Kentucky Insurance Pre-licensure Study

6 months Most states allow the insurers to delay payment of cash surrender values for up to 6 months after policyowners request payment. This provision is a proactive measure for companies should an economic crisis arise, but such delays are rarely invoked.

How long do most states allow an insurance company to delay the payment of a cash surrender under the Delayed Payment provision?

Revocable

J would like to maintain the right to change beneficiaries. Which beneficiary designation should be used?

The cost

The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is:

0%

What percent of personal life insurance premiums is usually deductible for federal income tac purposes?

Irrevocable beneficiary

When a policy loan is requested by a policyowner and it requires the consent of the beneficiary, what kind of beneficiary designation is this?

Interest factor increase An increase in an insurance company's rate of earnings on investments would be one way to reduce premiums

Which of these occurrences could justify an insurer to reduce premiums?

the premium is fixed for the entire duration of the contract

A level premium indicates:

$50,000

A man dies and is insured by a Whole Life insurance policy of $50,000 which has a cash value of $15,000. The primary beneficiary will receive how much?

living in the mountains

A preferred life insurance premium can be obtained by an applicant exhibiting all of these factors, EXCEPT:

person who receives the death benefits if the primary beneficiary dies before the insured

A secondary (contingent) beneficiary is described as the:

exempt from federal income tax

Death benefits from a life insurance policy are normally considered to be:

Policyowner's estate

A woman is insured under a Variable Life insurance policy with her husband named as primary beneficiary. If there is no designated contingent beneficiary, who will receive the policy's proceeds if they both die in a common accident?

Taxes are owed on the amount of cash value that exceeds the premiums paid

After fifteen years, a Whole Life policy is surrendered. Which of the following can the policyowner expect?

Proceeds will go to the contingent beneficiary

An insured covered by life insurance has just died. What will happen if the primary beneficiary had already died before the insured and contingent beneficiary?

The cost

C is trying to determine whether to convert her convertible term life policy to whole life insurance using her original age or attained age. What factor would affect her decision the most?

Taxes are owed on the amount of cash value that exceeds the premiums paid

How much will be taxable if a policyowner, age 55, relinquishes a Universal Life policy?

Request of the change will be refused

T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?

Minors are normally not capable of handling money in a reasonable manner

What is considered a valid reason for an insurer's refusal to pay death benefits directly to a minor?

Fixed amount option

Which life insurance settlement option pays a stated monthly amount until the proceeds are gone?

An insurer's rating

Which of these factors do NOT affect life insurance premium rates?