life insurance part 3

The full premium was submitted with the application for the life insurance, and the policy was issued two weeks later as requested. When does coverage become effective?

as of the application date if the full premium was submitted with the application and the policy was issued as requested, the policy effective date would generally coincide with the date of application.

An investor busy a life policy on an elderly person in order to sell it for a life settlement. This is an example of

A STOLI Policy Stranger Oriented Life Insurance policies are usually purchased by people who have no relationship with the insured with intention of selling them for life settlements

Which of the following is NOT true regarding a Certificate of Authority?

It is issued to group insurance participants Before insurers may transact business in a specific state, they must apply for a license or Certificate of Authority

Which of the following statements best describes the effect the Accerlerated Benefit provision would have on the benefits paid to the beneficiary?

It will decrease the benefits paid to the beneficiary

Which of the following is an example of a limited pay life policy?

Life paid up at Age 65 Limited Pay Whole Life premiums are all paid by the time the insured reaches age 65. The policy endows when the insured turns 100. It is the period that is limited, not the maturity.

Z falls from the roof of his house while fixing it and damanages his spinal column enough to render him disabled for a year. His insurance policy carries a Disabililty Income Benefit Rider. Which of the following benefits will Z receive?

Monthly premium waiver and monthly income The Disability Income Benefit rider waives the policy premiums, just like the Waiver of Premium rider. Unlike the Waiver of Premium rider, it allows the insurer to receive a weekly or monthly income during the disability period.

IN a Commerical General Liability policy, which of the following forms covers losses that occur, start or are discovered during the policy period, regardless of when the date is actually reported by the insurer?

Occurrence A clims made form provides coverage that occurs after a retroactive date and when a claim is made during the policy period. An occurrence form covers losses that start or are discovered during the policy period, regardless of when the date is actually reported and filed by the insured

Which explains the policy owner rights to change beneficiaries, choose options and receive proceeds of a policy?

Owner's rights

Which of the following will be included in a policy summary

Premium amounts and surrender values

IN which of the following instances would the premium be tax dedcutible

Premiums paid on a 30,000 ife insurance group term life insuranc eplan for an employee

An employee has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called?

Profit sharing plan A profit sharing plan is one where the employer will contribute monies into an employee's retirement plan when the company shows a profit. The others are all qualitfied plans, but company profit isn't an issue with them (401K, tax-sheltered annuity, HR 10 plan)

A policyowner who is also the insured wants to name her husband as the beneficiary of her policy. She also wishes to retain all of the rights of ownership. The policyowner should have have her husband named as

Revocable beneficiary

Which of the following determines the length of time that benefits will be received under the Fixed Amount settlement option?

Size of each installment The size of each installment determines the length of time that benefits are received under the Fixed Amount settlement option.

Insurance policies ensure that after a loss proceeds will go to the

beneficiary the beneficiary is the person who receives the benefits from the insurance policy

What defines a peril

cause of loss A peril is a specific cause of loss

What kind of insurance covers the life of a debtor in connection with a credit transaction

credit insurance Credit life insurance covers the life of a debtor in connection with a specific loan or other credit transaction

Which of the following is NOT among the primary ways deductibles for major medical plans can be paid?

en embedded deductible. Deductibles for a major medical plans can be paid in one of the following primary ways: a FLAT dollar deductible, a PER CAUSE deductible, and a MAXIMUM annual deductible FM PC

Once an agent has met the requirements to sell long term care insurance, how often must he or she complete the 4 hours of training?

every 2 years

Which nonforfeiturue option has the highest amount of insurance protection

extended coverage The extended term nonforfeitfture option has the same face amount as the original policy but for a shorter period of time

All of the following are considered Social Security Benefits EXCEPT

group Social security provides 3 types of benefits: Retirement, Disability and Survivors

Should the Commissioner request information from a certificate holder, licensee, or other person under the jurisdiction of the commissioner. If no time specified they must comply

in 30 days. state law provides that if a time is not specified, the person shall comply with the request within 30 days and shall provide all documents ot material to the Commerissionar has qr

What are the two components of the universal policy?

insurance and cash account A universal policy has two components: an insurance component and a cash account The insurance component of a universal life policy is always annually renewable term insurance. The cash account accumulates on a tax deferred basis each year and earns either the guaranteed contract rate or the

On its advertisement, a company claims that it has funds in its possession that are in fact, not available for the payment of losses or claim. The company is guilty of

misrepresentation

Which option is being utilized when insurer acculumates dividents at interest and then uses the accumulated dividends plus interest, and the policy cash value to pay up the policy early

paid up option this is different from paid up additions, in which the insured can use dividends to buy additional policies that increase the face amount of the original policy

When a life insurance policy stipulates that the beneficiary will receive payment sin specified installments or for a specified number of years, what provision prevents the beneficiary from changing or borrowing from the planned installments

spendthrift provision When a life insurance policy contains a spendthrift provision, all rights of the beneficiary to change time of payment or amount of installments, surrender cash, borrow against, or assign for any purpose, are withdrawn and those parts of the policy that may give the beneficiary such rights are void.

Under an extended term nonforfeiture option, the cash value is converted to

the same face amount as in the whole life policy Under this option the insurer uses the policy cash value to convert to term insurance for the same face amount as the former permanent policy