Life Prac Exam 5
The Commissioner may issue a temporary insurance producer license without requiring an examination for a period
Not to exceed 180 days.
What is the purpose of the Insurance Guaranty Association?
To protect policyowners against insurer insolvency
An Internal Revenue Code provision that specifically provides for an individual retirement plan for public school teachers is a(n)
403(b) Plan (TSA).
Which of the following riders would NOT cause the Death Benefit to increase?
Payor Benefit Rider
In an Adjustable Life policy all of the following can be changed by the policy owner EXCEPT
The type of investment.
An employee quits her job where she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a Traditional IRA, how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer?
$10,000, no tax consequence
Any individual insurance producer who allows his license to lapse may, within 12 months from the due date of the renewal fee, reinstate the same license
Without the necessity of passing a written examination, but a penalty fee of double the unpaid renewal fee must be paid.
All of the following entities regulate variable life policies EXCEPT
The Guaranty Association.
Who can make a fully deductible contribution to a traditional IRA?
An individual not covered by an employer-sponsored plan who has earned income
Which of the following is NOT true regarding the accumulation period of an annuity?
It would not occur in a deferred annuity.
If an insurer becomes insolvent, which of the following would pay benefits to policyholders?
The Guaranty Association
Which of the following would provide an underwriter with information concerning an applicant's health history?
The Medical Information Bureau
The continuing education requirement for licensees, during the initial licensing period, is a
Minimum of 60 hours of instruction.
Every insurer must file all rates, rating plans, and modifications to its plans with the Commissioner at least how many days prior to the effective date of use?
15 days
For how long must producers maintain complete records of all complaints?
2 years
Under which of the following circumstances would an insurer pay accelerated benefits?
An insured is diagnosed with cancer and needs help paying for her medical treatment.
All other factors being equal, the least expensive first-year premium payment is found in
Annually Renewable Term.
An insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time that the insured had concealed information during the application process. What can they do?
Pay the death benefit
Which nonforfeiture option provides coverage for the longest period of time?
Reduced paid-up
The policyowner pays for her life insurance annually. Until now, she has collected a nontaxable dividend check each year. She has decided that she would rather use the dividends to help pay for her next premium. What option would allow her to do this?
Reduction of premium
If the annuitant dies during the accumulation period, who will receive the annuity benefits?
The beneficiary
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then
The benefit is received tax free.
When a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit?
The insured's contingent beneficiary
Which of the following is NOT true regarding a Certificate of Authority?
It is issued to group insurance participants.
All of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT
It is a life contingency option.
A producer is helping a married couple determine the financial needs of their children in the event one or both should die prematurely. This is a personal use of life insurance known as
Survivor protection
Not all losses are insurable, and there are certain requirements that must be met before a risk is a proper subject for insurance. These requirements include all of the following EXCEPT
The loss may be intentional.
All of the following are true regarding a decreasing term policy EXCEPT
The payable premium amount steadily declines throughout the duration of the contract.
All of the following statements are true regarding installments for a fixed amount EXCEPT
The payments will stop when the annuitant dies.
Which of the following best describes what the annuity period is?
The period of time during which accumulated money is converted into income payments
All of the following are general requirements of a qualified plan EXCEPT
The plan must provide an offset for social security benefits.
Why is an equity indexed annuity considered to be a fixed annuity?
It has a guaranteed minimum interest rate.
In which of the following situations is it legal to limit coverage based on marital status?
It is never legal to limit coverage based on marital status.
Which of the following is NOT true regarding a nonqualified retirement plan?
It needs IRS approval.
Which of the following is an example of liquidity in a life insurance contract?
The cash value available to the policyowner
