Studying Life

Automatic premium loan

A client has missed her premium payment on her cash calue policy, and the grace period has also lapsed. The policy is still in force because her insurer has been deducting the cost of the premium from her cash value. What provision allows this?

Single premium Immediate annuity

A client has purchased an annuity with an annual bonus she received at the end of the last year. She has requested annual benefit payments to start at the end of this year. What type of annuity did she purchase?

Variable universal life

A client's flexible premium is invested into separate account. What type of insurance product did he purchase?

He will be required to pay 10% tax penalty on the amount withdrawn

A forty-five year old investor has been laid off from his job. In order to pay bills he takes a premature distribution from his traditional IRA account. What tax penalties, if any, will he face?

Facility of payment

A partial payment of proceeds to cover final expenses is paid to someone not designed as a beneficiary but acting in a legal or fiduciary capacity. This is provided in which provision?

Irrevocable beneficiary

A policyowner who cannot borrow the equity, change beneficiaries written consent has designated the beneficiary as a/an

The agents faces potential suspension or revocation of their license.

A-life-only agent issues a binding receipt to his client since the client did include a check for the initial premium with his completed application. Which statement is true?

The new policy will be cash value. The employee pays all the premiums

An employee has lost access to their group term life insurance plan, but they allowed to convert to a new plan. Which plan best describes this new plan?

General account

An insurer invests the cash value of a fixed annuity in which of the following assets?

Theft

Any person who misappropriates fiduciary funds for personal use is guilty of:

Ashley's estate

Ashley's the policy owner and insured, named wendell as primary beneficiary and barbara as contingent beneficiary. Just six weeks prior to Ashley's death, wendell and barbara are killed in a common disaster. The insurance proceeds will be received by whom?

Agent Charles cannot allow mrs.smith to purchase an annuity if after the purchase, mrs.smith wouldn't qualify for medi-cal

At age 72, mrs.smith is considering applying for medi-cal so she can afford her medical bills. Today agent charles is visiting her home and wanting to sell her an annuity product. which of the following is true?

65

At what age does social security Medicare program part b start providing benefits?

Accumulation Period

For a flexible premium deferred annuity, the time during which owner makes premium payments and the time before benefit payments begin is known as the:

Each party relies upon the truthfulness of the other

For an instance contract, utmost good faith means:

24 hours, 4 of the hours must be in ethics

How many hours of continuing education are required per renewal for a life - only agent?

Premium cost for insurance above $50,000 is taxable as income to the employee

In a group life policy with a death benefit of more than $50,000

100% of employees must be allowed to participate

In a non-contributory group policy:

100%

In a seven year vesting schedule, what percentage of employer contributions is vested after seven years?

Elimination Period

In disability insurance, the period of time between when the disability and the commencement of benefits is the

Express authority, implied authority and apparent authority

In insurance, the agents have authorization to represent the company. The producers may exercise this relationship through:

Contingent beneficiary

In life insurance, beneficiary succession is the method used to determine who will receive death proceeds. If the primary beneficiary is not living upon the death of the insured who will receive the payment?

She has a 30 day free look period in case she changes her mind

Mrs. Anderson needs to invest the proceeds from her late husband's life insurance.

Accumulation units

Premiums paid into a variable annuity purchase which of the following?

Allow for a contribution of a specified proportion of company profits

Profit sharing plans:

Life with a refund option, life with 10 years certain, straight life

Rank from lowest to highest, the amount of monthly income that would result from the following annuity settlement options:

A hazard

Situations where the risk is increased by slippery floors, a habit of lying , or reckless drunk driving are best described by which of the following?

Provides temporary protection, builds no cash value, is less expensive, and may be renewed

Term insurance is best describes by which of the following?

If the applicant has permitted someone in their employment to violate the California insurance code

The commissioner can deny an applicant for a license after a hearing:

Spendthrift(trust) Clause

The provision that protects the proceeds of a life insurance policy from attachment by the beneficiary's creditors after the insured's death is known as the:

Sign a consent form

To authorize the release of an attending physician's report, applicant must:

None of these would ever be automatically approved

Tommy Greene has a CLU Certification. Which of the following names would be automatically approved for use as his agency's name?

SEC, FINRA, and DOI

Variable insurance and variable annuity products are regulated by:

Selected by the governor as an appointee

What is a false statement? The California insurance commissioner is:

10

What is the minimum numbers required for group life insurance?

Representation

When an applicant makes a material statement believed to be true to the best of their knowledge, the statement is considered to be a/an

An agent advises a claimant to obtain the services of an attorney

Which action by an insurer, or its representatives, is not considered an unfair claims violation?

2,000 or less in coverage and premiums collected by agent

Which best describes industrial insurance?

Whole life

Which insurance is known for having level premium with a fixed rate of return resulting in guaranteed cash value?

Allows the policyowner the opportunity to renew the policy at the end of term, without evidence of insurability. The premium will increase

Which of the following are characteristics of renewable term?

Warranty

Which of the following becomes part of the contract, is guaranteed to be true, and if untrue, may be grounds for rescinding the policy?

Vanishing premiums

Which of the following cannot be used in a policy illustrations if non-guaranteed elements are intended to pay future premiums?

The item to be insured is part of a large group of homogenous exposure units.

Which of the following characteristics would not stop an insurance company from accepting an insurance risk?

A client does not have access of their MIB report as it belongs to the member's life insurers

Which of the following is an incorrect statement about a client's privacy rights?

Mortgage redemption

Which of the following is considered ordinary insurance?

School distract employee

Which of the following is most likely to have a TSA?

Declined

Which of the following is not an acceptable underwriting classification?

Purchasing a new policy that will take the place of an existing policy

Which of the following is not excluded from the California life and annuity Replacement Law?

A variable annuity exchange for a variable universal life policy

Which of the following is not qualified 1035 exchange?

A licencee 30 days to update or change in address

Which of the following statements about a resident life-only agent licensing is incorrect?

The policy will endow at age 65

Which of the following statements is false in regard to a life-paid up at 65 whole life policy?

The insurer agrees to provide life insurance protection for the named insured which will be paid to a designated beneficiary when proof of death is received by the insurer

Which of the following statements is not included in the entire contract clause?

Any action that could do harm to your clients well-being such as reckless driving.

Which of the following would not be considered a speculative risk?

Policyowner

Which of the party has the legal authority to name or change beneficiary?

Accidental Death Benefit

Which rider pays a multiple of the original face amount?

Acts of fair and unfair discrimination are prohibited

Which statement about life insurance code and ethics is not true?

Convertible term can be purchased by applicants who may require a larger death benefit in the future

Which statement below is least correct regarding the type of insurance that fits best with the applicant's needs?

One party accepts the exact terms of the other party's offer

Which statement best describes "agreement" as it relates to contracts?

Reciprocal insurer

Which type of insurer requires an attorney -in-fact overseen by an advisory committee of subscribers?

post-claims underwriting is a valid and necessary means of determining the insurability of a potential applicant

While collecting underwriting information, certain rules must be followed. Which of the following is incorrect?

The applicant

Who submits a request for life insurance company?

5 Years

According to the CIC, life-only agents must keep records of their transactions for:

An insurer

According to the code, any person legally capable of making an insurance policy is considered:

Interest only option

All of the following are divided options, except:

The death benefit is taxable to the business

All of the following are true about key person insurance, except:

Disability income insurance

All of the following needs to be included on an application for life insurance except:

Grace periods are typically 31 days

All of the following statements about a policy grace period are false, except:

Assignments need not be filed with the insurer if notarized and filed in county records

All of the following statements about assignments are not false, except:

Policy dividends issued by mutual companies are guaranteed and not taxable

All of the following statements about mutual insurance companies are correct except

Non-participating policies issue dividends to policyowners

All of the following statements are true about participating and non- participating policies, except:

Express

An agent follows the rules and terms of his agent contract. He is exercising his _______ authority

Twisting

An agent who knowingly misrepresents material information for the purpose of including a client to lapse, forfeit, change or surrender a life insurance policy or annuity has committed an illegal practice known as:

A consumer report

An applicant has the right to know that the insurance company will collect certain personal information about their credit, character and reputation. The insurer may gain such information from:

Buy-Sell Agreement

Bob and Neal are partners in a law firm together. If one of them was to pass away, they want to make sure that their surviving family would receive a fair value for their stake in the business.

The death benefit will be reduced to reflect the age discrepancy

Brian purchased a variable life policy and died 25 months after the issue date. It is then discovered that Brian Understand his age on the application. What will the insurer do in regard to the payment of the death benefit to the beneficiary?