General insurance chapter quiz
Which of the following is the basis for a claim against an insurance policy
loss
Which of the following is the best reason to purchase life insurance rather than annuities
to create an estate
hazard
A danger or risk.
An insurance contract requires that both the insured and the ensure meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe?
Conditional
Which of the following is TRUE regarding the insurance amount in a credit life policy
Creditor can only insure the debtor for the amount owed.
In the executive bonus plan, who is the owner of the policy and who pays the Premium
Executive is the owner and the Executive pays the premium.
What does "level" referred to in the level term insurance
Face amount
Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated large or religious organization
Fraternal benefit society
Universal life insurance policy has two types of interest rates that are called
Guaranteed and current
Annually renewable term policies provide a level death benefit for a premium that
Increases annually
Which statement is NOT true regarding a straight life policy
Its premium steadily decreases over time, in response to its growing cash value.
Which of the following is an example of a limited pay life policy
Life Paid-up at Age 65
Which of the following terms means a result of calculation based on the average number of months to ensure it is projected to live due to medical history in mortality factors?
Life expectancy
Which option for universal life allows the beneficiary to collect got the death benefit and cash value upon the death of the insured
Option B
An applicant wants to buy a policy that has a cash value element. What type should she buy
Permanent
All of the following are marketing arrangements used by insurers except
Reinsurance System
Uninsured receives a monthly summary for his life insurance policy. He notices that the cash value of the policy is significantly lower this month and it was last month. What type of policy does the insured have
Variable
When would a misrepresentation on an insurance application be considered fraud?
When it is intentional and material
Which of the following would describe a legal document which would dictate who can buy a deceased partners share of a business and for what amount
buy-sell agreement
When will the 20th a whole life policy endow
When the insured reach his age 100
Which of the following documents delivered to the policy owner includes information about premium amounts, cash values, surrender values and death benefits for specific policy years
A policy summary
All of the following are personal use of life insurance except
Buy sell agreement
Which of the following must ensure obtain in order to transact insurance within a given state
Certificate of authority
What is a definition of a unilateral contract
One-sided: only one party makes an enforceable promise
If someone wants to buy a life insurance policy that will provide lifetime protection against premature death, what type of life insurance policy should that person by?
Permanent
An adjustable life policy owner can change which of the following policy features
The coverage period
What is the purpose of key person insurance
To minimize the risk of financial loss caused by the death of a key employee
If an insurer meets the states financial requirements and is approved to transact business in the state it is considered to be
authorized
Which of the following are the authorities that an agent can hold
express and implied
And insured stated on her application for life insurance that she has never had a heart attack, when in fact she had a series of minor heart attacks last year for what she sought medical attention. Which of the following will explain the reason for death benefit claim is denied?
Material misrepresentation
An applicant wants to buy a life insurance policy in which he can count on receiving the same benefits as stated in the contract. Which type should he buy?
fixed
An individual that has just borrow $10,000 from his bank on a five-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to the situation
Decreasing term
What is the term for the entity that an agent representative regarding contractual agreements with third parties
Principal
What is the maximum amount of coverage that the Utah life and health insurance guarantee association (ULHIGA) will pay
500,000
Who is the owner and who is the beneficiary on a key person life insurance policy
the employer is the owner and beneficiary
A key person insurance policy can pay for which of the following
Costs of training a replacement
Which of the following is TRUE about credit life insurance
Creditor is the policyowner.
And insurance contract must contain all the following to be considered legally binding except
Beneficiaries consent
Stranger-oriented life insurance policies are in direct opposition to the principle of
Insurance interest
And a life settlement contract, whom does the life settlement broker represent
owner
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?
Limited-Pay Life
If the owner of a whole life policy who is also the insured dies at age 80, and there are no outstanding loans on the policy, what portion of the death benefit will be paid to the beneficiary
The full death benefit
And employee is insured under her employer is a 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