Exam 2 corrections

All of the following are personal uses of life insurance EXCEPT

buy-sell agreement

An underwriter is reviewing the medical questions in the application and needs further information due to a medical situation the applicant had in the past. What will the underwriter require?

attending physician statement

Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to

10 years

within how many days must a producer respond to an inquiry from the Commissioner?

30 days

where would Long-Term care services be rendered?

a nursing home or one's own home

Which of the following would be deducted from the death benefit paid to a beneficiary, if a partial accelerated death benefit has been paid while the insured was still alive?

amount paid with the accelerated benefit, plus the earnings lost by the insurance company in interest income from the accelerated benefit

An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation?

decreasing term

Two individuals are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant. What is this called?

discrimination

Which of the following is an example of an unfair class settlement practice?

failure to promptly settle a claim when liability has been clearly established

Violation of unfair discrimination law may result in all of the following penalties EXCEPT

fines up to $1,000 for each act

All of the following are dividend options EXCEPT

fixed-period installments

The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the

incontestability clause

An insurer invests the money it received from premiums paid by its insureds. Which of the following is TRUE regarding the interest earned on these investments?

it is used to lower premiums

Which of the following is true regarding a single life settlement option?

it provides income the beneficiary cannot outlive

The provision which prevents the insured form bringing any legal action against the company for at least 60 days after proof of loss is known as

legal actions

All of the following are true regarding key person disability income insurance EXCEPT

premiums are tax deductible as a business expense

The responsibility of making certain that an application for insurance is filled out completely, correctly, and to the best of his or her knowledge is the responsibility of whom?

the producer

In a survivorship life policy, when does the insurer pay the death benefit?

upon the last death

When is the insurability conditional receipt given?

when the premium is paid at the time of application

for the purpose of examination by the department, insurers must keep a record of all financial files for at least

5 years

All other factors being equal, the least expensive first-year premium payment is found in

annually renewable term

Which is TRUE about the cash surrender nonforfeiture option?

funds exceeding the premium paid are taxable as ordinary income

Which of the following is an eligibility requirement for all Social Security Disability Income benefits?

have attained fully insured status

An insured owes his insurer a premium payment. Since then, he incurs medical expenses. The insurer deducts the unpaid premium amount from the claim amount and pays the insured the different. What provision allows for this?

unpaid premium

Are insurance company underwriters allowed to discriminate?

yes, but not unfairly