Exam 1 stimulator
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?
Aleatory
A life insurance policy's grace period entitles the insured in a period of no less than ____ days to make the premium payment
30
An insurer may normally delay the payment of a cash value loan or surrender value for up to?
6 months
If an agent combines premiums collected with their personal funds, they have engaged in
Commingling (This is a prohibited act, to combine premiums and personal funds.)
K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?
Conditional
T purchased a 100,000 single premium, straight life annuity 5 years ago. He has received monthly payments since inception of annuity. if t dies the insurance company
Does not have to make any further payments
"A producer does not have the authority to change a policy or waive any of its provisions". The health provision that best describes this statement is called the
Entire Contract
Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?
Entire Contract
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called
Fraternal life insurance organizations
How are policyowner dividends treated in regards to income tax?
Interest on accumulations is taxed
All of these Settlement options involve the systematic liquidation of the death proceeds in the event of the insured's death EXCEPT
Interest only
Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following contractual elements?
Legal Purpose (Insurable Interest)
Which factors are taken into consideration when an insurance company determines the premium rate for a Whole Life policy on an applicant?
Risk classification
Which of the following provisions is not required in HMO contracts/certificates?
Seven-day grace period
S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation?
Single Premium
Which of the following costs would a Basic Hospital/Surgical policy likely cover?
Surgically removing a facial birthmark
In an insurance contract. the insurer is the only party legally obligated to perform, Because of this the insurance contract is considered
Unilateral
The cash value in a(n) _________ Life policy may fluctuate to reflect changing assumptions regarding mortality, cost, interest, and expense factors.
Universal
T cash surrenders a recently-issued whole life policy. He also requests that the proceeds be payable to an unrelated third party. T would likely be red-flagged for violation of
anti-money laundering rules
Insurance contracts are known as ____ because certain future conditions or acts must occur before any claims can be paid.
conditional
the __ is authorized to assign a life insurance policy as collateral for a loan
policyowner
the department of financial services serves as the receiver of any insurer placed into 1. bankruptcy 2. Foreclosure 3. Receivership 4. Indebtedness
receivership
The reason for backdating a policy is
to obtain a premium rate based on an earlier age
A policy of adhesion can only be modified by whom?
✓ The insurance company
Which of the following policy features allows an insured to defer current health charges to the following year's deductible instead of the current year's deducitble?
Carryover provision