Primerica Simulated Exam 4
Your client wants both protection and savings from the insurance, and is willing to pay premiums until age 65. What would be the right policy for this policy
Limited pay whole life
Which is true about a spouse term rider
The rider is usually level term insurance
What is the purpose of a disclosure statement in life insurance policies
To explain features and benefits of a proposed policy to the consumer
Which of the following policies would have an IRS corridor or gap between the cash value and the death benefit
Universal Life - Option A
All of the following are the general qualifications for a an agents license EXCEPT
Have a high school diploma
An agent selling variable annuities must be registered with
FINRA
All of the following are true regarding insurance policy loans EXCEPT
Policy loans can be made on policies that do not accumulate cash value
Which of the following is TRUE regarding variable annuities
The annuitant assumes the risks on investment
In which of the following instances would the premium be tax deductible
Premiums paid by an employer on a $30,000 group term life insurance plan for employees
Which of the following factors determines the amount of each installment paid in a Life Income Option arrangement
Recipient's life expectancy and amount of principle
Which of the following is NOT true regarding a Certified of Authority
It is issued to group insurance participants
Which of the following is a feature of a variable annuity
Benefit payment amounts are not guaranteed
Which of the following must an insurer obtain in order to transact insurance within a given state
Certificate of authority
Which of the following describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance
Defamation
The requirement that agents not commingle insurance monies with their own funds is known as
Fiduciary responsibility
Which term describes the benefits of a life insurance policy that the policyowner does not automatically relinquish even if the policy lapses
Nonforfeiture values
Which of the following is NOT true regarding the annuitant
The annuitant cannot be the same person as the annuity owner
All of the following are TRUE statements regarding the accumulation at interest option EXCEPT
The interest is not taxable since it remains inside the insurance policy
What is the purpose of a fixed-period settlement option
To provide a guaranteed income for a certain amount of time
If a life insurer holds the proceeds of any policy it issues, which of the following is true?
The proceeds may be exempt from any creditor's claim against a beneficiary other than the policy owner
An individual applies for a life policy. Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. He has also been hospitalized for drug abuse, but does not remember this when applying for insurance. The insurer issues the policy and learns of his history one year later. What will probably happen
The policy will not be affected
If a settlement option is not chosen by the beneficiary or policyowner, which option will be used?
lump sum
An employee quits her job where she has a balance of $10,000 in her qualified plan. The balance was paid out directly to the employee in order for her to move the funds to a new account. If she decides to rollover her plan to a Traditional IRA, how much will she receive from the plan administrator and how long does she have to complete the tax-free rollover?
$8,000, 60 days
An insured pays $1,200 annually for her life insurance premium. The insured applies this year's $300 worth of accumulated dividends to the next year's premium, thus reducing it to $900. What option does this describe
Reduction of Premium
An insured committed suicide 6 months after his life insurance policy was issued. The insurer will
Refund the premiums paid
If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE?
The policy will be interpreted as if the insurer waived its right to have an answer on the application
What percentage of a company's employees must take part in a noncontributory group life plan
100%
Who does the secondary notice provision protect?
The insured over the age of 64
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
Which of the following describes the tax advantage of a qualified retirement plan
The earnings in the plan accumulate tax deferred
The proposed makes the premium payment on a new insurance policy. If the insured should die, the insurer will pay the death benefit if the beneficiary if the policy is approved. This is an example of what kind of contract
Conditional
The inclusion of the Life and Health Guaranty Association in an advertisement by an insurer is
Forbidden
If a policy includes a free-look period of at least 10 days, the Buyer's Guide must be delivered to the applicant
With the policy
All of the following are requirements for life insurance illustrations EXCEPT
They must be part of the contract
If a claim is made on a policy during the grace period, an insurer is allowed to deduct the overdue premium and to charge interest. What is the maximum allowed interest rate
8%
Which of the following best describes a misrepresentation
issuing sales material with exaggerated statements about policy benefits
Part 2 of the application for life insurance provides questions regarding all of the following EXCEPT
Other insurance coverages