ExamFx: Chp. 6: Texas statutes and Rules Pertinent to life insurance Only
How long is the incontestability period in group life insurance policies issued in Texas? A. Indefinitely B. 3 years C. 1 year D. 2 years
2 years
If a policy owner surrenders his life insurance policy that has been in force for 5 years within 60 days after the premium date, what will the insurer be required to pay? A. The death benefit B. A paid-up nonforfeiture benefit C. Nothing D. A cash surrender value
A cash surrender value
The term "illustration" in a life insurance policy refers to.. A. Pictures accompanying a policy B. A depiction of policy benefits and guarantees C. Charts and graphs D. A presentation of nonguaranteed elements of a policy
A presentation of nonguaranteed elements of a policy
Which of the following CANNOT be included along with illustrations used to sell life insurance? A. Rating information B. Name of the insurer C. Vanishing premium information D. Original death benefit
Vanishing premium information
To which of the following situations does the Replacement Regulation apply? A. Group life insurance B. A whole life policy reissued with reduction in cash value C. An immediate annuity purchased with proceeds from an existing policy D. Coverage under a binding receipt issued by the same company
A whole life policy reissued with reduction in cash value
An insured in a group policy has misstated his age on the insurance application. As a result, the insurer will most likely.. A. Issue an amended policy B. Impose a fine on the insured C. Cancel the coverage D. Adjust the premium
Adjust the premium
The type of insurance sold to a debtor and designed to pay the amount due on a loan if the debtor dies before the loan is repaid is called.. A. Multiple Protection insurance B. Credit Life C. Credit health D. Decreasing whole life
Credit Life
Which of the following types of insurance policies is most commonly used in credit life insurance? A. Increasing term B. Equity indexed life C Whole life D. Decreasing term
Decreasing term
When possible, what should insurers strive to eliminate from illustrations? A. Footnotes and caveats B. Words they don't know C. References to other products D. Policy amendments more than a page long
Footnotes and caveats
What provision in a life or health insurance policy extends coverage beyond the premium due date? A. Free look B. Automatic premium loan C. Grace period D. Waiver of premium
Grace period
Which of the following must be included in all life insurance advertisements? A. Names of any companies B. Contact information for the Commissioner of Insurance C. Contact information for each local office of the insurer D. Identity of the actual insurer
Identity of the actual insurer
During replacement of life insurance, a replacing insurer must do which of the following? A. Obtain a list of all life insurance policies that will be replaced B. Guarantee a replacement for each existing policy C. Send a copy of the Notice Regarding Replacement to the Department of Insurance D. Designate a new producer for a replaced policy
Obtain a list of all life insurance policies that will be replaced
Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance? A. Disclosure B. Conversion rule C. Replacement rule D. Reinstatement rule
Replacement rule
The initial amount of credit life insurance may NOT exceed.. A. An amount set by statute and adjusted regularly for inflation B. The borrower's annual income C. The borrower's monthly income D. The amount to be repaid under the contract
The amount to be repaid under the contract
Which of the following is NOT required on an illustration used in the sale of a life insurance policy? A. The name of the primary and secondary beneficiaries B. Generic name of policy C. Name of insurer D. Underwriting or rating classification upon which the illustration is based
The name of the primary and secondary beneficiaries