general life exam part 1 review

Defamation

making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance

unilateral

only one of the parties to the contract is legally bound to do anything. If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?

30 days

The commissioner of insurance issues a Cease & Desist order to an agent. If the agent wishes to contest the charges in court, how many days after the order was issued does the agent have to make the request?

Its premium steadily decreases over time, in response to its growing cash value.

Which statement is NOT true, regarding a Straight Life policy?

prudent

acting with or showing care and thought for the future. Wise actions

The guaranty association

all of the following entities regulate variable life EXCEPT

Automatic Premium Loan Provision

an overdue premium is automatically borrowed from the cash value after the grace period expires

Grace Period Provision

Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum. Extends coverage beyond the premium due date

any change in business name

any individual licensed as an agent must notify the texas department of insurance on a monthly basis EXCEPT

conditions

because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT

term

children's riders attached to whole life policies are usually issued as what type of insurance

at distribution, all amounts received by the employee are tax free

All of the following are TRUE of the federal tax advantages of a qualified plan EXCEPT

Free Look Provision

Applicant has 10 days to cancel policy

Buy-Sell Agreement

for business uses of life insurance

Personal Uses of Life Insurance

survivor protection estate creation & conservation cash accumulation liquidity

15 days

viatical settlements may be rescinding within what time period after the viator receives the proceeds?

Collateral Assignment

A business owner was trying to obtain a bank loan to fund the purchase of a new business facility, but the bank required proof of additional assets to secure the loan. The business owner then decided to use her $250,000 life insurance policy to secure the loan. Which provision makes this possible?

Proof of insurability is not required

A couple owns a life insurance policy with a Children's Term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. What will she need to provide for proof of insurability?

unfair

After filing a claim, an insured tells the imsurer that there is more than one insurance policy in force. The insurer sets aside the claim until it hears what the other company will pay. The insurers actions can be classified as? -include refusing or delayimh a settlement because there is other imsurance available to partially or entirely satisfy the claim loss

upon conversion, the death benefit of the permanent policy will be reduced by 50%

All of the following are TRUE regarding the convertibility option under a term life insurance policy EXCEPT

Paid endorsement

If a person is compensated for a testimonial in an advertisement, which of the following statements should br included in the advertisement?

SEC Registration

To sell variable life insurance policies, an agent must receive all of the following EXCEPT

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

What is NOT TRUE regarding a Decreasing term?

Premiums are not tax-deductible as a business expense

What is correct concerning the taxation of premiums in a key-person life insurance policy?

to help customers make educated decisions in buying life insurance

What is the main purpose of the regulation on life insurance policy illustrations?

footnotes & caveats

When possible, what should insurers strive to eliminate from illustrations?

it is level term insurance

Which of the following best describes annually renewable term insurance?

Commissioner of Insurance only

can issue a temporary 90 day life insurance agent's license. Which entity has the authority to grant a temporary life insurance license?

Rebating

giving an individual a premium reduction or some other financial advantage not stated in the policy as an inducement to purchase the policy. For example, if an agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of?

She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan.

An employee has group life insurance through her employer. After five years, she decides to leave the company and work independently. How could she obtain an individual policy?

The date of medical exam

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

15 year level term

An individual covered under a group life insurance policy may convert the policy to any of the following except?

Refund the premiums paid

An insured committed suicide one year after his life insurance policy was issued. The insurer will

Authorized Insurer

An insurer that holds a certificate of authority in the state in which it transacts business is considered ?

issue the policy anyway & pay the face value to the beneficiary

When Y applied for insurance and paid the initial premium on August 14, he was issued a conditional receipt. During the underwriting process, the insurance company found no reason to reject the risk or classify it other than as standard. Y was killed in an automobile accident on August 22, before the policy was issued. In this case, the insurance company will

Payor Benefit

Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or become disabled?

the application given to a prospective insured

Which of the following is NOT the consideration in a policy?

it is issued to group insurance participants

Which of the following is NOT true regarding a Certificate of Authority?

It requires the policyowner to pay all overdue premiums with interest before the policy of reinstated.

Which of the following statements about the reinstatement provision is true?

Cross Purchase Plan

a partnership buy-sell agreement in which each partner purchases insurance on the life of each of the other partners

annually renewable term policy with a cash value account

a universal life insurance policy is best described as ?

profit sharing plan

an employer has sponsered a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called?

31 days

how long is the grace period in group policies?

24

if an agent has completed 35 hours of continuing education in one renewal period how many CE HOURS left to complete in the next renewal period?

when an insurers underwriting approves coverage

in forming an insurance contract, when does acceptance usually occur?

an applicant submits an application to the insurer

in insurance, an offer is usually made when?

Adhesion

insurance policies are not drawn up thru negotiations & an insured has little to say about its provisions. What contract is this?

Reciprocal association

insurers/associations that provide insurance for their members, but they are formed only for the purpose of providing insurance

making comparisons between different policies

legal. Which of the following is Not considered a misrepresentation as it pertains to unfair trade practices?

Faternal Benefit Society

operate on the basis of a lodge or charitable organization, but may also sell formal insurance plans for the benefit of their members

taxable

the interest earned on policy dividends is?

a Nonqualified Annuity plan

the president of a manufacturing company has offered one of the company's officers a special individual annuity plan that is unavailable to lower echelon employees. it does not meet government approval standards.

6 months

what is the waiting period on a waiver of premium rider in life insurance policies?

the beneficiary must have insurable interest in the insured

which is NOT TRUE about beneficiary designations

identity of the actual insurer

which of the following must be included in all life insurance advertisements?

insurance agent

which of the following occupations would NOT HELP qualify someone for the commissioner of insurance

Insuring Clause

which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the insured & to whom the benefits will be paid?

the insurance company

who bears all of the investment risk in a fixed annuity?

the employer is the owner & beneficiary

who is the owner & who is the beneficiary on a a key person life insurance policy?