Prim 3

What provision in an insurance policy extends coverage beyond the premium due date?

Grace period

A nonresident licensed producer moves to Illinois and wants to obtain a license in this state. Which of the following is true regarding the licensing examination?

No examination will be required.

The paid-up addition option uses the dividend

To purchase a smaller amount of the same type of insurance as the original policy.

What is the name of the insured who enters into a viatical settlement?

Viator

An insured purchased a variable life insurance policy with a face amount of $50,000. Over the life of the policy, stock performance declined and the cash value fell to $10,000. If the insured dies, how much will be paid out?

$50,000

If an insured requests forms that are necessary to present a claim, within how many working days must the insurer provide the forms?

15

What is the waiting period on a Waiver of Premium rider in life insurance policies?

6 months

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

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.

Which of the following riders would NOT cause the Death Benefit to increase?

Payor Benefit Rider

An insured will be allowed to reactivate her lapsed life insurance policy if action is taken within a certain period of time, and proof of insurability is provided. Which policy provision allows this?

Reinstatement provision

In order for a firm to maintain its registration as a legal insurance company, what must it do?

Submit a biennial fee to the Director

The premiums paid by the employer in a business life insurance policy are

Tax deductible by the employer.

An agent uses an insurer's illustration. He obtains proper approval and does not change the illustration in any way. The illustration involves projected amounts, and the agent stipulates that the amount would not be guaranteed. Which of the following is true?

The agent must stipulate that the illustration is not part of the contract.

If a life insurance policy has an irrevocable beneficiary designation,

The beneficiary can only be changed with written permission of the beneficiary.

All of the following are true regarding a decreasing term policy EXCEPT

The payable premium amount steadily declines throughout the duration of the contract.

The LEAST expensive first-year premium is found in which of the following policies?

Annually Renewable Term

When a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit?

The insured's contingent beneficiary