Insurance Exam - May 2024 - Georgia
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be
Authorized.
Which of the following statements concerning buy-sell agreements is true?
Buy-sell agreements are normally funded with a life insurance policy.
Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid
For 20 years or until death, whichever occurs first.
When an employee terminates coverage under a group insurance policy, coverage continues in force
For 31 days.
The automatic premium loan provision is activated at the end of the
Grace period.
Fixed annuities provide all of the following EXCEPT
Hedge against inflation.
An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. The insurer is hoping that this advertising will help to eliminate the competition and therefore create a monopoly. Which of the following best describes this act?
Illegal
If a person is compensated for a testimonial in an advertisement, which of the following statements should be included in the advertisement?
"Paid endorsement"
In this state, what is the maximum fine for transacting insurance without a license?
$1,000
An insurance agent has received a request for a hearing from the Commissioner. Within how many days must the hearing be held?
30 days
In order for an insurer's certificate of authority to remain in effect, the insurer must maintain a surplus equal to how much of paid-in capital stock?
50%
What is the maximum allowed rate of interest on policy loans from life insurance?
8%
The two types of assignments are
Absolute and collateral.
A Straight Life policy has what type of premium?
A level annual premium for the life of the insured
If an insurance company wishes to order a consumer report on an applicant to assist in the underwriting process, and if a notice of insurance information practices has been provided, the report may contain all of the following information EXCEPT the applicant's
Ancestry
When an insurer begins underwriting procedures for an applicant, what will be the main source for its underwriting information?
Application
Which of the following is INCORRECT regarding a $100,000 20-year level term policy?
At the end of 20 years, the policy's cash value will equal $100,000.
Which of the following entities has the power to issue certificates of authority?
Commissioner of Insurance
Which of the following would be considered an illegal inducement to purchase insurance?
Confirming future dividends in a life insurance proposal
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as
Contracts of adhesion.
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT
Dividends from a mutual insurer.
All of the following are Nonforfeiture options EXCEPT
Interest only
State law specifically prohibits using illegal inducements in the marketing of insurance. All of the following would be considered illegal inducements EXCEPT
Inviting prospective clients to the grand opening of the company's new office.
What is the function of a Certificate of Authority?
It allows an insurer to transact insurance in Georgia.
Which of the following is NOT true regarding a nonqualified retirement plan?
It needs IRS approval.
Which of the following statements is TRUE concerning the Accidental Death Rider?
It will pay double or triple the face amount.
Which statement is NOT true regarding a Straight Life policy?
Its premium steadily decreases over time, in response to its growing cash value.
Variable Whole Life insurance is based on what type of premium?
Level fixed
All of the following would be different between qualified and nonqualified retirement plans EXCEPT
Taxation on accumulation
What is a definition of a unilateral contract?
One-sided: only one party makes an enforceable promise.
Which Universal Life option has a gradually increasing cash value and a level death benefit?
Option A
Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured?
Option B
All of the following statements concerning an employer sponsored nonqualified retirement plan are true EXCEPT
The employer can receive a current tax deduction for any contributions made to the plan.
Which of the following is TRUE regarding the premium in term policies?
The premium is level for the term of the policy.
Which of the following would be a lawful reason for the Commissioner to suspend a producer's license?
The producer failed to pay child support.
Which of the following is NOT true of life settlements?
The seller must be terminally ill.
Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?
Universal Life - Option A
Executive Bonus
owned by the employee
A corporation is the owner and beneficiary of the key person life policy. If the corporation collects the policy benefit, then
the benefit is received tax free
