ohio life insurance missed questions and answers part 8

All of the following are personal uses of life insurance EXCEPT a)Buy-sell agreement. b)Survivor protection. c)Estate creation. d)Cash accumulation.

a) Buy-sell agreement.

The dividend option in which the policyowner uses dividends to purchase a term policy for one year is referred to as the a)One-year term option. b)Paid-up option. c)Accelerated endowment. d)Paid-up additions.

a) One-year term option.

An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium? a)It will increase each year during the next 5 years as the face amount increases each year. b)It will increase because the insured will be 5 years older than when the policy was originally purchased. c)It will remain the same for the new 5-year term. d)It will decrease for the new 5-year term since the insured is now a lesser risk to the company.

b) It will increase because the insured will be 5 years older than when the policy was originally purchased.

All of the following are true regarding rebates EXCEPT a)Dividends are not considered to be rebates. b)Rebates are allowed if it is in the best interest of the client. c)Rebates are only allowed if specifically stated in the policy. d)Rebating can be anything of monetary value given as an inducement to purchase insurance.

b) Rebates are allowed if it is in the best interest of the client.

Which of the following best describes taxation during the accumulation period of an annuity? a)The growth is subject to immediate taxation. b)Taxes are deferred. c)The annuity is subject to state taxes only. d)The annuity is subject to both state and federal taxation.

b) Taxes are deferred.

The annuity owner dies during the accumulation period without naming a beneficiary. Annuity's cash value exceeds premiums paid. Which of the following is TRUE? a)The cash value will be paid to the state government. b)The cash value will be paid to the annuitant's estate. c)The premium value will be paid to the annuitant's estate. d)All benefits will be forfeited.

b) The cash value will be paid to the annuitant's estate.

If an insured continually uses the automatic premium loan option to pay the policy premium, a)The insurer will increase the premium amount. b)The policy will terminate when the cash value is reduced to nothing. c)The face amount of the policy will be reduced by the automatic premium loan amount. d)The cash value will continue to increase.

b) The policy will terminate when the cash value is reduced to nothing.

Under an extended term nonforfeiture option, the policy cash value is converted to a)A higher face amount than the whole life policy. b)The same face amount as in the whole life policy. c)The face amount equal to the cash value. d)A lower face amount than the whole life policy.

b) The same face amount as in the whole life policy.

What is the maximum civil penalty for violating the Director's cease and desist order? a)$1,000 b)$5,000 c)$10,000 d)$15,000

c) $10,000

What required provision protects against unintentional lapse of the policy? a)Payment of premiums b)Reinstatement c)Grace period d)Assignment

c) Grace period

Which of the following documents must be provided to the policyowner or applicant during policy replacement? a)Buyer's Guide and Policy Summary b)Policy illustrations c)Notice Regarding Replacement d)Disclosure Authorization Form

c) Notice Regarding Replacement

A nonadmitted insurer who provides unique insurance coverage that is not available from an admitted insurer is called a/an a)Capital stock insurer. b)Reciprocal insurer. c)Surplus lines insurer. d)Assessment mutual insurer.

c) Surplus lines insurer.

The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true? a)A corporation can be an annuitant as long as the beneficiary is a natural person. b)The contract can be issued without an annuitant. c)The annuitant must be a natural person. d)A corporation can be an annuitant as long as it is also the owner.

c) The annuitant must be a natural person.

Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium? a)Extended term b)Reinstatement c)Reduced paid-up option d)Automatic premium loan

d) Automatic premium loan

Which of the following would be the beneficiary in credit life insurance? a)Insured b)Company c)Borrower d)Creditor

d) Creditor

What determines the penalty for surrendering a market value adjusted annuity prematurely? a)The flat fee determined by an index of interest gains and the amount of time the annuity would take to mature b)There are no penalties imposed for surrendering annuities prematurely. c)The guaranteed minimum interest rate provided in the contract d)The current interest rate at the time of surrender

d) The current interest rate at the time of surrender

A father owns a life insurance policy on his 15-year-old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disabled, what will happen to the life insurance premiums? a)The premiums will become tax deductible until the insured's 18th birthday. b)Since it is the policyowner, and not the insured, who has become disabled, the life insurance policy will not be affected. c)The insured will have to pay premiums for 6 months. If at the end of this period the father is still disabled, the insured will be refunded the premiums. d)The insured's premiums will be waived until she is 21.

d) The insured's premiums will be waived until she is 21.