Life Study 1
Entire contract.
The provision which states that both the policy and a copy of the application form the contract between the policyowner and the insurer is called the
Buy-sell agreement.
All of the following are personal uses of life insurance EXCEPT
The insured may choose to convert to term or permanent individual coverage.
An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is INCORRECT?
$10,000, no tax consequence
An employee quits her job where she has a balance of $10,000 in her qualified plan. If she decides to do a direct transfer from her plan to a Traditional IRA, how much will be transferred from one plan administrator to another and what is the tax consequence of a direct transfer?
Mutual
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?
Consideration
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?
Predicted needs of the family after the insured's death.
Based on Human Life Value Approach, which of the following is NOT used to calculate an individual's life value?
Apparent
Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?
An unfair trade practice.
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
Waiver of premium.
The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called
At the time of application
When must insurable interest exist in a life insurance policy?
An individual who, because of an illness, is expected to live no longer than 24 months
Which circumstance describes someone who is terminally ill?
The annuitant assumes the risks on investment.
Which of the following is TRUE regarding variable annuities?
The cost of coverage is based on the ratio of men and women in the group.
Which of the following statements about group life is correct?
The amount of the distribution is reduced by the amount of a 20% withholding tax.
A 60-year-old participant in a 401(k) plan takes a distribution and rolls it over to an IRA within 60 days. Which of the following is true?
Annually Renewable Term policy with a cash value account.
A Universal Life Insurance policy is best described as a/an
Joint life
A couple receives a set amount of income from their annuity. When the wife dies, the husband no longer receives annuity payments. What type of annuity did the couple buy?
Cost of Living Rider
A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of her life insurance policy has been raised 7% as a result. Which policy rider caused this change?
Joint and survivor
A married couple's retirement annuity pays them $250 per month. The husband dies and his wife continues to receive $125.50 per month for as long as she lives. When the wife dies, payments stop. What settlement option did they select?
24 hours will be applied to the current reporting period, and 24 can be applied to the period immediately following.
A producer has successfully completed 52 hours of continuing education (CE). How many hours can the producer apply to her current reporting period, and how many hours can she carry toward the next reporting period?
Imprison the licensee.
After a hearing, if the Commissioner finds that a licensee is in violation of the state insurance laws, the Commissioner can do any of the following EXCEPT
Having all employees complete continuing education courses once every 2 years.
All of the following are licensing requirements for a business entity, EXCEPT
The beneficiary can only be changed with written permission of the beneficiary.
If a life insurance policy has an irrevocable beneficiary designation,
The beneficiary will receive the greater of the money paid into the annuity or the cash value.
The annuitant dies while the annuity is still in the accumulation stage. Which of the following is TRUE?
The cash value will be paid to the annuitant's estate.
The annuity owner dies during the accumulation period without naming a beneficiary. Annuity's cash value exceeds premiums paid. Which of the following is TRUE?
One-year term option.
The dividend option in which the policyowner uses dividends to purchase a term policy for one year is referred to as the
Apparent
Which of the following types of agent authority is also called "perceived authority"?
It has a guaranteed minimum interest rate.
Why is an equity indexed annuity considered to be a fixed annuity?
