Life exam
Which statement regarding insurable risk is not correct?
Insureds cannot be randomly selected
What type of an interest rate is guaranteed in universal life policies
Contract interest rate
An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance he can afford at this time. He wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?
Guaranteed insurability option
Your client wants to provide a retirement income for his elderly parents in case something happens to him. He wants to make sure that both beneficiaries are guaranteed an income for life. Which settlement option should this policyowner select?
Joint and survivor
How long will the beneficiary receive payments under the single life settlement option?
Until the beneficiary's death
A producer must renew a liscense
every 2 years
Which statement best describes agreement as it relates to insurance contracts?
One party accepts the exact terms of the others party offer
An agent received some inaccurate info, and as a result, he publicly misstated information 12 times over a 3 month period, if this face is revealed, the agent may face a fine up to
$10,000
Which of the following is a correct statement about annuities?
Fixed annuities do not provide protect against inflation
In which of the following scenarios would a producer be allowed to obtain insurance through an unauthorized insurer?
If there are no authorized insurers for a specific type of coverage in this state
Under which of the following conditions would life insurance proceeds be taxable by the federal government?
If there is a transfer of value
An Equity Indexed Annuity will grow based upon
Performance of a recognized index
How long is the grace period for an individual life insurance policy
1 month
Which component increases in the increasing term insurance?
Death benefit
During policy solicitation, an insurer exaggerates the financial conditions of its competitors, and makes it sound worse than it is. This is
Defamation
Which is an example of a physical hazard?
Diabetes
Who makes up the MIB?
Insurers
Which of the following is true regarding the accumulation period of an annuity?
It is the period during which the payments into the annuity grow tax deferred
According to the privacy of consumers financial information regulation, if a consumer decides to opt out, this means
The consumer directs the licensee not to disclose the consumer's nonpublic personal financial information to a third party
All of the following are true about key person insurance except
The db is taxable to the business
An insured's flexible premium is invested into a separate account, what type of insurance product did he purchase?
Variable Universal Life
An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?
Pay a reduced death benefit
A married couple purchases a life insurance policy on their new born baby. The are concerned about what would happen to the policy if either one of them were unable to continue making the premium payments due to death or disability. Which policy rider should their agent recommend?
Payor benefit
If an insurance company issues a policy even though some questions on the app were unanswered, when can the insurer get the answers to those questions?
Never, the insurer has waived its rights to those answers by issuing the policy
Which of the following is not true regarding a Variable Universal Life Policy?
The db is fixed
All advertisements are the responsibility of the
insurer
Which of the following is true regarding pure life annuity settlement option ?
If provides the highest monthly benefits
An adjustable policy can assume the form of
Term or permanent
All of the following statements about indexed whole life insurance are correct except
The db is not guaranteed
Under which of the following circumstances can financial institutions share insurance coverage with third parties, for the purpose of soliciting the purchase of insurance?
If a consumer does not sign and return the notice of disclosure within 30 days
Which of the following statements concerning the MIB is correct
It assists underwriting in evaluating and classifying risks
When comparing a joint life policy to two individual life policies of the same amount on the same insured, what is true
Joint life has a lower premium
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the
Other insured rider
All of the following are true about group life insurance except
The employer is the beneficiary
Which of the following would not be eligible for coverage under key person?
The owner of a shop because the owner is the principal, not a key person
Annuities certain limit the amount paid by the annuity to a certain fixed
period or fixed amount
When a whole life policy is surrendered for its nonforfeiture value, what is the automatic option?
Extended term
Which of the following could reduce the amount of the db?
Failure to repay a policy loan
According to the nonforfeiture law, if the owner decides to surrender a deferred annuity prior to annuitization, the owner is entitled to which of the following?
Guaranteed surrender value
The Human Life Value approach to determining Life insurance needs is based upon which of the following ideas?
Loss of the breadwinner's income
cash value guarantees in a whole life policy are called
Nonforfeiture values
Key person insurance can provide protection for all of the follwing economic losses to a business except
Pay the db to the estae of the insured
Which of the following statements concerning buy sell agreements is true
Buy sell agreements are normally funded with a life insurance policy?
An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. 5 days later the applicant had to submit to a medical exam. If the policy is issued what would the policy's effective date be?
The date of the medical exam
An insured's flexible premium is invested into a separate account. What type of insurance product did he buy?
Variable Universal Life
To purchase insurance, the policyowner must face the possibility of losing money or something of value in the event of loss. What is this concept called?
Insurance interest
Contributions to Roth IRAs are
not tax deductible
A liscensee who has moved to PA from out of state must provide what before becoming licensed as a resident in this state?
Proof of licensing or a letter of clearance from the previous home state
Which of the following types of insurance is investment based, has a level fixed premium, and a nonguaranteed cash value?
Variable whole life
An insured and his spouse recently had a child. Which of the following riders would allow the couple to insure the child for a limited period of time at a specific amount?
Children's term rider
J is receiving fixed amount benefit payments from his late wife's insurance policy. He was told that if he dies before all of the benefits are paid, the remaining amount will go to the contingent beneficiary. Which settlement option did J choose?
Fixed amount
Which of the following methods of calculating the amount of life insurance needed takes into account the insureds wages, years until retirement, and inflation?
Human Life value approach
Insurance producers that do not have company appointments are considered a
h
Which of the following is the closest term to an authorized insurer?
Admitted
A universal life insurance policy is best described as a
ART policy with a cash value account
All of the following would be different between qualified and nonqualified retirement plans except
Taxation on accumulation
All of the following are true of the survivorship life policy except
The premium is based on the age of each insured
If a life insurance company uses HIV testing as part of its underwriting, when must an applicant be notified of the producer?
Prior to performing the test
According to the life insurance replacement regulation, which of the following would be an example of policy replacement?
a policy is reinsured with a reduction in cash value
Which of the following statements is incorrect concerning MECs
A MEC must always pass the 7 pay test
What documentation grants express authority to an agent?
Agent's contract with the principal
An agent is hand delivering an insurance policy to a policyholder. What must the agent obtain to complete the transaction?
A signed delivery report
If an applicant submits the initial premium with an application, which action constitutes acceptance?
The underwriters approve the application
