My license
Which statement below is INCORRECT regarding the type of term insurance that fits best with the applicant's needs?
Applicants who may require a larger death benefit on the future should buy convertible term insurance
If a life insurance company uses HIV testing as a part it's underwriting, when must an applicant be notified of the procedure?
Prior to performance of the test
How long is the grace period for an individual life insurance policy?
1 month
How long does the law required agents to maintain records of transactions pertaining to premium payments?
3 years
Which of the following is NOT considered eligible for group life insurance?
A credit union that needs coverage only for its top 10 employees
According to the insurance statutes definition, an insurer who transacts insurance in this state, but whose articles of incorporation are registered in Canada is considered what type of insurer?
Alien
All of the following could qualify as a group for the purpose of purchasing group health insurance EXCEPT
An association formed 1 year ago
A married couple wants to include the entire family in their whole life policy under one rider. Which of the following riders will help them achieve that goal?
Family term
All advertisements, regardless of their source of creation, are the responsibility of the
Insurer
If an insurance company issues a policy even though some questions on the application were unanswered, when can the insurer get the answers to those questions?
Never; the insurer has waived it's right to those answers buy issuing the policy
In order to reinstate a life insurance policy the insured must do all of the following EXCEPT
Pay next year's premium in advance
All of the following are true of annually renewable term insurance EXCEPT
Proof of insurability must be provided at each renewal
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 Advisor
Which statement is an accurate description of the life insurance policy dividends?
They are not taxable and are not guaranteed
Which method of dealing with risk is applied when insurance is purchased?
Transfer
All of the following statements about indexed whole life insurance are correct EXCEPT
The death benefit is not guaranteed
Which of the following entities is considered the Principal?
The insurer issuing a policy
Which department or division of an insurance company is responsible for the selection, evaluation, and distributions from risks?
Underwriting
If a life insurance policy is purchased by someone who has no insurance interest in the insured, it is considered
A STOLI policy
Joe moved last year and forgot to notify the Department of is change of address. He was charged a $250 fine. This year joe moved again, and again forgets to notify the Department within the required time. What will Joe's penalty be?
A minimum fine of $500 or revocation of his license
Agents in this state are required to promptly report all of the following to the Department EXCEPT
change in material status
In life insurance, which of the following is NOT required to have an insurable interest in the insured?
The beneficiary
Insurance contracts are unilateral in nature. What does that mean?
Only one party makes a promise
The renewable provision allows the policyowner to renew the coverage at the expiration date
Without evidence of insurability
A whole life policy is surrendered for a reduced-paid up policy. The cash value in the new policy will
Continue to increase
An agent is filling out an insurance application for a client. The applicant realizes she should have answered an earlier question differently. Which of the following methods should the agent use to make the change?
Cross out the incorrect information, write in the correct answer, and have the applicant initial the change
Which of the filling is NOT a standard exclusion in life insurance policies?
Disability
When life insurance proceeds are used to pay inheritance taxes and federal estate taxes, it is known as what?
Estate conversion
When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?
Extended term
An insured bought an insurance policy that requires him to pay $150 in premiums on the 15th of each month. He then takes an extended vacation and forgets to pay the premium. Ten days later, his policy is still in effect and has not lapsed. Which policy provision allowed for this?
Grace period
Which of the following types of policies would NOT be subject to Florida regulations on life insurance solicitation?
Annuities
Decreasing Term Insurance is often used to
Cover a mortgage
Which of the following is NOT true regarding a deferred annuity?
Income payments begins within 1 year from the date of purchase.
An insurance agent visits a potential client and explains various types of policies. The customer displays a lack of interest, so the agent guarantees higher dividends than he know me would be possible. Which term describes what the agent has done?
Misrepresentation
In the state of Florida, which of the following government entities is responsible for the administration and regulation of insurance?
The Department of Financial Services
Which of the following is required in order for a plan to be qualified?
The plan must be written and communicated to the employees
According to the "Common Disaster" clause, if the insured and the primary beneficiary are killed in the same accident and it cannot be determined who died first, which of the following will be assumed?
The primary beneficiary died before the insured
Which of the following policies would NOT offer a policy loan option?
Term life
Which of the following types of insurance is investment based, has a level fixed premium, and a nonguaranteed cash value?
Variable whole life
What does the application of "Contract of Adhesion" mean?
Since the insured does not participate in preparing the contract, any ambiguities would be resolved in favor of the insured
Which risk classification is representative of the majority of people in a certain age group and with similar lifestyles?
Standard
An agent who knowingly misrepresents material information for the purpose of inducing an insured to lapse, forfeit, change or surrender a life insurance policy or annuity has committed an illegal practice known as
Twisting
J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did J choose?
Fixed amount
With adjustable life, the owner can change all of the following EXCEPT
The insured
An example of an alien insurer doing business in this state is one formed under the laws of
Mexico
An IRA owner who is 57 years old wants to make a withdrawal from her traditional IRA. What penalty will be imposed?
10%
In a no contributory group policy
100% of eligible employees must participate
The policyowner has an option to pledge the life insurance policy as collateral for a bank loan. This is called
A collateral assignment
According to the terms of the policy or an agreement between the insured, the group policyholder, and the insurer, the insured person may not do which of the following?
Assign an appropriate premium based on preference
Which of the following would NOT trigger the payment of Accelerated Death Benefits?
Being permanently disable
What is the difference between straight life policy and a 20-pay whole life policy?
Premium payment period
Which of the following is a provision found in life insurance policies
Reinstatement
An agent tells an insured that if he replaces his current 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
Dividends received on participating life insurance policies are
Not taxable because they are a return of unused premiums
All of the following are consideration in a insurance policy EXCEPT
the cash value in the policy
Among people in the same class and life expectancy, which of the following factors can be used to influence premium rates?
Occupation
Where are premiums from fixed annuities invested?
A general account
The family term rider incorporates
Spouse term and children's term
Life insurance creates an immediate estate. Which of the following best explains this statement?
The face value of the policy is payable to the beneficiary upon death of the insured
In a life insurance application, all of the following signatures will be required EXCEPT
The home office of underwriter
All of the following informations needs to be included on an application for life insurance EXCEPT
Health insurance policies in force
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 the insured's death is called
Insuring clause
Which of the following is consideration on part of an insurer?
Paying a claim
A viatical settlement is a transaction outside the life insurance company where the owner sells the life insurance policy for which of the following?
A percentage of the face amount of the policy
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
Which of the following is a correct statement about annuities?
Fixed annuities do not provide protection against inflation
An annuitant pays the annuity premium on the 14th of each month. Which of the following best describes this agreement?
Level
Life insurance can provide which of the following?
Survivor protection
Which of following types of insurance products would be appropriate for an individual with low income and high insurance needs?
Term insurance
When term insurance is added to main policy to enhance the policy or provide added benefit or coverage, it is called a
Term rider
In a replacement situation, all of the following are prohibited practices EXCEPT
Borrowing 50% of a policy's cash value to fund a new life insurance contract
Which of the following would be TRUE of both fixed-period and fixed-amount settlement option?
Both guarantee that the principal and interest will be fully paid
Variable insurance and variable annuities are regulated by
SEC, FIRNA and Department of insurance
An applicant for an agent's Life only license must complete a minimum of how many hours of prelicensing education?
40
In which of the following scenarios would a producer be allowed to obtain insurance through an unauthorized insurer?
If there are no unauthorized insurers for a specific type of coverage in this state
Your client wants to provide a retirement income for his elderly 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
Cash value guarantees in a whole life policy are called
Nonforfeiture values
Answers to questions in an insurance application are called representations and, as such, they are
Believed to be true to the best of the applicant's knowledge
In this state owner gets a "free look" of a specified number of days from
Delivery of the policy
Which of the following would NOT be eligible for coverage under key person?
The owner of a shop
What does the Guaranty Association guard against?
Insurer insolvency
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
An insurer mails an insurance to a new policyowner. When the insurer relinquishes control of the policy, the policy is considered
Delivered
When comparing a Joint Life Policy to two individual life policies of the same insureds, which condition is true?
Joint Life has a lower premium than the total of the two individual policies
What does an annuity protect the contract owner against?
Living longer than expected
When an insured terminates membership in the insured group, the insured can convert to
Whole life without proof of insurability
An insurer recently collected information from a senior consumer, and used that information to make recommendations regarding insurance transaction. For how many years must this information be maintained after the transaction has been completed?
5
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 purchased a life insurance policy on their newborn baby. They are concerned about what would happen if either one of them were unable to continue making premium payments due to death or disability. Which policy rider should their agent recommend?
Payor benefit
The policyowner's spouse was designated as the primary beneficiary on a life policy issued 3 years ago. Last year, the couple got divorced. Which of the following is true regarding the beneficiary designation of the former spouse?
The designation will be void
Failing to acknowledge and act reasonably promptly upon communications with respect to an insurance claim is in violation of what insurance regulation?
Unfair claims settlement
Consideration the principles of liquidity, how would the policyowner use today's cash values in a life insurance policy?
Use it for emergency expenses
Partners in a business want to make sure that if one of them were to pass away, their surviving family will receive a fair value for their portion in the business. What life insurance arrangement would be most suited for transitioning the business?
Buy-Sell Agreement