FFL STATE EXAM (FL)

WHICH STATEMENT IS TRUE REGARDING A VARIABLE WHOLE LIFE POLICY?

A MINIMUM GUARANTEED DEATH BENEFIT IS PROVIDED

WHICH OF THE FOLLOWING LIFE INSURANCE POLICIES COMBINE TERM INSURANCE WITH AN INVESTMENT ELEMENT?

A UNIVERSAL LIFE

Q PURCHASES A 500,000 LIFE INSURANCE POLICY AND PAYS 900 IN PREMIUMS OVER THE FIRST 6 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

DIVIDENDS PAYABLE TO A POLICY OWNER ARE?

DECLARED BY THE INSURANCE COMPANY

AN ? TERM LIFE POLICY IS NORMALLY USED WHEN COVERING AN INSUREDS MORTGAGE BALANCE?

DECREASING

WHICH OF THESE STATEMENTS DESCRIBE A MODIFIED ENDOWMENT CONTRACT?

EXCEEDS THE MAXIMUM AMOUNT OF PREMIUM THAT CAN BE PAID INTO POLICY AND STILL HAVE IT RECOGNIZED AS A LIFE INSURANCE CONTRACT

A UNIVERSAL LIFE POLICY IS SOMETIMES REFERRED TO AS AN UNBUNDLED LIFE POLICY BECAUSE THE OWNER CAN SEE THE INTEREST EARNED COST OF INSURANCE AND THE?

EXPENSE CHARGES

TERM INSURANCE HAS WHICH OF THE FOLLOWING CHARACTERISTICS?

EXPIRES AT THE END OF THE POLICY PERIOD

T HAS A TERM POLICY THAT ALLOWS HIM TO CONTINUE THE COVERAGE AFTER EXPIRATION OF THE INITIAL POLICY PERIOD. WHAT TYPE OF TERM COVERAGE IS THIS?

RENEWABLE

A GROUP OWNED INSURANCE COMPANY THAT IS FORMED TO ASSUME AND SPREAD THE LIABILITY RISKS OF ITS MEMBERS IS KNOWN AS A?

RISK RETENTION GROUP

K IS SHOPPING FOR A PERMANENT LIFE INSURANCE POLICY THAT WILL OFFER HER THE MOST PROTECTION PER DOLLAR OF ANNUAL PREMIUM. WHICH OF THESE POLICIES BEST FITS HER NEEDS?

STRAIGHT LIFE

T WOULD LIKE TOBBE ASSURED 10000 IS AVAILABLE IN 10 YEARS TO REPLACE A ROOF ON HIS HOUSE. WHAT KIND OF 10000 POLICY SHOULD T PURCHASE?

TEN YEAR ENDOWMENT

AT WHAT POINT DOES A WHOLE LIFE INSURANCE POLICY ENDOW?

WHEN THE CASH VALUE EQUALS THE DEATH BENEFIT

WHAT KIND OF LIFE POLICY EITHER PAYS THE FACE VALUE UPON THE DEATH OF THE INSURED OR WHEN THE INSURED REACHES AGE 100?

WHOLE LIFE

WHAT TYPE OF INSURANCE OFFERS PERMANENT LIFE COVERAGE WITH PREMIUMS THAT ARE PAYABLE FOR LIFE?

WHOLE LIFE

A POLICY THAT BECOMES A MODIFIED ENDOWMENT CONTRACT (MEC)?

WILL LOSE MANY OF ITS TAX ADVANTAGES

IF A 10 YEAR TERM LIFE POLICY CONTAINS A RENEWABILITY PROVISION THE POLICY WILL RENEW?

WITHOUT EVIDENCE OF INSURABILITY

A NONPROFIT INCORPORATED SOCIETY THAT DOES NOT HAVE CAPITAL STOCK AND OPERATES FOR THE SOLE BENEFIT OF ITS MEMBERS IS KNOWN AS?

fraternal benefit society

VARIABLE LIFE PRODUCTS REQUIRE A PRODUCER TO

HOLD A LIFE INSURANCE LICENSE AND A SECURITIES LICENSE

WHICH OF THE FOLLOWING ACTIONS REQUIRE A POLICY OWNER TO PROVIDE PROOF OF INSURABILITY IN AN ADJUSTABLE LIFE POLICY?

INCREASE FACE AMOUNT

WHO MAKES THE LEGALLY ENFORCEABLE PROMISES IN A UNILATERAL INSURANCE POLICY?

INSURANCE COMPANY

IF A CONTRACT OF ADHESION CONTAINS COMPLICATED LANGUAGE TO WHOM WOULD THE INTERPRETATION BE IN FAVOR OF?

INSURED

CREDIT LIFE INSURANCE IS?

ISSUED IN AN AMOUNT NOT TO EXCEED THE AMOUNT OF THE LOAN

LIFE INSURANCE THAT COVERS AN INSUREDS WHOLE LIFE WITH LEVEL PREMIUMS PAID OVER A LIMITED TIME IS CALLED?

LIMITED PAY LIFE

WHICH TYPE OF POLICY IS CONSIDERED TO BE OVERFUNDED AS STATED BY IRS GUIDELINES?

MODIFIED ENDOWMENT CONTRACT

WHEN A LIFE INSURANCE POLICY EXCEEDS CERTAIN IRS TABLE VALUES THE RESULT WOULD CREATE WHICH OF THE FOLLOWING?

MODIFIED ENDOWMENT CONTRACT (MEC)

WHICH OF THESE LIFE PRODUCTS IS NOT CONSIDERED INTEREST SENSITIVE?

MODIFIED WHOLE LIFE

A FATHER WHO DIES WITHIN 3 YEARS AFTER PURCHASING A LIFE INSURANCE POLICY ON HIS INFANT DAUGHTER CAN HAVE THE POLICY PREMIUMS WAIVED UNDER WHICH PROVISION?

PAYOR PROVISION

WHICH OF THESE DESCRIBE A PARTICIPATING INSURANCE POLICY?

POLICY OWNERS ARE ENTITLED TO RECEIVE DIVIDENDS

WHICH STATEMENT IS CORRECT REGARDING THE PREMIUM PAYMENT SCHEDULE FOR WHOLE LIFE POLICIES?

PREMIUMS ARE PAYABLE THROUGHOUT THE INSUREDS LIFETIME/ COVERAGE LASTS UNTIL DEATH OF THE INSURED

WHAT IS CONSIDERATION GIVEN BY AN INSURER IN THE CONSIDERATION CLAUSE OF A LIFE POLICY?

PROMISE TO PAY A DEATH BENEFIT TO A NAMED BENEFICIARY

WHO ELECTS THE GOVERNING BODY OF A MUTUAL INSURANCE COMPANY?

Policyholders

WHAT TYPE OF LIFE INSURANCE ARE CREDIT POLICIES ISSUED AS?

TERM

Q IS LOOKING TO BUY A LIFE INSURANCE POLICY THAT WILL PROVIDE THE GREATEST AMOUNT OF PROTECTION FOR A TEMPORARY TIME PERIOD. WHICH OF THESE POLICIES SHOULD Q PURCHASE?

TERM LIFE

WHAT TYPE OF LIFE INSURANCE GIVES THE GREATEST AMOUNT OF COVERAGE FOR A LIMITED PERIOD OF TIME?

TERM LIFE

THE INVESTMENT GAINS FROM A UNIVERSAL LIFE POLICY USUALLY GO TOWARD?

THE CASH VALUE

A POLICY OF ADHESION CAN ONLY BE MODIFIED BY WHOM?

THE INSURANCE COMPANY

THE AMOUNT OF COVERAGE ON A GROUP CREDIT LIFE POLICY IS LIMITED TO?

THE INSUREDS TOTAL LOAN VALUE

UNDER A GRADED PREMIUM WHOLE LIFE POLICY?

THE PREMIUM INCREASES EACH YEAR DURING THE EARLY YEARS OF THE CONTRACT AND REMAINS THE SAME AFTER THAT TIME

ALL OF THESE STATEMENTS ABOUT EQUITY INDEXED LIFE INSURANCE ARE CORRECT EXCEPT?

THE PREMIUMS CAN BE LOWERED OR RAISED BASED ON INVESTMENT PERFORMANCE

UNDER A RENEWABLE TERM POLICY

THE RENEWABLE PREMIUM IS CALCULATED ON THE BASIS OF THE INSUREDS ATTAINED AGE

THE CONSIDERATION CLAUSE OF AN INSURANCE CONTRACT INCLUDES?

THE SCHEDULE AND AMOUNT OF PREMIUM PAYMENTS

K PURCHASED A LIFE INSURANCE POLICY IN 1986 WHICH PAID 10% INTEREST IN THE EARLY YEARS OF THE POLICY. TWENTY YEARS AFTER THE PURCHASE SHE RECEIVED A NOTICE FROM THE INSURER STATING THAT THE POLICY WILL SOON TERMINATE UNLESS A MUCH HIGHER PREMIUM IS PAID BECAUSE OF FALLING INTEREST RATES. THIS TYPE OF POLICY IS KNOWN AS A? LIFE POLICY?

UNIVERSAL

S AGE 40 IS LOOKING TO BUY A LIFE INSURANCE POLICY THAT WILL ALLOW FOR INCREASES OR DECREASES IN COVERAGE AS HIS NEEDS CHANGE. THE POLICY BEST SUITED FOR S WOULD BE?

UNIVERSAL LIFE

WHAT TYPE OF LIFE INSURANCE INCORPORATES FLEXIBLE PREMIUMS AND AN ADJUSTABLE DEATH BENEFIT?

UNIVERSAL LIFE

AT WHAT POINT MUST A LIFE INSURANCE APPLICANT BE INFORMED OF THEIR RIGHTS THAT FALL UNDER THE FAIR CREDIT REPORTING ACT?

UPON COMPLETION OF THE APPLICATION

WHEN IS THE FACE AMOUNT PAID UNDER A JOINT LIFE AND SURVIVOR POLICY?

UPON DEATH OF THE LAST INSURED

A TERM LIFE INSURANCE POLICY MATURES

UPON THE INSUREDS DEATH DURING THE TERM OF THE POLICY

A ? LIFE POLICY COMBINES INVESTMENT CHOICES WITH A FORM OF TERM COVERAGE?

VARIABLE UNIVERSAL

WHICH OF THE FOLLOWING POLICIES IS CHARACTERIZED BY A FLEXIBLE PREMIUM AND DEATH BENEFIT AND ALLOWS THE POLICY OWNER OF THE INVESTMENT ASPECT OF THE PLAN?

VARIABLE UNIVERSAL LIFE

A LIFE POLICY THAT CONTAINS A MONTHLY MORTALITY CHARGE AS WELL AS SELF DIRECTED INVESTMENT CHOICES IS CALLED AN?

VARIABLE UNIVERSAL LIFE POLICY

S OWNS A LIFE INSURANCE POLICY WITH CASH VALUES THAT FLUCTUATE ACCORDING TO THE UNDERLYING INVESTMENT PERFORMANCE OF COMMON STOCKS. WHICH OF THESE POLICIES DOES S OWN?

VARIABLE WHOLE LIFE

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

WHICH OF THESE REQUIRE AN OFFER ACCEPTANCE AND CONSIDERATION?

- CONTRACT

VARIABLE WHOLE LIFE INSURANCE CAN BE DESCRIBED AS?

BOTH AN INSURANCE AND SECURITIES PRODUCT

ALL OF THESE ARE CHARACTERISTICS OF AN ADJUSTABLE LIFE POLICY EXCEPT?

FACE AMOUNT CAN BE ADJUSTED USING POLICY DIVIDENDS

WHAT DOES A FACE AMOUNT PLUS CASH VALUE POLICY PAY UPON THE INSUREDS DEATH?

FACE AMOUNT PLUS THE POLICYS CASH VALUE

WHAT KIND OF PREMIUM DOES A WHOLE LIFE POLICY HAVE?

LEVEL

WHICH OF THESE WOULD BE CONSIDERED A LIMITED PAY LIFE POLICY?

LIFE PAID UP AT AGE 70

WHICH OF THESE IS NOT CONSIDERED TO BE AN ELEMENT OF AN INSURANCE CONTRACT?

NEGOTIATING

WHOLE LIFE INSURANCE POLICIES ARE CONTRACTUALLY GUARANTEED TO PROVIDE EACH OF THE FOLLOWING EXCEPT?

PARTIAL WITHDRAWING FEATURES BEYOND A SURRENDER CHARGE PERIOD

WHEN A POLICY PAYS DIVIDENDS TO ITS POLICY HOLDERS IT IS SAID TO BE?

PARTICIPATING

A LIMITED PAY LIFE POLICY HAS

PREMIUM PAYMENTS LIMITED TO A SPECIFIED NUMBER OF YEARS

IN AN INSURANCE CONTRACT THE INSURER IS THE ONLY PARTY WHO MAKES A LEGALLY ENFORCEABLE PROMISE. WHAT KIND OF CONTRACT IS THIS?

UNILATERAL

LIFE AND HEALTH INSURANCE POLICIES ARE?

UNILATERAL CONTRACTS

THE CASH VALUE IN AN ? LIFE POLICY MAY FLUCTUATE TO REFLECT CHANGING ASSUMPTIONS REGARDING MORTALITY COST INTEREST AND EXPENSE FACTORS.

UNIVERSAL

IN ORDER TO SELL A ? LIFE POLICY A PRODUCER IS REQUIRED TO REGISTER WITH THE FINANCIAL INDUSTRY REGULATORY AUTHORITY ( FINRA)?

VARIABLE

A LIFE POLICY WITH A DEATH BENEFIT AND CASH VALUE THAT CAN FLUCTUATE ACCORDING TO THE PERFORMANCE OF ITS UNDERLYING INVESTMENT PORTFOLIO IS REFERRED TO AS?

VARIABLE LIFE

WHICH POLICY REQUIRES AN AGENT TO REGISTER WITH THE NATIONAL ASSOCIATION OF SECURITIES DEALERS (NASD) BEFORE SELLING?

VARIABLE LIFE

THE STATED AMOUNT OR PERCENT OF LIQUID ASSETS THAT AN INSURER MUST HAVE ON HAND THAT WILL SATISFY FUTURE OBLIGATIONS TO ITS POLICY HOLDERS IS CALLED?

reserves

IN REGARDS TO REPRESENTATIONS OR WARRANTIES, WHICH OF THESE STATEMENTS IS TRUE?

- IF MATERIAL TO THE RISK, FALSE REPRESENTATIONS WILL VOID A POLICY

WHEN MUST INSURABLE INTEREST EXIST FOR A LIFE INSURANCE CONTRACT TO BE VALID?

- INCEPTION OF THE CONTRACT

WHEN THIRD PARTY OWNERSHIP IS INVOLVED, APPLICANTS WHO ALSO HAPPEN TO BE THE STATED PRIMARY BENEFICIARY ARE REQUIRED TO HAVE?

- INSURABLE INTEREST IN THE PROPOSED INSURED

WHICH OF THE FOLLOWING TYPES OF TERM LIFE POLICIES MOST LIKELY CONTAINS A RENEWABILITY FEATURE?

10 YEAR CONVERTIBLE TERM

G PURCHASED A FAMILY INCOME POLICY AT AGE 40. THE POLICY HAS A 20 YEAR RIDER PERIOD. IF G WERE TO DIE AT AGE 50, HOW LONG WOULD G's FAMILY RECEIVE AN INCOME?

10 YEARS

A 15 YEAR MORTGAGE IS BEST PROTECTED BY WHAT KIND OF LIFE POLICY?

15 YEAR DECREASING TERM

WHAT YEAR WAS THE McCARRAN-FERGUSON ACT?

1945

A POTENTIAL CLIENT AGE 40 WOULD LIKE TO PURCHASE A WHOLE LIFE POLICY THAT WILL ACCUMULATE CASH VALUE AT A FASTER RATE IN THE EARLY YEARS OF THE POLICY. WHICH OF THESE STATEMENTS MADE BY THE PRODUCER WOULD BE CORRECT?

20 PAY LIFE ACCUMULATES CASH VALUE FASTER THAN STRAIGHT LIFE

K PAYS ON A $20000 20 YEAR ENDOWMENT POLICY FOR 10 YEARS AND DIES FROM AN AUTOMOBILE ACCIDENT. HOW MUCH WILL THE INSUREDS COMPANY PAY THE BENEFICIARY?

20000 DEATH BENEFIT

ALL OF THE FOLLOWING ARE CONSIDERED TO BE TYPICAL CHARACTERISTICS DESCRIBING THE NATURE OF AN INSURANCE CONTRACT, EXCEPT?

BILATERAL

UNDER AN INTEREST SENSITIVE WHOLESALE LIFE POLICY?

CASH VALUES ARE DETERMINED BY INTEREST RATES

A COMPANY THAT OWNS A LIFE INSURANCE POLICY ON ONE OF ITS KEY EMPLOYEES MAY DO ALL OF THE FOLLOWING EXCEPT?

CHANGE THE POLICY INTEREST RATE

INSURANCE CONTRACTS ARE KNOWN AS ? BECAUSE CERTAIN FUTURE CONDITIONS OR ACTS MUST OCCUR BEFORE ANY CLAIMS CAN BE PAID?

CONDITIONAL

WHICH PROVISION ALLOWS THE POLICY OWNER TO CHANGE A TERM LIFE POLICY TO A PERMANENT ONE WITHOUT PROVIDING PROOF OF GOOD HEALTH?

CONVERSION

WHEN A POLICY OWNER EXCHANGES A TERM POLICY FOR A WHOLE LIFE POLICY WITHOUT PROVIDING PROOF OF GOOD HEALTH, WHICH OF THESE APPLY?

CONVERSION PROVISION

WHAT KIND OF LIFE INSURANCE STARTS OUT AS TEMPORARY COVERAGE BUT CAN BE LATER MODIFIED TO PERMANENT COVERAGE WITHOUT EVIDENCE OF INSURABILITY?

CONVERTIBLE TERM

THE COMBINATION OF WHOLE LIFE AND ? TERM INSURANCE IS REFERRED TO AS A FAMILY INCOME POLICY?

DECREASING

CREDIT LIFE INSURANCE IS TYPICALLY ISSUED WITH WHICH OF THE FOLLOWING TYPES OF COVERAGE?

DECREASING TERM

WHAT TYPE OF LIFE POLICY HAS A DEATH BENEFIT THAT ADJUSTS PERIODICALLY AND IS WRITTEN FOR A SPECIFIC PERIOD OF TIME?

DECREASING TERM

WHICH OF THESE TYPES OF POLICIES MAY NOT HAVE THE AUTOMATIC PREMIUM LOAN PROVISION ATTACHED TO IT?

DECREASING TERM

What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?

DECREASING TERM

ADDITIONAL COVERAGE CAN BE ADDED TO A WHOLE LIFE POLICY BY ADDING A?

DECREASING TERM RIDER

E AND F ARE BUSINESS PARTNERS. EACH TAKES OUT A 500,000 LIFE INSURANCE POLICY ON THE OTHER, NAMING HIMSELF AS PRIMARY BENEFICIARY. E AND F EVENTUALLY TERMINATE THEIR BUSINESS AND 4 MONTHS LATER E DIES. ALTHOUGH E WAS MARRIED WITH 3 KIDS AT THE TIME OF DEATH THE PRIMARY BENEFICIARY IS STILL F. HOWEVER, AN INSURABLE INTEREST NO LONGER EXIST. WHERE WILL THE PROCEEDS FROM E's LIFE INSURANCE POLICY BE DIRECTED TO?

F

WHAT KIND OF INSURANCE POLICY SUPPLIES AN INCOME STREAM OVER A SET PERIOD OF TIME THAT STARTS WHEN THE INSURED DIES?

FAMILY MAINTENANCE POLICY

WHAT KIND OF LIFE INSURANCE POLICY PAYS A SPECIFIED MONTHLY INCOME TO A BENEFICIARY FOR 30 YEARS AND THEN PAYS A LUMP SUM BENEFIT AT THE END OF THAT 30 YEARS?

FAMILY MAINTENANCE POLICY

AN INSURANCE APPLICANT MUST BE INFORMED OF AN INVESTIGATION REGARDING HIS/HER REPUTATION AND CHARACTER ACCORDING TO THE?

Fair Credit Reporting Act

THE PART OF A LIFE INSURANCE POLICY GUARANTEED TO BE TRUE IS CALLED A?

WARRANTY

WHICH OF THESE IS CONSIDERED A STATEMENT THAT IS ASSURED TO BE TRUE IN EVERY RESPECT?

WARRANTY

AT WHAT POINT DOES AN INFORMAL AGREEMENT BECOME A BINDING CONTRACT?

WHEN CONSIDERATION IS PROVIDED BY ONE OF THE PARTIES TO THE CONTRACT

WHEN MUST INSURABLE INTEREST BE PRESENT IN ORDER FOR A LIFE INSURANCE POLICY TO BE VALID?

WHEN THE APPLICATION IS MADE