Life insurance

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A policyowner cancels his life policy but instructs the insurance company to transfer the cash value of his policy to an annuity. This nontaxable transaction is called

1035 exchange

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

If licensees have administrative action taken against them, they must report this to the Superintendent within

30 days

In an IRA rollover the rollover must be completed within how many days of the time the funds are taken out of the first plan

60 days

According to the Entire Contract provision, a policy must contain

A copy of the original application for insurance

All of the following could own group life insurance except

A group needing low cost life insurance.

Which of the following would be required to be licensed as an insurance producer

A salaried employee who advertises and solicits insurance

Which of the following is not an allowable 1035 exchange

A whole life insurance policy is exchanged for a term insurance policy

In insurance, an offer is usually made when

An applicant submits an application to the insurer

When an annuity is written, whose life expectancy is taken into account?

Annuitant

In an annuity, the accumulated money is converted into a stream of income during which phase?

Annuitization period

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

Which of the following is true about a class designation

Beneficiaries are not identified by name

Which of the following best describes fixed-period settlement option

Both the principal and interest will be liquidated over a selected period of time.

A tax-sheltered annuity is a special tax-favored retirement plan available to

Certain groups of employees only.

Before an agent can transact business in New York every insurer fraternal benefit society or HMO file with the superintendent which of the following

Certificate of appointment

The continuing education (CE) requirement in this state

Consists of completing 15 hours of continuing education each biennium.

A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called

Cost of Living Rider

When must an IRA be completely distributed when a beneficiary is not named?

December 31 of the year that contains the fifth anniversary of the owner's death.

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.

Which of the following best describes the aleatory nature of an insurance contract

Exchange of unequal values

The authority's granted to an agent through the agents contract is referred to as

Express authority

Under which installments option does the annuitant select the amount of each payment, and the insurer determines how long they will pay benefits?

Fixed amount

Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid

For 20 years or until death, whichever occurs first.

In which of the following cases will the insured be able to receive the full face amount from a whole life policy

If the insured lives to age 100

What are the two components of a universal policy

Insurance and cash account

Who makes up the Medical Information Bureau?

Insurers

If an insured surrenders his life insurance policy, which statement is true regarding the cash value of the policy?

It is only taxable if the cash value exceeds the amount paid for premiums.

Which of the following is an irs qualified retirement program for self employed

Keogh

Which of the following is an example of a limited pay life policy

Life Paid-up at Age 65

Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client?

Limited pay whole life

In a single employer group plan, what is the name of policy issued to the employer

Master contract

Which of the following is not true regarding policy loans

Money borrowed from the cash value is taxable.

After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive?

Monthly premium waiver and monthly income

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

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

Which of the following can surrender a deferred annuity contract

Only the annuity owner

Which Universal Life option has a gradually increasing cash value and a level death benefit?

Option A

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 policyowners right to change beneficiaries choose options and receive proceeds of a policy

Owner's Rights

Which of the following has the right to convert the existing term coverage to permanent insurance

Policyowner

Based on Human Life Value Approach, which of the following is NOT used to calculate an individual's life value?

Predicted needs of the family after the insured's death.

Which nonforfeiture option provides coverage for the longest period of time?

Reduced Paid-Up

To sell variable life insurance policies an agent must receive all of the following except

SEC registration

All the following would be different between qualified and nonqualified retirement plans except

Taxation on accumulation

If an insured withdraws a portion of the face amount in the form of accelerated benefits because of a terminal illness, how will that affect the payable death benefit from the policy?

The death benefit will be smaller

If an insured continually uses the automatic premium loan option to pay the policy premium,

The policy will terminate when the cash value is reduced to nothing

Which of the following statements is correct regarding a whole life policy

The policyowner is entitled to policy loans

All of the following would be eligible to establish a Keogh retirement plan except

The president and employee of a family corporation

How must a replacing producer respond to an applicant wishing to replace existing life insurance?

The producer must provide the applicant with a Notice Regarding Replacement

Which is generally true regarding insureds who have been classified as preferred risks

Their premiums are lower.

Which of the following is true for both equity indexed annuities and fixed annuities

They have a guaranteed minimum interest rate.

What is the purpose of key person insurance

To lessen the risk of financial loss because of the death of a key employee

The paid up addition option uses the dividend

To purchase a smaller amount of the same type of insurance as the original policy.

In a survivorship life policy, when does the insurer pay the death benefit

Upon the last death

Which of the following would least likely be considered a legitimate need that would be paid by insurance proceeds

Vacation travel expenses

Which of the following cannot be included along with illustrations used to sell life insurance

Vanishing premium information

Which of the following is a key distinction between variable whole life and variable universal life products

Variable whole life has a guaranteed death benefit

An agent and an applicant for a life insurance policy fill out and sign the application. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. When will coverage begin?

When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health

The least expensive first year premium is found in which of the following policies

annually renewable term

Which of the following is a short-term annuity that limits the amounts paid to a certain fixed period or until a certain fixed amount is liquidated

annuity certain

If the annuitant dies during the accumulation period, who will receive the annuity benefits?

beneficiary

A business owner was trying to obtain a bank loan to fund the purchase of a new business facility, but the bank required proof of additional assets to secure the loan. The business owner then decided to use her $250,000 life insurance policy to secure the loan. Which provision makes this possible?

collateral assignment

An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?

consideration

An individual has been making periodic premium payments on an annuity the annuity income payments are scheduled to begin after 1 year since the annuity was purchased what type of annuity is it

deferred

All of the following information about the applicant is identified in the general information section of a life insurance application except

education

Which of the following is true regarding a single life settlement option

it provides income the beneficiary cannot outlive

In a life settlement contract who does the life settlement broker represent

owner

What is the major difference between a stock company and a mutual company

ownership

A situation in which a person can only lose or have no change represents

pure risk

Annuities can be used to fund which of the following?

retirement plans

If an agent wishes to sell variable life policies, what license must the agent obtain?

securities

A father owns a life insurance policy on his 15-year-old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disabled, what will happen to the life insurance premiums?

the insured's premiums will be waived until she is 21.

Which of the following types of policies will provide permanent protection

whole life


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