Readiness exam
According to the Facility of Payment Clause, if the insured person under a life insurance policy dies and no beneficiary is stated, what is the maximum amount that another person (not stated in the policy) can receive for the insured's funeral expenses?
$1,000
How many days notice must an insurer provide to an insured regarding the lapse of a policy due to outstanding loans?
30 days
Within how many days must the agent notify the commissioner of any felon or misdemeanor conviction?
30 days
Which of the following best describes a rebate?
A producer returning part of her commission to her client, as an inducement to buy
In a variable life insurance policy, all of the following assets are held in the insurance company's general account EXCEPT
Cash surrender values
When an individual obtains an insurance license for the primary purpose of writing insurance on themselves, or for members of their immediate family or business, this is called
Controlled business
An insurer, mails an insurance policy to a new policy owner. When the insurer relinquishes control of the policy, the policy is considered
Delivered
Which type of authorities found in the agent's contract?
Express
Which of the following is a presentation that includes nonguaranteed elements of a policy over a period of years
Illustration
What is the cost of coverage based on for a group life insurance?
The average age and the ratio of men to women
If an insurance company requires an autopsy on a deceased insured, who is responsible for the expenses?
The insurance company
The willful violation of statues or rules governing insurance business in Wisconsin is punishable by a fine of up to
$10,000
If an individual willfully violates provisions of the Fair Credit Reporting Act, what is the maximum civil penalty?
$2,500
A life insurance policy can be backdated to affect a lower premium for up to a maximum of how many months?
6 months
Policy loan request, except for loan request for payment of due premiums, may be deferred for a period of up to
6 months
Which of the following would benefit the most from a straight life immediate annuity?
A 60-year old man who needs as much retirement income as possible
Which of the following terms is used to defined the period of time during which an annuitant makes payment into an annuity
Accumulation period
Which of the following statements is incorrect concerning endowment contracts (MECs)?
An MEC must always pass the 7-pay test
What is the maximum loan amount a policy owner withdraw from a variable universal life insurance policy?
An amount not exceeding the cash value
If an insurance company makes a statement that its policies are guaranteed by the existence of the Wisconsin insurance security fund, that would be considered
An unfair trade practice
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 in the future should buy convertible term insurance.
Which provision may be added to a permanent life policy, at no cost, that insures that the policy will not lapse so long as there is cash value?
Automatic Premium Loan Option
When life insurance procedure used to pay inheritance taxes and federal estate taxes, it is known as
Estate conservation
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
At point would an automatic premium loan be generated?
Following the grace period
Because of the imposed blackout period, the surviving spouse will not receive social security benefits until
He or she qualifies for retirement benefits
According to the fair, credit reporting act, all of the following statements are true EXCEPT
If declined for an insurance policy, an applicant has no right to the information in the report
Under what circumstances will the contingent beneficiary receive the death benefit?
If the primary beneficiary dies before the insured
Which of the following conditions would life insurance proceeds be taxable by the federal government?
If there is a transfer for value
Who would be allowed to catch up contributions into an IRA plan?
Individuals age 50 or older
Which of the following best describes life annuity with period certain option?
It guarantees benefit payments for life of the annuitant and for a specified period for the beneficiary
Which of the following is TRUE of level term insurance?
It is temporary protection
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 guarenteed an income for life. Which settlement option should this policyowner select
Joint and survivor
An example of an alien insurer doing business in this state is one formed under the laws of
Mexico
Which of the following is NOT one of independent rating services that publishes guides to insurance companies' financial integrity?
NAIC
What is a specific requirement 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
In order to reinstate a life insurance policy the insured must do all of the following EXCEPT
Pay next year's premium in advance
Which of the following is a person, other than an officer or employee of the ceding insurer, who solicits, negotiates, or places reinsurance cessions or retro-cessions on behalf of a ceding insurer?
Reinsurance broker
The commissioner issues an order without having conducted a hearing. What may the person aggrieved by the order do?
Request a hearing
Which annuity is purchased with a single payment and begins annuity payments within the first year?
SPDA
Wagering on a sporting event, is an example of what type of risk?
Speculative
Which of the following types of insurance is investment based, has a level fixed premium, and a nonguaranteed cash value?
Variable Whole Life
Which of the following types of insurance policies would perform the function of cash accumulation?
Whole life
When an insured terminates membership in the insured group, the insured can convert to
Whole life without proof of insurability
A loss resulting from which of the following would qualify for the accidental death rider coverage?
an automobile accident
Who does the spendthrift clause in a life insurance policy protect?
beneficiary
A producer advises a policyholder that he should replace his life insurance policy with another, similar policy. The agent is advising this, however, for the sole purpose of earning a commission. What violation has the agent committed?
churning
Which of the following is an example of a physical hazard?
diabetes
Which of the following would be considered a peril?
fire
An annuity owner receives the same guaranteed payment every month. What type of annuity is it?
fixed
If a retirement, plan or annuity is qualified, this means
it satisfies IRS requirements for favorable tax treatment
An annuitant pays the annuity premium on the 14th of each month. Which of the following best describes this arrangement?
level
All of the following are true of annually renewable term insurance EXCEPT
proof of insurability must be provided at each renewal
The purpose of the Fair Credit Reporting Act is to
protect consumers against the circulation of inaccurate or obsolete personal or financial information
An insured recently had a new home built and insisted on having smoke detectors installed in multiple places in the house. What method of handling risk is the insured using?
reduction
In order for a business partner to be eligible for a Keogh plan, he/she must work full-time and own at least how much of the business?
the person must be self-employed or a partner working part or full-time who owns at least 10% of the business
In contrasting stock insurers with mutual insurers, which statement is true?
Stock insurers are owned by the shareholders and issue nonparticipating policies
The maximum annual billing for any insurer cannot exceed what percentage of net premiums earned?
1%
How many days is the free-look period in most life insurance policies?
10 days
In order to avoid an unintentional lapse, every life insurance policy must contain a provision, entitling the policyholder to a grace period of at least
31 days
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 would be considered an example of incorporation by reference in insurance contracts ?
A rate amendment is later made part of the original policy
A presentation that includes non guaranteed elements of a policy is called
An illustration
An individual has a $200,000 covertible term life insurance policy. If he chooses, he can
Convert to another term policy with a lower face amount without proof of insurability.
An insurer recently used an illustration during the sale of an insurance policy. Because of this illustration, the insurer will be required to provide the policy owner with an an annual report on the status of the policy. This report must contain all of the following EXCEPT the
Dates of illustrations
In which of the following situations may the policy owner be allowed to sell a life insurance policy purchased one year ago for a viatical settlement contract?
Divorce
All of the following are general requirements of a qualified plan EXCEPT
The plan must be temporary
If an applicant submits the initial premium with an application, which action constitutes acceptance?
The underwriters approve the application
Which of the following is true regarding taxation of accelerated benefits paid under a life insurance policy?
They are received tax free
What is the purpose of the Agent's Report in the application process?
To provide additional information about the applicant to the underwriters
Which method of dealing with risk is applied when insurance is purchased?
Transfer
Insurance provides a mean to
Transfer a loss
An insurer has received some information regarding a newly issued policy that provides sufficient grow policy rescission. What should the insurer do?
notify the insured within 60 days of acquiring that information
Which of the following is not a component of an insurance policy premium?
number of beneficiaries
Annuities certain limit the amount paid by the annuity to a certain fixed
period or fixed amount
Which risk classification is representative of the majority of people in a certain age group and with similar lifestyles
standard
Variable life insurance is regulated by all of the following entities EXCEPT
The U.S. Department of Treasury
With Adjustable Life, the owner can change all of the following EXCEPT
The insured
As it relates to life settlements, the term "owner" means
The owner of the original life policy
The Commissioner issued in order without holding a hearing. The person aggrieved by this order sent a demand for a hearing 20 days ago. The hearing must be held within the next
10 days
A Social Security disability must be expected to last for at least how many months in order for the person to qualify for disability benefits?
12 months
How many days after passing their state examination does an applicant have to apply for license?
180 days
The Commissioner obtains a restraining order against a person who has violated an insurance law. The person must comply with this order within how many weeks?
2 weeks
The policy summary must state the effective policy loan annual percentage interest rate for at least
20 years
A producer born in 1993 received a license in 2022. When will the producers license need to be renewed?
2024
An insurer must notify the consumer in writing that in investigative, consumer report has been requested, within how many days of the initial request?
3 days
Intermediaries must maintain records for at least
3 years
Which annuity is purchased with a single payment and begins annuity payments within the first year?
Immediate annuity
A married couple purchased the 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 rider should their agent recommend?
Payor benefit
What is the difference between a straight life policy and a 20-pay whole life policy?
Premium payment period
Insurers and intermediaries must provide a copy of the current edition of the Wisconsin buyer's guide to Annuities and a preliminary contract summary at what point?
Prior to accepting the applicant's initial premium
What type of license is required for an intermediary to sell variable contract?
Series 6 or series 7