Primerica pt. 4
In the state of Illinois, a viatical settlement contract must contain an unconditional right to cancel. How long does this right remain in effect?
30 days from the date the contract is executed
How long must an insurer's advertisement be kept on file?
4 years
The termi "illustration" in a life insurance policy refers to
A presentation of non guaranteed elements of a policy
Insurance policies are not drawn up through negotiations, and an insured has little to say about the provisions. what contract characteristics does this describe?
Adhesion
Who can make a fully deductible contribution to a traditional IRA?
An individual not covered by an employer- sponsored plan who has earned income
An insirance contract requires that both the insured and insurer meet certain conditions in order for the contract to be enforceable. What contract does this describe?
Conditional
An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe?
Conditional
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
Conditions
Which is TRUE about the cash surrender nonforfeiture option?
Funds exceeding the premium paid are taxable as ordinary income
When would a misrepresentation on the insurance application be considered fraud?
If it is intentional and material
If a license charges any fee separate from a commission off of the insured's premium, and if the fee exceeds 10% of the premium's value, what must the license obtain?
Insured's signature
When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income?
Interest only
Which of the following is NOT true regarding a Premium Fund Trust Account?
It can be used as a claim payment account
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?
Misrepresentation
Which of the following is NOT true regarding policy loans?
Money borrowed from the cash value is taxable
which of the following is another term for the accumulation period of an annuity?
Pay- In Period
Which of the following is correct concerning the taxation of premiums in a key- person life insurance policy?
Premiums are not tax deductible as a business expense
The Federal Fair Credit Reporting Act
Regulates consumer reports
Which of the following best details the underwriting process for life insurance
Selection, classification and rating of risks
A producer is helping a married couple determine the financial needs of their children in the event one or both die prematurely. This personal use of life insurance is
Survivor protection
All of the following are correct regarding Misrepresentation EXCEPT
The fines for misrepresentation is $50 to $1,000
An applicant recieves a temporary insurance producer license. After 80 days, the owner of the insurance company decides to sell the business. Which of the following is true?
The license will automatically terminate
Which of the following individuals must have insurable interest in the insured?
The policyowner
Under a Simple Plan, which of the following is TRUE regarding taxation on both contributions and earnings?
They are tax deferred until withdrawn
What is the purpose of a fixed- settlement option?
To provide a guaranteed income for a certain amount of time
If an insurance company makes a statement that it's policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
Unfair Trade practice
If only one party to an insurance contract has made legally enforceable promise, what kind of contract is it?
Unilateral
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When the does the policy coverage become effective?
as of the application date
Why is an equity indexed annuity considered to be a fixed annuity?
it has a guaranteed minimum interest rate
Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must
respond to the consumers complaint
Within how many days may a person who is being examined by the Director for nonfinancial business practices request a hearing after receiving the examination report?
10 days
An Internal Revenue Code provision that specifically provides for an individual retirement plan for public school teachers is a(n)
403 (b) Plan (TSA)
if a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 days
Each year a license viatical settlement provider must file with the Director a
Annual Statement
A Universal Life Insurance Policy is best described as a
Annually renewable term policy with a cash value account
Employer Contributions made to a qualified plan
Are subject to vesting requirements
Which nonforfeiture option has the highest amount of insurance protection?
Extended Term
The life insurance policy that prevents an insurance company from denying payment of a death claim after a specified period of time is known as
Inconstestability Clause
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time
Incontesability clause
Which of the following best describes annually renewable term insurance
It is level term insurance
Which of the following is NOT true regarding the accumulation period of an annuity
It would not occur in a deferred annuity
Which of the following is correct concerning the taxaxtion of premiums in a key- person life insurance policy?
Premiums are not tax- deductible as a business expense
The policyowner of a Universal Life policy may skip paying the premium and the policy will not lapse as long as
The policy contains sufficient cash value to cover the cost of insurance
In insurance policies, the insured is not legally bound to any particular action in the insurance contract, but the insurer is legally obligated to pay losses covered by the policy. What contract element does this describe?
Unilateral
An employer has sponsored a qualified retirement plan for its employees where the employer will contribute money whenever a profit is realized. What is this called?
Profit Sharing Plan
Which if the following is not true regarding the annuitant?
The annuitant cannot be the same as the annuitant owner
If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?
5 days
Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early?
Paid- Up option
which of the following is NOT TRUE regarding the annuitant?
the annuitant cannot be the same person as the annuity owner
all of the following statements about equity index annuity are correct EXEPT
the annuitant receives a fixed amount of return
Life income joint and survivor settlement option guarantees
Income for 2 or more recipients until they die
the advantage of qualified plans to employers is
Tax- deductible contributions