life 4

#11. An employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called? a)401(k) planb)Tax-sheltered account plan c)HR 10 plan d)Profit sharing plan

d)Profit sharing plan

#80. Which of the following is NOT true regarding a nonqualified retirement plan?a)Contributions are not currently tax deductible.b)It can discriminate in benefits and selecting participants.c)Earnings grow tax deferred.d)It needs IRS approval.

It needs IRS approval.

#6. Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known asa)Twisting.b)Controlled business.c)Coercion.d)Rebating.

Rebating

#15. Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean?a)The beneficiary must pay interest to the insurer .b)The beneficiary will receive the lump sum, plus interest. c)The primary beneficiary will receive the death benefit and the secondary beneficiaries will share the interest payments. d)The beneficiary will only receive payments of the interest earned on the death benefit.

d)The beneficiary will only receive payments of the interest earned on the death benefit.

#2. To sell variable life insurance policies, an agent must receive all of the following EXCEPT a)A securities license. b)A life insurance license .c)SEC registration. d)FINRA registration.

.c)SEC registration.

#18. A temporary license may be issued by the Commissioner for a period not to exceed how many days?a)90b)120c)180d)365

180

#74. Unless revoked or suspended, how long does a producer's license remain in effect in Tennessee?a)48 monthsb)6 monthsc)12 monthsd)24 months

24 months

#14. A Return of Premium term life policy is written as what type of term coverage?a)Decreasingb)Renewablec)Leveld)Increasing

Increasing

70. What do individuals use to transfer their risk of loss to a larger group?a)Insurance b)Insurable interest c)Exposure d)Indemnity

Insurance

#7. Who makes up the Medical Information Bureau?a)Hospitalsb)Former insuredc)Physicians and paramedicsd)Insurers

Insurers

#8. Which of the following best describes annually renewable term insurance?a)It requires proof of insurability at each renewal.b)Neither the premium nor the death benefit is affected by the insured's age.c)It provides an annually increasing death benefit.d)It is level term insurance.

It is level term insurance.

69. A domestic insurer issuing variable contracts must establish one or morea)Liability accounts.b)Annuity accounts.c)General accounts.d)Separate accounts.

Separate accounts.

#41. The policyowner wants to make sure that upon his death, 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? a)Interest only option b)Life income with period certainc )Joint and survivor d)Fixed amount option

a)Interest only option

#10. How many accounts must the Tennessee Life and Health Insurance Guaranty Association maintain?a)2 accounts: life insurance and health insurance b)3 accounts: life insurance, annuities, and health insurance c)3 accounts: insurance, annuities, and variable products d)2 accounts: life insurance and annuities

b)3 accounts: life insurance, annuities, and health insurance

#17. Equity indexed annuities a)Invest conservatively. b)Seek higher returns. c)Are more risky than variable annuities .d)Are security instruments.

b)Seek higher returns.

68. An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries?a)One of the beneficiaries will receive 1/3 and the other 2/3 of the proceeds when the insured dies. b)The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive. c)The beneficiary will receive 2/3 of the lump sum up front, and the remaining 1/3 will be paid over time. d)The beneficiary will receive 2/3 of the total benefit, with the final 1/3 payable when the first beneficiary dies.

b)The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.

16. Which of the following is the best reason to purchase life insurance rather than annuities?a)To liquidate a sum of money over a lifetime b)To create an estate c)To liquidate a sum of money over a period of years d)To create regular income payments

b)To create an estate

4. The insured under a $100,000 life insurance policy with a triple indemnity rider for accidental death was killed in a car accident. It was determined that the accident was his fault. The triple indemnity rider in the policy specifies that the death must not be contributed to by the insured in any manner. In this case, what will the policy beneficiary receive? a)$0 b)$50,000 (50% of the policy value) c)$100,000 d)$300,000 (triple the amount of policy value)

c)$100,000

#19. Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium?a)Reinstatement b)Reduced paid-up option c)Automatic premium loan d)Extended term

c)Automatic premium loan

#12. Variable Whole Life insurance is based on what type of premium?a)Flexible b)Graded c)Level fixed d)Increasing

c)Level fixed

13. Which of the following is NOT true regarding the annuitant?a)The annuitant receives the annuity benefits. b)The annuitant must be a natural person. c)The annuitant cannot be the same person as the annuity owner. d)The annuitant's life expectancy is taken into consideration for the annuity.

c)The annuitant cannot be the same person as the annuity owner.

#79. If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE?a)The policy will be void .b)The insurer may deny coverage later, because of the information missing on the application. c)The policy will be interpreted as if the insurer waived its right to have an answer on the application. d)The policy will be interpreted as if the insured did not have an answer to the question.

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

20. Partners in a business enter into a buy-sell agreement to purchase life insurance, which states that should one of them die prematurely, the other would be financially able to buy the interest of the deceased partner. What type of insurance policy may be used to fund this agreement? a)Term insurance only b)Permanent insurance only c)Universal life insurance only d)Any form of life insurance

d)Any form of life insurance

#64. Which of the following is NOT a type of whole life insurance?a)Single premium b)Straight life c)Limited payment d)Increasing term

d)Increasing term