Insurance Exam
An employee with $25,000 group term life coverage was recently fired. This employee's group coverage may be converted to a $125,00 individual whole life policy $25,000 modified whole life policy $25,000 individual term life policy $35,000 individual whole life policy
$25,000 individual whole life
___ of a personal life insurance premium is usually deductible for federal income tax purposes 100 percent 75 percent 0 percent
0%
Non-contributory plan retires ___ participation of all eligible employees 25% 50% 75% 100%
100%
A 15 year mortgage is best protected. y what kind of life policy? modified whole life 15 year level term 15 year decreasing term adjustable life
15 year decreasing term
What year was the McCarran-Ferguson Act enacted? 1944 1945 1946 1947
1946
Which of the following requires in surfers to disclose when an applicant's consumer or credit history is being investigated: 1970 - fair credit reporting act 1959 - Intervention by (SEC) The securities and exchange commission 1999- Financial services modernization act 1945- The McCarran-Ferguson Act
1970 - fair credit reporting act
q is severely insured in an automobile accident and becomes totally dibbled, how many months must Q be dibbled b before being able yo file for social security benefits? 5 4 5 6
5
One becomes eligible for Social Security disability benefits after having been disabled for 3 months 5 months 6 months 12 months
5 months
What is the excise tax rate the irs imposes on individuals aged70 1/2or older. who do not take the required minimum distributions from their. qualified retirement plan? 30% 40% 50% 60%
50%
An IRA owner can start making withdraws andNOT be subjected to a tax penalty beginning at what age? 70 1/2 65 55 59 1/2
59 1/2
an insurer may normally delay the payment of a cash value loan or surrender value for up to 2 months 4 months 6 months 8 months
6 months
which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?
Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company.
Which of the following consists of an offer, acceptance, and consideration?
Contract
Insurance policies are offered on a "take it or leave it" basis, which make them conditional contracts aleatory contracts unilateral contracts contracts of adhesion
Contracts of adhesion
Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?
Decreasing term
which provision is not a requirement in a group life policy? conversation grace period incontestable period accidental
ACCIDENTAL
To be eligible for social security benefits, an employee must be unable to perform
ANY occupation
Which of the following is NOT included in an annuity contract? Nonforfeiture benefit Free-Look period Beneficiary AD&D rider
All of these are included in an annuity contract EXCEPT an Accidental Death & Dismemberment (AD&D) rider.
What action can a policyowner take if an application for a bank loan requires collateral? Assign policy ownership to the bank utilize accelerated benefits provision barrow against policy cash value and use as a down payment name bank as beneficiary
Assign policy ownership to the bank
A student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following? guaranteed insurability rider aviation exclusion impairment rider accidental death benefit
aviation exclusion
which of these statements is incorrect regarding the federal income tax treatment of life insurance? Entire cash surrender value is taxable premiums are normally not tax deductible proceeds are received tax free is a named beneficiary
Entire cash surrender value is taxable
S, while in the process of converting her group life insurance to an individual policy, dies. What happens to the claim her beneficiary submits? No benefits are payable under the Master contract Full benefits are payable under the Master contract Full benefits are payable under the converted policy Benefits less required premium are payable under the converted policy
Full benefits are payable under the Master contract
An insured is past due on his life insurance premium, but is still within the Grace Period. What will the beneficiary receive if the insured dies during this Grace Period? Full face amount minus any past due premiums full face amount refund of all premiums paid refund of all p premiums paid, plus interest
Full face amount minus any past due premiums
Which of these individual plans can be started by an employee, even if another plan is in existence?
IRA
Tom has a qualified retirement plan with his employer that is currently considered to be 80% "vested". How can This be interpreted?
If tom's employments terminated, 20% of the funds would be forfeited
When most insurable interest exist for a life insurance contract to be valid? inception of the contract throughout the entire length of the contract when the insured dies during the contestable period
Inception of contract
If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of? Insurer beneficiary reinsurer insured
Insured
Variable annuities may invest premiums in each of the following, EXCEPT: Common stock money market securities Insurer's corporate business account Junk bonds
Insurer's corporate business account
A policyowner is allowed to pay premiums more than once a year under which provision? Made of premium Insuring Consideration Payor
Mode of Premium
Which type of policy is considered to be overfunded, as stated by IRS guidelines? Modified Endowment Contract modified whole life variable universal life interest sensitive whole life
Modified Endowment Contract
P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to P only P and Q's estate R's estate
P only
P is the insured on a participating life policy. Which statement is true if P's premiums are waived due to a disability? P will still received dividends p cannot borrow against the policy's cash value while disabled p will have to pay income tastes on the amount of premiums waived p cannot assign ownership of the policy while premiums are being waived
P will still received dividends
what determines the full amount of social security retirement benefits a qualified individual is entitled to receive ? primary insurance (PIA) total taxes paid into FUCA number of dependents state of residence
PIA
Which statement is TRUE in regards to a policy loan? Past-due interest on a policy loan is added to the total debt past due interest on a policy loan is added to the total debt insurance companies can send delinquent interest accounts to a collection agency
Past-due interest on a policy loan is added to the total debt
On a life insurance policy who is qualified to change the beneficiary designated? Payor Primary Policyowner Insurer
Policyowner
K is the insured and P is the sole beneficiary on a life insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true?
Proceeds will be paid to P's estate
What is the consideration given by an insurer in the Consideration clause of a life policy? promise to never cancel coverage promised to pay a health benefit to a named beneficiary
Promise to pay a death benefit to a named beneficiary
All of these are considered sources of underwriting information about an applicant EXCEPT inspection report credit report rating services medical information bureau
Rating Services
M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son? Revocable Tertiary Irrevocable Contingent
Revocable
which of the following types of permanent life insurance policies offers the highest cash value single premium limited pay straight whole interest-sensitive
Single
the annuity that represents the largest possible monthly payment to an individual annuitant is a cash refund installment refund straight life annuity life annuity with period certain
Straight life annuity
C is trying to determine whether to convert her convertible term life policy to whole life insurance using her original age or attained age. What factor would affect her decision the most? The cost The nonforfeiture options The contestable period The assignment of ownership
The cost
When does a life insurance contract becomes effective if the initial premium is not collected during the application process? after all medical and personal information has been evaluated when insurer receives initial premium for the producer When producer delivers policy and collects initial premium after application has been approved by the underwriters
When producer delivers policy and collects initial premium
What does the ownership clause in a life insurance policy state? Who the policy owner is and what rights the policy owner is entitled to who the beneficiary is and what rights the beneficiary is entitled to ownership cannot be assigned after the incontestable period allows the policy owner to adjust the death benefit and premium amount at anytime
Who the policyowner is and what rights the policyowner is entitled to
what kind of life policy either pays the face value upon the death of the insured or when the insures reaches age 100 ? term life whole life credit life universal life
Whole life
In Iowa insurance producer has violated an unfair trade practice The commissioner may penalize the producer in which of the following manner?
a fine, only after a hearing
which premium schedule results in the lowest cost to the policy owner semi-annual monthly quarterly annual
annual
group life insurance policies are generally written as: a term rider annually renewable term increasing term group whole life
annually renewable term
when can a policy owner change a revocable beneficiary? antime after the consent of the current beneficiary never. only of the primary beneficiary dies
anytime
under a graded premium policy, the premiums lower during the policy early years are higher during the policy early years are constant throughout the length of the policy can be adjusted by the insured
are lowered during the policy's early years
Whose life is covered on a life insurance policy that contains a payor benefit clause? parent beneficiary child spouse
child
What type of employee welfare plans are not subject to ERISA regulations? church plans major medical plans corporate qualified plans
church plans
which of the following correctly explains the actions an agent should take if a customer wants to apply. for an. insurance policy
complete the application over the phone with the customer, sign the application for the customer then send the application off to the insurance company
K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used? binding initial premium conditional contingent
conditional
T applies for a life insurance policy and is told by the producer that the insurer is bound to the coverage as of the date of the application or medical examination, whichever is later, provided that T is an acceptable risk. What item is given to T? binding receipt conditions; receipt warranty receipt backdated receipt
conditional receipt
if its employees share in the most of insurance, what. type of group life insurance plan would a corporation have? noneligible nonocntributory eligible contributory
contributory
C is trying to determine whether to convert her convertible term life policy to whole life insurance using her original age or attained age. What factor would affect her decision the most? the cost the contestable period the assignment of ownership
cost
The ___ must provide an insured with the proper disclosure concerning the replacement of a life insurance policy compliance officer underwriter commissioner producer
date of delivery
an ____term life policy is normally used when covering an insureds mortgage balance increasing decreasing level variable
decreasing
additional coverage can be added to a whole life policy by adding a(n) payout rider accelerated benefit rifer decreasing term rider automatic premium loan ride
decreasing term rider
How are surrender charges deducted in a life policy with a rear-end loaded provision? deducted from the death benefit deducted when the policy is discontinues deducted from the policy's cash value deducted when assigned to another policy owner
deducted when the policy is discontinued
Which of the following does Social Security NOT provide benefits for?SurvivorshipDismembermentDisabilityRetirement dismemberment survivorship disability retirement
dismemberment
which of these statements is incorrect redarding the federal income tax treatment of life insurance premiums are normally not tax deductible cash dividend. are normally not taxed entire cash surrender value is taxable
entire cash surrender value is taxable
in a life insurance policy, which feature states that the policy will not cover certain risks exception exclusion ejection expulsion
exclusion
A universal life policy is sometimes referred to as an unbundled life policy because the owner can see the interest earned, cost of insurance, and inherent risk commission rate inflation factor expense charges
expense charges
d owns a whole life policy that was purchased 10 years go. If the premium payments suddenly stop and D takes no additional actions which nonforfeiture option will the insurer likely proceed with? extended term loan provision reduced paid up cash surrender
extended term
An underwriter determines that a life insurance applicant's risk should be reclassified due to a health issue. This policy may be issues with a(n) extra premium concealment clause extended contestable period exclusion for the medical condition
extra premium
The act of an insurance company publishing misleading information about its policy's provisions is called
false advertising
P is looking to purchase a life insurance policy that will pay a stated monthly income to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end of that 20 year period. What type of policy should P purchase? family benefit policy family maintenance policy family income policy family survivor policy
family maintenance policy
Taking receipt of premiums and holding them for the insurance company is an example of commingling misappropriating theft fiduciary responsibility
fiduciary responsibility
The payments on Q's annuity are no less than. $250 quarterly. Which of the following annuities does Q own? immediate fixed quarterly flexible flexible installment deferred adjustable deferred
flexible installment deferred
M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT policy is delivered free-look period has expired insurance company issues policy initial premium is collected
free look period has expired
a life insurance application may be rejected on the basis of all these factors except medical history hobbies gender weight
gender
Which requirement must be met for an association to be eligible for a group life plan? group was formed for a purpose other an acquiring insurance group must establish a president group must have at least 10 members group was formed for the purpose of acquiring insurance
group was formed for a purpose other than acquiring insurance
variable life products require a producer to guarantee not more than a 12% return per annum hold a life and health insurance license hold a life insurance license and a securities license be regulated solely by state law
hold a life insurance license and a securities license
which of these is not a reason for purchasing life insurance on the life of a minor ?
if both parents were to die, it would provide death benefits to the child
A long term care rider in a life insurance policy pays a daily benefit in the event of which of the following critical illness terminal illness inability of the insured to perform more than 2 actives of daily activity (ADL's) inability of the insured to maintain insurance premiums due to unemployment
inability of the insured to perform more than 2 actives of daily activity (ADL's)
All of the following statements regarding tax sheltered annuity (TSA) are true except income derived from the TSA is received income tax-free TSA's are available to public school employees contributions to the TSA are tax-deductible interest earned by the TSA is tax deferred
income derived from the TSA is received income tax-free
K is an annuitant currently receiving payments. if she were to die before receiving payments. equal to t he correct value, a. beneficiary ill contuse receiving payments under an amount equal to the contract value had been paid. This is called a(n) installment refund annuity joint refund annuity straight refund annuity equal value annuity
installment refund annuity
When third-party ownership is involved, applicants who also happen. to be the stated primary beneficiary are required to have all statements be warranties insurable interest in the proposed insured the agent completed third party application all these involved be family-related
insurable interest in the proposed insured
if the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died firs, there are the death proceeds to be directed under the uniform simultaneous death act primary beneficiary estate primary beneficiary next of kin insureds estate insureds contiengient beneficiary
insureds contiengient beneficiary
In a Life insurance contract, an insurance company's promise to pay stated benefits is called the -Insuring clause -Consideration clause -Entire Contract -Owner's rights
insuring
Which of these arrangements allows one to bypass insurable interest laws? concealment indemnity contract contract. of adhesion investor-originated life insurance
investor-originated life insurance
A policyowner would like to change the beneficiary on a Life insurance policy and make the change permanent. Which type of designation would fulfill this need? Revocable Contingent Irrevocable
irrevocable
A policyowner's rights are limited under which beneficiary designation? Revocable Tertiary Contingent Irrevocable
irrevocable
T has an annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity is this? fixed certain joint and full survivor life annuity with period certain installment refund
life annuity with period certain
Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary? life income interest period fixed amount life income
life income
A whole life insurance policyowner does not wish to continue making premium payments. Which of the following enable the policyowner to sell policy for more cash surrender life settlement contract buy sell arrangement 1031 exchange
life settlement contract
the accelerated death befit provision in a life insurance policy is also known as 1035 exchange inter vivos gift non-forfeiture option living benefit
living benefit
which of these is not relevant when determining the amount if personal life insurance needed ? household debt household income local unemployment rate existing life insurance coverage
local unemployment rate
Defamation occurs when an agent makes a false statement intended to
malign another insurer
a trustee-to-trustee transfer of rollover funds in a qualified plan allows a participant to avoid paying transfer fees paying trustee fees ver paying income tax es on the distributions
mandatory income tax withholding on the transfer amount
B the producer would like to sell an annuity to his. client. before selling the annuity, b needs to collect all of the. following information from his client except investment objectives tax status marital status financial status
marital status
____ can be defined as "making an unfair comparison of two insurance policies" rebating twisting coercing misrepresentation
misrepresentation
which unfair trade practice involves a producer telling a prospective client that a policy dividend are guaranteed? twisting rebating misrepresentation sliding
misrepresentation
which of these is not considered to be a right given to policy owner surrendering the policy's cash value modify a provision in the insurance contract assignment of ownership change the beneficiary, if revocable
modify a provision in the insurance contract
which of these is not an element of life I insurance premiums mortality rate insurers expense interest credit morbidity rate
morbidity rate
when funds are shifted straight from one IRA, what percentage of the tax is withheld 10 20 30 none
none
In an individual retirement account, (IRA), rollover contributions are subject to capital gains tax subject to ordinary income tax partially limited by dollar amount not limited by dollar amount
not limited by dollar amount
In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy? owners rights entire contract nonforfeiture insuring clase
owners rights
P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to r estate q estates and qestate p only
p only
whole life insurance policies are contractually guaranteed to provide each of the following, EXCEPT: cash value that will ultimately replace the death benefit nonforfeiture benefit. option premiums that remain fixed for the life of the policy partial withdraw features beyond a surrender charge period
partial withdraw features beyond a surrender charge period
When a policy pays dividends to its policyowners, it is said to be profitable mutual nonparticipating participating
participating
Insurance policies are considered aleatory contracts because they are "take it. or leave it" contacts both parties consent to the contract performance is conditioned upon a future occurrence the contract is voidable
performance is conditioned upon a future occurrence
who has the right to revoke a beneficiary beneficiary agent insurance company policyownrer
policy owner
When an employee is terminated, which statement about a group term life conversion is true?
policy proceeds will be paid if the employee dies during the conversation period
who elects the governing body of a mutual insurance company? chairman of the board bondholders stockholders policyowner
policyowner
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees? portion of the premium paid for by then employer may portion of the premiums paid for by the employer may be a tax deduction portion of the death proceeds are taxable to the beneficiary portion of the death proceeds are taxable to the estate
portion of the premium paid for by then employer may be a tax deduction
A level premium premium can only be changed with the consent of the. insurer premium stays level until the policy renewal dare fixed then becomes variable premium can only be changed premium is fixed for the entire contract
premium is fixed for the entire contract
Which of these characteristics is consistent with a straight life policy? owner can adjust both premium and death benefit premiums are lower for the first five years, increase the sixth year, then levels off for the remaining length of the contract. owner. has the option of converting to term insurance premiums are payable for as long as there is insurance coverage in force
premiums are payable for as long as there is insurance conversation in force
Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company. What action should J take?
return to the customer, collect a new check made out. to the insurance company, and send the checkbook to the insurance company
a(n) _____ beneficiary may be changed y the policy owner without the consent of the beneficiary revocable irrevocable tertiary replaceable
revocable
A group owned insurance company that is formed to assume and spread the liability risks of its members is known as: treaty insurer risk retention group captive insurer risk assumption group
risk retention group
which factors does not influence an applicants need for life insurance ? lifestyle of the applicant number of dependents future educational. costs of the dependents self-maintenance expenses
self maintenance expense
An immediate annuity consisting of a variable premium flexible premium single premium deferred premium
single
T would like to be assured $10,000 is available in 10 years to replace a roof on his house. What kind of $10,000 policy should T purchase? interest sensitive whole life ten year endowment variable universal life ten year renewable term
ten-year endowment
Who is normally considered to be the owner of a 403(b) tax sheltered annuity the employee the employer the financial institution The 403(b) custodian
the employee
the consideration clause in a life insurance policy indicated that a policy owners consideration consist of a completed application and the initial premium agreeing to a physical examination delivery of policy disclosure of any medical conditions
the initial premium
upon policy delivered, a signed good health statement is requested from the applicant. why would this be necessary? The applicant chose an annual premium mode the applicant is suspected of making a material misrepresentation the initial premium was submitted with the application the initial premium was not submitted with the application
the initial premium was not submitted with the application
Which statement regarding the change of beneficiary provision true? Can only be changed with. e consent of the insurer the policy owner can change the beneficiary raw insured can change the beneficiary a beneficiary change is subject to underwriting procedures
the policy owner can change the beneficiary
an individual who purchases a life annuity is given protection against: inflation the risk if dying prematurely the risk of living longer than expected the risk of not having enough retirement income
the risk of living longer than expected
The consideration clause of an insurance contract includes the buyers guide a summary of the coverage provided the named beneficiaries the schedule and amount of premium payments
the schedule and amount of premium payments
the common disaster clause provides that both the insured and the Cole named beneficiary where to. die in a common accident which of the following is true? provides payment of proceeds to the insureds estate provides the payment of the proceeds to the beneficiary estate the estates taxes in the insureds estate maybe reduced
this clause provides the payment of proceeds to the insureds estate
The reason for backdating a policy is to avoid being considered substandard risk due to a recent cancer diagnosis to obtain a premium rate based on an earlier age to decreased the face amount to decrease the the contestable period
to obtain a premium rate based on an earlier age
a variable annuity has which of the of the following characteristics underlying equity investments only available with single premium offers a fixed interest rate does not require na insurance license underlying equity investments only available with single premium offers a fixed interest rate does not require an insurance licensed
underlying equity investments
life and health insurance policies are multi-lateral contracts bilateral contracts unilateral contracts non-lateral contracts
unilateral contracts
The cash value in a(n) _______ life policy may fluctuate to reflect changing assumptions regarding mortality cost, interest, and expense factors universal graded term endowment
universal
k purchased a life insurance policy in 1986 which paid 10% interest in the early years of the policy. Twenty years after the purchase, she received a notice from the insurer stating. that the policy will soon terminate unless a much-higher premium is paid because of falling interest rates. This type of policy is known as a(n) ____life policy. whole universal graded increasing
universal
a term life insurance policy matures upon death of insured upon endowment of the contract when the cash value equals the death benefit upon the insureds death during theorem of the policy
upon the insureds death during theorem of the policy
a life insurance policy owner would like to take out a policy. loan. against the cash value in this. whole one policy. the interest rate applied to t his. loan. may vary over time. thIS IS REFERRED TOAS A(N)______rate loan fixed variable increasing fluctuating
variable
in order to sell a(n). ____ life policy, a producer is required to register with theFinancial Industry Regulatory Authority (FINRA) variable adjustable straight term
variable
Which of these is considered a statement that is assured to be true in every respect? Estoppel warranty guarantee representation
warranty
if a 10 year term life policy contains a renewable provision, the policy will renew along with a decrease in premium at the option of the insurer only with evidence of insurability without evidence of insurability
without evidence of insurability
which of the following permits an insurance company to transact business in iowa
certificate of authority
company xyzzy offers a group term life insurance plan to its employees, what does each employee. covered under this plan receive? master policy receipt of coverage individual policy certificate of insurance
certificate of insurance
a whole life insurance policy owner does not have the right to designate beneficiary take out policy loan change grace period assign policy
change grace period
Two partners own equal shares in a business worth a total of $1,000,000. If they both commit to the purchase of a life insurance policy that will fund a Buy-Sell Agreement, which of the following is TRUE? -Each partner owns a $1,000,000 policy on their own life - Each partner owns a $1,000,000 policy on their partner's life - Each partner owns a $500,000 policy on their own life - Each partner owns a $500,000 policy on their partner's life
- Each partner owns a $500,000 policy on their
Which of the following statements is correct regarding a tax treatment of a lump-sum payment aid to a life insurance policy's to Mary beneficiary The proceeds which exceed the amount paid In premiums are taxable Proceeds are taxable only if the beneficiary's tax bracket has changed from the payout All proceeds are considered taxable Income in the year that they are received All proceeds are income tax free in the the year that they are received
All proceeds are income tax free in the year that they are received
which of the following statements is correct regarding the tax treatment of a lump-sum payment paid to a life insurance policy primary beneficiary?
All proceeds are income tax free in the year they are received
What is the underlying concept regarding level premiums Level premiums can only be paid annually The early years are charged more than what is needed The early years are charged less than what is needed
The early years are chased more than what is needed
J chooses a monthly premium payment mode on his Whole Life insurance policy. Which of these statements is correct?
The gross premium is higher on a monthly payment mode as compared to being paid annually
a policy of adhesion can only be modified by whom? the agent the applicant the primary beneficiary the insurance company
The insurance
A policy of adhesion can only be modified by whom? The agent the applicant the primary beneficiary the insurance company
The insurance company
All of these statements about Equity Indexed Life Insurance are Correct EXCEPT: Can values has a minimum rate of accumulation if the gain on the index goes beyond the policy minimum rate of return, the cash value will mirror that of the index the premiums can be lowered or raised, based on investment performance tided to an equity index such as S&P 500
The premiums can be lowered or raised, based on investment performance
Why is an applicant's signature required on a life insurance application? To attest that the statement on the application are accurate to the best on the applicants knowledge To attest that all statements on the application are guaranteed to be true To give the power of attorney to the producer if needed To attest that all statements on the application are guaranteed to be true
To attest that the statement on the application are accurate to the best on the applicants knowledge
P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take? beneficiary will be paid the death benefit beneficiary will be denied the claim beneficiary will be denied the claim and refunded all paid premiums beneficiary will be paid a partial death benefit
beneficiary will be paid the death benefit
Which of these is NOT considered to be a cost connected with an individual's death? funeral expenses tax liability business expenses
business expenses
Which of the following actions is NOT possible with a Universal Life policy? policy cash value may be used to pay premiums premium payments may be made at unscheduled times premiums may be applied as a credit against income tax face amount may be adjusted
premiums may be applied as a credit against income tax
consumer reports requested by an underwriter during the application process of a life insurance policy can be sued to determine: driving history probability of making timely payments if applicant is a tobacco user overall health of applicant
probability of making timely payments
K is the insured and P is the sole beneficiary on a life insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true? proceeds will be paid to P's estate proceeds will be divided equally between K's and P's estate proceeds will be payable to K's estate if P dies within a specific time the courts will decide who will receive death benefits
proceeds will be payable to K's estate if P dies within a specific time
a primary beneficiary hashed before the insured in a life insure policy. A contingent beneficiary is also named in the policy. Which of the following will occur when the insured dies? proceeds will do to the primary beneficiary estates probate will decide who receives proceeds proceeds will go to. the continent beneficiary proceeds will go to the insureds estate
proceeds will fo to the contingent beneficiary
an individual who has a contract with an insurance company to represent it is called a(n) representative producer director administrator
producer
A retirement plan to set aside part. of the company's new income for distributions to qualified employees is called an rollover plan. 403(b) plan profit-sharing plan salary reduction plan
profit sharing plan
What is the consideration given by an insurer in the consideration clause of a life policy promise to never cancel coverage promise to pay a death benefit to a named beneficiary promise to not raise premiums promise to accept an insureds assignment of benefits
promise to pay a death benefit to a named beneficiary
Statements made on an insurance application that are believed to be true to the best of the applicant's knowledge are called
representations
