life

Life insurers are prohibited from requiring disgruntled policyowners who want to sue the insurer from doing so within (that is, no later than): 30 days after the triggering event is noted 90 days after the triggering event is noted 6 months after the triggering event is noted 1 year after the triggering event is noted

1 year after the triggering event is noted

In comparing a multiple employer trust (MET) to a multiple employer welfare association (MEWA), which of the following statements is correct? A MET requires a minimum of 10 employers, while a MEWA may be established with as few as 2 employers. A MET requires that all participating employers belong to the same trade or industry, while no such requirement applies to MEWAs. Both METs and MEWAs require that all employees, regardless of their employer, be subject to a single set of plan requirements. Both METs and MEWAs are available in two forms: fully insured and self-insured plans.

A MET requires a minimum of 10 employers, while a MEWA may be established with as few as 2 employers.

Which of the following statements regarding life insurance accelerated benefits is correct? The insured can use these funds only for medical care. An accelerated benefit is only available as a rider. An accelerated benefit is only available as a provision of the policy itself, not as a rider. An accelerated benefit rider pays out part or all of the policy's face value while the insured is still living.

An accelerated benefit rider pays out part or all of the policy's face value while the insured is still living.

All the following statements about group life insurance are correct EXCEPT: The employer owns the policy, holds the master policy, and often pays the entire premium. The employees are the individual insureds. The amount of insurance coverage provided for each employee is typically some percentage of his or her salary. Employee contributions are not permitted.

Employee contributions are not permitted.

Hillary purchased a fixed deferred annuity from ABC Insurers and named her daughter, Bess, as annuitant and her husband, Charles, as beneficiary. Which of these parties is specifically authorized to make withdrawals from the annuity prior to annuitization? Hillary Bess Charles Hillary, Bess, and Charles

Hillary

Ralph, Jerry, and Paula are primary and equal beneficiaries of the $600,000 insurance policy on the life of their mother, Judy. Ralph dies before his mother. He leaves two children, Tim and Hal. Judy's life insurance policy designates the death benefit per capita. How will the insurer distribute the policy benefits? Ralph's $200,000 share will pass equally to his two children when Judy dies. Jerry and Paula will each receive $300,000. Tim and Hal will divide the death benefit between them. Jerry, Paula, Tim, and Hal will divide the benefits equally among them.

Jerry and Paula will each receive $300,000.

With respect to adjustable life insurance, which one of the following statements is correct? The policyowner stops making premium payments after the policy has been in force for a certain period. The policyowner can increase the death benefit without hurting the policy's cash value. Premiums can increase or decrease to suit the policyowner's changing needs. It offers five times higher cash value than whole life insurance.

Premiums can increase or decrease to suit the policyowner's changing needs.

Which of the following statements about the interest-only life settlement option is NOT correct? When a policyowner selects the interest only option, the insurer holds the policy proceeds until a future date and pays the interest that those proceeds earn. The policy specifies the minimum interest rate. The insurer pays interest at least annually but no more often than monthly. The interest rate paid by the insurer is the lesser of current rate or guaranteed rate.

The interest rate paid by the insurer is the lesser of current rate or guaranteed rate.

Which of the following statements regarding the life insurance return of premium rider is correct? The return of premium rider pays a beneficiary a sum equal to the death benefit. This rider is available only with permanent life insurance policies. The rider pays the policyowner a sum equal to all or a portion of the premiums paid. If the base policy is cancelled before the end of the coverage term, this rider will return a reduced portion of premiums paid.

The rider pays the policyowner a sum equal to all or a portion of the premiums paid.

Richard just retired at age 72 and owns a $500,000 life insurance policy. Because he no longer needs insurance protection, Richard would like to sell his policy and use the proceeds to travel during retirement. Which option would be best suited for this purpose? a viatical settlement an accelerated benefits settlement a life settlement a cash value settlement

a life settlement

Which organization is NOT eligible to sponsor a 403(b) plan for its employees? a real estate partnership a state university a religious center a not-for-profit cancer society

a real estate partnership

Which of the following would be most appropriate for Haley, 55, if her primary objective is to ensure having an income she cannot outlive? life insurance mutual funds CDs an annuity

an annuity

A distribution from a qualified retirement plan before age 59' is generally subject to: ordinary income taxation only a 10 percent premature distribution penalty tax only both ordinary income taxation and a 10 percent premature distribution penalty tax no taxation

both ordinary income taxation and a 10 percent premature distribution penalty tax

Flora's deferred annuity contract has an 11-year surrender charge period, during which the surrender charge will most likely: remain level increase decrease fluctuate up and down

decrease

Which of the following life insurance products is best suited for insuring a mortgage or other long-term loan with the least premium possible? increasing term life insurance level term life insurance decreasing term life insurance whole life insurance

decreasing term life insurance

All of the following distributions from a traditional IRA prior to age 59' would be exempt from the 10 percent penalty tax, EXCEPT: distributions taken when the IRA owner becomes disabled distributions taken when the IRA owner remarries distributions taken to pay for qualifying higher education expenses distributions taken when the IRA owner dies

distributions taken when the IRA owner remarries

The type of Section 529 plan that builds a tax-free pool of money the account owner can use to pay for qualifying education expenses including tuition, fees, room and board, and books is called a(n): prepaid tuition plan college spending plan FAFSA plan education savings plan

education savings plan

Your client is interested in purchasing an annuity that will provide interest rates tied to a stock index, tax-deferred earnings, and a guarantee of principal. Which of the following annuities could you recommend to meet her investment objectives? variable deferred annuity indexed deferred annuity fixed deferred annuity market-value adjusted deferred annuity

indexed deferred annuity

If a couple wants an annuity settlement option that will continue making payments for as long as either is alive, no matter which of them dies first, which of the following settlement options best suits their need? straight life income (also referred to as pure life income) life income with guaranteed minimum (refund guarantee or life annuity certain) life income with period certain joint and survivor life income

joint and survivor life income

What part of a deferred annuity's death proceeds is taxable? only the gain (investment earnings) is taxable only the basis (amount paid into it) is taxable the full amount is taxable none of it is taxable

only the basis (amount paid into it) is taxable

What type of life insurance policy distributes its surplus after the company accounts for liabilities, reserves, capital, and expenses? participating policy non-participating policy industrial insurance policy commercial insurance

participating policy

As distribution vehicles, annuities are useful for all the following reasons EXCEPT: be structured to fit almost any payout period or term ensure that income continues for the lives of two people protect against the financial impact of dying too soon ensure that one's income cannot be outlived

protect against the financial impact of dying too soon

The human life value approach to determining life insurance needs is essentially based on which of the following factors? the applicant's current income the applicant's financial goals the applicant's estimated net future earnings the applicant's current assets and liabilities

the applicant's estimated net future earnings

John, a life insurance policyowner, exercises an absolute assignment of the policy to his daughter, Jane, at which point Jane becomes: the policyowner the beneficiary the policy's executor the policy's trustee

the policyowner