Life Only Exam II
if a dependent child covered by a group life plan is incapable of self-support, coverage under the plan may continue up to which age?
any age as long as disabled
the guarantee insurability rider provides that the policy holder can purchase more insurance at what point and under what conditions
at certain specific ages on his own life insurance without proof of insurability
which party has rights in a life insurance policy only after the death of the insured
beneficiary
the policy provision which comes into effect when the insured and the primary beneficiary die in a simultaneous accident with no evidence of who died first
common disaster provision
which of the following is considered ordinary life insurance
continuous premium whole life
which of the following applies to social security
contributions are compulsory for most workers
after a life insurance policy has been in effect for 2 years, what keeps it from being rescinded by the owner
the incontestability clause
which of the following is a correct statement about life insurance policy types?
the initial premium for term insurance is lower than the initial premium for whole life insurance
an insured and beneficiary die in a car accident and it is impossible to determine who died first. who will receive the life insurance proceeds
the insured's estate
regarding group life insurance coverage for a company, the one responsible for obtaining the coverage, maintaining the policy, and paying the premium is whom
the master policy holder
all of the following are true about variable annuity EXCEPT
the number of units received during a payout period fluctuates
a variable annuity applicant requests that the premium be immediately invested in a stock portfolio. the policy is returned to the insurer within the cancellation period. what is the applicant entitled to receive
the policy account value on the date the policy was received by the insurer
all of the following statements regarding survivorship life insurance are true EXCEPT
the policy face amount is made out based only on the death of the first to die
what is an example of a term policy
the policy has a face amount of $100,000, every 5 years the premium paid increases, after 10 years the policy holder stops paying the premiums, the coverage stops and policy has no cash value
what is true about policy dividends
they cannot be guaranteed
an insured bought a $150,000 non-participating whole life policy many years ago. she is 100 years old today. she has never borrowed from the policy, and has made all premium payments when due. the policy cash value is
$150,000
all of the following are true regarding variable insurance products EXCEPT
the growth in the cash value is guaranteed
an annuity that pays income to two or more annuitants until their deaths is called what
a joint and survivor annutiy
person receives a large bonus at work and decides to purchase an annuity with it, his monthly income payments from the annuity will begin the following month. what did he purchase
a single premium immediate annuity
all are required to be included in life insurance illustrations EXCEPT
a statement that the benefits in the illustration are guaranteed
all of the following must be included in life insurance illustrations EXCEPT
a statement that the benefits in the illustration are guaranteed
which provision will pay a portion of the death benefit prior to the insured's death due to a serious illness
accelerated death benefit
which is part of an application
agent report
all of the following are true statements concerning the treatment of federal income tax on life insurance EXCEPT
annuity death benefit proceeds are exempt from all taxation
insurers make an adjustment to the cash value of an account of a universal life policy each time a payment is made. in doing so, they add the premium paid, what else do they add
current interest adjusted for mortality, and a general expense charge
the doctrine of utmost good faith applies to the business of transacting insurance. which of the following is an example of this application
each party is entitled to rely upon the representations of the other party
the master policy owner of a group health insurance contract is the
employer/sponsor
which of the following are common insurance policy provisions
entire contract, grace period, reinstatement
When a family policy covers children, all of the following are true EXCEPT
evidence of insurability is required for children for permanent insurance
which of the following policy provisions allow the life insurance company to pay the death benefits left to a minor, to the guardian of the minor?
facility of payment provision
a beneficiary wants to receive $2,000 per month until the principle and interest are exhausted. which settlement option should be chosen
fixed amount option
unless the applicant indicates otherwise during the right to return period for an individual annuity, the premium for a variable annuity would be invested only in which of the following
fixed income investments and money marketing funds
which of the following is not an option for the use of the policy dividends
fund the distribution of monthly income payment
which of the following is not one of the common personal uses of life insurance
funding a buy/sell agreement
which of the following is not ordinary life insurance
group life insurance policy
for a non-medical life insurance policy application what is best practice for selling this policy
if the answers given in the health statement do not meet the company's underwriting standards, a medical exam is required
which of the following is true about life insurance beneficiary designations
is there is not surviving beneficiary, the death benefit is paid to the insured's estate
which statement best describes a life insurance policy dividend
it is a distribution of excess funds accumulated by the insurer on participating policies
in order to join a group insurance plan without proving insurability, an employee must do which of the following
join the plan during the enrollment period
the annuity that pays the benefit to two or more people and ends upon the death of the first is know as what
joint life
which of the following annuity pay out methods pays for the duration of the annuitant's life
life annuity, life income period certain, life income with refund
the settlement option that puts the insurer in the position of the least guaranteed and also has the potential to generate the greatest return to the policy owner is known as what
life income option
life insurance illustrations showing premiums, values, credits or charges that are not determined at issue demonstrate what
non-guaranteed elements
the class beneficiary designation means that the surviving beneficiaries will receive equal shared of the death benefit divided amongst them. what is this designation called
per capita
who has the right to change life insurance policy beneficiaries
policy owner
in a group life policy with a death benefit of more than $50,000 which of the following is true
premium cost for insurance above $50,000 is part of the taxable gross annual income to employees
if an insurer indicates than an illustration will be used, they must do what
provide a summary status report to the policy owner on an annual basis
which type of insurance policy guarantees the right to renew the policy each year, regardless of health, with an increase in premium
renewable term
the clause that protects the proceeds of a life insurance policy from attachment by creditors after the death of the insured is called what
spendthrift trust clause
an individual with a low income and high insurance needs should buy what
term insurance
all of the following is required on a life insurance application EXCEPT
the amount of disability income insurance in force
$10,000 in a certificate of deposit, 10% annual interest, in the 31% income tax bracket. for 40 years, person does not touch his annuity and reinvests all income from the CD at 10%. what statement is true
the annuity would be worth several hundred thousand more because of the tax deferral of the earnings
the common disaster provision is designed to protect the interests of whom
the contingent or secondary beneficiary
with the cost of living rider, what occurs with the life insurance policy holder
they receive the automatic increase in the face value if there is an increase in the cost of living index. there is an additional premium for the additional coverage
Why should a contingent beneficiary be named in a life insurance policy?
to determine who receives the policy benefits if the primary beneficiary is deceased
an insured bought an annuity 10 years ago, he will retire in five years. to determine the value of the annuity, the number of accumulation units is multiplied by the value of the separate account. which type of annuity was purchased
variable annuity
which policy requires that the agent be securities licensed
variable life