Stimulate Exam

An insured had a $10,000 term life policy. The annual premium of $200 was due on Feb. 1st; however, the insured failed to pay the premium. He died on Feb. 28th. How much would the beneficiary receive from the policy?

$9,800

How many hours of continuing education can be carried from on licensing period to the next?

0

If an agent has completed 35 hours of continuing education in one renewal period, how many CE hours will the agent have to complete in the new renewal period?

24

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

The insuarance commissioner may examine the affairs of any insurer as often as necessary, but not at least frequently than once every

5 years

Insurance policies are not drawn up through negotiations, an an insured has little to say about its provisions. What contract characteristic does this describe?

Adhesion

All of the following statements about the continuing education requirement in this state are true EXCEPT

All licensed agents must comply by Jan. 1 of even-numbered years

Who is considered a non resident agent?

An agent who resides in another state, but is licensed to write insurance in Texas

Which of the following would be required to be licensed as an insurance producer?

An employee who solicits insurance and recieves a commission

Single Premium Whole Life

An insurance policy that only requires a payment of premium at its inception and no further premiums contributions, and in addition to providing insurance protection for the life of the insured, endows at the insured's age 100, is called

The accelerated benefits provision will provide for an early payment of the death benefit when the insured

Becomes terminally ill

Which of the following is a feature of a variable annuity?

Benefit payment amounts are not guaranteed

A banker is ready to close on a consumer's loan. The bank is prepared to offer the loan but only if the customer purchases an insurance policy from the bank in the amount of the loan. This is an example of

Coercion

When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is

Conditional

Representations are written or oral statements made by the applicant that are

Considered true to the best of the applicant's knowledge

A key person insurace policy can pay for which of the following?

Costs of training a replacement

An insurance professional advises a client regarding the benefits of her life insurance policy, in exchange for a fee. Which of the following terms best describes the type of insurance professional?

Counselor

The death benefit in a variable universal life policy?

Depends on the performance of a seperate account

When possible, what should insurers strive to eliminate from illustrations?

Footnotes and caveats

If an insured worker has earned 40 quarters of coverage, the worker's status under Social Security disablilty is

Fully insured

An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be availiable in the future. Which of the following options should be included in the policy?

Guaranteed insurability option

Which of the following is an eligibility requirement for all Social Security Disability Income benefits

Have attained fully insured status

A Return of Premium term life policy is written as what type of term coverage?

Increasing

An underwriter may obtain information on an applicant's hobbies, finiancial status, and habits by ordering a(n)

Inspection report

The Policyowner wants to make sure that upon his death benefit, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain age. Which settlement option should the Policyowner choose?

Interest only option

What is the benefit in variable universal life policy?

It has the highest amount of insurance protection

Which of the following is correct regarding credit life insurance?

It insurers the life of a debtor

What is the purpose of a conditional receipt?

It is intended to provide coverage on a date prior to the policy issue

Which of the following best describes anually renewable term insurance?

It is level term

Exclusions clause

Items stipulated in the contract that the insurer will not provide coverage for are found in the

An insurer advertises a health policy that is covered by the Life and Health insurance Guaranty Association. The advertisement includes a short list of benefits and approximate rates. The end of the advertisement includes a statement the protection is provided by the Guaranty Association. Which of the following is true?

Mentioning the Guaranty Association In advertisements is considered to be unfair trade practice

On its advertisement, a company claims that it has funds in it possession that are, in fact, not available for the payment of losses or claims. This company is guilty of

Misrepresentation

During replacement of life insurance, a replacing insurer must do which of the following?

Obtain a list of all life insurance policies that will be replaced

What is the major difference between a stock company and a mutal company?

Ownership

All of the following insurance policy may do which of the following?

Pay dividends to the policy owner

Which of the following is another term for the accumulation period of annuity?

Pay-in period

Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or become disabled?

Payor benefit

Which of the following riders would NOT cause the death benefit to increase?

Payor benefit rider

All of the following are mandatory life insurance policy provisions EXCEPT

Policy backdating

A coupke owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?

Proof of insurability is not required

All of the following are true regarding rebates EXCEPT

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

The regulations regarding replacement apply to ?

Renewable term

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?

Replacement rule

Under the Fair Credit Reporting Act, if a consumer challenges the accuracy of the information contained in a consumer or investigative report, the reporting agency must...

Respond to the consumer's complaint

Which type of life insurance policy generates immediate cash value?

Single premium

The payments will stop when the annuitant dies

Statements are true regarding installments for a fixed amount EXCEPT

Which of the following policies would be classified as a traditional level premium contract?

Straight life

A license may NOT be denied, suspended, or revoked if the license

Sumbits an unsigned insurance policy

Which of the following is an example of a producer being involoved in an unfair trade practice of rebating?

Telling a client that his first premium will be waived if he purchases the insurance policy

The initial amount of credit life insurance may NOt exceed

The amount to be repaid under the contract

An individual applied for an insurance policy and paid the intial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

The date of medical exam

If an insured withdraws protion of the face amount in the for of accelerated benefits because of a terminal illness, how will that affect payable death benefit from the policy?

The death benefit will be smaller

An employer sponsered non qualified retirement plan are tru EXCEPT

The employer can receive a current tax deduction for an contributions made to the plan

A 40-year old man buys a whole life policy and names his wife as his only beneficiary. His wife dies 10 years later. He never remarries and dies at 61, leaving 32 grown-up children. Assuming he never changed the beneficiary, the policy proceeds will go to

The insured's estate

Which of the following is NOT required on an illustration used in the sale of a life insurance?

The name of the primary and secondary beneficiaries

If an insurer issued a policy based upon the application that had unanswered questions, which of the following will be TRUE?

The policy will be interpreted as if the insurer waived its right to have an answer on the application

What kind of policy allows withdrawals or partial surrenders?

Universal life

In a survivorship life policy, when does the insurer pay the death benefit?

Upon the last death

When is the earliest a policy may go into effect?

When the application is signed and check is given to the agent

Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE?

Withdrawals are not taxable

In Texas, the Commissioner of Insurance is

appointed by the Governor