NW internship Life Insurance CH 3- scenarios
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary? Return of premiums paid Cash value plus interest $20,000 death benefit Face amount plus interest
$20,000 death benefit
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct? Straight life accumulates faster than Limited-pay Life 20-Pay Life accumulates cash value faster than Straight Life Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurer's financial rating 20-Pay Life and Straight Life accumulate cash value at the same rate
20-pay life accumulates cash value faster than Straight Life
S has a Whole Life policy with a premium payment due soon. Which provision would keep the policy in force if S does not make the required payment and the policy has adequate cash value from which the premium payment can be made? Automatic Policy Loan Assignment Grace Period Waiver of Premium
Automatic Policy Loan
The automatic premium loan provision is designed to provide a source of revenue to the insurance company avoid a policy lapse allow a policyowner to request a policy loan allow a policyowner to take out additional coverage without evidence of insurability
Avoid a policy lapse
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 denied the claim Beneficiary will be denied the claim and refunded all paid premiums Beneficiary will be paid the Death Benefit Beneficiary will be paid a partial Death Benefit
Beneficiary will be paid the Death Benefit
Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it? Modified Whole Life 20-Pay Life Decreasing Term Endowment
Decreasing Term
Which of these statements about a Guaranteed Insurability Option rider is NOT TRUE? Coverage can be added at specific events such as marriage or having a child Evidence of insurability is not required when the option is exercised Evidence of insurability is required when the option is exercised Coverage can be added at specific ages
Evidence of insurability is required when the option is exercised
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? Refund of all premiums paid, plus interest Refund of all premiums paid Full face amount minus any past due premiums Full face amount
Face amount minus any past due premiums
Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options? Modified Whole Life Variable Life Universal Life Adjustable Life
Variable Life
Which type of life policy contains a monthly mortality charge as well as self-directed investment choices? Joint Life Adjustable Life Variable Universal Life Universal Life
Variable Universal Life
The Consideration clause in a life insurance contract contains what pertinent information? Summary of benefits Offer and acceptance Entire Contract Amount of premium payments and when they are due
amount of premium payments and when they are due
In a life insurance policy, which feature states that the policy will not cover certain risks? Exception Exclusion Ejection Expulsion
exclusion
What is the Suicide provision designed to do? decline an applicant who is contemplating suicide safeguard the insurer from an applicant who is contemplating suicide protect the insurer from ever paying a claim that results from suicide allows the insurer the option to pay a death benefit in the event of suicid
safeguard the insurer from an applicant who is contemplating suicide