Beneficiaries & Settlement Options Review
If a primary beneficiary dies before the insured, the benefits are paid to the estate of the insured even if there is a contingent beneficiary true or false
false
An irrevocable beneficiary can borrow from the cash value t or f
false
When the beneficiary is revocable the beneficiary must give their consent before the beneficiary can be changed true or false
false
If there is no living beneficiary then the proceeds are paid to the estate of the beneficiary named true or false
false (would go to the estate of the insured)
The common disaster or uniform simultaneous death act sets up a sequence of payment to keep the proceeds from going to the primary beneficiary estate, protecting the rights of the contingent beneficiary when it cannot be determined who died first t or f
true
The contingent beneficiary receives the death proceeds if the primary beneficiary is deceased at the time of the insureds death t or f
true
The election of settlement may be made by the beneficiary if no settlement option is in force at the time of death of the insured t or f
true
The policyowner may change the settlement option after it has been chosen t or f
true
Without the spendthrift clause, creditors could attach the policy proceeds t or f
true
What are the two types of beneficiaries?
revocable, irrevocable
If a policyowner selects a settlement option, the beneficiary cannot change it t or f
t
A settlement option election is made by the policy owner at the time the app is submitted t or f
true
An irrevocable beneficiary has a vested right that neither the policyowner nor his creditors can impair without the beneficiaries consent t or f
true
If an insured wanted his children to share equally upon his death you would recommend the beneficiary designation class per capita
true
If the insured named their son/daughter as irrevocable ben they would need to get their permission to borrow form their own policy t or f
true
If there is no surviving beneficiary, the death benefit is paid to the insureds estate true or false
true
More than one contingent beneficiary may be name t or f
true
a contingent beneficiary receives remaining payments made under a settlement agreement upon the primary beneficiaries death t or f
true
Do the insureds creditors have any right to the death benefit that is paid to the beneficiary after insured's death? yes or no
No... at time of death contract is no longer between insured & insurer and is now between beneficiary & insurer
There are how many types of beneficiaries? a. 1 b.2 c.3 d. 5
b. 2
If the policyowner did not want to specify one or more of the beneficiaries by name they could use which designation a. per capita b. Class c. irrevocable beneficiary d. per stirpes
b. Class
If no other mode of payment is selected how do life insurance proceeds settle? a. gift card b. lump sum cash c. reinvested d. surrendered
b. lump sum cash
Class designation which means that beneficiaries will receive equal shares divided among the surviving members of a class is a. class b. per capita c. per stirpes d. contingent
b. per capita
If the insured wanted the heirs of the named beneficiaries to be able to collect their portion in the event they were already deceased at the time of the insureds death, what designation? a. per capita b. per stirpes c. irrevocable d. contingent
b. per stirpes
Facility of payment clause could be found in the industrial policies. This allows the insurer to pay proceeds to whomever they deem entitled under certain circumstances. Give 2 examples where this might happen
beneficiary deceased or unlocatable
Settlement option that allows only the death benefit earnings to be paid is a. cash value b. extended term c. interest/principal d. nonforfeiture
c. interest/principal
Which type of beneficiary has a vested interest in the death benefit and cash value? a. revocable beneficiary b. per capita c. irrevocable beneficiary d. none do
c. irrevocable
What settlement option is guaranteed for the life of the recipient, no guaranteed min payout? a. per capita b. per stirpes c. extended d. life income
d
who may never select a settlement option? a. policy owner b. applicant c. beneficiary d. insurer
d
Settlement option that pays a specified amount until proceeds are exhausted a. per capita b. interest c. life income d. fixed amount
d.
Settlement option that the principal never decreases unless the recipient makes withdrawals from it is? a. per capita b. cash c. per stirpes d. interest
d.
Who may select a settlement option and may change it if no proceeds have been paid? a. insurer b. beneficiary c. contingent d. policyowner
d.
Under what two circumstances do the settlement options normally come into play? a. death or endowment b. accidental death c. change of beneficiary d. all apply
a. death or endowment
Individuals designated as beneficiaries means that each beneficiary must be ----- a. named b. initialed by beneficiary c. on the policy d. all of the above
a. named
A beneficiary wants to receive $2k per month until the principal and interest are exhausted is which settlement option? a. decreasing term b. reduced term c. per capita d. fixed amount
d. fixed amount
Who has the right to change life insurance policy beneficiaries? a. insured b. insurer c. beneficiary d. policyowner
d. policyowner
A revocable beneficiary can become the policy owner at any time by paying the premiums t or f
false
An irrevocable beneficiary may be changed by the policy owner without the beneficiary's consent true or false
false
Per stirpes is used when you want proceeds to be shared in equal shares of the survivors t or f
false
Purpose of naming a contingent beneficiary is to allow creditors to receive policy proceeds t or f
false
The primary and secondary beneficiary share proceeds equally true or false
false ... primary gets proceeds
When no settlement option is chosen, proceeds are automatically paid to the policy owners estate. t or f
false... lump sum
Primary, contingent, and tertiary are types of beneficiaries true or false
false... thats succession of beneficiaries