life test pt 4

What type of insurance would be used for a Return of Premium rider?

Increasing Term

If a licensee charges any fee separate from a commission off of the insured's premium, and if the fee exceeds 10% of the premium's value, what must the licensee obtain?

Insured's signature

During partial withdrawal from a universal life policy, which portion will be taxed?

Interest

Which of the following is NOT true regarding a Certificate of Authority?

It is issued to group insurance participants.

Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early?

Paid-up option

A new life insurance policy is derived from a policy that was recently terminated. Which of the following terms best describes this policy?

Replacement

Methods used to pay the death benefits to a beneficiary upon the insured's death are called

Settlement options.

Which of the following statements about a suicide clause in a life insurance policy is TRUE?

Suicide is excluded for a specific period of years and covered thereafter.

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

The interest earned on policy dividends is

Taxable.

All of the following entities regulate variable life policies EXCEPT

The Guaranty Association.

What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?

$2,500

What is the minimum number of study hours required of a candidate for a casualty producer's license?

20

In the state of Illinois, a viatical settlement contract must contain an unconditional right to cancel. How long does this right remain in effect?

30 days from the date the contract is executed

An individual has been diagnosed with Alzheimer's disease. He is insured under a life insurance policy with the accelerated benefits rider. Which of the following is true regarding taxation of the accelerated benefits?

A portion of the benefit up to a limit is tax free; the rest is taxable income.

In insurance, an offer is usually made when

An applicant submits an application to the insurer.

The equity in an equity index annuity is linked to

An index like Standard & Poor's 500.

An applicant for a fire insurance producer's license must successfully complete an approved prelicensing education course of at least

20 hours.

A legally acceptable attempt by an existing insurer to dissuade a current policyowner from the replacement of existing life insurance is called

Conservation.

In the Executive Bonus plan, who is the owner of the policy, and who pays the premium?

Executive is the owner, and the executive pays the premium.

Which of the following is an example of an unfair claims settlement practice?

Failure to promptly settle a claim when liability has been clearly established

The policyowner wants to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain age. Which settlement option should the policyowner choose?

Interest only option

Which of the following would provide an underwriter with information concerning an applicant's health history?

The Medical Information Bureau

What is the advantage of reinstating a policy instead of applying for a new one?

The original age is used for premium determination

Which of the following determines the cash value of a variable life policy?

The performance of the policy portfolio

Which of the following is correct regarding the Director's ability to revoke or suspend a producer's license?

The producer must be given the reason, in writing for the nonrenewal, suspension, or denial of a license, and has the right to request a hearing within 30 days.

Which of the following is NOT true regarding Equity Indexed Annuities?

They earn lower interest rates than fixed annuities.

What is the purpose of a disclosure statement in life insurance policies?

To explain features and benefits of a proposed policy to the consumer

Which of the following products requires a securities license?

Variable annuity