Life Law 1 ( chapter 27 )

A Dually Licensed Agent:

Holds an insurance and a securities license at the same time

All of the following are eligible for group insurance EXCEPT :

Home owners associations

The incontestable clause applies to all the following except :

Impersonation

Robert had a $100,000 policy which he converted to a reduced paid-up policy with a $55,000 death benefit. At the same time robert purchased a variable universal policy that allowed him to choose the investments. Which word best describes this ?

Replacement

The amount and frequency of premium payments are found in which clause of a life or health insurance policy ?

The consideration clause

Policy Assignment is :

The policy owner assigns certain ownership rights to a second party

an individual may convert his industrial insurance policies to ordinary policies when his industrial policies total at least :

$3000

Shirley has a $10,000 life policy. She borrows $500 from the cash value at a rate of 5%. Five months later Shirley suffers a small calamity which put her in the grave. Her beneficiary will receive :

$9475

Temporary term for interim coverage may used to defer the effective date of an original policy for how many months ?

1-11

The Florida uniform simultaneous death act

1. Provides that when it is impossible to determine who does last it is assumed the insured died last. 2. It was designed to clear the way for playing claims

Joe has a $10,000 whole life insurance policy with an adjustable loan interest rate. Moodys bond index is 12%. If joe were to borrow against his cash value, what is the most the insurance company could charge joe for the loan ?

12%

In Florida , an insurer is required to issue an additional lapse notice after the applicable statutory grace period has expired for which age group ?

64 or older

A life Insurnace company's legal reserve shows on the balance sheet as :

A liability

Which of the following constitutes replacement ?

All the above

All of the following statements concerning a family plan life Insurnace policy are true except :

Children born later are immediately covered

An insured has a $50,000 whole life insurance policy which has an accumulated cash value of $30,000. Upon the advice of his insurance agent he uses $20,000 of the cash value to pay for a single premium life insurance policy from the same company. The remaining $10,000 is used to purchase an annuity. Which of the following best describes the agents recommendations ?

Churning

Borrowing money from a life insurance policy at 5% to invest in a variable universal life policy could be considered :

Churning

Dude bought a life insurance policy, after 10 years he died and it was found that there were misrepresentations on the application. What will the insurance company pay ?

Full benefit

The ____________ clause states the insurance company will pay the death proceeds .

Insuring

Which of the following statements is not correct regarding an association group ?

Must have been in existence for one year

Which of the following statements concerning par and non-par policies is correct ?

Premiums for par polices are higher than non-par

All the following statements concerning the tax treatment of life insurance are true except :

Premiums paid for life insurance in non-qualified are deductible

Which of the following is NOT a duty of an agent when replacing a life insurance policy ?

Presenting to the applicant, at time of policy delivery, notice to applicant regarding replacement of life Insurnace

Real Deal wants to name her husband as the beneficiary of her life policy; however, she wishes to retain all of the rights of ownership. Real should have had husband named as :

Revocable beneficiary

Alice had a life insurance policy naming her husband, TOM, as the primary beneficiary, and her son as the secondary beneficiary. Alice divorced Tom and died serval months after the divorce and had not taken time to change the beneficiary. The company will pay the proceeds to

THE SON

Which of the following is called the fifth dividends option?

Term

If the insurance company were to cancel a group life insurance policy it must notify their certificate holders covered under the group. How may The insurance company perform his action?

The insurance company notifies the master contract holder

Which of the following agencies regulate variable life insurance products :

The office of insurance regulation & securities exchange commission

The viatical settlement act includes all of the following except :

Viatical providers are regulated by dept. of viatical settlement

Which of the following statements about the misstatement of age provision in a life insurance policy is true ?

If the insured's age has been understated, it provides that a death benefit smaller than the face amount of the policy will be payable

Which of the following are disadvantages of naming the insureds estate as beneficiary :

I. Creditors can easily attach the proceeds II. Proceeds increase the size of the estate III. If there is a will it may be contested IV. The advantages of settlement options are lost

Which of the following statements about the assignment of a life insurance policy is ( are ) true ?

I. Most insurance companies require that notice of any assignment of a policy be filed at the home office.

The viatical settlement act

I. Requires licensing for brokers and provides II. Allows licensed life agents perform the functions of a viatical broker III. Provides for regulation of these products by the Dept. of financial services

Florida rules on disclosure require

II. A 14 day free look and buyers guide provided at delivery

Munch withdraws $2,000 of accumulated dividends from his life insurance policy. What will be the TAX result ?

III. The dividends are exempt from income tax, but any interest credited will be taxable .

Titus has absolutely assigned his $100,000 life insurance policy to the bank to cover a $75,000 mortgage. His wife is named as primary beneficiary. If Titus were to die which statement correctly reflects the insurance company's obligation?

The bank would receive the entire amount

A life insurance policy is considered incontestable after it has been in force for a period of :

2 years

Which of the following is correct concerning the grace period for folks aged 64 & over ?

2. They are afforded an additional 21 days of grace. 3. Does not apply to policies held less than one year

Old man AnnaCee, 67 yrs old , has had a policy for 16 years. In addition to his regular grace period he will have an additional grace period of how many days ?

21 days

Mammy had a $100,000 policy which which had $25,000 of cash value. Mammy used the cash value to purchase a Variable Universal policy with the same insurer that allowed her to choose the investments. Which word best describes this?

Churning