Life insurance test

a policy will pay the death benefit if the insured dies during the 20 year premium paying period and nothing if death occurs after the 20-year periods

level term

life insurance death proceeds are

Generally not taxed as income

credit life insurance

insures the lies of a debtor

which of the following policy components contain the company's promise to pay

insuring clause

a participating insurance policy may do which of the following

pay dividends to the policyowner

which of the following licenses is required for a surplus lines producer

property and casualty

all of the following are requirements for life insurance illustration except

they must be part of the contract

what is the purpose of the buyer's guide?

to allow the consumer to compare the cost of different policies

the waiver of cost of insurance rider is found in what type of insurance

universal life

insurance companies may be classified according to the legal form of their ownership. this type of company organized to return any surplus money to their policyholder is

mutual insurer

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

SEC registration

all of the following would be different between qualified and non qualified retirement plans except

taxation on accumulation

when an employee terminated coverage under a group insurance policy, coverage continues in for for

31 days

all of the following are true of key person insurance except

the pan is funded by permanent insurance only

if an applicant license has lapsed within the past year, the applicant may apply for late renewal of the license within the max of how many months of expiratuon

12 months

an employee quits her job where she has a balance of 10,000 in her qualified plan. the balance was paid out directly to the employee in order for her to move the funds to a new account. if she decides to rollover her plan to a traditional ira, how much will she receive from the plan administrator and how long does she have to complete the tax-free rollover?

8000, 60 days

all of the following statements concerning dividends are true except

dividends amounts are guaranteed in the policy

all of the following statements are true regarding tax-qualified annuities except

employers contributions are not tax deductible

universal life insurance policy has 2 types of interest rates that are called

guaranteed and current

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

which of the following riders is often used in business life insurance policies when the policy owner needs to change the insured under the policy

substitute insured rider

which is true regarding insured who have been classified as preferred risks

their premiums are lower

what is purpose of settlement options

they determine how death process will be paid

which of the following would not be considered an exception to the national do not call list

calls based from outside of the US

what happens when a policy is surrendered for its cash value

coverage ends and policy cannot be reinstate

which of the following types of insurance would be written by a limited lines agent

credit incurance

another name for a substandard risk classification is

rated

which nonforfeiture option provides coverage for the longest period of time

reduced paid up

an insurance producer is acting as a broker when he or she negotiates for an insurance contract on behalf of

a client

all of the following could own group life insurance except

a group needing low-cost life insurance

all of the following candidates for a resident producer license may be exempted from the examination requirement except

a resident producer licensed for property and casualty insurance applying for a life insurance license

which of the following determines the cash value of a variable life policy

the performance of the policy portfolio

the insured under $100000 life insurance policy with a triple indemnity rider for accidental death was killed in car accident. it was determined that the accident was his fault. the triple indemnity rider in the policy specifies that the death must not be contributed to by the insured in any manner. in this case, what will the policy beneficiary receive?

100,000

within how many days of requesting an investigate consumer report must an insurer notify the consumer in writing that that report will be obtained

3 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 premiums to the insurer

5 business days

in cases where a producer's license has been revoked, the producer must wait for how long before applying for reinstatement

5 years

if a person violates a cease and desist order, the commissioner can turn the matter over to the nj superior court for further legal action and can assess a fine for each violation of up to

5000

what is the fine for violating the commissioner's cease and desist order

5000

the max the insurance guaranty association will pay to an individual for life insurance death benefits is

500000

which of the following would be considered an unfair claims settlement practice

admission the insured that if the claim goes to arbitration, the insured would probably receive less that what is currently being offered

which of the following is the closest term to an authorized insurer

admitted

the full premium was submitted with the application for life insurance, and the policy was issued 2 weeks later as requested. when does the policy coverage become effective

as of the application date

which of the following would not be considered a misrepresentation on the part of the insurer

backdating policies to secure a lower premium for the insured

social security was created to protect against all of the following except

bad investment choises

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

beneficiary

when an insurance producer negotiates for an insurance contract on behalf of a client, the producer is acting as

broker

an insured pays an annual premium to his insurer. in return, the insurer promises to pay benefits in accordance with the terms of the contract

consideration

according to the entire contract provision, what document must be made part of the insurance policy

copy of original application

which of the following are not fundable by annuities

death benefits

misrepresenting an insurance policy as a share of stock is an example of which of the following

false advertising

a lucky individual who won the state lottery, so the state will be sending him a check each month for the next 25 years. what type of annuity products are they likely to use to provide these benefits

immediate annuity

the MIB was created to protect

insurance companies from adverse selection by high risk persons

which provisions of life insurance policy states the insurer's duty to pay benefits upon the death of the insured, and to whom the benefits will be paid

insuring clause

which for the following statements about the reinstatement provisions is true

it requires the policy owner to pay all overdue premiums with interest before the policy is reinstated

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?

mutual

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

option a

an insured purchases a life policy in 2010 and died in 2017. the insurance company discovers at the that time that the insured had concealed information during the application process. what can they do?

pay the death benefit

which of the following allows the insurer to relive a minor insured from premium payments if the minor's parents have died or become disabled

payor benefit

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

which of the following is true regarding variable annuities

the annuitant assumes the risks on investment

all of the following are examples of third-party ownership of life insurance except

an insured borrows money from the bank and make a collateral assignment of part of the death benefit to secure the loan

if an insurance company makes a statement that its policies are guaranteed by the existence of the insurance guaranty association, that would be considered

an unfair trade practice

all other factors being equal, the least expensive first year premium payment is found in

annually renewable term

partners in 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 insurnace

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

application

a group of 4 entrepreneurs decides to open an insurance company. which of the following is true?

at least 1 member must be licensed insurance producer

circulating deception sales material to the public is what type of unfair trade practice

false advertising

what is the advantage of having a qualified annuity

favorable tax treatment

which of the following entities established the do not call registry

federal trade commission

the requirement that agent must account for all. insurance funds collected, and are not permitted to commingle those funds with their own is known as

fiduciary responsibility

a universal life insurance policy has 2 types of interest rates that are called

guaranteed and current

an individual is purchasing a permanent life insurance policy with face value of 25000. while the is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be available in the future. which of the following options should be included in this policy

guaranteed insurability option

an insurer devises an intimidation strategy in order to corner a large portion of the insurance market. which of the following best describes this practice?

illegal

which of the following is not true regarding a certificate of authority

it is issued to group insurance participants

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 not considered a misrepresentations it pertains to unfair trade practices

making comparisons between different policies

which of the following is not true regarding policy loans

money borrowed from the cash value is taxable

z falls from the roof of his house while fixing it and damages his spinal column enough to render him disabled for a year. his insurance policy carries a disability income benefit rider. which of the following benefits will z receive

monthly premium waiver and monthly income

under the fair credit reporting act, individuals rejects for insurance due to information contained in a consumer report

must be informed of the source of the report

which of the following individuals must have insurable interest in the insured

policyowner

the life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specific period of time is known as the

incontestability clause

an insurer receives a report regarding a potential insured that includes the insured's financial status, hobbies, and habits. what type of report is that

inspection report

producers and insurers actions related to insurance transactions, from selling insurance to processing claims are referred to as

insurance-related conduct

who makes up the medical information bureau

insurers

what is the benefit of choosing extended term as nonforfeiture option

it has the highest amount of insurance protection

what is the purpose of a conditional receipt

it is intended to provide coverage on a date earlier than the date of issuance of the policy

a universal life insurance policy is best described as

annually renewable term policy with cash value account

if an insurer cancels any agency contract, it must notify the commissioner in writing within how many days

15 days

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 year?

2 years

if an insured requires an application in order to reinstate a policy, and if the insured requests reinstatement in writing, an application must be delivered to the insured within

30 days

in NJ, the public is protest by a notice of discontinuance when a policy is discontinued for nonpayment of premium. when a policy is discontinued, all of the following are required except

refund of premiums

all of the following professional designations are recognized by the department as acceptable substitutes for education and examination requirements excpet

ChFC

when an insurance producer negotiates for an insurance contract on behalf of a client, the producer is acting as an

broker

forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as

coercion

which policy component decreases in decreasing term insurance

face amount

what describes the specific information about a policy

policy summary

insurance is regulated

mostly on state level

which of the following is not required information a producer must provide before soliciting insurance

producer contact information

which of the following describes the tax advantages of a qualified retired plan?

the earnings in the plan accumulate tax deferred

all of the following entities regulate variable life policies except

the guaranty association

who bears all of the investment risk in a fixed annuity

the insurance company

under an extended term nonforfeiture option, the policy cash value is converted to

the same face amount as in the whole life policy

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

their premiums are lower

if an insured requires an application in order to reinstate a policy, and if the insured requests statements in writing, an application must be delivered to the insured within

30 days

a certification of license status report can be run on any currently licensed NJ producer, but can only contain information on formal disciplinary actions taken within the past

4 years

in an adjustable life policy all of the following can be changed by the policy owner except

type of investment

an insurer wants to begin underwriting procedures for an applicant. what source will it consult for the majority of its underwriting information

application

if an insurer meets the state's financial requirements and is approved to transact business in the state, it is

authorized

a policy owner fair to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. this is due to what provision?

automatic premium loan

an insured receives an annual life insurance dividend check. what term best describes the arrangement

cash option

the life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specific period of time is known as

incontestability clause

which provision of life insurance policy states the insurer's duty to pay benefits upon the death of the insured, and to whom the benefits will be paid

insuring clause

a nonresident licensed producer decides to conduct business under an assumed name. Which of the following is true

nonresident producer may not conduct business under any name besides legal names

a life insurance policy insures again 5 different perils. if the policy owner wants to cancel the coverage of one of those perils, can he do that?

only if the policy specifics that a separate premium for that peril coverage is separately canceable

which of the following riders would not cause the death benefit to increase?

payor benefit rider

which of the following is correct concerning the taxation of premiums in a key-person life insurance policy

premiums are not tax deductible

which fo the following is correct concerning the taxation of premiums in a key-person life insurance policy

premiums are not tax deductible as a business expense

term illustration in life insurance policy refers to

presentation of non guaranteed elements of policy

an insured committed suicide 6 moths after his life insurance policy was issued. the insurer will

refund the premiums paid

what method do insurers use to protect themselves again catastrophic losses

reinsurance

the ownership provision entities the policy owner to do all of the following except

set premium rates

the policy owner of an adjustable life policy wants to increase the death benefit. which of the following statements is correct regarding this change

the death benefit can be increased by providing evidence of insurability

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 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