Guarantee examm
If the policy summary for a life insurance policy is not given when the application is taken, when must the policy summary be given to the policyowner?
When the policy is delivered
Which of the following types of insurance policies would performed the function of cash accumulation?
Whole life
When an insured terminated membership in the insured group, the insured can convert to
Whole life without proof of insurability
During what period is a new life insurance policyholder entitled to review a policy and return it for a full refund?
Within 14 days after delivery of the policy
An insured has a life insurance policy in the amount of $250,000 naming his wife as beneficiary. Upon his death, his beneficiary decides not to receive the death benefit for sometime. When she finally receives the death benefit check, it's in the amount of $250,530. Is any portion of the proceeds that the beneficiary receives taxable?
Yes, proceeds in excess of face amount are taxable as interest.
Which of the following is not a standard exclusion in life insurance policies?
disability
An insurer incorporated under the laws of another state but doing business in this state is considered
foreign
Among the applicants in the same class and life expectancy, which of the following factors can be used to influence premium rates?
occupation
The guaranteed insurability rider allows the owner to purchase additional amounts of life insurance, without proof of insurability at all of the following, except
purchase of a new home
If an applicants health is poorer than that, of an average applicant, the policy may be issued
substandard
An agent tells an insured that if he replaces his current insurance policy with a newer one, his dividends will be higher and his premiums will be slightly lower. The policy, however, would not offer either one of these things. What type of misrepresentation is being committed?
twisting
An insured is issued a life insurance policy in Florida and wishes to return it for a refund. How many days does the insured have for such an action?
14 days
How many hours of continuing education must a newly licensed agent complete every 2 years?
24
An insurer must notify the consumer in writing that an investigative consumer report has been requested, within how many days of the initial request?
3 days
How long is the required grace period in life insurance policies issued in this state?
30 days
An applicant for an agent's Life only license must complete a minimum of how many hours of pre licensing education?
40
Individual members covered by group life insurance receive
A certificate of insurance
Which of the following is NOT considered eligible for group life insurance?
A credit union that needs coverage only for its top 10 employees
Which of the following would be required to become licensed as an insurance producer?
A customer service representative who solicits no more than one policy a year
According to the life insurance replacement regulations, which of the following would be an example of policy replacement?
A policy is reissued with a reduction in cash value
When agents, brokers, or solicitors handle premiums for an insurer, they are acting in which capacity?
As a fiduciary
In whole life insurance when is the policy cash value scheduled to equal the face amount?
At the insured's age 100
Which of the following statements is true regarding an agent's report during the policy application process?
Aunt provides the agents personal observation is concerning the proposed insured
Which of the following is NOT an example of the company's location of incorporation?
Authorized
Which provision may be added to a permanent life policy at no cost that insures that the policy will not last so long as there is cash value?
Automatic premium loan option
All of the following statements about mutual insurance companies are correct except
Policy dividends issued by mutual companies are guaranteed and not taxable
Agent mcbutch uses his big size and implication of his connections to intimidate applicants into purchasing life insurance from him. Which unfair trade practice is this an example of?
Coercion
An individual has a $200,000 convertible term life insurance policy. If he chooses, he can
Convert to a whole life policy for the same face amount without proof of insurability
Decreasing term insurance is often used to
Cover a mortgage
An employee guys having 6 quarters of coverage during the previous 13-quarter period. What status of coverage does the employee have under Social Security?
Currently insured
At what point would an automatic premium loan be generated?
Following the grace period
Under which of the following conditions would life insurance proceeds to be taxable by the federal government?
If there is a transfer for value
What does the Guaranty Association guard against?
Insurer insolvency
The provision that sets forth the basic agreement between the insurer and the insured and states the insurer's promise to pay the death benefit upon insureds death is called the
Insuring clause
In making an annuity recommendation to a consumer, that producer must have responsible grounds to believe that the annuity
Is suitable
Which of the following is true of level term insurance?
It is temporary protection
All of the following statements regarding the Life insurance Policy Summary is correct EXCEPT
It must illustrate all guaranteed policy dividend values
Which of the following is true regarding pure life annuity settlement option?
It provides the highest monthly benefit
Which of the following best describes pure life annuity?
It provides the highest monthly benefits. The pure life annuity, also known as Life Only or Straight Life, pays the most since it only guarantees to pay for the rest of one's life without a minimum guarantee.
Your client wants to provide a retirement income for his early parents in case something happens to him. He wants to make sure that both beneficiaries are guaranteed an income for life. Which settlement option should this policyowner select?
Joint and survivor
Which of the following is not eligible for Group Life Insurance?
Labor groups
What does an annuity protect the annuitant against?
Living longer than expected
An example of an alien insurer doing business in this state is one formed under the laws of
Mexico
Guaranteeing future dividends is considered to be an unfair or deceptive act known as
Misrepresentation
An insurance company that is owned by the policyholders is called a
Mutual insurer
The reduction of premium option uses the dividend to reduce
Next year's premium
What is a specific requirements regarding the number of employees in a simple plan?
No more than 100 employees
cash value guarantees in a whole life policy are called
Nonforfeiture values
Which statement best describes agreement as it relates to insurance contracts?
One party accepts the exact terms of the other party's offer
A married couple purchase a life insurance policy on their newborn baby. They are concerned about what would happen to the policy. If either one of them were unable to continue making the premium payments due to death or disability, which policy writer should their agent recommend?
Payor benefit
In a group life policy with a death benefit of more than $50,000
Premium cost above $50,000 is taxable as income to the employee
If a life insurance company uses HIV testing as a part of its underwriting, when must an applicant be notified of the procedure?
Prior to performance of the test
When an agent delivered an insurance policy to the insured, he collected the initial premium, as well as the document, verifying that the insured had not had any inquiries or illness since the application date. What is this document called?
Statement of good health
Which of the following actions does not constitute false advertising
Stating that dividends are not guaranteed
Life insurance can provide which of the following?
Survivor protection
What Florida insurance regulation established an outline of appropriate and inappropriate business behavior for life insurance agents?
The Code of Ethics of the Florida Association of Insurance and Financial Advisors
Which of the following statements concerning the medical information bureau is correct?
The Medical Information Bureau assists underwriters in evaluating and classifying risks.
Which of the following is a permissible reason for an insurance company to contest payment of a claim based on statements in the application?
The application contains material misstatements
Variable life insurance is regulated by all of the following entities except
U.S. Department of the Treasury
Failing to acknowledge and act reasonably promptly upon communications with respect to an insurance claim is in violation of what insurance regulation?
Unfair claims settlment
Two individuals of the same age, health status, and life expectancy apply for individual insurance coverage. When policies are issued by the same insurer, the premium rates are different based on the insurer's race. What practice does this describe?
Unfair discrimination
What guarantees that the information explained in the insurance contract is true?
warranty
Which of the following indicates the person upon his life the annuity income amount is determined?
Annuitant
An annuity has accumulated the cash value of 70,000, of which $30,000 it's from premium payments, annuitant dies during the accumulation phase the beneficiary will receive
$70,000
What is the maximum amount of individual life insurance coverage that a person can convert to if the existing group policy has been terminated?
$10,000
If an individual willfully violates provisions of the Fair Credit Reporting Act, what is the maximum civil penalty?
$2,500
What is the maximum level of item an insurer may gift a prospective insured as an advertisement?
$50
Which of the following statements is incorrect concerning modified endowment contracts (MECs)?
An MEC must always pass the 7-pay test
Which of the following would be an example of an unfair trade practice of sliding?
An agent is falsely leading an applicant to believe that additional coverage is required by law
All of the following could qualify as a group for the purpose of purchasing group life insurance except
An association formed 1 year ago.
Group life policies are usually issued as what type of coverage?
Annually renewable term
Which of the following would be true of both the fixed-period and fixed-amount settlement options?
Both guarantee that the principal and interest will be fully paid out
Which of the following would be an example of an insurer participating in the unfair trade practice of discrimination?
Charging the insured higher premiums based on her race
Which of the following sources would explain the state policies regarding appropriate agent conduct?
Code of ethics of the Florida Association of Insurance and Financial Advisers
A married couple wants to include the entire family and their whole life policy under one rider . Which of the following riders will help them achieve that goal?
Family term
Premiums collected on behalf of the insurance company by an agent will be held in what capacity?
Fiduciary
Which of the following is a correct statement about annuities?
Fixed annuities do not provide protection against inflation
The owner of a deferred annuity pays $100 in premium one month, and $130 the next month. Which of the following terms best describes this premium payment arrangement?
Flexible premium
What effect will the long-term care (LTC) rider have on the death benefit of life insurance policy if LTC benefits were paid to the insured?
Reduce the death benefit
An individual receives a lump-sum inheritance. He'd like to use the money to create a lifetime income since he'll be retiring soon. He purchased an annuity and wishes to receive payments beginning in 2 months. What did he buy?
Single, premium deferred annuity
As an insurer's field underwriter, a producer has all of the following responsibilities except
Soliciting insurance contracts
Which of the following will not be included in the buyers guide?
Specific information about the policy
The family term rider incorporates
Spouse term and children's term
As it relates to life settlements, the term "owner" means
The owner of the original life policy
Who is the annuity owner?
The person who purchases the annuity
All of the following statements about indexed whole life insurance are correct except
The policy face amount remains level throughout the life of the policy
Which of the following is true regarding premium in a 10-year level premium policy?
The premium will remain level for 10 years
What is the purpose of key-person insurance?
To minimize the risk of financial loss caused by the death of a key employee
Who does the spendthrift clause in a life insurance policy protect?
beneficiary
The policy owner has an option to pledge the life insurance policy as collateral for a bank loan this is called
collateral assignment
Which of the following elements of an insurance contract requires payment of premium?
consideration
A whole life policy is surrendered for a reduced paid up policy. The cash value in the new policy will
continue to increase
During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, and makes it sounds worse than it is. This is an example of an unfair trade practice of
defamation
