Primerica

An insured purchased a 15-year level term life insurance policy with a face amount of $100,000. The policy contained an accidental death rider, offering a double indemnity benefit. The insured was severely injured in an auto accident, and after 10 weeks of hospitalization, died from the injuries. What amount would his beneficiary receive as a settlement?

$200,000

A Straight Life policy has what type of premium?

A level annual premium for the life of the insured

Who is a third-party owner?

A policyowner who is not the insured

What characteristic makes whole life permanent protection?

Coverage until death or age 100

An agent selling variable annuities must be registered with

FINRA

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

What would be an advantage to naming a contingent (or secondary) beneficiary in a life insurance policy?

It determines who receives policy benefits if the primary beneficiary is deceased.

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

It has the highest amount of insurance protection

Which of the following is TRUE regarding the accumulation period of an annuity?

It is a period during which the payments into the annuity grow tax deferred.

Which of the following is true of a children's rider added to an insured's permanent life insurance policy?

It is term coverage that is convertible to permanent insurance at or prior to the child reaching the maximum coverage age.

Which of the following policies would be classified as a traditional level premium contract?

Straight life

Which of the following would qualify as a competent party in an insurance contract

The applicant has a prior felony conviction

An applicant signs an application for a $25,000 life insurance policy, pays the initial premium, and receives a conditional receipt. If the applicant dies the following day, which of the following is TRUE?

The beneficiary will receive the full death benefit if it is determined that the applicant qualified for the policy.

Which of the following is INCORRECT concerning a noncontributory group plan

The employees receive individual policies

An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT?

The insured may choose to convert to term or permanent individual coverage

Which of the following best describes what the annuity period is?

The period of time during which accumulated money is converted into income payments

Which of the following best defines the "owner" as it pertains to life settlement contracts?

The policy owner of the life insurance policy

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 is TRUE for both equity indexed annuities and fixed annuities?

They have a guaranteed minimum interest rate.

What is the main purpose of the Seven-pay Test?

To determine if a life insurance policy is a Modified Endowment Contract

Why should the producer personally deliver the policy when the first premium has already been paid?

To help the insured understand all aspects of the contract

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

annually renewable term

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

The proposed insured makes the premium payment on a new insurance policy. If the insured should die, the insurer will pay the death benefit to the beneficiary if the policy is approved. This is an example of what kind of contract?

conditional

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

Which of the following terms is used to name the nontaxed return of unused premiums?

dividend

All advertisements are the responsibility of the

insurer

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

Children's riders attached to whole life policies are usually issued as what type of insurance?

term

In insurance, an offer is usually made when

the application is submitted

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.

An absolute assignment is a

transfer of all ownership rights in a policy

If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?

unilateral

In insurance policies, the insured is not legally bound to any particular action in the insurance contract, but the insurer is legally obligated to pay losses covered by the policy. What contract element does this describe?

unilateral

Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?

Joint Life

Which of the following settlement options in life insurance is known as straight life?

Life income

Which of the following statements concerning a Simplified Employee Pension plan (SEP) is INCORRECT?

SEPs are suitable for large companies

Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member?

Family term rider

A life insurance policy has a legal purpose if both of which of the following elements exist?

Insurable interest and consent. To ensure legal purpose of a life insurance policy, it must have both insurable interest and consent.