Life Insurance and Health Other Health Insurance Concepts

All of the following are examples of third party ownership of a life insurance policy EXCEPT

An insured borrows money from the bank and makes a collateral assignment of a part of the death benefit to secure the loan.

When a disable dependent child reaches the age limit for coverage, how long does the policy owner have to provide proof of dependency in order for the dependent to remain covered under the policy?

31 days

All of the following statements concerning workers compensation are correct EXCEPT

A worker receives benefits only if the work related injury was not his/her fault.

All of the following are personal used of the life insurance EXCEPT

Buyer-sell agreement

The mode of premium payment

Is defined as the frequency and the amount of the premium payment.

A brain surgeon has an accident and develops tremors in her right arm. Which disability income policy definition of total disability will cover her for losses

Own occupation - less restrictive than other definitions

Which of the following is correct concerning the taxation of premiums in a key-person life insurance policy

Premiums are not tax deductible as a business expense.

If an immediate annuity is purchased with the face amount at death or with the cash value at surrender, this would be considered a

Settlement option

Which of the following statements regarding the change of Beneficiaries Provision is false

The policy owner has the right to change beneficiaries in any case

Which of the following best defines the "owner" as it pertains to life settlement contracts

The policy owner of the life insurance policy

Which of the following employees insured under a group like plan would be allowed to convert to individual insurance of the same coverage one the plan is terminated?

Those who have been insured under the plan for at least 5 years

An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live. The insured knows that his financial state will worsen even more with the upcoming medical expenses. What option could the insured utilize?

viatical settlement

Which of the following would best describe total disability?

A person's ability to work is significantly reduced eliminated for the rest of his/her life

Who is a third-party owner?

A policyowner who is not the insured

Disability income coverage specifies that the policy covers the insured if he is unable to perform any job for which he is qualified. In this case, total disability is defined as

Any occupation - more restrictive than other definitions.

Group disability income insurance premiums paid by the employer are

Deductible by the employer as an ordinary business expense

In a direct rollover, how is the money transferred from one plan to the new one?

From trustee to trustee

Traditional IRA contributions are

Tax deductible

Under workers compensation, which of the following benefits are NOT included?

legal benefits

An individual is insured under his employer's group Disability Income policy. The insured suffered an accident while on vacation that left him unable to work for 4 months. If the disability income policy pays the benefit, which of the following would be true?

Benefits that are attributable to the employer contributions are fully taxable to the employee as income.

Which of the following is TRUE of a qualified plan?

It has a tax benefit for both employer and employee.

Which of the following describe taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable.

Which of the following is an example of liquidity in a life insurance contract?

The cash value available to the policyowner

Which of the following is NOT true of life settlements?

The seller must be terminally ill

Premium payments for personally-owned disability income policies are

not tax deductible