Texas Life Insurance Exam
Which of the following terms means a result of calculation based on the average number of months the insured is projected to live due to medical history and mortality factors?
Life expectancy
Which of the following settlement options in life insurance is known as straight life?
Life income
How soon from the termination of debt under a credit life insurance policy must a creditor provide notice to the insurer ?
60 days
How soon from the termination of the under a credit life insurance policy must a creditor provide notice to the insured?
60 days
If a contract provides a set amount of income for two or more persons with the income stopping upon the first death of the insured, it is called a
Joint life annuity
Which of the following is an example of a limited pay life policy?
Life Paid-up at Age 65
Which of the following terms means a result of calculation based on the average number of months the insured is projected to live due to medical history and mortality factors ?
Life expectancy
Under an extended term nonforfeiture option, the policy cash value is converted to
The same face amount as the whole life policy
An insured has chosen joy and 2/3 survivor as a settlement option. What does this mean to the beneficiaries?
The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive
The interest earned on a policy dividends is
taxable
An individual has just borrowed $ 10,000 from his bank on a 5 - year installment loan requiring monthly payments . What type of life insurance policy would be best suited to this situation ?
Decreasing term
Which of the following best describes an insurance company that has been formed under the laws of this state ?
Domestic
If an annuitant dies before annuitization occurs , what will the beneficiary receive ?
Either the amount paid into the plan or the cash value of the plan , whichever is the greater amount
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 .
If an insured worker has earned 40 quarters of coverage , the worker's status under Social Security disability is
Fully insured
Which of the following would NOT be considered rebating ?
Giving a client a $ 25 pen with the insurer's logo during the insurance application process
If a life policy allows the policyowner to make periodic additions to the face amount at standard rates , without proving insurability , the policy includes a
Guaranteed insurability rider
Stranger - originated life insurance policies are in direct opposition to the principle of
Insurable interes
A life insurance policy has a legal purpose if both of which of the following elements exist?
Insurable interest and consent
Which of the following occupations would NOT directly help to qualify someone for the office of Commissioner of Insurance ?
Insurance agent
Which of the following statements is NOT true concerning insurable interest as it applies to life insurance ?
Insuring clause
Which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the insured , and to whom the benefits will be paid ?
Insuring clause
The policyowner wants to make sure that upon his death , the life policy will pay a portion of the proceeds annually to his spouse , but that the principal will be paid to their children when they reach a certain age . Which settlement option should the policyowner choose ?
Interest only option
As a field underwriter , a producer is responsible for all of the following tasks EXCEPT
Issue the policy that is requested
Which of the following best describes a misrepresentation ?
Issuing sales material with exaggerated statements about policy benefits
Which of the following is TRUE of a qualified plan ?
It has a tax benefit for both employer and employee.
What is the purpose of a conditional receipt ?
It is intended to provide coverage on a date prior to the policy issue.
Which of the following statements about the reinstatement provision is true ?
It requires the policyowner to pay all overdue premiums with interest before the policy is reinstated .
. A man decided to purchase a $ 100,000 Annually Renewable Term Life policy to provide additional protection until his children finished college . He discovered that his policy
Required a premium increase each renewal
A man decided to purchase a $ 100,000 Annually Renewable Term Life policy to provide additional protection until his children finished college . He discovered that his policy
Required a premium increase each renewal .
When an insured under a life insurance policy died , the designated beneficiary received the face amount of the policy , as well as a refund of all of the premiums paid . Which rider is attached to the policy ?
Return of premium
A policyowner who is also the insured wants to name her husband as the beneficiary of her life policy . She also wishes to retain all of the rights of ownership The policyowner should have her husband named as the
Revocable beneficiary
A domestic insurer issuing variable contracts must establish one or more
Separate accounts .
All of the following are considered unfair trade practices in the business of insurance EXCEPT
Sharing commissions
Upon policy delivery , the producer may be required to obtain any of the following EXCEPT
Signed waiver of premium
Which type of life insurance policy generates immediate cash value ?
Single Premium
Which of the following applicants would NOT qualify for a Keogh Plan ?
Someone who works 400 hours per year
Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles ?
Standard risk is representative of the majority of people
Which of the following riders is often used in business life insurance policies when the policyowner needs to change the insured under the policy ?
Substitute insured rider
Which of the following is an example of a producer being involved in an unfair trade practice of rebating ?
Telling a client that his first premium will be waived if he purchases the insurance policy today
Which of the following is NOT the consideration in a policy ?
The application given to a prospective insured
The annuitant dies while the annuity is still in the accumulation stage . Which of the following is TRUE ?
The beneficiary will receive the greater of the money paid into the annuity or the cash value
The annuitant dies while the annuity is still in the accumulation stage . Which of the following is TRUE ?
The beneficiary will receive the greater of the money paid into the annuity or the cash value.
The policyowner of an adjustable life policy wants to increase the death benefit . Which of the following statements is correct regarding this change ?
The death benefit can be increased by providing evidence of insurability
The policyowner of an adjustable life policy wants to increase the death benefit . Which of the following statements is correct regarding this change ?
The death benefit can be increased by providing evidence of insurability .
Which of the following best describes the tax advantage of a qualified retirement plan ?
The earnings in a qualified plan accumulate tax deferred
An insured purchased a 10 - year level term life policy that is guaranteed renewable and convertible . What happens at the end of the 10 - year term ?
The insured may renew the policy for another 10 years , but at a higher premium rate
An insured purchased a 10 - year level term life policy that is guaranteed renewable and convertible . What happens at the end of the 10 - year term ?
The insured may renew the policy for another 10 years , but at a higher premium rate.
If an insurer issued a policy based on the application that had unanswered questions , which of the following with be TRUE ?
The policy will be interpreted as if the insurer waived its right to have an answer on the application .
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 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
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.
A life insurance counselor is someone who , for a fee or commission , offers to examine a life insurance , an annuity , or pure endowment policy and gives advice , recommendations or information regarding the policy's terms , conditions , benefits , coverage or premium .
The producer must provide the applicant with a Notice Regarding Replacement .
How are contributions to a tax - sheltered annuity treated with regards to taxation ?
They are not included as income for the employee , but are taxable upon distribution
Which of the following insurance arrangements will be appropriate for a parent buying a life insurance policy on a child where the parent is the policy owner?
Third - party ownership
Which of the following insurance arrangements will be appropriate for a parent buying a life insurance policy on a child where the parent is the policyowner ?
Third - party ownership
The paid - up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy
The paid - up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy .
In insurance policies , the insured is not legally bound to any particular action in the insurance contract , but the insurer is legally obligated to pay losses covered by the policy . What contract element does this describe ?
Unilateral
An insured owns a life insurance policy . To be able to pay some of her medical bills , she withdraws a portion of the policy's cash value . There is a limit for a withdrawal and the insurer charges a fee . What type of policy does the insured most likely have ?
Universal life
What kind of policy allows withdrawals or partial surrenders ?
Universal life
Which of the following CANNOT be included along with illustrations used to sell life insurance ?
Vanishing premium information
For how long is an insurance company allowed to defer policy loan request?
6 months
After receiving a cease and desist order how many days does an agent have to make a request?
60 days
The insured under a $ 100.000 life insurance policy with a triple indemnity rider for accidental death was killed in a car accident . It was determined that the accident was his fault . The triple indemnity rider in the policy specifies that the death must not be contributed to by the insured in any manner . In this case , what will the policy beneficiary receive ?
$ 100,000
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 employee transfers $10,000 in her qualified plan to a traditional IRA, how much will be transferred and what is the tax consequences of a direct transfer?
$10,000, NO tax consequence
Before he died, an annuitant had received $12,500 in monthly benefits from his $25,000 straight life annuity. He was also the insured under a $50,000 paid-up whole life policy that named his wife as primary beneficiary. Considering both contracts, how much will the annuitant's spouse receive in benefits?
$50,000
If an agent has completed 35 hours of continuing education in one renewal period , how many CE hours will the agent have to complete in the next renewal period ?
24
What is the minimum percentage of licensing total volume of the premiums in a calendar year that must come from business other than control business?
25%
Within how many days are requesting an investigative consumer report messenger and notify the consumer in writing that the report will be obtained?
3 days
After getting a cease and desist order within how many days must a hearing be held?
30 days
How long must an agent keep records of CE course completion?
4 years
If a consumer requests additional information concerning an investigative consumer report , how long does the insurer or reporting agency have to comply ?
5 days
The Insurance Commissioner may examine the affairs of any insurer as often as necessary , but not less frequently than once every
5 years
Which of the following statements is not true concerning insurable interest as it applies to life insurance?
A debtor has an insurable interest in the life of a lender.
Which of the following is NOT a possible penalty for a violation of the Insurance Code ?
A fine up to $ 100,000
The two types of assignments are
Absolute and Collateral
Insurance policies are not Jonathan negotiations, and an insured has a little say about is provisions. What contract characteristics describe?
Adhesion
Which of the following is another term for an authorized insurer?
Admitted
Who is considered a nonresident agent?
An agent who resides in another state, but is licensed to write insurance in Texas
In insurance an offer is usually made when
An applicant submits an application to the insurer
The minimum interest rate on an equity indexed annuity is often based on
An index like Standard & Poor's 500
What is a foreign insurer?
An insurer with a home office in another state
The LEAST expensive first-year premium is found in which of the following policies?
Annually Renewable Term
The least expensive first year premium is found in which of the following policies?
Annually Renewable Term.
A universal life insurance policy is best described as an
Annually renewable term policy with a cash value account
A universal life insurance policy is best described as a
Annually renewable term policy with the cash value account
Which of the following is a short-term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated?
Annuity certain
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
All of the following are considered unfair or deceptive acts in connection with the sale of insurance EXCEPT
Attempting to settle a claim in which liability is clear
Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium
Automatic premium loan
Which of the following protects the insured from an unintentional policy lapse due to a nonpayment of premium ?
Automatic premium loan
Which of the following best describes fixed-period settlement option?
Both the principal and interest will be liquidated over a selected period of time.
An insurer receives an annual life insurance dividend check. What term best describes this arrangement?
Cash option
Which of the following must an insurer obtain in order to transact insurance within a given state?
Certificate of Authority
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
When an individual obtains an insurance license for the primary purpose of writing insurance on him- of herself, or for the members of their family this is called
Controlled business
The type of policy that can be changed from one that does not accumulate cash value to one that does is a
Convertible term policy
Which of the following is used to compare the cost of one life insurance policy against another in order to guide prospective purchasers to policies that are competitively priced ?
Cost comparison methods
A long stretch of national economic hardships causes a 7% rate of inflation. A policy owner owner notices that the face value of her insurance policy has been raised 7% as a result. Which policy rider cause this change?
Cost of a Living Rider
A rider that may be attached to a less insurance policy that adjusts The face amount based upon a specific index, such as a consumer price index, is called
Cost of living rider
A key person insurance policy can pay for which of the following?
Costs of training a replacement
What happens when a policy is surrendered for its cash value?
Coverage ends and the policy cannot be reinstated
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 must be included in all life insurance advertisement?
Identity of the actual insurer
An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of insurance policy would be best suited to this situation?
Decreasing Term
Which of the following types of insurance policies is most commonly used in credit life insurance ?
Decreasing Term
Which of the following types of insurance policies is most commonly used in credit life insurance ?
Decreasing term
Which of the following actions is NOT in violation of the Unfair Settlement Practices Act?
Denying an unsubstantiated claim
When twin brothers applied for life insurance from Company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered
Discrimination
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT
Dividends from a mutual insurer.
The provision which states that both the policy and a copy of the application form the contract between the policy owner and the insurer is called the
Entire Contract
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
When the insured selects the extended term known for non-forfeiture option, the cash value will Be used to purchase Turman Sherance with white face amount?
Equal to the original policy for as long as the cash values will purchase.
In the Executive Bonus plan who is the owner of the policy and who pays the premium?
Executive is the owner, and the executive pays the premium
Which Nonforfeiture option has the highest amount of insurance protection
Extended term
Which nonforfeiture option has the highest amount of insurance protection?
Extended term
An agent selling variable annuities must be registered with
FINRA
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.
Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization?
Fraternal benefit society
Which is true about the cash surrender nonforfeiture option
Funds exceeding the premium paid are taxable as ordinary income
Two attorneys operator practice as a partnership. They want to start a new program through their practice that will provide retirement benefits for themselves and three employees. They would likely choose
HR-10 (Keogh Plan)- self employed n their employees
A father purchases a life insurance policy on his teenage daughter and adds the Payor Benefit rider . In which of the following scenarios will the rider waive the payment of premium ?
If the father is disabled for more than 6 months
The medical information bureau (MIB) was created to protect
Insurance companies from adverse selection by high risk persons
As a field underwriter, a producer is responsible for all of the following tasks EXCEPT
Issue the policy that is requested
Which of the following best describes misrepresentation?
Issuing sales material with exaggerated statements about policy benefits
Why is an equity indexed annuity considered to be a fixed annuity?
It has a guaranteed minimum interest rate.
Which of the following is correct regarding credit life insurance?
It insures the life of a debtor
If a retirement plan or annuity is "qualified," this means
It is approved by the IRS
Which of the following is NOT true regarding a Certificate of Authority
It is issued to group insurance participants
Which of the following is not true regarding a Certificate of Authority?
It is issued to group insurance participants
Which of the following is NOT true regarding a Certificate of Authority?
It is issued to group insurance participants.
Which of the following is true about the premium on the children's rider in a life insurance policy?
It remains the same no matter how many children are added to the policy
Which is not true regarding straight life policy?
It's premium steadily decreases over time, in response to its growing cash value
A couple receives a set amount of income from their annuity. When the wife dies, the husband no longer receives annuity payments. What type of annuity did the couple buy?
Joint Life
All advertisements are the responsibility of the
insurer
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?
Limited Pay Life
What is the other term for the cash payment settlement option ?
Lump sum
An insurer advertise a health policy that is covered by the life and health insurance guaranty association. The advertisement includes a short list of benefits and approximate rates. The end of the advertisement include settlement that protection is provided by the guarantee association. Which of the following is true?
Mentioning the guarantee association and advertising is an unfair practice
What is the term for how frequently a policy owner is required to pay the policy premium?
Mode
If a life insurance policy develops cash value faster than a seven pay whole life contract it becomes a
Modified endowment contract
An insured purchased an insurance policy 5 years ago . Last year , she received a dividend check from the insurance company that was not taxable . This year , she did not receive a check from the insurer . From what type of insurer did the insured purchase the policy ?
Mutual
On a participating insurance policy issued by mutual insurance company, dividends paid to the policy holders are
Not taxable since the IRS treats them as a return of a portion of the premium paid
Which of the following documents must be provided to the policy owner or applicant during policy replacement?
Notice Regarding Replacement
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
If a person is compensated for a testimonial and an advertisement which of the following statements should be included in the advertisement?
Paid endorsement
If a person is compensated for a testimonial in an advertisement, which of the following statements should be included in the advertisement?
Paid endorsement
Which of the following is another term for the accumulation period of an annuity?
Pay-in period
Which of the following is NOT true about joint and survivor annuity benefit option?
Payments stop after the first death among the annuitants.
All of the following are true regarding insurance policy loans EXCEPT
Policy loans can be made on policies that do not accumulate cash value.
What describes the specific Information about a policy?
Policy summary
Who might receive dividends from a mutual insurer?
Policyholders
Which of the following will be included in a policy summary?
Premium amounts and surrender values
Most agents try to collect the initial premium for submission with the application. When an agent collects the initial premium from the applicant, the agent should issue the applicant a
Premium receipt
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.
A couple owns a life insurance policy with a children's term writer. Their daughter is reaching the maximum age of dependent covers, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?
Proof of insurability is not required
What form of annuity settlement options provides payments to a new it for the rest of the anyone's life and ceases at the annuitants death?
Pure life
Which of the following best describes a pure life annuity settlement option?
Pure life provides payments for as long as the annuitant is alive.
Another name for a substandard risk classification is
Rated
According to the state nonforfeiture law for life insurance policies , insurers must offer at least one of the following nonforfeiture options EXCEPT
Reduction of premium
The Federal Fair Credit Reporting Act
Regulates consumer reports .
The regulations regarding replacement apply to which of the following ?
Renewable term
Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?
Replacement
A policy owner who is also the insured wants to name her husband is the beneficiary of her life policy. She also wishes to retain all the rights of ownership. The policy owner should have her husband named as the
Revocable beneficiary
If an immediate annuity is purchased with the face amount of deaths or with the cash value at surrender this would be considered a
Settlement option
The interest earned on policy dividends is
Taxable.
A 60 yr old participant in a 401(k) plan takes a distribution and rolls over to an IRA within 60 days. Which of the following is true?
The amount of the distribution is reduced by the amount of a 20% withholding tax
Which of the following is not true regarding the Annuitant
The annuitant cannot be the same person as the annuity owner
Which of the following is not the consideration and a policy?
The application given to a prospective insured.
Upon the death of the insured, the primary beneficiary discovers that the insured shows interest only settlement option. What does this mean?
The beneficiary will only receive payments of the interest earned on the death benefit
The policy owner of an adjustable life policy wants to increase the death benefit. Which of the following statements is correct regarding this change?
The death benefit can be increased by providing evidence of insurability.
Which of the following best describes the tax advantage of a qualified retirement plan?
The earnings in a qualified plan accumulate tax deferred
Which of the following is incorrect concerning a noncontributory group plan
The employees receive individual policies
When a life insurance policy was issued the policy owner designated a primary in a contingent beneficiary. Several years later, both the insured in the primary beneficiary die 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
All of the following are TRUE statements regarding the accumulation an interest option EXCEPT
The interest is not taxable since it remains inside the insurance policy
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.
Which of the following is NOT required on an illustration used in the sale of a life insurance policy?
The name of the primary and secondary beneficiaries
What is the advantage of renting a policy instead of applying for a new one?
The original age is used for premium determination.
In a life settlement contract, whom does the life settlement broker represent?
The owner
All of the following statements concerning the use of life insurance as an Executive Bonus are correct EXCEPT
The policy is owned by the company
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
. An agent explains the details of a life insurance policy to a client . The agent does not realize , however , that the state has recently rewritten two of the provisions . As a result , the agent inadvertently misrepresents the policy , making it more attractive than it really is . What best describes this situation ?
There is no misconduct
What is the purpose of a disclosure statement in life insurance policies?
To explain features and benefits of a proposed policy to the consumer
What is the purpose of a disclosure statement in life insurance policies?
To explain features and benefits of a proposed policy to the consumer.
What is the main purpose of the regulation on life insurance policy illustrations?
To help customers make educated decisions In buying life insurance
What is the purpose of establishing the target premium for a universal life policy?
To keep the policy in force
What is the purpose of a fixed-period settlement option?
To provide a guaranteed income for a certain amount of time
There is a limit for withdrawal and the insurer charges a fee. What type of policy does the insured have?
Universal Life
All of the following are true regarding the convertibility option under a term life insurance policy except
Upon conversion, the death benefit of the permanent policy will be reduced by 50%
What is the name of a clause that is included in a policy that limits or eliminates the death benefit if the insured dies as a result of war or while serving in the military?
War or military service
Which of the following is a statement that is guaranteed to be true and if not may breach an insurance contract
Warranty
All of the following benefits are available under Social Security EXCEPT
Welfare benefits
In forming an insurance contract, when does acceptance usually occur
When an insurer's underwriter approves coverage
Informing an insurance contract, when does acceptance usually occur?
When the insurers underwriter approves coverage
If a policy includes a free-look period of at least 10 days, the Buyer's Guide may be delivered to the applicant
With the policy
Which of the following statements is not true concerning insurable interest as it applies to life insurance?
a debtor has insurable interest in the life of a lender
All of the following are personal uses of life insurance except
buy-sell agreement
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 individual has been making periodic premium payments on an annuity. The annuity income payments are scheduled to begin after one year since the annuity was purchased. What type of annuity is it?
deferred
What required provision protects against unintentional lapse of the policy?
grace period
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.
The Commissioner of Insurance issues a Cease and Desist Order to an agent . If the agent wishes to contest the charges in court , how many days after the order was issued does the agent have to make the request ?
60 days
According to the Entire Contract provision , a policy must contain
A copy of the original application for insurance .
The term " illustration " in a life insurance policy refers to
A presentation of nonguaranteed elements of a policy .
The term " illustration " in a life insurance policy refers to
A presentation of nonguaranteed elements of a policy . .
Who is considered a nonresident agent ?
An agent who resides in another state , but is licensed to write insurance in Texas .
Who can make a fully deductible contribution to a traditional IRA ?
An individual not covered by an employer - sponsored plan who has earned income
consumer report been provided , the report may contain all of the following information EXCEPT the applicant's
Ancestry
Which of the following is TRUE about a class designation ?
Beneficiaries are not identified by name
All of the following statements are correct regarding credit life insurance EXCEPT
Benefits are paid to the borrower's beneficiary .
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 insurance professional advises a client regarding the benefits of her life insurance policy , in exchange for a fee . Which of the following terms best describes this type of insurance professional ?
Counselor
The term " fixed " in a fixed annuity refers to all of the following EXCEPT
Death benefit
Variable Whole Life insurance is based on what type of premium ?
Level fixed
Which of the following riders added to a life insurance policy can pay part of the death benefit to the insured to cover expenses incurred in a nursing or convalescent home ?
Long - term care
If a settlement option is not chosen by the policyowner or the beneficiary , which option will be used ?
Lump sum
On a participating insurance policy issued by a mutual insurance company dividends paid to policyholders are
Not taxable since the IRS treats them as a return of a portion of the premium paid .
Under a pure life annuity , an income is payable by the company
Only for the life of the annuitant
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 is another term for the accumulation period of an annuity ?
Pay - in period
A prospective insured receives a conditional receipt but dies before the policy is issued. The insurer will...
Pay the policy proceeds only if it would have issued the policy
Which of the following is NOT true about a joint and survivor annuity benefit option ?
Payments stop after the first death among the annuitants
Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or become disabled ?
Payor Benefit
All of the following are mandatory life insurance policy provisions EXCEPT
Policy backdating .
All of the following are true regarding insurance policy loans EXCEPT
Policy loans can be made on policies that do not accumulate cash value
All of the following are characteristics of group life insurance EXCEPT
Premiums are determined by the age , sex and occupation of each individual certificate holder .
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
A couple owns a life insurance policy with a Children's Term rider . Their daughter is reaching the maximum age of dependent coverage , so she will have to convert to permanent insurance in the near future . Which of the following will she need to provide for proof of insurability ?
Proof of insurability is not required .
When a whole life policy lapses or is surrendered prior to maturity , the cash value can be used to
Purchase a single premium policy for a reduced face amount
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as
Rebating
The policyowner pays for her life insurance annually . Until now , she has collected a nontaxable dividend check each year . She has decided that she would rather use the dividends to help pay for her next premium . What option would allow her to do this ?
Reduction of premium
Theregulations regarding replacement apply to which of the following ?
Renewable term
Why is an equity indexed annuity considered to be a fixed annuity ?
it has a guaranteed minimum interest rate .
