EXAM

The Commissioner obtains a restraining order against a person who has violated an insurance law. The person continues the violation for 10 days. The person will have to pay a fine of

$0

A Return of Premium term life policy is written as what type of term coverage?

Increasing

An intermediary's license remains in effect for how long?

Indefinitely

The Medical Information Bureau (MIB) was created to protect

Insurance companies from adverse selection by high risk persons.

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

Which of the following is a person who receives a fee or commission to attempt to negotiate settlements between a life insurance policyholder or certificate holder and one or more life settlement providers?

Life settlement broker

The owner of a life insurance policy dies, and no beneficiary is named. One of the owner's friends paid for part of the funeral costs. What is the maximum amount of money that the friend could be issued from the insurance policy?

$1,000

If a person violates an order specifically issued to them, they may be required to pay a fine up to

$1,000.

An insurer decides to renew a life policy but at a higher premium rate, starting on the renewal date. How many days in advance must the insured be notified?

60

Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe?

Adhesion

Who can make changes to the policy once it is in effect?

An executive officer of the insurer

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

Which of the following is NOT true of Section 1035 Policy Exchanges?

Any exchange made under Section 1035 of the Internal Revenue Code must be completed within 30 days.

Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?

Apparent

Which of the following statements is true of insurance licensing in the state of Wisconsin?

Applicants must pass a state licensing exam.

Which of the following terms describes a situation in which an agent and policyholder act together to defraud the insurer?

Collusion

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

Consideration

All of the following apply to defined benefit plans EXCEPT

Contributions are tied to the company profits.

An insurance producer just sold an insurance policy to his sister. What kind of business is this?

Controlled

According to the entire contract provision, what document must be made part of the insurance policy?

Copy of the original application

An insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice?

Illegal

Which of the following best describes the MIB?

It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.

An agent is selling a client a Variable Life Insurance policy and as an inducement shows the client a projection based upon shares or dividends paid on a similar policy. This is

Misrepresentation

Which of the following insurance options would be considered a risk-sharing arrangement?

Reciprocal

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 insurer is given an order of liquidation, which of the following will protect the insureds' unpaid claims?

The Wisconsin Insurance Security Fund

An Adjustable Life policyowner can change which of the following policy features?

The coverage period

J transferred his life insurance policy to his son two years before his death. Which of the following is true?

The entire face value of the policy will be included in J's taxable estate.

All of the following are true regarding a decreasing term policy EXCEPT

The payable premium amount steadily declines throughout the duration of the contract.

All of the following are true regarding the Policy Summary EXCEPT

The policy summary may show dividends.

A group of 15 skydivers met at a seminar and began talking about life insurance during a break. Because it was expensive to get individual life insurance, they decided to band together to form a small group so that they could qualify for group life insurance. After they applied for group life insurance, they were rejected. Why?

The purpose of the group was to purchase life insurance.

The termination of marital property rights may be reversed for all of the following reasons EXCEPT

The spouse named as beneficiary has obtained or consented to a final decree or judgment of an annulment, divorce or separation.

All of the following are requirements for life insurance illustrations EXCEPT

They must be part of the contract.

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 must maintain a specified "corridor" or gap between the cash value and the death benefit

Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce

Without receiving written consent from an insurance regulatory authority.

When would a 20-pay whole life policy endow?

When the insured reaches age 100

The authority granted to an agent through the agent's contract is referred to as

Express authority.

Which of the following is INCORRECT regarding a $100,000 20-year level term policy?

At the end of 20 years, the policy's cash value will equal $100,000.

An insured decides to surrender his $100,000 Whole Life policy. The premiums paid into the policy added up to $15,000. At policy surrender, the cash surrender value was $18,000. What part of the surrender value would be income taxable?

$3,000

Within how many days of the original hearing and final issuance of an order (regarding an order issued by the Commissioner) may an aggrieved person request a re-hearing?

20 days

An intermediary must maintain records for how long?

3 years

Which of the following would be considered a violation of Life Insurance Advertising regulations?

Calling an insurance policy an investment plan

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT

Dividends from a mutual insurer.

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

An insurer can refuse, cancel or deny insurance coverage to a class of risks based on which of the following characteristics of an applicant or insured?

None of the above

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

Notice Regarding Replacement

When calculating the amount a policyowner may borrow from a variable life policy, what must be subtracted from the policy's cash value?

Outstanding loans and interest

Which of the following refers to the amount of retirement benefits a worker receives under Social Security based on the worker's earnings and retirement age?

PIA

All of the following are examples of risk retention EXCEPT

Premiums