03/18/24

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How long is the grace period for an individual life insurance policy?

1 month

An Agent is hand delivering an insurance policy to a policyowner. What must the agent obtain to complete the transaction?

A signed delivery receipt

Which of the following indicates the person upon whose life the annuity income amount is determined?

Annuitant

When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?

Extended term

Who is the annuity owner?

The person who purchases the annuity

An IRA contribution can be made from which of the following?

cash

Which of the following is NOT a type of a hazard?

exposure

Which method of dealing with risk is applied when insurance is purchased?

to transfer

An aleatory contract is based on what kind of exchange?

unequal exchange of values

What guarantees that the information explained in the insurance contract is true?

warranty

With Adjustable Life, the owner can change all of the following EXCEPT

insured

Which of the following individuals would be a likely candidate to purchase a deferred annuity?

Someone who wants to grow retirement funds tax deferred

If a life insurance policy is purchased by someone who has no insurable interest in the insured, it is considered

Stoli

What is the exclusion ratio used to determine?

The annuity benefit to be excluded from taxes

An insured decides to surrender his Whole Life insurance policy. The cash value at surrender is higher than the premiums paid into the policy, due to interest. What part of the surrender value would be income taxable?

The difference between the premiums paid and the cash value

What happens to the face amount of a whole life policy if the insured reaches the age of 100?

The face amount is paid to the insured

All of the following are considerations under the needs approach planning for life insurance EXCEPT

The insured's income

All of the following are general requirements of a qualified plan EXCEPT

The plan must be temporary

Which of the following has the right to change a settlement option in a life insurance policy?

The policy owner at any time during the life of the insured

All of the following are true regarding the waiver of cost of insurance rider EXCEPT

The rider expires when the insured reaches age 60

Which of the following policies can be described as a flexible premium adjustable life policy?

Universal Life

Considering the principles of liquidity, how would the policyowner use today's cash values in a life insurance policy?

Use it for emergency expenses

Which of the following types of insurance is investment based, has a level fixed premium, and a non guaranteed cash value?

Variable Whole Life

What type of an interest rate is guaranteed in universal life policies?

contract interest rate

If a loan request is for payment of due premiums on the policy, how soon must the insurer issue a loan?

immediately

An annuitant pays the annuity premium on the 14th of each month. Which of the following best describes this arrangement?

level

Contributions to Roth IRAS are

not tax deductible

Key person insurance can provide protection for all of the following economic losses to a business EXCEPT

pay the death benefit to the estate of the insured

Annuities certain limit the amount paid by the annuity to a certain fixed

period or fixed amount

Wagering on a sporting event is an example of what type of risk?

speculative

Which of the following are characteristics of term life insurance ?

temporary protection, renewability, no cash value

Which of the following terms is used to define the period of time during which an annuitant makes payments into an annuity?

Accumulation period

Refusing to pay claims without conducting a reasonable investigation based upon all available information is an example of

An unfair claims practice

Which of the following is correct statement about annuities?

Fixed annuities do not provide protection against inflation

In a life insurance application, all of the following signatures will be required EXCEPT

Home office underwriter

Under which of the following conditions would life insurance proceeds be taxable by the federal government?

If there is a transfer for value

Which of the following is not true regarding a deferred annuity?

Income payments begin within 1 year from the date of purchase

Who would be allowed catch-up contributions into an IRA plan?

Individuals age 50 or older

Which of the following best describes life annuity with period certain option?

It guarantees benefit payments for life of the annuitant and for a specified period for the beneficiary

Which of the following is true regarding pure life annuity settlement option?

It provides the highest monthly benefit

Which of the following best describes pure life annuity?

It provides the highest monthly benefits

For a contract to be enforceable by law, the purpose of the contract must be

Legal and not against public policy

The Human Life Value approach to determining Life Insurance needs is based upon which of the following ideas?

Loss of the breadwinners income

Guaranteeing future dividends is considered to be an unfair or deceptive act known as

Misrepresentation

Which of the following is NOT one of the independent rating services that publishes guides to insurance companies financial integrity?

NAIC

What is a specific requirement regarding the number of employees in a SIMPLE plan?

No more than 100 employees

Which of the following best defines the unfair trade practice of rebating?

Offering an inducement of something of value not specified in the policy

When the owner of a participating whole life policy uses the dividend to provide more life insurance coverage, which of the following dividend options is being used?

Paid-up additions

The frequency and the amount of the premium payment are known as what?

Premium Mode

Which of the following is a provision found in life insurance policies?

Reinstatement

Who acts on behalf of the principal?

agent

Which of the following premium modes would result in the lowest overall premium?

annual

Who does the spendthrift clause in a life insurance policy protect?

beneficiary

A lender who conditions approval of a loan on the condition that the borrower purchase insurance from that lender may be guilty of

coercion

Which of the following is NOT a characteristic of variable insurance and annuities?

Benefits are determined solely based on the policy premium


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