Life 7

An employee quits her job where she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a Traditional IRA, how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer?

$10,000, no tax consequence

When appointing a producer, an insurer must file a notice of appointment to the Department of insurance within

15 days

The validity of coverage under a life insurance policy may not be contested except for nonpayment of premium, after the policy has been in force for at least how many years?

2 years

All of the following would be excluded from the regulation. On life insurance solicitation EXCEPT

A term life policy

An insured pays a $100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. What characteristic of an insurance contract does this describe?

Aleatory

To which of the following policies would the state regulation on illustration NOT apply?

An individual variable life policy

Which of the following is the basic source of information used by the company in the risk selection process?

Application

Which of the following best describes annually renewable term insurance?

It is level term insurance

Which of the following is TRUE regarding the annuity period?

It many last for the lifetime of the annuitant.

Untrue statements on the application unintentionally made by insureds that, if discovered, would alter the underwriting decision of the insurance company, are called

Material misrepresentations

Which of the following would NOT be considered a purpose of life insurance solicitation regulations in Connecticut?

Help buyers choose most qualified insurance producers

Which of the following information about the applicant is NOT included in the General Information section of the application for insurance?

Medical background

A rider attached to a life insurance policy that provides coverage on the insured's family members is called the

Other-insured rider

Which of the following explains the policy owner's right to change beneficiaries, choose options, and receive proceeds of a policy?

Owner's Rights

When a life insurance policy was issued, the policy owner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accidident, and it was impossible to determine who died first. Which of the following would receive benefit?

The insured's contingent beneficiary

What is the advantage of reinstating a policy instead of applying for a new one?

The original age is used for premium determination

Under an extended term nonforteiture option, the policy cash value is converted to

The same face amount as in the whole life policy

What is the purpose of a suicide provision within a life insurance policy?

To protect the insurer from persons who purchase life insurance with the intention of committing suicide

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

Universal life - Option A

An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live. The insured knows that his financial state will worsen even more with the upcoming medical expenses. What option could the insured utilized

Viatical settlement

In forming an insurance contract, when does acceptance usually occur?

When an insurer's underwriter approves coverage

Which of the following components must a life insurance policy have to allow policy loans?

Cash value

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT

Conditions

The type of policy that can be changed from one that does not accumulate cash value to the one that does is a

Convertible Term Policy.

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT

Dividends from a mutual insurer.

Which nonforfeiture option has the highest amount of insurance protection?

Extended Term

It would be considered unfair discrimination to ask an insurance applicant about which of the following and then use that information as rating factor to determine

Sexual orientation

Which two terms are associated directly with the way an annuity is funded?

Single payment or periodic payments

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

Straight Life

In insurance, an offer is usually made when

The agent hands the policy to the policyholder.

Which of the following information will be stated in the consideration clause of a life insurance policy?

The amount of premium payment

An individual is exempt from the written examination requirement for licenses in all of the following circumstances EXCEPT

The individual is licensed in another state, and applies with 1 year of establishing Connecticut residency.