Exam Simulator - Life
A modified Endowment contract
A life insurance policy that develops cash value faster than a seven-pay whole life contract
conservative investments like bonds
In reference to fixed annuities, what comprises most of a life insurance company's general account?
Equity Indexed Annuity
An annuity owner is funding an annuity that will supplement her retirement. Because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the standard and poor's 500 index. She would likely purchase a?
403B
An internal revenue code provision that specifically provides for an individual retirement plan for public school teachers is a
1K
Who many hours a year do you have to work to qualify for a Keogh Plan?
Transfer of all ownership rights in a policy
An absolute assignment is a?
They are not included as income for the employee, but are taxable upon distribution
How are contributions to a tax-sheltered annuity treated with regards to taxation?
From trustee to trustee
In a direct rollover, how is the money transferred from one plan to the new one?
Generally not taxed as income
Life insurance death proceeds are handled tax-wise how?
HR-10 (Keogh Plan)
Plan specifically for self-employed and their employees.
Life income with period certain
The form of life annuity which pays benefits throughout the lifetime of the annuitant and also guarantees payment of a minimum number of years is called?
The owner will receive the premium payment that have been paid into the annuity, plus any interest, minus a surrender charge.
The owner prematurely surrenders his deferred annuity before the annuitization period begins which will likely occur?
Single payment or periodic payments
Two terms are associated directly with the way an annuity is funded?
Nothing, the payments will cease
Under a straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive?
Employer contributions made to a qualified plan
What is subject to vesting requirements?
Favorable tax treatment
What is the advantage of having a qualified annuity?
Income tax on distribution and no penalty
What is the consequence of amounts received from a traditional IRA after the money was left in the tax-deferred account by the beneficiary?
It has a tax benefit for both employer and employee
What is true of a qualified plan?
The charge may be waived if the annuitant is confined to a long-term care facility for a least 30 days.
What is true regarding a waiver or a surrender charge on an annuity contract?
It may last for the lifetime of the annuitant
What is true regarding the annuity period?
Interest only
When a beneficiary receives a payments consisting of both principal and interest portions, which parts are taxable as income?
Annuitant
When an annuity is written, whose life expectancy is taken into account?
Automatic premium loan
Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium?
Bail-out
Which of the following provisions in annuity contracts allow the owner to surrender the annuity if the interest rates drop to a specified level?
An individual not covered by an employer-sponsored pan who has earned income
Who can make a fully deductible contribution to a traditional IRA?
3
under SIMPLE plans, participating employees may defer up to a specified amount each year, and the employer then makes a matching contribution up to an amount equal to what percent of the employee's annual wages?