Examfx

A lucky individual won the state lottery, so the state will be sending him a check each month for the next 25 years. What type of annuity products are they likely to use to provide these benefits?

Immediate annuity

Which of the following is TRUE regarding the annuity period?

It may last for the lifetime of the annuitant.

The most the Insurance Guaranty Association will pay for net cash surrender values is

$100,000.

An insured was involved in an accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after 1 month, for how long would she be receiving benefits under an "own occupation" disability plan?

2 years

A producer has successfully completed 52 hours of CE. How many hours can the producer apply to her current reporting period, and how many hours can she carry forward to the next reporting period?

24 hours will be applied to the current reporting period, and 24 can be applied to the period immediately following. The excess 4 hours may not be carried over.

Regarding viatical settlements, the term terminally ill means a person who is expected to live for no longer than

24 months.

The minimum number of credits required for partially insured status for Social Security disability benefits is

6 credits

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within

90 days of a loss.

Which of the following statements is INCORRECT?

A licensee is barred from charging a fee in addition to a commission to a person for the sale, solicitation or negotiation of a contract of insurance for commercial business.

Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values and death benefits for specific policy years?

A policy summary

What is a material misrepresentation?

A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company

When the policy premium wasn't submitted with the application, what should the agent obtain from the insured upon policy delivery?

A statement of good health

An individual was just caught acting as an exclusive general agent - even though he is not properly licensed. Assuming that this occurred in a single day, what is the maximum penalty he faces?

A third degree misdemeanor and a $1,000 fine

Which of the following is the closest term to an authorized insurer?

Admitted

In which Medicare supplemental policies are the core benefits found?

All plans

Your client plans to retire at age 50. He would like to purchase an annuity that would provide income from the time he retires to the age when social security and other pension funds become available. What settlement option should he consider?

Annuity certain

Which of the following is NOT true regarding an annuity certain?

Benefits stop at the annuitant's death.

A producer's license must be renewed

Biennially

Which of the following statements concerning buy-sell agreements is true?

Buy-sell agreements are normally funded with a life insurance policy.

What limits the amount that a policyowner may borrow from a whole life insurance policy?

Cash value

An individual borrowed money at the bank to send his daughter to college. Instead of purchasing Credit Life insurance, he used an existing life insurance policy to secure the debt. This would be called a/an

Collateral Assignment.

Representations are written or oral statements made by the applicant that are

Considered true to the best of the applicant's knowledge.

Which of the following provisions must be included on the first page of a Medicare supplement policy, which states the insurer's right to change premium amounts?

Continuation provision

What happens when a policy is surrendered for its cash value?

Coverage ends and the policy cannot be reinstated.

Which of the following authorities monitors the financial strength of insurers?

Department of Insurance

Which of the following is true regarding taxation of dividends in participating policies?

Dividends are not taxable.

An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This indicates that his policy is written with a 30-day

Elimination period.

An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This would indicate that his policy was probably written with a 30-day

Elimination period.

The death benefit under the Universal Life Option B

Gradually increases each year by the amount that the cash value increases.

A Return of Premium term life policy is written as what type of term coverage?

Increasing

Which type of a hospital policy pays a fixed amount each day that the insured is in a hospital?

Indemnity

Which of the following does a producer NOT have the authority to do?

Issue policies

Which of the following best describes a misrepresentation?

Issuing sales material with exaggerated statements about policy benefits

How soon after the due date should the insurer pay the agent appointment fees?

Within 30 days

Life with period certain

annuity payments are guaranteed for the lifetime of the annuitant

Variable Life

fixed premiums and guaranteed minimum death benefit,cash valueis not guaranteed, must have fixed premiums and guaranteed death benefit

Universal life (flexible premium adjustable life)

has the flexibility to increase the amount of premium paid into the policy and then decrease it again. can even skip a premium

life with guaranteed minimum

if annuitant dies before principal has been paid out the remainder will be paid to beneficiary

Deferred annuity

income payments begin sometime after one year. The longer the annuity is deferred the more flexibility for payment premiums

Decreasing term

level premium with death benefit that decreases each year, not renewable.

Increasing term

level premium, death benefit that increases every year. handles inflation

A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this?

level term

Level term

most common-death benefit does not change throughout the policy

Pure life (straight life)

payment ceases at annuitants death. provides the highest monthly benefits. payments are guaranteed a lifetime, no guarantee that all proceeds will be paid out

Annually renewable term

purest form-death benefit remains level, guaranteed to be renewable but premium increases annually

Which of the following would help prevent a universal life policy from lapsing?

target premium

A father purchases a life insurance policy on his teenage daughter and adds the Payor Benefit rider. In which of the following scenarios will the rider waive the payment of premium?

If the father is disabled for more than 6 months

Which life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed period, during which, if the original recipient dies, the payments will continue to a designated beneficiary?

Life income with period certain

Which of the following best describes the unfair trade practice of defamation?

Making derogatory oral statements about another insurer's financial condition

Medicare Advantage is also known as

Medicare Part C.

In a long-term care policy, pre-existing condition limitations

Must appear as a separate paragraph and be clearly labeled.

Whole Life

Provides lifetime protection and includes a cash value.endow at the insureds age of 100. policies are higher

What type of care is Respite care?

Relief for a major care giver

Upon policy delivery, the producer may be required to obtain any of the following EXCEPT

Signed waiver of premium.

Regarding health insurance premiums, all of the following statements are true EXCEPT

Substandard risks are not insurable and are always rejected.

An insurance agent proposed an individual health insurance policy that is guaranteed renewable. If the applicant accepts this policy, the insurer agrees that

The company will continue to renew the policy until the insured has reached age 65.

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?

The customer's associates, friends, and neighbors provide the report's data.

Which of the following is NOT the consideration in a policy?

The application given to a prospective insured

Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean?

The beneficiary will only receive payments of the interest earned on the death benefit.

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 determines the cash value of a variable life policy?

The performance of the policy portfolio

Which provision states that the insurance company must pay Medical Expense claims immediately?

Time of Payment of Claims

Which of the following statements is NOT true concerning Medicaid?

It consists of 3 parts: Part A: hospitalization, Part B: doctor's services, Part C: disability income.

All of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT

It is a life contingency option.

Which of the following statements best describes the effect the Accelerated Benefit provision would have on the benefits paid to the beneficiary?

It will decrease the benefits paid to the beneficiary.