EXAMFX
Social Security was created to provide all of the following benefits except
unemployment income Social Security is designated to provide protection against financial loss due to old age, disability, or death. It also provides income during retirement
An individual purchased a $100,000 Joint Life policy on himself and his wife. Eight years later, he died in an automobile accident. How much will his wife receive from the policy?
$100,000 (In Joint Life policies, the death benefit is paid upon the first death only)
Every individual life insurance policy must provide for a free-look provision that lasts for at least
10 days Insurers must allow individual life insurance customers the ability to return their new policy within 10-30days (this time period is up to the insurer) for a full refund.
What is the minimum free-look period for newly insured life insurance policies in the state?
10 days The free-look period for all individual life insurance contracts must be no less than 10 days and not exceed 30 days from the date the policy is delivered to the insured.
What percentage of a company's employees must take part in a noncontributory group life plan?
100% If the employer pays all of the premium, all employees must be covered to avoid adverse selection
What is the limiting age for dependent children of the insured employee in a group life plan (other than disabled children)?
26 The term "dependents" includes the insured's spouse and all children from birth until 26 years of age.
During the cancellation period, an insurer must refund any premiums and policy fees within how many days of written cancellation notice by the insured?
30 days Once the insurer receives notification of recession, the company has 30 days to issue the refund of premiums and policy fees.
What is the waiting period on a Waiver of Premium rider in life insurance policies?
6-months Most insurers impose a 6-month waiting period from the time of disability until the first premium is waived.
To legally transact insurance in this state, an insurer must obtain which of the following?
Certificate of Authority A Certificate of Authority is required in order to transact insurance.
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. If an annuitant dies before annuitization, the beneficiary will receive either the amount paid into the plan or the cash value of the plan, whichever is greater.
For a retirement plan to be qualified, it must be designed for the benefit of
Employees Qualified plans are designed for the exclusive benefit of the employees and their beneficiaries.
If an insured worker has earned 40 quarters of coverage, the worker's status under Social Security disability is
Fully insured A worker is fully insured under Social Security if the worker has accumulated the required number of credits based on his/her age.
Which of the following is TRUE of a qualified plan?
It has a tax benefit for both employer and employee. A qualified plan is approved by the IRS, which then gives both the employer and employee benefits in deductibility of contributions and tax deferral of growth.
An insurer received a claim on May 1st. On May 31th, the claim was approved in its entirely, By what date can the claimant expect the payment?
June 30th. Upon acceptance of the claim, insures are required payments within 30 days.
What is the official name for the Social Security Program?
Old Age Survivors Disability Insuance
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. As a general rule, premiums paid for life insurance are not tax dedcutible. The exception to this rule is when an employer buys group term life insurance for his employees since it is considered a business expense.
What type of annuity activist will cause immediate taxation of the interest earned?
Surrendering the annuity for cash One-sum cash surrenders give rise to immediate taxation of the interest earned.
If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?
The balance of the loan will be taken out of the death benefit. If the loan and interest are not repaid and the insured dies, then it will be subtracted from the death benefit.
Which of the following determines the case value of a variable life policy?
The performance of the policy portfolio The cash value of a variable life policy is not guaranteed and fluctuates with the performance of the portfolio in which the premiums have been invested by the insurer.
An agent is a legal person who acts on behalf of
The principal
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.
The purpose of the group was to purchase life insurance. In order to qualify for small group life insurance, a group must be formed for a purpose other than attaining life insurance.
Which of the following statements regarding deferred compensation funds is INCORRECT?
They are usually qualified plans. Deferred Compensation Funding refers to any employer retirement plan. Funding involves a contractual commitment between the employer and employee to pay compensation in future years. These plans are typically made with selected employees to provide additional retirement benefits.
The Waiver of Cost of Insurance rider is found in what type of insurance?
Universal Life If the insured becomes disabled, the rider allows the cost of insurance to be waived, with the exception of premium costs required to accumulate cash value
In a survivorship life policy, when does the insurer pay the death benefit?
Upon the last death Survivorship life pays on the last death rather than upon the first death.
The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called
Waiver of premium
An insurance agent who diverts premiums held in a trust capacity for his or her own use
Will be considered guilty of theft and be punished to the extent of the law
Variable Whole Life Insurance is based on what type of premium?
level-fixed Variable Whole Life insurance is a level fixed premium investment-based product.
Within how many days of termination of employment must an employer give notice of the employee's right to convert the group policy to an individual policy?
15 days. The employer or the insurer must give the employee notice of his/her right to convert to individual coverage within 15 days of termination of employment (or at least 15 days prior to the expiration date of the conversation period).
What is the number of credits required for fully insured status for social Security disability benefits?
40 The term "fully insured" refers to someone who has earned 40 quarters of coverage (10 years of work times 4 maximum annual credits)
Level term insurance provides a level death benefit and a level premium during the policy term. If the policy renews at the end of a specified period time, the policy premium will be
Adjusted to the insured's age at the time of renewal If a level term product is renewed at the end of the term period the premium will be based upon the attained age of the insured.
A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called
Cost of living Rider A "cost of living" rider adjusts the face amount of a policy to maintain the relationship of the face amount and increases in the cost of living.
Which of the following is true regarding the insurance amount in a credit life policy?
Credit Life Insurance cannot pay out more than the balance of the debt, so that there is no financial incentive for the death of the insured.
Which of the following is NOT allowed in credit life insurance?
Creditor requiring that a debtor buys insurance from a certain insurer In credit life insurance, creditor may require that the debtor has a life insurance, but they cannot tell you who to buy the insurance from.
Both Universal Life and Variable Universal Life have a
Flexible premium Variable universal life, like universal life itself, has a flexible premium that can be increased or decreased as the policywoner chooses, so long as there is enough value in the policy to fund the death benefit.
An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?
Guaranteed insurability option Allows the insured to purchase specific amounts of additional insurance at specific times without proving insurability.
An exclusive agent
Has a contact with one company. The exclusive agent, also known as the captive or career agent, chooses to have a contract with one company.
Variable Whole Life Insurance is based on what type of premium?
Level Fixed Variable While Life Insurance is a level fixed premium investment-based product.
All other following are true about variable products
Policy owners bear the investment risk. The minimum death benefit is guaranteed The cash value is not guaranteed. Insurers selling variable products invest their customer's monies in a separate account, which is very similar to a mutual fund. Since there is no guaranteed rate of return, customers must bear the investment risk.
A domestic insurer issuing variable contracts must establish one or more
Separate accounts (Any domestic insurer issuing variable contracts must establish one or more separate accounts. The insurer must maintain in each separate account assets with a value at least equal to the reserves and other contract liabilities connected to the account)
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 since the insured contributed to his own death, the triple indemnity rider is void, but the beneficiary will still receive the policy's death benefit.
Who is a third-party owner?
A policy owner who is not the insured. Third-party owner is a legal term used to identify an individual or entity that is not an insured under the contract, but that has a legally enforceable right under it.
If an annuitant dies during the accumulation period, what benefit (if any) will be included in the annuitant's estate?
Accumulated cash value If the annuitant died during the accumulation period, the insurer is obligated to return all or a portion of the annuity cash value (values accumulated in the annuity in accordance with contract terms), which will be included in the decades annuitant's estate.
An insurance agent explains to his client the difference between two disability income insurance policies and then offers to fill out an application with the client's personal information and history. Upon completion of the application, the agent informs his client that he will "shop around" to find the company with the most favorable rates. If the agent presents the client's application to an insurer, he will be acting in which of the following capacities?
An insurance broker. A broker represents the client's interest in a contract of insurance. A broker may not be, at the same time, appointed as an agent with the same company.
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT
Dividend from a mutual insurer. Dividends paid to policyholders of a mutual insurer are not considered to be a rebate because the policy specifies that they might be paid.
A deceptive act or practice committed by a person with the intent to secure an unfair advantage or unlawful gain is known as:
Fraud. Fraud occurs when a person intends to benefit from his/her unlawful act or action of age expense of another person. It may involve a misrepresentation, but could simply result when an agent takes money from a client and diverts it to personal use, as an example.
In the state of California, who selects the Insurance Commissioner and for how long?
General election, for no more than two four-year terms
When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income?
Interest only If a beneficiary receives payments that contain both principal and interests portions, only the interest is taxable as income.
Which of the following is NOT true regarding a Certificate of Authority?
It is issued to group insurance participants. Before insures may transact business in a specific state, they must apply for a license or Certificate of Authority from the state department of insurance and meet any financial (capital and surplus) requirements set down by the state.
Which of the following is another term for the accumulation period of an annuity?
Pay-in Period its the time the annuitant makes payments into an annuity.
Which of the following can an insured submit to the insurer that would provide evidence of a claim and illustrate how severe the loss is?
Proof of claim An insured can submit a proof of claim to the insurer after a loss has occurred. This helps to notify the insurer of the loss and provide information on ow large or severe the loss was.
Giving a client an inducement to a sale not stated in the policy is an unlawful practice known as
Rebating Rebating is defined as any inducement offered to the insured in the sale of insurance products that is not specified in the policy. Both the offer and acceptance of a rebate are illegal.
During the accumulation period in a non qualified annuity, what are the tax consequences of a withdrawal?
Taxable interest will be withdrawn first and the 10% penalty will be imposed if under age 59 1/2. When money is withdrawn from the annuity during the accumulation phase, the amount are taxed on a last in first out basis. Therefore, all withdrawals will be taxable until the owner's cost basis is reached.
If the annuitant dies during the accumulation period, who will receive the annuity benefits? 如年金领取者在累积期内死亡，谁可领取年金?
The beneficiary If the annuitant dies during the accumulation period, the beneficiary receives benefits from the annuity: either the amount paid into the plan or the cash value - whichever is greater.
What method is used to determine the taxable portion of each annuity payment?
The exclusion ratio The ratio of the total investment in that contract to the expected return is developed to determine the portion of the annuity payment that will be taxable and nontaxable.
Which of the following are generally NOT considered when underwriting group insurance?
The insured's medical history Group life insurance is written on a group, not individual basis. Each individual completes an application that identifies the participant and beneficiary. Then, the group is judged based on its nature and past claim experience. Generally, medical questions are not necessary.
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. (option choice, if the cash value exhausted, the policy will terminate)
How long will the beneficiary receive payments under the single life settlement option?
Until the beneficiary's death The Single Life Option can provide a single beneficiary income for the rest of his/her life. Upon the death of the beneficiary, the payments stop.
An insured has the right to cancel a policy by written notification to the insurer. This notification may be mailed to the insurer or returned to the original agent who made the sale. Upon receipt of the cancellation request, the insurer will
refund any premiums and policy fees within 30 days of notice if the policy is within the cancellation period specified by the insurer.
Which of the following is TRUE about credit life insurance?
Creditor is the policy owner In credit life insurance, the creditor is the policy owner and the beneficiary; the debtor is the insured.
The type of term insurance that provides increasing death benefits as the insured ages is called
Increasing Term (Increasing term insurance provides an increase in the death benefit each year. The coverage is usually structured to provide a death benefit equal to the amount of premium paid on a permanent life insurance policy, or to provide a death benefit equal to the cash value accumulation in a permanent policy; however, it can be written as a stand-alone policy for the individual that has a need for increasing amounts of insurance.)
Under which of the following annuity options does the annuitant select the time period for the benefits, and the insurer determines how much each payment will be?
Installments for a fixed period the annuitant selects the time period for the benefits, and the insurer determines how much each payment will be. only pays for a specific period of time only, and there are no life contingencies.
Which of the following insureds as a right to cancel an individual life policy within 30 days?
Insureds 60 years of age of older If the insured on the individual life policy is 60 years of age or older, the right of recession for a full refund must last for at least 30 days.
Which of the following is true regarding the life with Guaranteed Minimum annuity settlement option?
It is a life contingency option. 这是一种生活应急选择。 The beneficiary receives the remainder of the principal amount upon the annuitant's death. 受益人在年金领取者死亡后，将获得剩余的本金。 Payments can be made in installments and as a single cash refund.
Which of the following is TRUE regarding the accumulation period of an annuity?
It is a period during which the payments into the annuity grow tax deferred. annuitant makes payments into an annuity payments earn interest grow tax deferred
Which of the following best describes annually renewable term insurance?
It is level term insurance (Annually renewable term is a form of level term insurance that offers the most insurance at the lowest cost)
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 Contracts that are owned by someone other than the insured are known as their-party ownership. Most policies involving third-party ownership are written in business situations or for minors in which the parent owns the policy.
Group like insurance is a single policy written to provide coverage to members of a group. Which of the following statements concerning group life is CORRECT?
100% participation of members is required in noncontributory plans. If the employer pays all the premium, then all employees must be included.
The notice to senior consumers regarding their right to cancel a policy must be printed on the cover or policy jacket in at least what type of print? 有关高级消费者取消保单权利的通知必须印在保单封面或保单夹套上，最少印哪种?
12-point bold print Each individual life policy annuity contract delivered to a senior consumer must have the regarding their right to cancel either printed on the cover page or policy jacket in 12-point bold print with one inch of space on all sides, or printed on a sticker attached to the cover page or policy jacket.
An individual has been diagnosed with Alzheimer's disease. He is insured under a life insurance policy with the accelerated benefits rider. Which of the following is true regarding taxation of the accelerated benefits?
A portion of the benefit up to a limit is tax free' the rest is taxable income. When accelerated benefits are paid to a chronically ill insured, they are tax free up to a certain limit. Any amount receive in excess of this dollar limit must be included in the insured's gross income.
A provision in a life insurance policy that provides for the early payment of some portion of the policy face amount should the insured suffer from a terminal illness or injury is called
Accelerated benefit provision can be made in a lump sum or in monthly installments over a special period of time. This provision is given without an increase in premium. Some companies, deduct an interest charge from the proceeds paid out to make up for their loss earnings. 一些公司，从支付的收益中扣除利息费用来弥补他们的损失。
Every policy of individual life insurance must include a notice of right to cancel the policy, stating the specific time frame for the free-look period. Once the insured has cancelled the policy, within how many days must the insurer refund all premiums and policy fees?
All premiums and policy fees paid for the policy must be refunded by the insurer to the owner within 30 days from the date that the insurer is notified that the insured has cancelled the policy.
Any insurance agent who commits a repeated violation of the Insurance Code with respect to insurance replacement will be liable for
An administrative penalty of no less than $5,000 and no more than $50,000 per violation. The fines for additional violations of the replacement article by an individual agent will result in increased fines ($5,000 to $50,000). The Commissioner may suspend or revoke the license of any person or entity that violates this article.
All of the following could own group life insurance
An alumni group A debtor group A group sponsored by an employer Group purchasing group life insurance must be fired for a reason other than purchasing insurance. (A group needing low-cosy life insurance是错的)
Who can make a fully deductible contribution to traditional IRA?
An individual who has earned income. Individuals who are not covered by an employer-sponsored plan may deduct the full amount of their IRA contributions regardless of their income level.
All of the following are examples third-party ownership of a life insurance policy except
An insured borrows money from the bank and makes a collateral assignment of a part of the death benefit to secure the loan. A collateral assignment is the transfer of some or all of the death benefits of the policy to a creditor as security for a loan, but does not give the creditor the rights of ownership. In the event of the insured's death, the creditor would only be able to recover that portion of the policy's proceeds equal to the credit's remaining interest in the loan.
Employer contributions made to a qualified plan
Are subject to vesting requirements. Qualified plans must have a vesting requirement.
A policy owner fails to pay the premium due on his whole life policy after the grace period possess, but the policy remains in force. this is due to what provision?
Automatic Premium Loan This provision is not required; but is commonly added to contracts with a cash value at no additional charge. This is a special type of loan that prevents the unintentional lapse of a policy due to nonpayment of the premium.
Any insurance agent who engages in the insurance business and violates the Code with respect to insurance replacement shall on the first violation
Be fined a sum of $1,000 An agent who violates the replacement provision of Code will be fined a $1,000 for the first offense.
Which of the following is TRUE about a class designation?
Beneficiaries are not identified by name A class of beneficiary is using a designation such and "my children". This can be a vague term if the insured has been married more than once, or has adopted or illegitimate children. Many insurers encourage the insured to name each child specifically and to state the percentage of benefit they are to receive.
Social security benefits are available for a surviving spouse until the youngest child reaches age 16. Benefits are again available for the spouse after reaching age 60. What is the time period called during which the surviving spouse does not receive benefits?
Blackout period No social security benefits would be paid to the surviving spouse during this time.
Social Security benefits are available for a surviving spouse until the youngest child reaches age 16. Benefits are again available for the spouse after reaching age 60. What its he times period called during which the surviving spouse does not receive benefits?
Blackout period The period of time after the youngest child reaches age 16 and prior to the surviving spouse reaching age 60 is called a black-out period. No Social Security benefits would be paid to the surviving spouse during this time.
The type of insurance sold to a debtor and designed to pay the amount due on a loan if the debtor dies before the loan is repaid is called:
Credit Life (Credit life is most often sold by lenders and is term insurance written with a face amount and term is matched to the amount and length of the loan period. Credit insurance is a special type of coverage written to insure the life of the debtor and pay off the balance of a loan in the event of the death of the debtor. )
What kind of policy issues certificates of insurance to insureds?
Group insurance (Individuals covered by group life insurance do not receive a policy, but receive a certificate of insurance from the master policy.)
Which of the following is True regarding the annuity period?
It may last for the lifetime of the annuitant. accumulated money is converted into an income stream. may last for the lifetime of the annuitant or for a shorter specified period of time depending on the benefit payment option selected.
Which of the following settlement options in life insurance is known as straight life?
Life Income The life-income option, also known as straight life, provides the recipient with an income that he or she cannot outlive. It pays the benefit while the beneficiary is alive; however, the payments stop at the beneficiary's death.
Which life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed period during which, if the original recipient dies, the payments will continue to a designated beneficiray?
Life Income with period certain. The life income with period certain option guarantees payments for the life of the recipient and also specifies a guaranteed period of continued payments. If the recipient should die during this period, the payments would continue to a designated beneficiary for the remainder of the period.
Which of the following statements is TRUE concerning whole life insurance?
Lump-sum death benefits are not taxable Dividend interest is taxable; policy loans are not tax deductible, and premiums are not tax deductible.
After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive?
Monthly premium waiver and monthly income Disability Income Benefit rider waives the policy premiums, just like the Waiver of Premium rider. Also allows the insured to receives a weekly or monthly income during the disability period.
Death benefits payable to a beneficiary under a life insurance policy are generally
Not subject to income taxation by the Federal Government When premiums are paid with after tax dollars, the death benefit is generally not subject to federal income taxation.
Which of the following documents must be provided to the policyowner or applicant during policy replacement?
Notice Regarding Replacement During policy replacement, the replacing producer must present to the applicant a Notice Regarding Replacement that is signed by both the applicant and the producer.
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. The replacing insurance company must require from the producer a list of the applicant's life insurance or annuity contracts to be replaced and a copy of the replacement notice provided to the applicant, and send each existing insurance company a written communication advising of the proposed replacement.
Which Universal Life option has a gradually increasing cash value and a level death benefit?
Option A Under Option A, the death benefit remains level while the cash value gradually increases. The death benefit will increase at. later date in order to maintain a gap between the cash value and the death benefit before the policy matures.
If the policyowner, the insured, and the beneficiary under a life insurance policy are three different people, who has the ownership rights?
Policy Owner
Which nonforfeiture option provides coverage for the longest period of time?
Reduced paid-up The reduced paid-up nonforfeiture option would provide protection until the insured reaches 100, but the face amount is reduced to what the cash would buy
To sell variable life insurance policies, an agency must receive all of the following EXCEPT
SEC registration Agents selling variable life products must be registered with FINRA, have a securities license, and must be licensed with the state to sell life insurance. SEC registration is for securities, not agents.
An insured purchased a 15-year level term life insurance policy with a face amount of $100,000. The policy contained an accidental death rider, offering a double indemnity benefit. The insured's severely injured in an auto accident, and after 10 weeks of hospitalization, died from the injuries. What amount would his beneficiary receives as a settlement?
The beneficiary would most likely receive twice the face value of the policy, since his fatal injuries were caused by an accident and he died within the 90-day benefit limit stipulated in most policies.
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. (If the payor (usually a parent or guardian) becomes disabled for at least 6 months or dies, the insurer will waive the premiums until the minor reaches a certain age, such as 21)
Which of the following employees insured under a group life plan would be allowed to convert to individual insurance of the same coverage once the plan is terminated?
Those who have been insured under the plan for at least 5 years. If the master contract is terminated, every individual who has been on the plan for at least 5 years will be allowed to convert to individual insurance of the same coverage.
An insured receives a monthly summary for his life insurance policy. He notices that the cash value of the policy is significantly lower this month than it was last month. What type of policy does the insured have?
Variable Variable life policies vary in value, because the value is based on the stocks that support the policy. If a policyholder wants a more stable, reliable value, he/she should invest in a fixed policy.
Who is eligible to purchase an IRA?
Anyone with earned income who has not attained age 70 1/2 can have an IRA.
All of the followings are features and requirements of the Living Needs Rider
It is usually available at no additional charge. The remainder of the policy proceeds is payable to the beneficiary at the insured's death. It provides funds for medical and nursing home expenses to a terminally ill insured. Provides for the payment of part of the policy death benefit if the insured is diagnosed with a terminal illness that will result in death within 2 years.
What license or licenses are required to sell variable annuities?
Agents are required to have both a life insurance license and a securities license to sell variable annuities.
An individual has been making periodic premium payments on an annuity. The annuity income payments are scheduled to begin after 1 year since the annuity was purchased. What type pf annuity is it?
Deferred annuities may be purchased with either a single lump sum or periodic payments, but they do not begin the income payments until sometime after 1 year from the date of purchase.
All of the following statements concerning dividends are true Except
Dividend amounts are guaranteed in the policy dividends cannot be guaranteed
What qualifies an individual to contribute to an IRA?
Earned Income Anyone with earned income can have an IRA. An individual can contribute 100% of earned income up to a specified amount, even if only one had earned income, but each must have an account. The excess contribution penalty for traditional IRAs is 6%.
Items stipulated in the contract that the insurer will not provide coverage for are found in the
Exclusion clause Exclusions are restrictions of coverage as stated in the policy.
A young father would like a life insurance policy to provide coverage for all five family members at the lowest cost . Which type of policy would he most likely buy?
Family (Protection) Policy combines protection for all members of a family into one policy. Provides a permanent plan of insurance on the "base insured", a term riders on other members of the family. Because they are all covered under a single policy, there is only one policy fee.
An applicant wants to buy a life insurance policy in which he can count on receiving the same benefits as stated in the contact. Which type should he buy?
Fixed Policy (Fixed life insurance policies offer minimum guaranteed or fixed benefits stated in the contract. Variable life insurance or annuities are contracts in which the cash values accumulate base upon a specific porfolio of stocks without guarantees of performance.)
An insured becomes disabled at age 22 and can no longer work. She meets the definition of total disability under social Security. What other requirement must the insured have met to receive Social Security disability benefits?
Have accumulated 6 work credits in past 3 years. To qualify for disability benefits under Social Security, the disable person must have earned a certain amount of work credits. A maximum of 4 work credits can be earned each year. The amount of credits required varies by age. Persons disabled before the age of 24 can qualify for Social Security Benefits will only 6 work credits earned in the 3 years prior to the start of the disability.
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 The difference between the premiums paid and the cash value would be taxable. In this example, the difference between the premiums paid ($15,000) and the cash value ($18,000) is $3,000
An insurer has been found guilty of a Code violation regarding replacement. 一家保险公司被发现违反了更换保险的规定 The insurer then repeats the violation. What will be the minimum penalty?
$30,000 Additional violations of the replacement article by an insurer will result in increased fines ($30,000 to $300,000). The Commissioner may suspend or revoke the license of any person or entity that violates this article. 专员可暂停或吊销违反本条规定的任何个人或实体的许可证。
An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and expertise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?
$50,000 The face of the term policy would be the same as the face amount provided under the whole life policy.
If a person is disabled at age 27 and meets Social Security's definition of total disability, how many work credits must he/she have earned to receive benefits?
12 credits Persons disable between ages 24 and 31 can qualify for benefits if they have credit for having worked half of the time between age 21 and the start of the disability. For example, if Joes becomes disabled at age 27, he would need 12 credits (or 3 years' worth) out of the prior 6 years. (between ages 21 and 27)
Accidental Death Rider
It will pay double or triple the face amount. Accidental Death Rider pays 2 or 3 times the face amount if death is the result of an accident as defined in the policy and occurs within 90 days of such an accident.
Twin brothers are starting a new business. They know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?
Joint Life (A Joint Life policy covering two lives would be the least expensive because the premiums are based on an average age, and it would pay a death benefit only at the first death)
If a life insurance policy increase significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this?
Jumping Juvenile policy While many policies provide a level death benefit, Jumping Juvenile policies provide a low face amount in the early years and then increase, usually by 5 times the amount, when the insured reaches an age specified in the policy (usually age 21)
Every long-term care insurer in California must submit to the Commissioner a list of all agents or other insurer representatives authorize to solicit individual consumers for the sale of long-term care insurance. These submitted agent lists must be updated at least
Semiannully The insurer must submit an updated list semiannually of all agents authorized to solicit long term care insurance.
The advantage of qualified plans to employers is
Tax-deductible contributions Qualified plans have these tax advantages: employer contributions are tax deductible and not taxed as income to the employee; the earnings in the plan accumulate tax deferred; lump-sum distributions to employees are eligible for favorable tax treatment.