life insurance exam
what is the maximum fine for violating the commissioners cease and desist order
$10,000
If $100,000 of life insurance proceeds were used in a settlement option, which paid $13,000 per year for ten years, which of the following would be taxable annually?
$3,000
an insurance company sends frequent email advertisements and coupons to its customers. one customer does not. want to receive these emails anymore and requests to. be excluded from the mailing listthe emails. to. the customer must stop within how many days
10
a consumer receives spam email. from an insurance company he requests to be removed from the company's list within what period of. time. must the insurer comply with the request
10 days
Once a claim is processed, and all claim investigations are completed, within how many days must the insurer mail or deliver a claim check?
10 working days
if an insurance producer allows his license to lapse within how many months of the due date of the continuation fee may the producer reinstate the License without having to pass a written examination
12 moths
a disabled producers spouce was issued a temporary liscence 30 days ago how much longer can the souse legally serve under this license
150 days (180. days total)
an insurance company forwards fixed annuity premiums to their general account, where the money is invested. the guaranteed minimum interest is set at 2.5%. during an economic downswing, the the. Investments only drew 2%. what interest rate will the insurer pay to its policy holders?
2.5%
when an employee terminates coverage under a group insurance policy coverage continues in force for
31 days
for how long is an insurance company allowed to defer policy loan request
6 months
An insured had a $10,000 term life policy. The annual premium of $200 was due on February 1; however, the insured failed to pay the premium. He died on February 28. How much would the beneficiary receive from the policy?
9,800
An insured misstates her age at the time the life insurance application is taken. This misstatement may result in
Adjustment in the amount of death benefit
an underwriter is reviewing the medical questions in the application and needs further information due to. a medical situation the applicant had in the past what will the underwriter require
Attending physician statement
what is TRUE about class designation
Beneficiaries are not identified by name
An applicant knowingly fails to communicate information that would help an underwriter make a sound decision regarding coverage. This is an example of
Concealment
which of the following terms describes making false statements about the Financial condition of any insurer are intended to injure any person engaged in the buisness of insurance
Defamation
an individual is purchasing a permanent life insurance policy with a face value of $25,000 while this is all the. insurance that he can afford at this time he wants to be sure that additional coverage will be available in the future. which of the following options should be included in the policy
Guaranteed insurability option
what are the two components of a universal policy
Insurance and cash account
what is the main purpose of the seven-pay test
It determines if the insurance policy is an MEC.
what best describes a MIB
It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.
If a life insurance policy develops cash value faster than a 7 pay whole life contract, it becomes an?
Modified endowment contract
Using a class designation for beneficiaries means
Naming beneficiaries as a group
to sell variable life insurance policies, an agent must recieve all of the following EXCEPT - a securities license - a life insurace license - SEC registration - FINRA registration
SEC registration
when is the earliest a policy may go into affect
When the application is signed and a check is given to the agent
When would a 20-pay whole life policy endow?
When the insured reaches age 100
According to the Entire Contract provision, a policy must contain
a copy of the original application for insurance
all of the following could own a group life insurance EXEPT? a debtor group a group needing low cost life insurance a group sponsored by an employer an alumni group
a group needing low-cost life insurance
a tornado that destroys property would be an example of which of the following
a peril
an individual has been diagnosed with Alzheimers he. is. insured under a. life. insurance policy with. the accelerated benefits rider which of. the following. is true regarding taxation of the. Accelerated benefits
a portion of the benefit up to a. limit is tax. free. the. rest is taxable. income
which of the following is an example of a producers fiduciary responsibilities
a producer promptly forwarding premiums to the insurance company
which of. the. Following is another term for an authorized insurer
admitted
partners in a buissiness enter into a buy-sell agreement to purchase life insurance, which states that should one of them die prematurely, the other would be financially able to buy the interest of the deceased partner. what type of insurance policy may be used to fund this agreement.
any form of life insurance
what are the types of agent authority is also called "perceptive authority"
apparent
the full premium was submitted with the application for ilife insurance, and the policy was issued two weeks later as requested, when does the policy coverage become affective
as of. the application date.
what is the time period called during which the surviving spouse of the insured does not recieve social security income benefits
blackout period
what best describes the fixed-period settlement option
both principal and intrest will be liquidated over a selected period of time
which of the. following statements concerning buy-sell agreements is true
buy-sell agreements are normally funded with a life insurance policy
what is the clause that describes the method of paying the death benefit in the event that the insured and beneficiary are both killed in the same accident
common disaster clause
an insured pays an annual premium to his insurer in return the insurer promises to pay benefits in accordance with the terms of the contract this is called
consideration
According to the entire contract provision, what document must be made part of the insurance policy?
copy of original application
what characteristic makes whole life permanent protection
coverage until death or age 100
the type of. insurance sold to a debtor and designed to pay the amount due on a loan if the debtor dies before the loan is repaid is called
credit life
which. of the following. is not allowed in credit life insurance
creditor requiring that a debtor buys insurance from a certain insurer
which of the following is not fundable by annuities
death benefits
what is NOT typically excluded from life policies
death due to plain crash for a fare-paying passenger
which of the following is not an example of a valid insurable interest
debtor in the life of the creditor
which of the following terms is used to name the non-taxed return of unused premiums
dividend
when an employer offers to give an employee a. wage increase in the amount of the premium on a new life. insurance policy this is called
executive bonus
The authority granted to an agent through the agent's contract is referred to as
express authority
an insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy what is this and example of
false advertising
all of the following are buisness uses of life inurance EXCEPT -funding against financial loss caused by the death of a key employee -funding business continuation agreements -funding against company's general financial loss -compensating executives
funding against company's general financial loss
in which of the following cases will the insured be able to receive the full face amount from a whole life policy
if the insured lives to age 100
the medical Information bureau (MIB) was created to protect
insurance companies from adverse selection by high risk persons
which of the following is true about the 10-day free-look period in a life insurance policy
it begins when the policy is delivered
all of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT -the payments are not guaranteed for life -the insured determines the amount for each payment -it is a life contingency option -it will pay the benefit only for a designated period of time
it is a life contingency option
if a differed annuity is surrendered prematurely a surrender charge is imposed how is the surrender charge determined
it is a percentage of the cash value and decreases over time
which of the following best describes annually renewable term insurance
it is level term insurance
When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy?
it is reduced to the amount of what the cash value would buy as a single premium
Which of the following statements is true concerning the accidental death rider
it will pay double or triple the face amount
the type of settlement option which pays throughout the lifetimes of. two or more beneficiarys is
joint and survivor
a couple receives a set amount of annuity. when the wife dies the husband no longer receives annuity payments what type of annuity did the couple buy
joint life.
which of the following is an example of a limited-pay life policy
life paid-up at age 65
what is the other term for the cash payment settlement option
lump sum
which of the following information about the applicant is not included in the general information section of the application for insurance
medical background
which part of an insurance application would contain information regarding the cause of death of the applicants deceased relatives
medical information
After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive?
monthly premium waiver and monthly income
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report
must be informed of the source of the report
which of the following is not true regarding the needs approach method of determining the value of an individuals life
need is predicated using the number of years until the insureds retirement
attempting to determine how much insurance a family would require based on their fanatical objectives is known as
needs approach
death benifits payable to a benificiary under a life insurance policy are generally
not subject to income taxation by the federal government
the dividend option in which the policy owner uses dividends to purchase a term policy for one year is referred to as the
one-year term option.
which of the following can surrender a deferred annuity contract
only the annuity owner can
an insured purchased an individual life insurance policy with a face amount of $15,000. the insured pays a premium each month directly to the insurance company. what type of policy is that
ordinary life
a rider attached to a life insurance policy that provides coverage on the insured's family members is called the
other-insured rider
all of the following statements are true regarding group insurance EXCEPT -participants in a group insurance plan are issued cartifcates of insurance -small groups such as labor unions are eligible for group insurance -participants in the policy each recieve a policy -the group sponsor is the policy leader
participants in the policy each recieve a policy
An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?
pay reduced death benefit
Based on Human Life Value Approach, which of the following is NOT used to calculate an individual's life value?
predicted needs of the family after the insureds death
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
An insurer wants to obtain information from investigators regarding an applicant for insurance. What must the insurer do in order to legally acquire this information?
present the insured with with a disclosure authorization Notice
the gramm-leach-billey act was passed to
protect private customer information filed with a financial institution
An agent offers a client free tickets to a sporting event in exchange for the purchase of an insurance policy. What is the agent guilty of?
rebating
an insurance policy that only requires a payment of premium at its inception provides insurance protection for the life of the insured and matures at the. insureds age 100 is called.
single premium whole life
which of the following policies would be classified as a traditional level premium contract
straight life
which of the following is called a second to die policy
survivorship life
which of the following. is not true regarding the annuitant
the annuitant cannot be the same person as the annuity owner
The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true? -the annuitant must be a natural person -a corporation can be an annuitant as long as it is also the owner -a corporation can be an annuitant as long as the beneficary is a natural person -the contract can be issued without an annuitant
the annuitant must be a natural person
which of the in NOT the consideration in a policy
the application given to a. prospective insured
An applicant signs an application for a $25,000 life insurance policy, pays the initial premium, and receives a conditional receipt. If the applicant dies the next day, which of the following is TRUE
the beneficiary will receive the full death benefit if it is determined that the applicant qualified for the policy
in comparison to. consumer reports. which of the following describes a unique characteristic of investigative consumer reports
the customers associates friends and neighbors provide the reports data
all of the following entities regulate variable life policies EXCEPT?
the guaranty association
Large Group Life Insurance underwriting takes all of the following into consideration EXCEPT
the health of each individual in the group
An employee quits his job on May 15 and doesn't convert his Group Life policy to an individual policy for 2 weeks. He dies in a freak accident on June 1. Which of the following statements best describes what will happen?
the insurer will pay the full death benefit from the group policy to the beneficiary
how is it determined whether an insurer is allowed to. write. buisness. in. a state
the insurers domicile or location of. Incorporation will determine whether a company is domestic foreign or alien.
what statement is NOT TRUE regarding teh accumulation at interest option
the intrest is not taxable since it remains inside the insurance policy
all of the following are true of key person insurance EXCEPT - the plan is funded by permanent insurance only - there is no limitation on the number of key employee plans in force at any one time - the employer is the owner, payor and benifenciary of the policy - the key employee is the insured
the plan is funded by permanent insurance only
all of the following statements concerning the use of life insuance as an executive bonus are correct. EXCEPT -any type of insurance policy may be use -the employer pays a bonus to a selected employee to fund the policy -it is considered a nonqualified employee benefit -the policy is owned by the company
the policy is owned by the company
in the replacement of a policy who notifies the existing insurer that a policy is being replaced
the replacing company
Under an extended term nonforfeiture option, the policy cash value is converted to
the same face amount as in the whole life policy
the rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called
waiver of premium
Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce
without receiving written consent from an insurance regulatory authority
