CERTIFICATION

Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member?

family term rider

which non-forfeiture option provides coverage for the longest period of time?

reduced paid up

An insured pays $1200 annually for her life insurance premium. The insured implies this years $300 worth of accumulated dividends to the next years premium, thus reducing it to $900. What option does this describe?

reduction of premium

An insured purchased a 10 year level term policy that is guaranteed renewable and convertible. What happens at he end of the 10 year term?

the insured may renew the policy for another 10 years, but at a higher premium rate

What is the purpose for establishing the target premium for a universal life policy?

to keep the policy in force

an insured receives an annual life insurance dividend check. What term best describes this arrangement?

cash option

Which of the following explains the policyowners right to change beneficiaries, choose options, and receive proceeds of a policy?

Owner's rights

During partial withdrawal from a universal life policy, which portion will be taxed?

interest (the interest earned on the withdrawn cash value may be subject to taxation)

A policy will pay the death benefit if the insured dies during the 20 year premium paying period, and nothing if death occurs after the 20 year period, what type of policy is this?

level term

Who has the right to convert the existing term coverage to permanent insurance?

policyowner

which of the following best describes target premium in a universal life policy?

the recommended amount to keep the policy in force throughout its lifetime

What insurance arrangement should be used for a parent buying a life insurance policy for a child where the parent is the policy owner?

third party ownership

the type of policy that can be changed from one that does not accumulate cash to one that does is a...

convertible term policy

an insured buys a 5-year level premium term policy with a face amount of about $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium?

it will increase because the insured will be five years older than when it was originally purchased

An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?

limited pay life

the paid up addition option uses the dividend to

purchase a smaller amount of the same type of insurance as the original policy

The annuity owner dies while the annuity is still in the accumulation stage. What happens?

the beneficiary will receive the greater of the money paid into the annuity or the cash value

which type of policy insurance allows the policyowner to pay more or less than the planned premium?

universal life

which of the following is not true regarding the accumulation period of an annuity? a. it would not occur in a deferred annuity b. it is the oeriod during which the annuity payments earn interest c. it is the period over which the annuitant makes payments into an annuity d. it is also known as the pay in period

A Accumulations is a period of time where the payments earn interest and grow tax deferred

which of the following is true regarding the annuity period?

it may last for the lifetime of the annuitant

Which of the following information will be stated in the consideration clause of a life insurance policy?

the amount of premium payment

a lucky individual won the state lottery, so the state will be sending him a check for the next 25 years. What type of annuity products are they likely to use to provide these benefits?

Immediate annuity (An annuity purchased with a single lump sum payment with a 25 year fixed period distribution will be most suitable for this arrangement)

Twin brothers are starting a new business, they know it will take several years to build the business to the point that they can pay off the debt incurred in starting the business. What type of insurance would be the most affordable, and still provide a death benefit should one of them die?

Joint life

a straight life policy has what kind of premium?

a level annual premium for the life of the insured

who can make a fully deductible contribution to a traditional IRA?

an individual not covered by an employer sponsored plan who has earned income

which of the following types of policies will provide permanent protection?

whole life

Which of the following is INCORRECT regarding a $100,000 20 year level term policy? a. the policy will expire after the 20 year period b. after 20 years, the policy's cash value will equal $100,000 c. the policy's premium will remain level for 20 years d. if the insured dies before the 20 year period, the beneficiary will receive $100,000

B

Which of the following is NOT a term for the period of time during which the annuitant or beneficiary receives income? a. liquidation period b. depreciation period c. annuitization period d. pay-out period

B

Which of the following is NOT true regarding Equity Indexed Annuities? a. the insurance company keeps a percentage of the returns b. they have guaranteed minimum interest rates c. they are less risky than variable annuities d. they earn lower interest rates than fixed annuities

D

agents selling variable life insurance products must: (3)

be registered with FINRA have securities license be licensed to sell life insurance

under which of the following circumstances would an insurer pay accelerated benefits? a. an insured is looking for a way to put her daughter through college b. a couple wants to build a house and would like to make a larger down payment c. an insured is diagnosed with cancer and needs help paying for her medical treatment d. a couple is preparing for retirement and needs a steady stream of income

C

a policy owner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision?

automatic premium loan

All other factors being equal, the least expensive first year premium payment is found in...

annually renewable term

what is called a "second-to-die" policy

survivorship life

Which of the following is true regarding the premium in term policies? a. decreasing term policy will have a decreasing premium b. the premium is level c. only level term policy has a level premium d. the premium in term policies is not based on the insured's age

B

equity indexed annuities...

seek higher returns

which of the following statements is correct regarding whole life policy? a. the policy owner is entitled to policy loans b. cash values are not guaranteed c. the policy premium is based on the attained age d. the death benefit may increase or decrease during the policy period

the policy owner is entitled to policy loans

what characteristic makes whole life permanent protection?

coverage until death or until age 100

In which of the following cases will the insured be able to receive the whole face amount from a whole life policy? a. if there are no named beneficiaries when the policy is paid up b. at age 65 c. if the insured lives to 100 d. as soon as the cash value exceeds the face amount

C

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

option-A

A couple earns a life insurance policy with a children's term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?

proof of insurability is not required