Life
what is the maximum penalty for habitual willful noncompliance with the fair credit reporting act
$2,500
the commisioner believes that an insurance rule or regulation has been violated and decides to call a disciplinary hesring. how many days before a hearing mucy yhe commissioner issue a notice to the person charged w a violation
10 days
a "certification of license status" report can be run on any currently licensed NJ producer but can only contain information on formal disciplin actions taken within the past
4 years
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 days
how long must producers and insurers maintain records of management of funds for insurance policies
5 years after the termination of coverage
what are the penalties for the first, second and any subsequent violation of the NJ fraud prevention act
5k, 10k, 15k
to attain currently insured status under social security, a worker must have earned at least how many credirs during the last 13 quarters
6
for how long is an insurance comoany allowed to defer policy loan requests
6 months
An insured committed suicide 6 months after his life insurance policy was issued. The insurer will
refund the premiums paid
The minimum number of credits required for partially insured status for Social Security disability benefit is
6 credits
in order to become a producer in NJ, after submitting a licensing application, candidates must pass a licensing exam within
1 year
in a noncontributory group policy
100% of eligible employees must participate
An insured replaces his current policy with one offered by another insurer. If he finds that he is unsatisfied with the new policy, within what period of time can he return it and receive a full refund?
30 days
What is reinsurance?
An agreement between a ceding insurer and assuming insurer
When an annuity is written, whose life expectancy is taken into account?
Annuitant
An employee dies having 6 quarters of coverage during the previous 13-quarter period. What status of coverage does the employee have under Social Security?
Currently insured
which of the following types of insurance policies is most commonly used in credit life insurance
Decreasing term
When the insured selects the extended term nonforfeiture option, the cash value will be used to purchase term insurance with what face amount?
Equal to the original policy for as long as the cash values will purchase.
When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?
Extended term
which of the following best describes the MIB
It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.
A participating insurance policy may do which of the following?
Pay dividends to the policyowner
an applicant for surplus lines authority must do all of the following except
Possess a certificate of authority in this state
A policyowner who is also the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of ownership. The policyowner should have her husband named as the
Revocable beneficiary
What is true about nonforfeiture values?
They are required by state law to be included in the policy.
What kind of policy allows withdrawals or partial surrenders?
Universal Life
Taxation of Accelerated Benefits rider
a portion of the benefit up to a limit is tax free; the rest is taxable income
the term "illustration" in a life insurance policy refers to
a presentation of nongauranteed elements of a policy
example of a candidate for a resident producer license that may be exempt from the examination requirement
a resident producer licensed for property and casualty insurance applying for a life insurance license
which of the following is abother term for authorized user
admitted
What is foreign policy?
an insurer with a home office in another state
A licensee violates an insurance regulation. A hearing is held, and the person is found guilty. If this is the person's first offense, the penalty is no more than A. $1,500. B. $3,000. C. $5,000. D. $1,000.
c. $5,000
gauranteeing future dividends is considered
misrepresentation
which of the following types of insurers is owned by stockholders
stock
what happens to the face amount of a whole life policy if the insured reaches 100
the face amount is paid to the insured
your client wants to provide retirement incone for his elderly parents in case something happens to him. he wants to make sure that both beneficiaries are gauranteed income for life. which settlement option should they choose
joint and survivor
which of the following riders added to life insurance policy can pay part of the death benefit to the insured to cover expenses incurred in a nursing or convalescent home
long term care
the primary beneficiary of her husbands life policy found that no settlement option was stated in the policy on the date of her husbands death. who will select the settlement option in this case
the beneficiary
An IRA owner who is 57 years old wants to make a withdrawal from her traditional IRA. What penalty will be imposed?
10%
in new jersey, what is the minimum age at which a person can purchase a life insurance policy on his or her own life
15
within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained
3 days
within how many days of requesting investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?
3 days
insured requires application in order to reinstate a policy. if the insured requests reinstatment in writing, an application must be delivered to the insured within
30 days
During policy replacement, the replacing insurer must notify existing insurers within what time period?
5 business days
during policy replacement the replacing insurer must notify existing insurers within what time period
5 business days
how many days does a producer have to remit the collected premium to the insurer
5 business days
an insured puchased a variable life insurance polocy w a face amount of 50K. the stock performance declined and the cash value fell to 10k. If they die what will be paid out?
50 K
what is the fine for violating the commissioners cease and disist order
5k
The death protection component of a universal life policy is expressed as what type of coverage?
annually renewable term
Universal life polocy is best described as
annually renewable term policy with a cash value account
an insurance company and insured are settling a lawsuit involving a life insurance policy. the insurer believes that the application would help to establish material facts in the case. what is true?
applications can only be used in court cases if they are attached or endorsed upon the issued policy
what insurancr professional offers advice regarding the benefits or advantages of an insurance policy to clients for a fee
consultant
which of the following is an insurance professional who offers advice regarding benefits or advantages of an insurance policy to clients for a fee
consultant
a universal life insurance policy has two types of interest rates that are called
gauranteed and current
what is not required information a producer must provide before soliciting insurance
producer contact info
the policyowner pays for her life insurance annually. until now, she has collected non taxable dividend check. she wants to use to dividends to help pay for her next premium. what option is this
reduction of premium
w adjustable life the owner can change all of the following except
the insured
who cannot be eligible to establish a keogh retirement plan
president and employee of a family corporation
An agent who knowingly misrepresents material information for the purpose of inducing an insured to lapse, forfeit, change or surrender a life insurance policy or annuity has committed an illegal practice known as
twisting
solicitation rules would apply to which of the following types of coverage
whole life
After its issuance, the temporary work authority expires after how many days?
60 days
An insurer cancelled a contract with a producer on April 1st. By what date must the insurer notify the Commissioner of this action?
April 15th (14 days)
which of the following entities established the do not call registry
Federal Trade Commission
insurance is regulated
Mostly on a state level
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report
Must be informed of the source of the report
A couple owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?
Proof of insurability is not required
Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?
Replacement rule
all of the following are considered limited lines of authority except
Surplus lines
what is the purpose of a disclosure statement in life insurance policies
To explain features and benefits of a proposed policy to the consumer
what is the purpose of establishing the target premium for universal life policy
To keep the policy in force
which of the following policies would have an IRS required corridor or gap between the cash value and death benefit
Universal Life - Option A
A producer's appointment lasts for how long?
Until it is terminated
in which of the following scenarios will the life insurance proceeds be protected from the creditors
When the benefits are not paid out to the insured or any person affecting the insurance
which of the following rider pays a beneficiary a death benefit that is double or triple the face amount if the death was caused by an accident as defined in the policy
an accidental death rider
which of the following wouldnnot trigger the accelerated death benefits
being permanently disabled
in life insurance, who is not required to have insurable interest in the insured
beneficiary
paul v virginia
decision has changed. insurance is interstate commerce and regulated by federal gov
An insurer mails an insurance policy to a new policyowner. When the insurer relinquishes control of the policy, the policy is considered
delivered
An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. what is this an example of
false advertising
under which of the following conditions would life insurance proceeds be taxable by the federal gov
if there is a transfer for value
Life income joint and survivor settlement option guarantees
income for 2 or more recipients until they die
If an insurer requires a medical examination of an applicant in connection with the application for life insurance, who is responsible for paying the cost of the examination?
insurer
US vs South-Eastern Underwriters Association was decided in 1944. to what extent does the supreme courts decision still apply to insurance today
it stands in full. insurance is considered to be interstate commerce and is therefore subject to regulation by the federal gov
which of the following acts stated that the fed gov would not regulate insurance as long as the states did an adequate job of regulating the industry
mccarran- ferguson act
a company claimes that it has funds in its possession that are not available for the payment of losses or claims. the company is guilty of
misrepresentation
The dividend option in which the policyowner uses dividends to purchase a term policy for one year is referred to as the
one-year term option
which of the following licenses is required for a surplus lines producer
property and casualty
which of the following is a person or organization that is allowed to write business in new jersey for insurance companies that do not posess a certificate of authority in NJ, if no authorized insurers in NJ offer the specific type of insurance in question?
surplus lines agent
an adjustable life policy can assume the form of
term or permanent life insurance
the president of a company is starting an annuity and decides that his corporation will be the annuitant. what is true
the annuitant must be a natural person
the annuitant dies while the annuity is still in the accumulation stage: what is true
the beneficiary will recieve the greater of the money paid into the annuity or the cash value
what is not required info a producer must provide before soliciting insurance
the nature of producers relationship w the insurer being represented
Under a SIMPLE plan, which of the following is TRUE regarding taxation on both contributions and earnings?
they are tax deferred until withdrawn
an organization licensed as a producer entity based in NY would like to transact insurance in NJ. What is true
they will need to obtain a non resident bysiness entity license and so will the producers
what is not true regarding a certificate of authority
It is issued to group insurance participants.
During replacement of life insurance, a replacing insurer must do which of the following?
Obtain a list of all life insurance policies that will be replaced
Part 2 of the application for life insurance provides questions regarding all of the following EXCEPT
Other insurance coverages
all of the following professional designations are recognized by the department as acceptable substitutes for education and examination requirement's except
Professional Insurance Agent (PIA)
which of the following could most likely be issued a resident producer license
Sally lives in a neighboring state but has an office in New Jersey
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT
Signed waiver of premium
In contrasting stock insurers with mutual insurers, which statement is true?
Stock insurers are owned by the shareholders and issue nonparticipating policies
which of the following statements regarding HIV testing is not true
Test results must be sent to the Department of Insurance.
which of the following information will be stated in the consideration clause of a life insurance policy
The amount of premium payment
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then
The benefit is received tax free
which of the following, when attached to a permanent life insurance policy, allows the policyowner to customize the policy to provide an additional amount of temporary insurance on the insured, or allows amounts of temporary insurance to cover other family members
term rider
a corporatation is the owner and beneficiary of the key person life policy. if the corporation collects the policy benefit then
the benefit is recieved tax free
all of the following are true about credit life except
the insured names the beneficiary
how must a producer respond to an applicant wishing to replace existing life insurance
the producer must provide the applicant eith a notice regarding replacement
which of the following is true about credit life insurance
Creditor is the policyowner.
a licensed insurance producer may request a waiver of license renewal procedures under any of the following circumstances except
His renewal forms were lost in the mail
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the
Other-insured rider
Federal Fair Credit Reporting Act (FCRA)
Regulates consumer reports
Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must
Respond to the consumer's complaint.
the ownership provision entitles the policyowner to do all of the following except
Set premium rates
If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a
Settlement option
Which two terms are associated directly with the way an annuity is funded?
Single payment or periodic payments
the initial amount of credit life insurance may not exceed
The amount to be repaid under the contract
Under an extended term nonforfeiture option, the policy cash value is converted to
The same face amount as in the whole life policy
An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries?
The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.
the paid-up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy.
If an insurance company wishes to order a consumer report on an applicant to assist the underwriting process and if a notice of insurance information practices has been provided the report may contain all of the following info except
ancestry
if an insurer and insured have a dispute about whether a particular loss is covered under a policy, which authority will settle the dispute
court system
which of the following may not be included in an insurance companys advertisment
that its policies are covered by a state gauaranty association
the supreme court stated that insurance is interstate commerce and is therefore subject to regulation by the federal gov. in the decision of what case
the US vs South Eastern Underwriters Association
which of the following is included in the term "insurance related conduct"
transmitting funds between producers and the insurance company
all of the following are benefits under Social security except
welfare benefits
the company has issued a policy and delivered it to Producer B on May 1st. By what date must the policy be delivered to the insured
within 10 calendar days
