Exam Review quest part 2

An individual participant personally received eligible rollover funds from a profit-sharing plan. What is the income tax withholding requirements for this transaction?

'20% is withheld for income taxes'

The Automatic Provision Loan is designed to

'Avoid a policy lapse' The purpose of the automatic premium loan is to keep the policy from lapsing.

If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?

'Insured's contingent beneficiary'

In a Major Medical Expense Policies, what is the objective of a Stop Loss Provision

'Limits an insured's Out - of - pocket medical expenses'

Which type of plan normally includes hospice benefits?

'Managed Care plans'

Under a Graded Premium policy, the premiums

'are lower during the policy's early years'

Stranger-Owned Life Insurance (STOLI) is when a person purchases life insurance only to sell to a(n):

'third - party with no insurable interest'

In Georgia, monthly - premium accident and sickness insurance policies must provide a grace period of at least

10 DAYS

a non- contributory plan requires ___ participation of all eligible employees

100%

Insurers may request a hearing within ______ days if their policy is rejected.

20 days

The USA Patriot Act enacted in year?

2001 NOT 2004. 2001

In Geogia, an accident and sickness policy that is paid on a quarterly basis requires a grace period of

31 days

The individual most likely to buy a Medicare Supplement policy would be

68 year old male covered by Medicare

P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?

An Immediate Annuity

What action can a policyowner take if an application for a bank loan requires collateral?

Assign

T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums. How are the $3,000 benefit payments taxable?

Benefits are taxable to T

An insurance agent is in violation of the Rules Governing Advertisement of Life Insurance and Annuities if the agent takes which of the following actions during a sales presentation.

DIVIDENS CANNOT BE ADVERTIZED AS A GURANENTEE

The combination of Whole Life and ___ Term insurance is referred to as a Family Income Policy

Decreasing

Which type of renewability best describes a Disability Income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class?

Guaranteed Renewable. The renewable provision in a guaranteed renewable policy specifies that the policy must be renewed (as long as premiums are paid) until the insured reaches a specific age. They usually have increasing premiums.

Which of these statements is INCORRECT regarding a Preferred Provider Organization PPO

PPO's are NOT a type of managed care systems

Which of these statements concerning an Individual Straight Life annuity is accurate

Payments are made to an annuity for life

Which of the following is NOT required to be included in the Whole Life Policy

Policies guaranteed dividend table'

Which of these do NOT constitute policy delivery?

Policy issued with a rating

An immediate annuity consists of a

SINGLE premium NOT deferred

T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?

The mother receives $0 because T is still alive and the sole primary beneficiary,

The best way to describe the elimination period is

Time deductible

In an insurance contract, the insurer is the only party who makes a legally enforceable promise. What kind of contract is this?

Unilateral

R becomes disabled and owns an individual Disability Income policy. When is R eligible to receive disability benefits?

Upon satisfying the elimination period requirement'

At what point does an informal agreement become a binding contract?

When consideration is provided by one of the parties to the contract.'

How long does the coverage normally remain on a limited - pay life policy

age 100

When does a Probationary Period provision become effective in a health insurance contract?

at the policy's inception

Consideration Clause

consideration clause, a health insurance contract is valid only if the insurer provides consideration in the form of the FULL MINIMUM PREMIUM and the statements made in the application

Medical Expenditures

is COMMERCIAL Insurer

Which of the following BEST describes a Short - term medical expense policy

nonrenewable

The payment of claims provision in a health insurance policy states to whom the claims will be paid

payments of claims

What is the purpose of the life and health insurance guaranty Association

protects policyowners against insolvent insurance companies,

A company that owns a life insurance policy on one of its key employees may do all of the following EXCEPT

the correct answer is "Change the policy's interest rate.' The company may do all of these things with a Key Person Ins, policy EXCEPT 'change the policy interest rate.'

Who is normally considered to be the owner of a 403(b) tax-sheltered annuity?

the employee' the employee normally applies for and own it

Term Life Policies that have the ability to be converted to permanent coverage may do so during a specific time period. This conversion period

varies according to the contract' the conversion period varies according to the contract