insurance quiz 3

A producer is in violation of the Replacement regulation by doing which of the following? A. Advising the applicant to directly contact their existing insurer to cancel their existing policy B. Indicating on the application that the policy they are applying for is intended to replace an existing policy C. Giving the applicant copies of the sales materials used in the presentation D. Not showing the applicant their NJ DOBI issued producers license

A. Advising the applicant to directly contact their existing insurer to cancel their existing policy

The purpose of advertising regulation is to A. Assure full and truthful disclosure to the public B. Ensure that the prospect has all the required information to make an informed decision C. Ensure that the insurance company is supervising its agents properly D. Assure that the spokespersons are properly compensated

A. Assure full and truthful disclosure to the public

According to New Jersey law, copies of insurance advertisements must be maintained A. At the producers office B. At the company's office C. On the producer's computer D. By the Department of Banking and Insurance

B. At the company's office

A policy illustration given at the time of sale does not typically include the A. The cash value of the policy B. Names of the beneficiary C. Effective interest rate for policy loans D. 10th and 20th year cost surrender value

B. Names of the beneficiary

The primary purpose of the replacement regulation is to A. Protect the renewal commission of the existing producers B. Protect policyowners from misrepresentation and loss of benefits C. Protect insurance company home offices from loss of in-force business D. Inform consumers of the availability of additional policy coverages

B. Protect policyowners from misrepresentation and loss of benefits

A Buyer's Guide must be provided to all purchasers of which of the following types of insurance? A. Annuities B. Ten year level term C. Credit life D. Group life

B. Ten year level term

The replacement of an existing policy requires all of the following EXCEPT A. Notification of what constitutes a replacement B. Notification of the proposed replacement to the insurer whose policies are intended to be replaced C. Notice that the owner can return the policy within 90 days for a full refund D. A complete comparison of the existing policy to the new policy

C. Notice that the owner can return the policy within 90 days for a full refund

All of the following actions can be taken by the Commissioner against a producer if he violates the rules of replacement EXCEPT: A. Suspension of license B. Monetary fines C. Redirect any commissions earned to the insured D. Order the insurer or producer to pay restitution to the insured

C. Redirect any commissions earned to the insured

Life insurance advertisements A. Must be truthful and not misleading B. Cannot use the terms "investment" or "savings" C. Are designed to persuade the public to purchase life insurance D. All the above

D. All the above

All of the following items may be considered forms of advertising for life insurance except: A. Information brochures B. Audiovisual materials C. Sales presentations D. Buyer' Guides

D. Buyer' Guides

. Credit life insurance may be issued to a borrower in which of the following forms? A. Group whole life insurance B. Individual annuity C. Individual whole life D. Group term life

D. Group term life

Insurance advertising in local newspapers is regulated by the: A. Marketing department of the insurance company B. Attorney general C. Federal Communication Commission D. New Jersey Department of Banking and Insurance

D. New Jersey Department of Banking and Insurance

Which of the following MUST an agent do when replacing a life insurance policy? A. Obtain with application the applicant's justification for why the replacement is suitable B. Notify the insurer whose policy is being replaced, but not the insurer that is replacing the policy C. Forward the signed and completed disclosure statement to the replacing insurer and not provide the applicant a copy D. Submit to the replacing insurer a list of all the life insurance policies or annuity contracts proposed to be replaced

D. Submit to the replacing insurer a list of all the life insurance policies or annuity contracts proposed to be replaced

Replacement rules apply to which of the following products? A. Individual life policies B. Group life policies C. Group term policies D. Group annuities

A. Individual life policies

All of the following statements are correct about the Notice Regarding Replacement of Life Insurance EXCEPT that it A. Increases the opportunity for misrepresentation by an agent B. Gives a prospective insured facts on which to base decisions about policy choices C. Increase the opportunity for fair methods of competition by insurance companies D. Reduces the opportunity for incomplete comparisons of policies by an insured

A. Increases the opportunity for misrepresentation by an agent

What information is NOT required to be included in advertising material for a life product? A. The agent's compensation B. Whether a spokesperson is paid C. That dividends are not guaranteed D. The company's name

A. The agent's compensation

In a credit insurance policy, who is the beneficiary? A. The creditor B. The debtor C. The borrower D. The insured

A. The creditor

A creditor collects payment from a borrower for a credit life policy, but the policy is not issued. What action MUST the creditor take with the advance payment? A. Apply it to the loan principal B. Return it directly to the borrower C. Deposit into the loan officers personal account D. Hold it in escrow until after the loan is paid

B. Return it directly to the borrower

A producer assists an insured in converting a life policy to reduced paid-up insurance in order to buy a new policy. This action is best known as A. solicitation B. rebating C. twisting D. replacing

D. replacing

Which of the following statements is CORRECT? A. Creditors may attach the death benefits payable to insured's estate B. Creditors may attach the death benefits payable to an insured's beneficiary only in the case of a third party ownership C. Creditors may attach the death benefits payable to an insured's beneficiary D. Creditors may attach the death benefits payable to an insured's beneficiary only if the insured was the owner

A. Creditors may attach the death benefits payable to insured's estate