Life insurance

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

Which of the following is the required number of participants in a contributory group plan?

75%

All of the following are personal uses of life insurance EXCEPT

Buy-sell agreement.

If an insured changes his payment plan from monthly to annually, what happens to the total premium?

Decreases

The automatic premium loan provision is activated at the end of the

Grace period.

Who makes up the Medical Information Bureau?

Insurers

On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of

Misrepresentation.

Part 2 of the application for life insurance provides questions regarding all of the following EXCEPT

Other insurance coverages.

All of the following entities regulate variable life policies EXCEPT

The Guaranty Association.

Which of the following is NOT true of life settlements?

The seller must be terminally ill.

An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium?

it will increase because the insured will be 5 years older than when the policy was originally purchased.

Which of the following is NOT true of Section 1035 Policy Exchanges?

Any exchange made under Section 1035 of the Internal Revenue Code must be completed within 30 days.

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?

Any form of life insurance

Which of the following methods of calculating the amount of life insurance needed takes into account the insured's wages, years until retirement, and inflation?

Human life value approach

An individual purchased a life insurance policy on his life naming his wife as primary beneficiary, and their daughter as contingent beneficiary. Under what circumstances could the daughter collect the death benefit?

If the primary beneficiary predeceases the insured

An insured purchased a life insurance policy on his life naming his wife as primary beneficiary, and his daughter as contingent beneficiary. Under what circumstances could the daughter collect the death benefit?

If the primary beneficiary predeceases the insured

Which authority is NOT stated in an agent's contract but is required for the agent to conduct business?

Implied

What is the benefit of choosing extended term as a nonforfeiture option

It has the highest amount of insurance protection.

All of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT

It is a life contingency option.

When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy?

It is reduced to the amount of what the cash value would buy as a single premium.

What method do insurers use to protect themselves against catastrophic losses?

Reinsurance

Which type of life insurance policy generates immediate cash value?

Single Premium

A producer is helping a married couple determine the financial needs of their children in the event one or both should die prematurely. This is a personal use of life insurance known as

Survivor protection

Which of the following is TRUE regarding the annuity period?

It may last for the lifetime of the annuitant.

Which of the following produces evaluations of insurers' financial status often used by state departments of insurance?

AM Best

Which of the following premium payment modes will incur the lowest overall payment?

Annual

The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?

As of the application date

An underwriter is reviewing the medical questions in the application and needs further information due to a medical situation the applicant had in the past. What will the underwriter require?

Attending Physician Statement

An insured and his wife are both involved in a head-on collision. The husband dies instantly, and the wife dies 15 days later. The company pays the death benefit to the estate of the insured. This indicates that the life insurance policy had what provision?

Common Disaster

Which of the following is usually true of a participating life insurance policy?

Pays dividends to policyowners.

All of the following statements about equity index annuities are correct EXCEPT

The annuitant receives a fixed amount of return.

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?

The balance of the loan will be taken out of the death benefit.

The annuity owner dies while the annuity is still in the accumulation stage. Which of the following is TRUE?

The beneficiary will receive the greater of the money paid into the annuity or the cash value.

An agent wants to include an illustration written by his insurance company. Which of the following best describes the conditions under which she may use the illustration?

The illustration must stay exactly as it is.

Which of the following is true regarding a market value adjusted annuity?

The owner is guaranteed a fixed interest rate for a specific period of time.

All of the following are true regarding the guaranteed insurability rider EXCEPT

This rider is available to all insureds with no additional premium.

Which of the following employees insured under a group life plan would be allowed to convert to individual insurance of the same coverage once the plan is terminated?

Those who have been insured under the plan for at least 5 years

Which of the following types of policies are protected by the South Carolina Guaranty Association?

a)Supplemental policies b)Life insurance policies and annuities c)Accident and health insurance policies d)All of the above (ANSWER d)