market funds" to "growth stock funds" to "precious metal funds". Therefore, the annuitant assumes the risk of the investment.
The insured had his wife named as the beneficiary of his life insurance policy. To ensure that his wife had income for life after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking into account all of the following EXCEPT a. The beneficiary's life expectancy B. Projected interest rates C. Face amount of the policy D. The insured's age at death
D. The insured's age at death. - but the longer the life expectancy of the recipient, the lower the payments will be.
Why should the producer personally deliver the policy when the first premium has already been paid? A. To ensure the producer gets paid commission B. To find out how the family has been doing since the initial presentation C. To make sure the policy is not stolen or lost D. To help the insured understand all aspects of the contract.
D. To help the insured understand all aspects of the contract.
The main difference between immediate and deferred annuities is A. How the annuity is purchased B. The number of insureds C. The amount of each payment D. When the income payments begin
D. When the income payments begin. - immediate annuities will begin payments within the first year, while deferred annuities will not begin payments until sometime after the first year.
Annually Renewable term (ART)
Is the purest form of term insurance - the death benefit remains level (in the sense it's level term policy). The policy may be guaranteed to be renewable each year with out proof of insurability - but the premium increases annually according the the attained age - as the probability of death increases.
Term Life
Provide pure death protection - if the insured dies during the term, the policy pays the death benefit to the beneficiary.
Securities
financial instruments that may trade for value (ex: stocks, bonds, options).
Term life
is temporary protection because it only provides coverage for a specific period of time. Also known as; provide for the greatest amount of coverage for the lowest premium as compared to any other form of protection. Usually a max age offered.
Decreasing Term
policies feature a level premium and a death benefit that decreases each year over the duration of the policy term. Primarily used when the amount of needed protection is time sensitive. Ex: mortgage or other debts. - The amount of coverage thereby decreases as the outstanding loan balance decreases each year. Usually convertable - however it is usually not renewable since the death benefit is $0 at the end of the policy term.
Endow
the cash value of a whole life policy has reached the contractual face amount.
Non-forfeiture values
benefits in a life insurance policy that the policy owner cannot lose even if the policy is surrendered or lapses.