Life insurance
A policyowner cancels his life policy but instructs the insurance company to transfer the cash value of his policy to an annuity. This nontaxable transaction is called
1035 exchange
The validity of coverage under a life insurance policy may not be contested except for nonpayment of premium after the policy has Been in force for at least how many years
2 years
If licensees have administrative action taken against them, they must report this to the Superintendent within
30 days
In an IRA rollover the rollover must be completed within how many days of the time the funds are taken out of the first plan
60 days
According to the Entire Contract provision, a policy must contain
A copy of the original application for insurance
All of the following could own group life insurance except
A group needing low cost life insurance.
Which of the following would be required to be licensed as an insurance producer
A salaried employee who advertises and solicits insurance
Which of the following is not an allowable 1035 exchange
A whole life insurance policy is exchanged for a term insurance policy
In insurance, an offer is usually made when
An applicant submits an application to the insurer
When an annuity is written, whose life expectancy is taken into account?
Annuitant
In an annuity, the accumulated money is converted into a stream of income during which phase?
Annuitization period
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?
As of the application date
Which of the following is true about a class designation
Beneficiaries are not identified by name
Which of the following best describes fixed-period settlement option
Both the principal and interest will be liquidated over a selected period of time.
A tax-sheltered annuity is a special tax-favored retirement plan available to
Certain groups of employees only.
Before an agent can transact business in New York every insurer fraternal benefit society or HMO file with the superintendent which of the following
Certificate of appointment
The continuing education (CE) requirement in this state
Consists of completing 15 hours of continuing education each biennium.
A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called
Cost of Living Rider
When must an IRA be completely distributed when a beneficiary is not named?
December 31 of the year that contains the fifth anniversary of the owner's death.
When the insured selects the extended term nonforfeiture option the cash value will be used to purchase term insurance with what face amount
Equal to the original policy for as long as the cash values will purchase.
Which of the following best describes the aleatory nature of an insurance contract
Exchange of unequal values
The authority's granted to an agent through the agents contract is referred to as
Express authority
Under which installments option does the annuitant select the amount of each payment, and the insurer determines how long they will pay benefits?
Fixed amount
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.
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
What are the two components of a universal policy
Insurance and cash account
Who makes up the Medical Information Bureau?
Insurers
If an insured surrenders his life insurance policy, which statement is true regarding the cash value of the policy?
It is only taxable if the cash value exceeds the amount paid for premiums.
Which of the following is an irs qualified retirement program for self employed
Keogh
Which of the following is an example of a limited pay life policy
Life Paid-up at Age 65
Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client?
Limited pay whole life
In a single employer group plan, what is the name of policy issued to the employer
Master contract
Which of the following is not true regarding policy loans
Money borrowed from the cash value is taxable.
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
During replacement of life insurance, a replacing insurer must do which of the following?
Obtain a list of all life insurance policies that will be replaced
Which of the following can surrender a deferred annuity contract
Only the annuity owner
Which Universal Life option has a gradually increasing cash value and a level death benefit?
Option A
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the
Other-insured rider
Which of the following explains the policyowners right to change beneficiaries choose options and receive proceeds of a policy
Owner's Rights
Which of the following has the right to convert the existing term coverage to permanent insurance
Policyowner
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 insured's death.
Which nonforfeiture option provides coverage for the longest period of time?
Reduced Paid-Up
To sell variable life insurance policies an agent must receive all of the following except
SEC registration
All the following would be different between qualified and nonqualified retirement plans except
Taxation on accumulation
If an insured withdraws a portion of the face amount in the form of accelerated benefits because of a terminal illness, how will that affect the payable death benefit from the policy?
The death benefit will be smaller
If an insured continually uses the automatic premium loan option to pay the policy premium,
The policy will terminate when the cash value is reduced to nothing
Which of the following statements is correct regarding a whole life policy
The policyowner is entitled to policy loans
All of the following would be eligible to establish a Keogh retirement plan except
The president and employee of a family corporation
How must a replacing producer respond to an applicant wishing to replace existing life insurance?
The producer must provide the applicant with a Notice Regarding Replacement
Which is generally true regarding insureds who have been classified as preferred risks
Their premiums are lower.
Which of the following is true for both equity indexed annuities and fixed annuities
They have a guaranteed minimum interest rate.
What is the purpose of key person insurance
To lessen the risk of financial loss because of the death of a key employee
The paid up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy.
In a survivorship life policy, when does the insurer pay the death benefit
Upon the last death
Which of the following would least likely be considered a legitimate need that would be paid by insurance proceeds
Vacation travel expenses
Which of the following cannot be included along with illustrations used to sell life insurance
Vanishing premium information
Which of the following is a key distinction between variable whole life and variable universal life products
Variable whole life has a guaranteed death benefit
An agent and an applicant for a life insurance policy fill out and sign the application. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. When will coverage begin?
When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health
The least expensive first year premium is found in which of the following policies
annually renewable term
Which of the following is a short-term annuity that limits the amounts paid to a certain fixed period or until a certain fixed amount is liquidated
annuity certain
If the annuitant dies during the accumulation period, who will receive the annuity benefits?
beneficiary
A business owner was trying to obtain a bank loan to fund the purchase of a new business facility, but the bank required proof of additional assets to secure the loan. The business owner then decided to use her $250,000 life insurance policy to secure the loan. Which provision makes this possible?
collateral assignment
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?
consideration
An individual has been making periodic premium payments on an annuity the annuity income payments are scheduled to begin after 1 year since the annuity was purchased what type of annuity is it
deferred
All of the following information about the applicant is identified in the general information section of a life insurance application except
education
Which of the following is true regarding a single life settlement option
it provides income the beneficiary cannot outlive
In a life settlement contract who does the life settlement broker represent
owner
What is the major difference between a stock company and a mutual company
ownership
A situation in which a person can only lose or have no change represents
pure risk
Annuities can be used to fund which of the following?
retirement plans
If an agent wishes to sell variable life policies, what license must the agent obtain?
securities
A father owns a life insurance policy on his 15-year-old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disabled, what will happen to the life insurance premiums?
the insured's premiums will be waived until she is 21.
Which of the following types of policies will provide permanent protection
whole life