Insurance
A nonprofit incorporated society that does not have capital stock and operates for the sole benefit of its members is known as:
A fraternal benefit society
P received Disability income benefits for 3 months then returns to work. She is able to work one month before her condition returns, leaving her disabled once again. What would the insurance company most likely regard this second period of disability as?
A recurrent disability
C is a key employee at ABC Incorporated. If a Key Employee life policy is purchased on her life, which of these statements would be true?
ABC is the policyowner, C is the insured, and ABC is the beneficiary
Which provision is NOT a requirement in a group life policy?
Accidental
P is blinded in an industrial accident. Which provision of his life insurance policy will pay a stated benefit amount?
Accidental death and dismemberment clause
A policyowner may generate taxable income from which of the following dividend options?
Accumulation at interest
Which of the following actions does the commission of insurance NOT have the power to conduct?
Activate insurance companies' financial reserves
L takes out a life insurance policy and dies 10 years later. During the claim process, the insurer discovers that L had understated her age on the application. Under the Misstatement of Age provision, the insurer will
Adjust the death benefit to a reduced amount
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?
Aleatory
Which of the following statements is correct regarding the tax treatment of lump-sum payment paid to a life insurance policy's primary beneficiary?
All proceeds are income tax free in the year they are received
A qualified profit-sharing plan is designed to:
Allow employees to participate in the profits of the company
The amount of monthly disability benefits payable under social security is affected by which of the following factors?
Amount of benefits available from other sources
If an insured's age was misstated on a life insurance contract, the misstatement of age provision requires that any death benefit payable would be
An amount that the premiums paid would have purchased at the current age
All of the following statements regarding group health insurance is true, Except:
An individual policy is given to each member
An insurer is NOT required to provide information on fraudulent claims if requested by
An insured
In Texas, which of these statements regarding the suicide clause is true?
An insurer may not use suicide as a defense against payment after second year
What does the insuring agreement in a Life insurance contract establish?
An insurer's basic promise
Which premium schedule results in the lowest cost to the policyowner?
Annual
When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n)
Anti-money laundering violation
A plan through the marketplace may be purchase by
Any legal resident (except those imprisoned)
An applicant's medical information received from the medical information bureau (MIB) may be furnished to the:
Applicant's physician
Before a life insurance policy is issued, which of these components of the contract is required?
Applicant's signature on application
In a qualified retirement plan, the yearly contributions to an employee's account:
Are restricted to maximum levels set by the IRS
Which of the following medical expenses does cancer insurance NOT cover
Arthritis
A certificate of _______ permits an insurance company to transact business in Texas.
Authority
What action will an insurer take if an interest payment on a policy loan is not made on time?
Automatically add the amount of interest due to the loan balance
A pilot applies for life insurance. The insurer approves the application with a $10 additional monthly premium modification due to the risk involved. The pilot declines the additional premium modification. The insurer will then likely issue the coverage with a(n)
Aviation exclusion
Which type of policy would pay an employee's salary if the employer was injured in a bicycle accident and out of work for six weeks?
Business overhead expense
What type of employee welfare plans are not subject to ERISA regulations?
Church plans are exempt from ERISA Regulations
N is covered by a Term Life policy and does not make the required premium payment which was due August 1. N dies September 15. What action will the insurer take?
Claim will be denied
How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy?
If the primary beneficiary dies before the insured
During a sales presentation for a participating life insurance policy, an agent MUST
Make a prospect understand that dividend are not guaranteed
When will a hearing be held after a notice of hearing, alleging participation in an unfair or deceptive act, is served to a licensee or insurer by the Commissioner?
No sooner than 6 days
A disability income policy that only the policyowner can terminate and which the rates will never go up is considered to be
Noncancellable
Which of the following is a valid reason for an enrolled to be cancelled by a health maintenance organization (HMO) plan?
Nonpayment of coverage
Which statement is true regarding a minor beneficiary?
Normally, a guardian is required to be appointed in the beneficiary clause of the contract
The notice of claims provision requires a policyowner to
Notify an insurer of a claim within a specific time
Who is liable when an insured suffers a loss on a policy sold by an agent though an insurer not authorized to conduct business in Texas?
The agent
The investment gains from a universal life policy usually go toward:
The cash value
The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is:
The cost
K is an agent who takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?
The date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured
Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?
The employee
Which statement is True regarding a group accident & health policy issued to an employer?
The employer receives the policy and each employee is issued a certificate
Which of the following benefits is NOT required under a group health plan for drug and alcohol treatment?
Transportation to and from a treatment facility
What type of reinsurance contract involves two companies automatically sharing their risk exposure?
Treaty
What type of life insurance incorporates flexible premiums and an adjustable death benefit?
Universal Life
How long does an insurance company appointment remain in force?
Until terminated
R becomes disabled and owns an individual Disability Income policy. When is R eligible to receive disability benefits?
Upon satisfying the elimination period requirement
Which of the following best describes how pre-admission certification is used?
Used to prevent nonessential medical cost
In order to sell a (n)____ Life policy, a producer is required to register with financial Industry Regulatory Authority (FINRA).
Variable life
Life insurance immediately creates an estate upon the death of an insured. Which of the following policies is characterized by a guaranteed minimum death benefit?
Variable life
Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?
Variable life
Which type of policy contains a monthly mortality charge as well as self-directed investment choices?
Variable universal life
A life policy that contains a monthly mortality charge as well as self-directed investment choices is called a(n)
Variable universal life policy
S owns a life insurance policy with cash values that fluctuate according to the underlying investment performance of common stocks. Which of these policies does S own?
Variable whole life
What is the primary factor that determines the benefits paid under a disability income policy?
Wages
ABC Insurance Company has accepted a life insurance application which contains unanswered questions. The company then makes the application part of the life contract. In this situation, the insurer has
Waived one of its legal rights
A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what of rider attached?
Waiver of premium - the waiver of premium is a rider on a life insurance policy that guarantees that the premium will be paid if the insured is disabled for a specified period of time.
What type of rider would be added to an Accident and Health policy if the policyowner wants to ensure the policy will continue if he/she ever becomes totally disabled?
Waiver of premium rider
Which of these is considered a statement that is assured to be true in every respect?
Warranty
Which parts of a life insurance policy are guaranteed to be true?
Warranty
A foreign insurance company conducting insurance business in Texas
Was formed under the laws of another state
At what point does an informal agreement become a binding contract?
When consideration is provided by one of the parties to the contract
When must insurable interest be present in order for a life insurance policy to be valid?
When the application is made
At what point does a whole life insurance policy endow
When the cash value equals the death benefit
A life insurance policy that provides a policyowner with cash value along with a level face amount is called:
Whole life
What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?
Whole life
What type of insurance offers permanent life coverage with premiums that are payable for life?
Whole life
Major Medical policies typically
contain a deductible and coinsurance
The incontestable clause allows an insurer to
contest a claim during the contestable period
A Nonforfeiture clause gives the policyowner
guaranteed values even if the policy has lapsed
Basic Medical Expense Insurance
has lower benefit limits than Major Medical insurance
Deductibles are used in health policies to lower
overuse of medical services
A limited-pay life policy has
premium payments limited to a specified number of years
An example of rebating would be
returning a portion of a premium as inducement to purchase insurance
Under a Graded Premium Whole Life policy,
the premium increases each year during the early years of the contract and remains the same after that time
A term life policy matures:
upon the insured's death during the term of the policy
A 15-year mortgage is best protected by what kind of life policy?
15-year decreasing term
What year was the McCarran-Ferguson Act enacted?
1945
In Texas, how long must a policy be in force before an insurance company must pay death benefits for suicide?
2 years
M has a Major Medical insurance policy with a $200 flat deductible and an 80% Coinsurance clause. If M incurs a $2,200 claim for an eligible medical expense, how much will M receive in payment for this claim?
2200 - 200 deductible x 80% = 1600
A new general property and casualty licensee must complete at LEAST ____ hours of continuing education within 24 months of initial licensure
24
N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?
30 pay life / limited pay whole life policies have level premiums that are limited to a certain period
The reason for backdating a policy is
To obtain a premium rate based on earlier age
A(n) ________ rider may be used to include coverage for children under their parents' life insurance policy.
"Term rider" may be used to include coverage for children under their parents life insurance policy
T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?
$0 because T is still alive and the sole primary beneficiary
A Hospital/Surgical Expense policy was purchased for a family of four in March of 2013. The policy was issued with a $500 deductible and a limit of four deductibles per calendar year. Two claims were paid in September 2013, each incurring medical expenses in excess of the deductible. Two additional claims were filed in 2014, each in excess of the deductible amount as well. What would be this family's out-of-pocket medical expenses for 2013?
$1,000
Under the USA Patriot Act, insurers are required to report receipt of cash payments in excess of
$10,000
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?
$20,000 death benefit
B has a $100,000 Accidental Death and Dismemberment policy that pays triple indemnity for common carrier death. If B is killed from an accident on a commercial flight, what will the policy pay B's beneficiary?
$300,000
T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. Five years later, T commits suicide. How much will the insurer pay?
$50,000
XYZ Company pays the entire premium for its group health plan. The MINIMUM percentage of eligible employees that must be covered is
100%
What is the maximum social security disability benefit amount an insured can receive?
100% of the insured's primary insurance amount (PIA)
What is the minimum benefit period that must be offered by a long term care policy?
12 month
Every 12-months after the initial enrollment period, an HMO must hold an open enrollment period of
31 days
In Texas, an individual life insurance policy is required to have a grace period of
31 days
One becomes eligible for Social Security disability benefits after having been disabled for
5 month
What is the excise tax rate the IRS imposes on individuals aged 70 1/2 or older who do not take the required minimum distributions from their qualified retirement plan?
50%
Three law partners form a Cross-Purchase Buy and Sell agreement. This agreement is funded with individual life insurance. How many total life policies are needed for this agreement?
6 (each partner owns, is the beneficiary of and pays the premiums for life insurance on the other partners equal to his or her share of the purchase price)
How long can a cash surrender value payment be deferred by the insurance company under the non forfeiture law?
6 months
A temporary agent's license issued by the commission of insurance is valid up to _____ days
90 days
The situation in which a group of physicians are salaried employees and conduct business in an HMO facility is called a(n):
Closed panel
B, an insurance agent, tells his clients that their rights may be impaired if they fail to complete a release form within a given period of time. B may be found guilty of
Coercion
The phrase "transacting business" includes
Collecting premiums
Which of the following organizations would make reimbursement payments directly to the insured individual for covered medical expenditures?
Commercial insurer
This type of deductible provision states that should more than one family member be involved in a common accident, or suffer the same illness, only one individual deductible amount shall be applied
Common accident deductible
Which of the following would be a likely candidate for disability income insurance on a key employee?
Company executive
Which of the following is NOT included in a life insurance illustration?
Company's mortality table
A prospective insured completes and signs an application for health insurance but intentionally conceals information about a pre-existing heart condition. The company issues the policy. Two months later, the insured suffers a heart attack and submits a claim. While processing the claim, the company discovers the pre-existing condition. In this situation, the company will:
Continue coverage but exclude the heart condition
Which of these require an offer, acceptance, and consideration?
Contract
When an employee is required to pay a portion of the premium for an employer/employee group health plan, the employee is covered under which of the following plans?
Contributory
D the agent met with a prospect and ended up selling an insurance policy. While filling out the insurance application, D makes a mistake. In this situation, D MUST
Correct the information and have the prospect initial the change
Which of the following statements about health coverage for newborns is NOT true?
Coverage is limited to only congenital defects
K has a life insurance policy where her husband is beneficiary and her daughter is contingent beneficiary. Under the Common Disaster clause, if K and her husband are both killed in an automobile accident, where would the death proceeds be directed?
Daughter
A(n) ____________ term life policy is normally used when covering an insured's mortgage balance.
Decreasing Term
The Combination of Whole Life and _____ Term insurance is referred to as a Family Income Policy
Decreasing term
Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?
Decreasing term
Additional coverage can be added to a Whole Life policy by adding a(n)
Decreasing term rider
Additional coverage can be added to a Whole Life policy by adding a(n)
Decreasing term rider can additional coverage to a whole life
P, age 50, purchased an annuity that P will fund with $500/ month for 15 years. The annuity will then pay P retirement payments after the 15 years. Which type of annuity did P purchase?
Deferred
Common exclusions to continuation of group coverage include:
Dental care and other prescription drugs
A CEO's personal assistant suffered injuries at home and as a result, was unable to work for four months. Which type of policy will pay a monthly benefit to the personal assistant?
Disability income
A characteristic of preferred provider organizations (PPOs) would be:
Discounted fees for the patient
How are Roth IRA distributions normally taxed?
Distributions are received tax-free
What type of policy would only provide coverage for specific types of illnesses (cancer, stroke, etc)?
Dread disease insurance
Company Z has a Cross Purchase Buy-Sell Agreement in place among its three founding partners. If the agreement is funded with individual life insurance, what would it require?
Each partner must own a policy on the other partners
Non-occupational disability coverage is designed for
Employees who suffer non-work related disabilities, since work-related disabilities are covered by workers' compensation
P owns a $25,000 Life Policy that pays the face amount to him if he lives to age 70, or to his beneficiary if he dies before age 70. What kind of policy does P own?
Endowment at age 70
Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?
Entire contract
When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called the
Entire contract provision
How often must an insurance agent license normally be renewed?
Every two years
An underwriter determines that a life insurance applicant's risk should be reclassified due to a health issue. This policy may be issued with a(n):
Extra premium
Which Federal law allows an insurer to obtain an inspection report on a potential insured?
Fair credit reporting act
What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?
Family maintenance policy
This type of deductible provision waives the deductible for all family members after some of them have satisfied individual deductibles within the same year:
Family maximum deductible
An insurance company organized under New York laws and licensed to do business in Texas is considered a(n)
Foreign company
What action should a producer take if the initial premium is NOT submitted with the application?
Forward the application to the insurer without the initial premium
M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT
Free-look period has expired
Under an individual health insurance policy, the time limit of certain defenses provision states that nonfraudulent misstatements first become incontestable two years
From the date that the policy was issued
Bryce purchased a disability income policy with a rider that guarantees him the option of purchasing additional amounts of coverage at predetermined times without requiring to provide evidence of insurability. What kind of rider is this?
Guaranteed insurability rider "guaranteed the insurer the option of purchasing additional amount"
Which type of renewability best describes a Disability Income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class?
Guaranteed renewable
Which of the following types of organizations are prepaid group health plans, where members pay in advance for the services of participating physicians and hospitals that have agreements?
HMO (Health Maintenance Organizations)
A medical care provider which typically delivers health services at its own local medical facility is known as a
Health maintenance organizations
J is a subscriber to a plan which contracts with doctors and hospitals to provide medical benefits at a preset price. What type of plan does J belong to?
Health maintenance organizations (contracts with doctors and hospitals to provide medical benefits)
S wants to open a tax-exempt Health Savings Account. To qualify for this type of account, Federal law dictates that S must be enrolled in a
High-deductible health plan
Under a basic medical expense policy, what does the hospitalization expense portion cover?
Hospital room and board
P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?
Immediate annuity
At the age of 45, an individual withdraws $50,000 from his qualified profit-sharing plan and then deposits this amount into a personal savings account. This action would result in:
Income tax and a 10% penalty assessed upon funds withdrawn from the qualified plan
A 55 year old recently received a $30,000 distribution from a previous employer's 401k plan, minus $6,000 withholding. Which federal taxes apply if none of the funds were rolled over?
Income taxes plus a 10% penalty tax on $30,000
Which of the following actions require a policyowner to provide proof of insurability in an adjustable life policy?
Increase face amount
How does an indexed annuity differ from a fixed annuity?
Indexed annuity owners may receive credited interest tied to the fluctuations of the linked index
Which of these actions should a producer take when submitting an insurance application to an insurer?
Inform insurer of relevant information not included on the application
What is being delivered during a policy delivery?
Insurance contract to the proposed insured
Who has the option to renew a renewable term policy?
Insured
All of these statements about the Waiver of Premium provision are correct EXCEPT
Insured must be eligible for social security disability for claim to be accepted
An insurance company normally has 2 years to contest information provided on an accident and health application. This 2 year period begins on the date that the:
Insurer dates the policy
A life insurance arrangement which circumvents insurable interest statutes is called:
Investor-originated life insurance
A policyowner's right are limited under which beneficiary designation?
Irrevocable
What kind of Accidental Death and Dismemberment (AD&D) insurance beneficiary requires his/her consent when a change of beneficiary is made?
Irrevocable beneficiary
A domestic insurance company in Texas is considered a company that?
Is incorporated and formed in Texas
Which of the following actions will an insurance company most likely NOT take if an applicant, how has diabetes, applies for a disability income policy?
Issue the policy with an altered time of payment of claims provision
Which of the following actions will an insurance company most likely Not take if applicant, who has diabetes, applies for a disability income policy?
Issue the policy with an altered time of payment of claims provision
Which statement regarding third-party ownership of life insurance policy is true?
It is used extensively in estate-planning as well as business circumstances
K's whole life insurance policy lapsed two months ago due to nonpayment. She would now like to reinstate the policy. All of these statements are correct about the policy's reinstatement except
K will forfeit the right to use the automatic loan provision upon reinstatement
A sole proprietor may use this plan ONLY if the employees of this business are included
Keogh pension plan
Which of the following situations does a critical illness plan cover?
Leukemia
T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this?
Life annuity with period certain
A whole life insurance policyowner does not wish to continue making premium payments. Which of the following enables the policyowner to sell the policy for more than its cash value?
Life settlement contract
The individual health insurance policy that offers the broadest protection is a(n)_ _ policy
Major medical
Which of these factors do not play a role in the underwriting of la life insurance policy?
Marital status
If a retiree on Medicare required five hospital stays in one year, which policy would provide the best insurance for excess hospital expenses?
Medicare supplement
An applicant MUST receive an Outline of Coverage when an application is taken for a(n)
Medicare supplement policy
Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?
Misrepresentation
A policyowner is allowed to pay premiums more than once a year under which provision?
Mode of premium
K buys a policy where the premium stays fixed for the first 5 years. The premium then increases in year 6 and stays level thereafter, all the while the death benefit remains the same. What kind of policy is this?
Modified whole life
Which of these is not considered to be right given to a policyowner?
Modify a provision in the insurance contract
Periodic health claim payments must be made at least:
Monthly
Which of the following actions is required by an insured who leaves the primary area of medical coverage and seeks medical care?
Obtain prior approval from the insurer for the medical service
All of these statements concerning settlement options are true, Except:
Only the beneficiary may select
P is insured under a basic cancer plan. Which of the following conditions would be covered under this plan?
Operation for a malignant tumor
Which tax would an IRA participant be subjected to on distributions received prior to age 59 1/2?
Ordinary income tax and 10% tax penalty for early withdrawal
An insurance agent has a fiduciary responsibility to all of the following Except
Other agents
P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to
P only
P is the insured on a participating life policy. Which statement is true if P's premiums are waived due to a disability?
P will still receive declared dividends
K owns a Whole Life policy. If K wants an increasing Death Benefit to protect against inflation, which Dividend Option should she chose?
Paid-up additional insurance
Which statement is true in regards to a policy loan?
Past-due interest on a policy loan is added to the total debt
M had an annual life insurance premium payment due January 1. She died January 10 without making the premium payment. What action will the insurer take?
Pay face amount minus the past due premium
The insured and insurance company will share the cost of covered losses under which health policy feature?
Payment of claims provision states that the insured and insurance company will share the cost of covered losses
A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision?
Payor provision
Which of these do NOT constitute policy delivery?
Policy issued with a rating
The underwriting process involves all of these(credit report, risk classification, and application), Except for:
Policy loan
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?
Policy was returned within the free-look period, premium will be fully refunded
The __________ is authorized to assign a life insurance policy as collateral for a loan
Policyowner
Which of these describe a participating insurance policy?
Policyowners are entitled to receive dividends
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees?
Portion of the premium paid for by the employer may be a tax deduction
What benefit does the Payor clause on a Juvenile Life policy provide?
Premium are waived if payor becomes disabled
What is the purpose of the time of payment of claims provision?
Prevents delayed claim payments made by the insurer
T is covered by two health insurance plans: a group plan through his employer and his spouse's plan as a dependent. When T submits a claim, his employer's plan is considered what type of carrier under the Model Group Coordination of Benefits provision?
Primary carrier
An insured covered by Accidental Death and Dismemberment (AD&D) insurance has just died. What will happen if the primary beneficiary had already died before the insured and contingent beneficiary?
Proceeds will go to contingent beneficiary
The legal actions provision of an insurance contract is designed to do all the following, Except:
Protect the producer
The provision that can be used to put an insurance policy back in force after it has lapsed due to nonpayment is called:
Reinstatement
Statements made on an insurance application that are believed to be true to the best of the applicant's knowledge are called
Representations
D is an architect receiving Disability Income benefits who is not able to return to work full time, but can work on a part-time basis. Which of these features would allow D to continue receiving benefits?
Residual benefit clause
When a person returns to work after a period of total disability but cannot earn as much as he or she did before the disability, this situation is called which of the following?
Residual disability
With Optionally Renewable Health policies, the insurer may
Review the policy annually and determine whether or not to renew it
Which of these terms accurately defines an underwriter's assessment of information on a life insurance application?
Risk classification
Post-tax dollar contributions are found in
Roth IRA investments
A prepaid application for individual disability income insurance was recently submitted to an insurer. When the insurer received the medical information burea (MIB) report, the report showed that the applicant had suffered a stroke 18 months ago, something that was not disclosed on the application. Which of the following actions would the insurance company NOT take?
Send a notice to the MIB that the applicant was declined
To terminate an agent's appointment, an insurance company must
Send termination notice to the Texas department of insurance
Which of these life insurance riders allows the applicant to have excess coverage?
Term rider
What does a Guaranteed Insurability rider provide a Disability Income policyowner?
The ability to periodically increase the amount of coverage without evidence of insurability
Why would the Insurance Commissioner examine the records of an insurance company?
To determine the solvency of the company
D was actively serving in the Marines when he was killed in an automobile accident while on leave. His $100,000 Whole life policy contains a War Exclusion clause. How much will D's beneficiary's receive?
The full face amount
J chooses a monthly premium payment mode on his Whole Life insurance policy. Which of these statements is correct?
The gross premium is higher on a monthly payment mode as compared to being paid annually
A policy of adhesion can only be modified by whom?
The insurance company
What advantage does the renewability feature give to a term policy
The insured may extend the coverage period
A Medicare supplement policy may be cancelled for which of the following reasons?
The premium has not been paid by the insured
The advantage of reinstating an original life policy is
The premiums are based on a younger age
What is the basic function of an annuity?
The systematic liquidation of accumulated funds
Which Accident and Health policy provision addresses preexisting conditions?
Time limit on certain defenses/ the time limit on certain defensive provision limits the period during which insurer can deny a claim on the basis of preexisting conditions.
Why is an applicant's signature required on life insurance application?
To attest that the statements on application are accurate to the best of the applicant's knowledge
P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take?
beneficiary will be paid the death benefit
A variable insurance policy
does not guarantee a return on its investment accounts
Credit life insurance is
insurance issued on a debtor to cover outstanding loan balances
Basic hospital and surgical policy benefits are:
lower than the actual expenses incurred