Life Insurance

a person requesting a hearing should file the request within how many days of the act giving rise to the grievance

60 days

Which policy has an IRS required corridor or gap between the cash value and the death benefit?

Universal life- option a

What would qualify as a competent party in an insurance contract?

applicant has a prior felony conviction

one source of funds from which life insurance policy dividends are paid is operating expenses; this is when:

cost of operating the company is less than assumed

Bill decides to take up skydiving as a hobby. His insurer attached a condition onto his policy which states that any injuries incurred while skydiving will not be covered. What term is not associated with the condition that the insurer attached?

exposure

What is not an example of a businesses use of life insurance?

funding against company's general financial loss

What is the tax consequence of amounts received from a traditional IRA after the money was left in the tax-deferred account by the beneficiary?

income tax on distributions and no penalty

When a reduced-paid up forfeiture option is chosen, what happens to the face amount of the policy?

it is reduced to the amount of what the cash value would buy as a single premium

Consent of the proposed insured for insurance contracts in Kentucky

only individual policies must be consented by the insured

What is not an example of risk retention?

premiums

Entire Contract

provision which states that both the policy and a copy of the application form the contract between the policy owner and the insurer

What is another name for a substandard risk?

rated

What two terms are associated directly with the way an annuity is funded?

single payment or periodic payments

Family income policy

special policy combines decreasing term insurance with whole life insurance to provides the insured's family with a monthly income upon the death of the insured, while maintaining permanent coverage until the end of the income payments

How is social security funded?

taxes imposed on a worker's earned income

A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then

the benefit is received tax free

the privilege of change clause

the clause that specifies the conditions under which insurers can allow policy owners to change coverage

What is not true regarding a decreasing term policy?

the payable premium amount steadily declines throughout the duration of the contract