missed questions
Any authorized insurer within a state
Who must be a member of insurance guaranty associations ?
It does not have a guaranteed death benefit
All of the following statements are true regarding an Ordinary ( Straight ) Life policy EXCEPT
Ordinary Life or Continuous Premium Whole Life
Straight Life also called
c ) Continue to increase
A whole life policy is surrendered for a reduced - paid up policy . The cash value in the new policy will a ) Decrease over time . b ) Reduce to the pre - surrender value . c ) Continue to increase d ) Remain the same .
Immediately
If a loan request is for payment of due premiums on the policy , how soon must the insurer issue a loan ? a ) Immediately b ) Within 10 days c ) Within 30 days d ) Within 90 days
A : When the commissions from controlled business do not exceed the aggregate commissions on all the other business ( specific limits may vary from state to state )
Q : When is controlled business legal
the policy , ( 2 ) a copy of the application and ( 3 ) any riders or amendments .
The entire contract includes
not subject to federal taxation
to the policyowner If life insurance proceeds are collected in a lump - sum payment , they are generally
c ) Prior to performance of the test
If a life insurance company uses HIV testing as a part of its underwriting , when must an applicant be notified of the procedure ? a ) Prior to solicitation of the policy b) Prior notice is not required c ) Prior to performance of the test d ) Prior to ordering a physical examination
Insurance company officers , directors , or any other employees who do not transact insurance and who do not receive commissions for their services usually , their responsibilities include administrative , executive or clerical ) .
In general , who can be excluded from producer licensing and examination requirements ?
Fiduciary
The requirement that agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility ?
Cash , reduced premium , accumulation at interest , paid - up additions , paid - up option , one - year term , and acceleration of endowment
What are the dividend options in life insurance policies ?
Cash surrender reduced paid up and extended term (REC)
What are the three nonforfeiture options in life insurance policies ?
c ) A general account
Where are premiums from fixed annuities invested ? a ) A hedge fund b ) A separate account c ) A general account d ) A variable annuity
A buyer's guide
The entire contract includes all of the following EXCEPT a ) Any riders or amendments . b ) A buyer's guide c ) The life insurance policy . d ) A copy of the application .
fixed premium and guaranteed minimum death benefit
Variable whole life insurance contains
Broker
What type of licensee represents the insured ?
a ) Whole life without proof of insurability
When an insured terminates membership in the insured group , the insured can convert to a ) Whole life without proof of insurability b ) Whole life with proof of insurability . c ) Term without proof of Insurability d ) Term with proof of insurability .
Straight Life
charge a level annual premium for the lifetime of the insured and provides a level , guaranteed death benefit . If the insured lives to age 100 , the policy endows matures ) and the face amount is paid to the insured at that time
7 years
a life insurance policy qualifies as a Modified Endowment Contract ( MEC ) if the amount of premium paid exceeds the amount that would have provided paid - up insurance in how many years ?
30 days
How many days ' notice must an insurer provide to an insured regarding the lapse of a policy due to outstanding loans ?
c ) Prior to performance of the test )
If a life insurance company uses HIV testing as a part of its underwriting , when must an applicant be notified of the procedure ? a ) Prior to solicitation of the policy b ) Prior notice is not required c ) Prior to performance of the test d ) Prior to ordering a physical examination
immédiately
Loan requests for payment of due premiums must be fulfilled Requests for any other reason may be deferred up to 6 months
Misrepresentation
On its advertisement , a company claims that it has funds in its possession that are , in fact , not available for the payment of losses or claims . What is the company guilty of ?
Purchase of a new home
The Guaranteed Insurability Rider allows the owner to purchase additional amounts of life insurance without proof of insurability at all of the following EXCEPT a ) Marriage . b ) Purchase of a new home c ) Approximately every 3 years between the ages of 25 and 40 . d ) Birth of a child .
The agent
What type of licensee represents the insurance company ?
a ) The principal portion is generally income tax - free while the interest portion is taxed as ordinary income .
When a settlement option is chosen at death , how are the monthly income payments taxed ? a ) The principal portion is generally income tax - free while the interest portion is taxed as ordinary income b ) The portion of the payment that represents the terminal reserve is income taxable . c ) The total monthly amount is tax - free since it derived from death benefits . d ) The entire amount is taxable since the benefit was not taken in a lump sum .
Whenever deemed necessary , but at least once every few years
When can the Commissioner or Director examine insurers ?
Reduced paid - up
Which nonforfeiture option provides coverage for the longest period of time ?
c ) Test results must be sent to the Department of Insurance
Which of the following statements regarding HIV testing is NOT true ? a ) The insurer is responsible for the cost of HIV testing . b ) Written consent from the applicant is required prior to the examination . c ) Test results must be sent to the Department of Insurance d ) Testing may be waived at the discretion of the insurer .
Variable whole life insurance
. The policy's cash value fluctuates and therefore is not guaranteed .
collaterally assigned to a lender
Transfer for value rules do not apply when a policy is
a ) If there is a transfer for value
Under which of the following conditions would life insurance proceeds be taxable by the federal government ? a ) If there is a transfer for value b ) If collaterally assigned to a lender c ) If taken as a lump sum d ) If paid to the policyowner
Primary beneficiary
What beneficiary designation has first claim to the death proceeds of a life insurance policy ?
Collateral assignment
What type of assignment is used to secure the payment of a debt with an existing life insurance policy ?
straight life
policy builds cash value . The insurer guarantees the cash value and death benefit
For continuation of business in case the licensed producer dies or becomes disabled
For what reason can a temporary license be issued ?
Authorized or admitted
If an insurer holds a Certificate of Authority , it is known as what type of insurer ?
when the policy is delivered .
The free - look period begins when
Producer's spouse or designee in case the licensed producer dies or becomes disabled
Who can usually be granted a temporary license ?
The cash value is converted to the same face amount as in the whole life policy
What happens to a policy's cash value under an extended term nonforfeiture option ?
To protect policyowners , insureds and beneficiaries from financial losses caused by insolvent insurers
What is the purpose of insurance guaranty associations ?
a ) Extended term
When a whole life policy is surrendered for its nonforfeiture value , what is the automatic option ? a ) Extended term b ) Paid up additions c ) Cash surrender value d ) Reduced paid up
Guaranteed Insurability Rider
allows the owner to purchase additional amounts of insurance without proof of insurability at marriage , birth of a child , and / or every 3 years or so between the ages of 25 and 40
d ) Reports may be sent to anyone who requests one
All of the following are true regarding the federal Fair Credit Reporting Act EXCEPT a ) Insurers are not required to give customers a copy of the report . b ) It applies to credit reports ordered in connection with insurance , banking and employment . c ) The customer must be notified if adverse action is taken as a result of a report . d ) Reports may be sent to anyone who requests one
d ) Delivery of the policy .
In this state the owner gets a " free look " of a specified number of days from a ) Acceptance of the risk by the insurer . b ) The date of application . c ) Acceptance of the application . d ) Delivery of the policy .
Authorized or admitted
If an insurer meets the state's financial requirements and is approved to transact business in the state , it is considered what type of insurer ?
The longer the period selected , the smaller each installment will be
In the fixed - period settlement option , how will the number of installments for the death benefit proceeds determine the amount of the installments ?
The insurer will pay a benefit of twice the face amount
What does the term ' double indemnity ' mean ?
convert to whole life without proof of Insurability
When a member terminates membership in a group , he or she can
a ) Minimum death benefit
Which of the following is guaranteed under a variable whole life insurance policy ? a ) Minimum death benefit b ) Interest rates c ) Cash value d ) Stock performance