simulate your exam life 1st try
During replacement of life insurance, a replacing insurer must do which of the following? a) Guarantee a replacement for each existing policy b) Designate a new producer for a replaced policy c) Send a copy of the Notice Regarding Replacement to the Department of Insurance d) Obtain a list of all life insurance policies that will be replaced
D
Which of the following is INCORRECT concerning a noncontributory group plan? a) They help to reduce adverse selection against the insurer. b) They require 100% employee participation. c) The employer pays 100% of the premiums. d) The employees receive individual policies.
D
If a group policy issued 5 years ago terminates, people insured at the date of termination will be entitled to have an individual policy issued if they have been insured under the plan for at least a) 4 years. b) 3 years. c) 2 years. d) 5 years.
b
In life insurance policies, cash value increases a) Are income taxable immediately. b) Are taxed annually. c) Are only taxed when the owner reaches age 65. d) Grow tax deferred.
d
What is the maximum permitted annual interest rate on policy loans? a) 10% b) 4% c) 6% d) 8%
d
An insured receives an annual life insurance dividend check. What term best describes this arrangement? a) Reduction of Premium b) Annual Dividend Provision c) Accumulation at Interest d) Cash option
D
Which of the following statements is TRUE concerning the Accidental Death Rider? a) It is only available in group insurance. b) It will pay double or triple the face amount. c) It is also known as a triple indemnity rider. d) This rider is only available to insureds over the age of 65.
b
Who is the owner and who is the beneficiary on a Key Person Life Insurance policy? a) The employer is the owner and the key employee is the beneficiary. b) The key employee is the owner and beneficiary. c) The key employee is the owner and the employer is the beneficiary. d) The employer is the owner and beneficiary.
d
The term "illustration" in a life insurance policy refers to a) Pictures accompanying a policy. b) Charts and graphs. c) A presentation of nonguaranteed elements of a policy. d) A depiction of policy benefits and guarantees.
C
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 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
In a life settlement contract, whom does the life settlement broker represent? a) The owner b) The insurer c) The beneficiary d) The life settlement intermediary
A
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? a) The producer b) The beneficiary of the applicant c) The insurance company d) The applicant
A
A mass-marketed life insurance policy is put into effect. What is a reasonable assumption about the policy? a) The West Virginia Life and Health Guaranty Association found that the total charges for the insurance were reasonable in relation to the benefits provided. b) The Commissioner found that the total charges for the insurance were reasonable in relation to the benefits provided. c) The policy is for a company consisting of at least 200 people. d) Persons covered under the policy have 90 days until the coverage is active.
B
If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE? a) The insurer may deny coverage later, because of the information missing on the application. b) The policy will be interpreted as if the insurer waived its right to have an answer on the application. c) The policy will be interpreted as if the insured did not have an answer to the question. d) The policy will be void.
B
Another name for a substandard risk classification is a) Elevated. b) Rated. c) Controlled. d) Declined.
B
The insured had his wife named as the beneficiary of his life insurance policy. To ensure that his wife had income for life after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking into account all of the following EXCEPT a) Face amount of the policy. b) The insured's age at death. c) The beneficiary's life expectancy. d) Projected interest rates.
B
All other factors being equal, what would the premium be like in a survivorship life policy as compared to the premium in a joint life policy? a) As high b) Half the amount c) Lower d) Higher
C
Group life insurance is a single policy written to provide coverage to members of a group. Which of the following statements concerning group life is CORRECT? a) Coverage cannot be converted when an individual leaves the group. b) Premiums are determined by age, occupation, and individual underwriting. c) 100% participation of members is required in noncontributory plans. d) Each member covered receives a policy.
C
If a producer does not complete the continuing education (CE) requirement, which of the following will happen? a) Nothing: the producer may make up the CE hours in the following licensing period b) The producer will be fined for each month the CE requirement is not met. c) The producer's license will not be renewed. d) The producer's license will be revoked until the CE requirement is met.
C
The death protection component of Universal Life Insurance is always a) Whole Life b) Adjustable Life c) Increasing Term d) Annually Renewable Term
D
Variable Life insurance is based on what kind of premium? a) Graded b) Level fixed c) Increasing d) Decreasing
b