Wrong answers Life insurance 2

Which of the following determines the cash value of a variable life policy? a. the company's general account. b. the policy's guarantees. c. the premium mode d. the performance of the policy portfolio.

D

An insured committed suicide one year after his life insurance policy was issued. The insurer will. a. refund the premiums paid. b. pay the policy's cash value c. pay the full death benefit to the beneficiary. d. pay nothing.

A

Which of the following polices would have an IRS required corridor or gap between the cash value and death benefit? a. Universal Life - Option B b. Equity indexed Universal Life c. Variable Universal Life d. Universal Life Option A

D

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? a. interest only option. b. life income with period certain. c. joint and survivor. d. fixed amount option.

A

which of the following named beneficiaries would NOT be able to receive the death benefit directly from the insurer in the event of the insured's death? a. the former wife of the deceased insured. b. a minor son of the insured c. a business partner of the insured d. the wife of the deceased insured.

B

J applied for a life insurance policy on January 10. The policy was issued on January 31. J's agent was vacationing at the time the policy was issued, so J did not receive the policy until February 18. J decides that he does not want the policy. When would J need to return the policy to the insurer in order to receive a full refund of premium paid? a. the time varies from one policy to another. b. it was already too late when J received the policy because the 10 day free look period had expired. c. anytime, because the agent did not deliver the policy promptly. d. February 28th, or 10 days after the time the policy is delivered.

D

According to the entire contract provision, a policy must contain: a. a buyer's guide to life insurance. b. listing of the insured's former insurers for incontestability provisions. c. a copy of the original application for insurance. d. a declarations page with a summary of insureds.

C

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: A. juvenile protection provision. b. survivor protection. c. life planning d. survivorship insurance

B

Which of the following explains the policyowner's right to change beneficiaries, choose options, and receive proceeds of a policy? a. the consideration clause. b. assignment rights c. owner's rights. d. the entire contract provision.

C

Which of the following, when attached to a permanent life insurance policy, allow the policyowner to customize the policy to provide an additional amount of temporary insurance on the insured, or allows amounts of temporary insurance to cover other family members? a. guaranteed insurability rider. b. change of insured rider. c. term rider. d. accidental death and dismemberment rider.

C

Who is a third-pary owner? a. an insurer who issues a policy for two people. b. it will increase each year during the next 5 years as the face amount increases each year. c. it will increase because the insured will be 5 years older than when the policy was originally purchased. d. it will remain the same for the new 5-year term.

C

Which of the following will be included in a policy summary? a. premium amounts and surrender values. b. copies of illustrations and application. c. comparisons with similar policies. d. primary and secondary beneficiary designations.

A

Employer contributions made to a qualified plan: a. are taxed annually as salary b. are subject to vesting requirements. c. may discriminate in favor of highly paid employees. d. are after-tax contributions.

B

Which of the following is the required number of participants in a contributory group plan? a. 50% b. 75% c. 100% d. 25%

B

a policyowner who is also the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all the rights of ownership. The policy owner should have her husband namedee as the: a. primary beneficiary b. irrevocable beneficiary c. revocable beneficiary d. secondary beneficiary

C

Which of the following information will be stated in the consideration clause of a life insurance policy? a. the conditions of insurability. b. the amount of premium payment. c. the parties to the contract. d. the time period allowed for the payment of premium.

B

In informing an insurance contract, when does acceptance usually occur? a. when an insurer's underwriter approves coverage. b . when an insurer delivers the policy. c. when an insurer receives an application. d. when an insured submits an application.

A

`All of the following would be different between qualified and nonqualified retirement plans EXCEPT: a. IRS approval requirements. b. taxation on accumulation. c. taxation of withdrawals. d. taxation of contributions.

B

An IRA purchased by a small employer to cover employees is known as a: a. defined contribution plan. b. 403 (b) plan c. simplified employee pension plan. d. 401k plan.

C

When would a 20-pay whole life policy endow. a. after 20 payments b. in 20 years c. when the insured reaches age 100. d. at the insured's age 65.

C

Which of the following statements is TRUE concerning the Accidental Death Rider? a. this rider only available to insureds over the age of 65. b. it is only available in group insurance. c. it will pay double or triple the face amount. d. it is also known as a triple indemnity rider.

C

when is the earliest a policy may go into effect? a. when the insurer approves the application. b. after the underwriter reviews the policy. c. when the application is signed and a check is given to the agent. d. when the first premium is paid and the policy has been delivered.

C

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: a. defend the report if the agency feels it is accurate. b. change the report c. send an actual certified copy of the entire report to the consumer. d. Respond to the consumer's complaint.

D

Which policy component decreases in decreasing term insurance? a. cash value b. dividend c. premium d. face amount

D

If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE? a. the insurer may deny coverage later, because of the information missing on the application. b. the policy will be interpreted as if the insurer waived its right to have an answer on the application. c. the policy will be interpreted as if the insured did not have an answer to the question. d. the policy will be void.

B

Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean? a. the primary beneficiary will receive the death benefit and the secondary beneficiaries will share the interest payments. b. the beneficiary will only receive payments of the interest earned on the death benefit. c. the beneficiary will only receive payments of the interest earned on the death benefit. d. the beneficiary will only receive the lump sum, plus interest.

B

An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy? a. 20,000 b. 25,000 c. 50,000 d. the face amount will be determined by the insurer.

C

Methods used to pay the death benefits to a beneficiary upon the insured's death are called: a. beneficiary provisions b. death benefit options c. settlement options d. designation options

C

If the owner of a whole life policy who is also the insured dies at age 80, and there are no outstanding loans on the policy, what portion of the death benefit will be paid to the beneficiary? a. a death benefit equal to the cash value of the policy. b. 50% of the total death benefit. c. the face amount minus the premiums that would have been collected until the insured reached the age of 100. d. a full death benefit.

D