Exam 3 corrections

Which of the following Life Insurance policies would be considered interest sensitive?

universal life

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

universal life - option A

What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?

$2,500

The validity of coverage under a life insurance policy may not be contested, except for nonpayment of premium, after the policy has been in force for at least how many years?

2 years

Who effectuates viatical settlement contracts?

vatical settlement providers

Which of the following terms 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

Which of the following authorities monitors the financial strength of insurers?

department of insurance

When a life insurance policy is cancelled and the insured has selected the extended term nonforfeiture option, the cash value will be used to purchase term insurance that has a face amount

equal to the original policy for as long a period of time that the cash values will purchase

Which of the following is the term used when a person in a fiduciary position has used assets in manner for which they were not intended such as the wrongful taking or use of money belonging to another?

misappropriation of funds

On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of

misrepresentation

Which of the following documents must be provided to the policyowner or applicant during policy replacement?

notice regarding replacement

Which of the following are the main factors taken into account when calculating residual disability benefits?

present earnings and earnings prior to disability

All of the following are penalties a producer may face for violating the insurance laws of this state EXCEPT

re-examination

Which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting?

stock

An individual wants to purchase a life insurance policy. His agent asks if the transaction will involve replacing any existing life insurance policies. If the customer replies, "Yes," which of the following best describes the agent's next step?

the agent must provide a replacement notice to the applicant

The annuity owner 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

Should an insurance company deny a claim submitted by an insured without providing to that insured a prompt and reasonable explanation of the claim denial, the insurer would be in violation of

unfair claims methods and practices regulations

Which of the following programs expands individual public assistance programs for people with insufficient income and resources?

medicaid

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

Insurance producers that do not have company appointments are considered a/an

representative of the consumer

In a group policy, who is issued a certificate of insurance?

the individual insured

When a fixed annuity owner pays pays a monthly annuity premium to the insurance company, where is this money placed?

the insurance company's general account

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

the plan must provide an offset for social security benefits

According to the Time Limit on Certain Defenses provision, the insurer cannot void the policy for any misstatements on the application (except for fraud) if the policy was in force for what time period?

3 years

A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period. What type of policy is this?

level term

When the Commissioner suspects that a person is violating an insurance law or other regulation, what can be issued that would order the person to stop committing the act of violation?

cease and desist order

Shortly after a replacement transaction on a Medicare supplement policy, the insured decided to cancel the policy, but is unsure whether the free-look provision applies. The insured could find that information in the

notice regarding replacement

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

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?

universe life