life insurance
if the commissioner of insurance is no longer able to complete the term of office who is required to fill this vacancy
Governor
Q is severely injured in an automobile accident and becomes totally disabled. How many months must Q be disabled before being able to apply for social Security disability benefits
5 months
a loss purchase buy and sell agreement among three partners, funded with individual life insurance would require how many policies
6
the life and health insurance guaranty association is funded by the authorized insurers in this state, one of the roles of this organization is
assist in the prevention of insurer insolvencies
when does a guaranteed insurability rider allow the insured to buy additional coverage
at future dates specified in the contract with no evidence of insurability required
what is considered to be a characteristic of an immediate annuity
benefit payments start within one payment period of purchase
which of these is not considered to be a cost connected with an individuals death
business expenses
a person who is insured within a group contract will be given a
certificate
company z has cross purchase buy sell agreement in place among its three founding partners. If the agreement is funded with individual life insurance, what would it require
each partner must own a policy on the other partners
which of these is not a reason for purchasing life Insurance on the life of a minor
if both parents were to die, it would provide death benefits to the child
W is a 39-year old female who just purchased an annuity to provide income for life starting at age 60. All of these would be acceptable annuity choices EXCEPT a(n)
immediate annuity
when must insurable interest exist for a life insurance contact too be valid
inception of the contact
which of the following is not regulated by the insurance info and privacy protection act
insurance regulators
a policy owners rights are limited under which beneficiary designation
irrevocable
if a blank insurance contract application is signed by an agent, the agent
is guilty of a misdemeanor
when is the face amount paid under a joint life and survivor policy
upon death of the last insured
which of these factors does not influence an applicants need for life insurance
self maintenance expenses
an immediate annuity consists of a
single premium
which action by an insurance agent is considered rebating
splitting commissions with a policyholder who has purchased additional coverage
If an agent is found to be incompetent, untrustworthy, or financially irresponsible, the commissioner may/n
suspend, revoke, or refuse to renew the agents license
before accepting the initial premium for a prearranged funeral contract, the agent must make these disclosures except
the amount of commission that the agent will receive
Before accepting the initial premium for a prearranged funeral contact, the agent must make these disclosures except
the amount of commission the agent will receive
which of these is not a reason for a business to buy key person life insurance
a pension deficiency if the key employee dies
which of the following individuals must be licensed as an agent
a person who places insurance on behalf of anyone seeking insurance
in north carolina an insurance agent is best defined as
a person who sells, solicits, or negotiates contacts of insurance or annuity
in nc which of the following must be delivered to a policy owner upon the scale of an individual life insurance policy
a policy summary and buyers guide
the circulation of written literature that is maliciously critical of an insurers financial condition is called an
defamation
How is the life and health insurance guaranty associated funded
from member companies
an insured is past due on his life insurance premium, but is still within the grace period. What will the beneficiary receive if the insured dies during this grace period ?
full face amount minus any past due premiums
the premiums paid by an employer for his employees group life insurance are usually considered to be
tax deductible to the employer
North Carolina requires that an insurance agent must complete ___ hours of continuing education on the subject of law and ethics every two years
3
ABC insurance company fails to pay death proceeds after satisfactory proof of loss was submitted. ABS must then begin paying interest on the death proceeds after__ days of receiving proof of loss
30
a life policy loan in nc cannot change a fixed rate of interest higher than
8%
At the age of 45, an individual withdraws $50,000 from his Qualified Profit-Sharing Plan and then deposits this amount into a personal savings account. This action would result in
Income tax and a 10% penalty assessed upon funds withdrawn from the Qualified Plan
Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company. What action should J take?
Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company
K is an agent who takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?
The date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured
ABC insurance company has a accepted life insurance application which contains unanswered questions. The company then makes the application part of the life contract. In this situation, the insurer has
waived one of its legal rights
when must insurable interest be present in order for a life insurance policy to be valid
when the application is made
what type of insurance offers permanent life coverage with premiums that are payable for life
whole life
the commissioner of insurance is responsible for
administering insurance laws
T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?
0
Z is an agent who violated the insurance info and policy protection act. Z was then issued and served a statement of charges and notice of hearing by the commissioner of insurance. Z's hearing date must be at least ___ days after the service of charges
10
an agent must report to the commissioner of insurance any administrative action or criminal charges taken against the agent within __ days of the conviction date
10
what is the maximum number of employees (earning at least 5000) that an emplyer can have in order ton start a simple retirement plan
100
in nc life insurance polices have a contest-ability period of
2 years
what type of policy would offer a 40 year old the quickest accumulation of cash value
20 pay life
An insurance applicant was recently denied insurance coverage. The applicant is requesting access from the insurer to recorded personal information regarding the decision. Under the info and privacy protection act, the insurer must make the info available within how many business days
30
an individual life insurance policy issued in nc must have a grace period for premium payment of how many days
31
an individual life insurance policy issued in nc must have a grace period for premium payments of how many days
31
a life insurance policy can be reinstated upon meeting company requirements within a maximum of
5 years
how long must every insurance agent maintain all records, books and documents to each insurance transaction ?
5 years
lapsed individual life insurance may be reinstated at any time within
5 years
In North Carolina which of the following must be delivered to a policyowner soon the sale of an individual life insurance policy
A policy summary and buyers guide
Which of the following is not an unfair method of competition or deceptive practice ?
Demonstrating that a policy has higher benefits by using a comparison
a life insurance company becomes insolvent, the fund that guarantees policyowners payment of death benefits is known as the
Life and health insurance guaranty association
a young, married teacher has two children and owns a whole life policy. If the teacher wants an increasing death benefit to protect agonies inflation, the teacher should select which of the following dividend options
Paid-up additional insurance
An agent who suggests that an insured surrender a life insurance policy in order to purchase a new policy would be subject to which of the following
Replacement provision
post tax dollar contributions are found in
Roth IRA investments
S is a life insurance policy owner and enters into a written agreement to receive immediate cash in exchange for the sale and transfer of her life insurance policy. This agreement is referred to as an
Viatical settlement
an engineering firm that would suffer financially from the death of a project manager should purchase a
a key person life policy
which statement is true regarding a variable whole life policy
a minimum guaranteed health benefit is provided
which of the following annuities pays benefits based on units rather than specific dollar amounts
a variable annuity
c is a key employee at abc incorporated. If a key employee life policy is purchased on her life, which of these statements would be true
abc is the policy owner, c is the insured, and the abc is the beneficiary
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?
aleatory
which of the following statements is correct regarding the tax treatment of a lump sum payment paid to a life insurance policy's primary beneficiary
all the proceeds are income tax free in the year they are received
An insurance company formed under the laws of Canada would be known in North Carolina as
an alien company
An example of false advertising would be
an insurer exaggerating its dividend in a magazine advertisiment
a life insurance company cannot declare a policy lapsed or forfeited within one year after default in premium payment, unless it has mailed a notice indicating the amount of premium due. This requirement only applies to polices with an
annual premium schedule
which product would best serve a retired individual looking to invest a lump sum of money through an insurance company
annuity
which type of contact liquidates an estate through recurrent payments
annuity
At what point during a transacting does a nonresident need a licensed resident agent in countersign any documents, policies, applications, or other insurance forms
at no point
a student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following
aviation exclusion
the life and health insurance guaranty association becomes involved in an insurance company affairs when the company
becomes insolvent
what is not required to sign a life insurance application
beneficiary
all of the following are considered to be typical characteristics describing the nature of an insurance contract except
bilateral
which rider provides coverage for a chid under a parents life insurance policy
child term rider
what type of employee welfare plans are not subject to ERISA regulations
church plans
in North Carolina an agent obtains his/her license from the
commissioner of insurance
a key employee policy is taken out by company x on its vice president. Ten years later, this employee leaves company x and begins working for company y. If this individual were to die and the policy is still in force and unchanged, where would the death proceeds be directed
company x
which of the following features of a group term life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability
conversion privilege
which of the following types of insurance is exempt from the rules governing life insurance and annuity replacements
credit life
which of the following is not an unfair method of competition or deceptive practice?
demonstrating that a policy has higher benefits by using a comparison
an insurance company formed under nc laws is referenced to as an
domestic company
k purchased a 10,000 life policy that will pay the face amount to her if she lives to age 65, or to her beneficiary if she dies before age 65. K purchased which of the following types of policies
endowment at age 65
the commissioner of insurance is empowered to
enforce state laws relating to insurance
how long must every insurance agent maintain all records, books, and documents related to each insurance transaction
every 5 years
which of the following is an important underwriting principle of group life insurance
everyone must be covered in the group
from what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant
fair credit reporting act
s, while in the process of converting her group life insurance to an individual policy dies, what happens to the claim her beneficiary submits?
full benefits are payable under the master contact
what is considered a valid reason for a small business to insure the lives of its major shareholders
fund a buy sell agreement
An insurance company may not reject a prospective insureds life application on the basis of which of the following factors
gender
in life insurance, the needs approach is used mostly to establish
how much life insurance a client should apply for
which of the following is not regulated by the insurance information and privacy protecting act
insurance regulators
in a key employee life insurance policy, the third party owner can be all of the following except
insured
variable annuities may invest premiums in each of the following accept
insurers corporate business account
the primary purpose of the life insurance replacement regulation is to protect the
interests of policy owners
immunity for releasing documents to the commissioner during a fraud investigation means that person
is not subject to civil liability or slander
which statement regarding third party ownership of a life insurance policy Is true
it is used extensively in estate planning as well as business circumstances
K is looking to purchase renewable term insurance. Which of these types of term insurance may be renewable
level
The Life and Health Insurance Guaranty Association In nc has regulations that apply only to
life and health policies issued by companies authorized in nc
which settlement option pats a stated amount to an annuitant but no residual value to a beneficiary
life income
the accelerated death benefit provision in a life insurance policy is also known as a
living benefit
which of these is not relevant when determining the amount of personal life insurance needed
local unemployment rate
which of these is an element of a single premium annuity
lump sum payment
an employer that offers a qualified retirement plan to its employees is eligible to
make tax- deductible contributions to the plan
how is the life and health insurance guaranty funded
member companies
which of these is not considered to be a right given to a policy owner
modify a provision in the insurance contract
which the following is true about a qualified retirement that Is "top heavy"
more than 60% of plan assists are In key employee accounts
K sent a renewal premium payment to her insurer that would extend her coverage beyond the policy maximum age limit. If the insurer accepts this premium payment, it
must continue the coverage to the end of the period of time for which the premium was accepted
which of the following statements is correct about accelerated death benefits
must have a terminal illness to qualify
when an existing life insurance policy is being reissued with a reduction in cash value the agent must sign the
notice regarding of life insurance or annuity
which tax would an ira participant be subjected to on distributions received prior to age 59 1/2
ordinary income tax and a 10% tax penalty for early withdrawal
which of the following provisions guarantees that premiums will be waived if a juvenile life policy owner becomes disabled
payor clause
the underwriting process involves all of these except for
policy loan
who benefits in investor originated life insurance when the insured dies
policy owner
which is true concerning a variable universal life policy
policyowner controls where the investment will go and selects the amount of the premium payment
which statement is correct regarding the premium payment schedule for whole life policies
premiums are payable throughout the insureds lifetime/ coverage lasts until death of the insured
a medical info report(mib) may disclose which of the following
prior use of marijuana
a primary beneficiary has died before the insured in a life insurance policy. A contingent beneficiary is also named in the policy. Which of the following will occur when the insured dies
proceeds will go to the contingent beneficiary
a retirement plan that sets aside part of the company net income for distributions to qualified employees is called a
profit-sharing plan
in North Carolina tontine policies are
prohibited
An applicant may not be refused insurance coverage due to
race
an applicant may not be refused insurance coverage due to
race
all of these are considered sources of underwriting information about an applicant except
rating services
the purple of the rules of governing life insurance and annuity replacements is to
reduce the opportunity for misrepresentation and incomplete disclosure
the purpose of the rules of governing life insurance and annuity replacements is to
reduce the opportunity for misrepresentation and incomplete disclosure
when an existing life insurance policy is terminated so that a new life insurance policy can be purchased, this transacting is referred to as
replacement
when an existing life insurance policy is terminated so that a new life insurance policy can be purchased, this transaction is referred to as
replacement
The commissioner may issue an annually renewable ______ valid for representing an insurer in a foreign country or on a us military base
restricted license
which of these actions is not considered an act of rebating
sharing commissions with other licensed and appointed agents
if the agent is found to be incompetent, untrustworthy, or financially irresponsible, the commissioner may or may not
suspend, revoke, or refuse to renew the agents license
which of the following is true is the owner of an ira names their spouses as beneficiary, but then dies before any distributions are made
the account can be rolled into the surviving spouses IRA
which statement regarding a key employee life policy is not true
the beneficiary is named by the key employee
if an annuity is terminated prior to beginning of the income payment period, the contract owner receives
the contract surrender value at the time
what is the underlying concept regarding level premiums
the early years are charged more than what is needed
a non contributory group term life plan is characterized by
the entire cost of the plan is paid for by the employer
d was acting severely in the marines when he was killed in an automobile accident while on leave. His 100,00 whole life policy contains a war exclusion clause. How much will D's beneficiary's receive
the full face amount
J chooses a monthly premium payment mode on his whole life insurance policy. Which of these statements is correct
the gross premium is higher on monthly payment mode as compared to being paid annually
which of the following statements regarding a tax sheltered annuity (tsa) is incorrect
the income from the tsa is received income tax free
a policy adhesion can only be modified by whom
the insurance company
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until feb 7. Q is dissatisfied and returns the policy feb 13. How will the insurer handle this situation
the policy will be returned within the free-look period, premium will be fully refunded.
which of the following characteristics is correct about interest sensitive whole life
there Is a flexible premium payment
An agent inducing an insured to lapse, forfeit, or surrender insurance through misrepresentation is coming the illegal act of
twisting
under the North Carolina insurance code, an insurance company must pay death benefits for suicide if the policy has been in force for a minimum of
two years
which type of life insurance contains a monthly mortality charge as well as self directed investment choices
variable universal life
S is a life insurance policy owner and enters into a written agreement to receive immediate cash in exchange for the sale and transfer of her life insurance policy. This agreement is refereed to as
vatical settlement
