Study Life insurance

Which of the following would help prevent a universal life policy from lapsing ?

Target premium

What is the maximum fine for a violation of a cease & desist order

1,000

Which of the following products will protect an individual from outliving their money ?

Annuity

All of the following TRUE of the federal tax advantage of the qualified plan EXCEPT

At distribution , all amounts received by the employee are tax free

Which of the following best describes fixed- period settlement option ?

Both the principal & interest will be liquidated over a selected period of time

Which of the following statements concerning buy-sell agreements is true ?

Buy-sell agreements are normally funded with a life insurance policy

What is another name for interest - sensitive whole life insurance

Current assumption life

How often does a viatical settlement providers license expire ?

Every year

What does "level" refer to in level term insurance

Face Amount

The death benefit under the Universal life option B

Gradually increases each year by the amount that the cash value increases

What type of insurance would be used for a return of premium rider?

Increasing Term

Which provision of a life insurance policy states the insurers duty to pay benefits upon the death of the insured, and to whom the benefits will be paid ?

Insuring clause

If a contract provides a set amount of income for two or more persons with the income stopping upon the first death of the insured, it is called a

Joint life annuity

Which 2 terms are associated directly with premium ?

Level or flexible

Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early ?

Paid-up option

An employee has group life insurance through her employer. After 5 years she decides to leave the company & work independently. How can she obtain an individual policy ?

She can convert her group policy to an individual with 31 days

Your client is planning to retire. She has accumulated $100,000 in a retirement annuity, and now wants to select the benefit option that will pay the largest monthly amount for as long as she lives. As her agent, you should recommend

Straight life

A domestic insurer issuing variable contracts must establish one or more

separate accounts

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT

Conditions

Which of the following riders added to a life insurance policy can pay part of the death benefit to the insured to cover expenses incurred in a nursing or convalescent home ?

Long-term care

An individual is purchasing a permanent life insurance policy with a face value of 25,000. While this is all the insurance that he can afford at this time , he wants to be sure that additional coverage will be available in future. Which of the following options should be included ?

Guarantee Insurability Option

When the policy owner want to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that principal will be paid to the children when they reach a certain age. Which settlement option should a policy owner chose ?

Interest only option

Which of the following best describes the tax advantage of a qualified retirement plan ,

The earnings in a qualified plan accumulate tax deferred

An insured has chosen joint and 2/3 survivor as the settlement option . What does this mean to the beneficiaries?

The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive .

Which of the following statements is TRUE concerning irrevocable beneficiaries?

They can be changed only with the written consent of the beneficiary

A producer failed to complete the required continuing education credit hours for this compliance period, and allowed his license to lapse within what time period after the deadline May the license be reinstated ?

12 months

Producers who broke insurance must file a bond along with the application for license. The bond must be issued in favor of the people of Illinois and must be on a continuous form and for an amount equal to 5% of the brokered the previous year , NOT to exceed

50,000

The term "illustrating" in a life insurance policy refers to

A presentation of nonguaranteed elements of a policy

If a life policy develops cash value faster than 7 pay whole life contract it becomes a

Modified endowment contract

Under a pure life annuity, an income is payable by the company .

Only for the life of the annuitant

Which of the following allows the insurer to relieve a minor insured from premium payments if the minors parents have died or become disabled

Payor benefit

An insured purchased a 10-year level term life policy that is guaranteed renewable and convertible. What happens at the end of the 10 year term ?

The insured may renew the policy for another 10 years, but at a higher premium rate

All of the following statements concerning the use of life insurance as an executive bonus are correct except

The policy is owned by the company