Chapter 11
An employee will be taxed on the cost of group life insurance paid by the employer if the amount of coverage exceeds
$50,000
An annuity contract is issued to a senior consumer over age 65. What is the maximum surrender charge for a withdrawal of money allowed on this annuity?
10%
Which of the following insurance products will be subject to the regulation on life insurance solicitation
A term life policy
How will a life insurance beneficiary designation naming a spouse be changed by divorce?
The beneficiary designation will be voided.
An employer offers group life insurance to its employees for the amount of $10,000. Which of the following is true?
The cost of coverage is a deductible expense by the employer
All advertisements are the responsibility of the
insurer
Certificates of coverage are issued to
participants in a group plan
Who does the secondary addressee provision protect?
the insured over the age of 64
What is the maximum allowed value of promotional gifts that an agent may give to a prospective insured?
$100
In order for a debtor group to qualify for group life insurance, what should be the minimum number of participants joining the plan every year?
100
agent delivers a life insurance policy to the proposed insured. The insured makes a decision not to accept the policy. The insured may return the policy for a full refund of premium within how many days?
14
An agent delivers a life insurance policy to the proposed insured. The insured makes a decision not to accept the policy. The insured may return the policy for a full refund of premium within how many days?
14. The free-look provision in Florida allows the insured to return a life policy or annuity after 14 days if dissatisfied for any reason.
A paid-up nonforfeiture benefit will become effective as specified in the policy, unless the person entitled elects another available option within how many days after the due date of the premium in default
60
Licensed life insurance agents are expected to be familiar with which of the following laws?
All of the insurance laws and regulations. While the other laws may have particular significance, an agent should be generally aware of all insurance laws.
If an employee is accepted into a group insurance plan, which status will the employee have?
Certificate holder. In group insurance, plan participants (insureds) do not receive a policy. Instead, they receive certificates of insurance, indicating that they are covered by the policy.
Who does the secondary notice provision protect?
Elderly Insureds
Which of the following documents must be provided to the policyowner or applicant during policy replacement?
Notice Regarding Replacement
If an employer decides to change its life insurance policy to a similar one with a different insurer, which of the following describes the extent that replacement regulations will be exercised?
Replacement regulations will not apply in this situation.
Which of the following dates must be contained in a policy summary?
The date the summary was prepared
When does a free-look period begin on a life insurance policy?
When the policy is delivered to the insured
What kind of policy does NOT typically require proof of insurability?
group insurance
What kind of policy issues certificates of insurance to insureds?
group insurance
Under a group plan, Certificates of Insurance must include all of the following EXCEPT
the name of the writing agent
Which statement is NOT true regarding a policy summary?
It must be combined with a sales illustration.
Which of the following is among the regulations set forth by the Florida Replacement Rule
Providing a written comparison and summary statement
Regulations for annuity recommendations would apply when a consumer is at least what age?
65 years old
In life policies issued in this state, insurers are permitted to charge interest during the policy grace period for the number of days elapsing before the premium is paid. What is the maximum annual interest rate?
8%
Under what conditions will proof of insurability NOT be required of an employee wanting to enroll in a group insurance plan?
If the employee enrolls within a certain time period
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
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
A customer with an existing life insurance contract is considering exchanging it for a newer contract. What Florida insurance regulation should the customer's insurance agent consult?
Florida Replacement Rule
Can a group that is formed for the sole purpose of obtaining group insurance qualify for group coverage?
No, the group must be formed for a purpose other than obtaining group insurance.
When a group policy terminates, every individual insured under the policy will be entitled to have an individual policy if the insured has been insured by the group policy for at least how many years prior to policy termination?
5 years. When a group policy terminates, every individual insured under the policy at the date of such termination who has been so insured for at least 5 years prior to such termination date will be entitled to have issued to him by the insurer an individual policy of life insurance.
How long must insurers maintain records of the information collected from senior consumers and other information used in making recommendations that were the basis for insurance transactions?
For 5 years after the insurance transaction is completed by the insurer
An insured received a new life insurance policy 5 days ago, but after a closer inspection of the policy provisions, decided to return it to the insurer. What provision would allow the insured to return the policy for a full premium refund
Free look
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%
When replacing life insurance, the duties of the replacing insurance company include all of the following EXCEPT
Maintaining a copy of the Notice Regarding Replacement and all sales proposals used for at least 5 years.
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 rule
Which term describes the benefits of a life insurance policy that the policyowner does not automatically relinquish even if the policy lapses?
Nonforfeiture values
