Minnesota Life Insurance
What is the term for how frequently a policyowner is required to pay the policy premium? A-Mode B-Schedule C-Grace period D-Consideration
A
An insured will be allowed to reactivate her lapsed life insurance policy if action is taken within a certain period of time, and proof of insurability is provided. Which policy provision allows this? A - Incontestable clause B - Grace period C - Reinstatement provision D - Waiver of premium provision
C
An insured's home is damaged in an earthquake. He finds out that his homeowners policy will NOT cover the loss, because earth movement is listed in his policy's A - Riders. B - Conditions. C - Exclusions. D - Endorsements.
C
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as A - Twisting. B - False advertising. C - Coercion. D - Rebating.
D
During each licensing period, every licensee subject to Minnesota's continuing education requirement must complete a minimum of A - 30 credit hours. B - 40 credit hours. C - 15 credit hours. D - 24 credit hours.
D
Group life insurance policies must permit covered employees to continue coverage for themselves and dependents for a specified period of time if their group coverage is terminated for any of the following reasons EXCEPT A - Termination because of a slow-down in the business. B - Termination because of illness. C - Reduction of hours so the employee is no longer classified as full-time. D - Termination because of misconduct on the part of the employee.
D
Children's riders attached to whole life policies are usually issued as what type of insurance? A-Term B-Variable life C-Adjustable life D-Whole life
A
Equity indexed annuities A - Seek higher returns. B - Are more risky than variable annuities. C - Are security instruments. D - Invest conservatively.:
A
The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called A-Waiver of premium. B-Guaranteed insurability. C-Waiver of cost of insurance. D-Payor benefit.
A
An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act? A - Legal, provided that the other insurers are paid royalties for the usage of their names B - Illegal under any circumstances C - Legal, provided that the information can be verified D - Illegal until endorsed by the Guaranty Association
B
Continuing education must be completed every A-Year. B-2 years. C-3 years. D-4 years.
B
Which of the following is correct concerning the taxation of premiums in a key-person life insurance policy? A - Premiums are taxable to the employee. B - Premiums are not tax deductible as a business expense. C - Premiums are tax deductible by the key employee. D - Premiums are tax deductible as a business expense.
B
On it's advertisement, a company claims that it has funds and its possessions that are, in fact, not available for the payment of losses or claims. The companies guilty of A - unfair clean practice B - rebating C - misrepresentation D - Concealment
C
The premium of a survivorship life policy compared with that of a joint life policy would be A - As high. B - Half the amount. C - Lower. D - Higher.
C
Which of the following is true regarding the master policy? A-It is the same as the entire contract. B-It is only available for creditor-debtor groups. C-It is issued to the sponsor of the group. D-It is issued to individual participants.
C
Which of the following must an insurer obtain in order to transact insurance within a given state? A - Business entity license B - Insurer's license C - Certificate authority D - Producer's certificate
C
Which of the following terms is used to name the nontaxed return of unused premiums? A - Interest B - Surrender C - Dividend D - Premium return
C
Which of the following types of life insurance provides permanent protection? A - annuities B - decreasing term C - whole life D - Term life
C
Any payment to a producer from an insurer that is contingent on the sale of an insurance policy or contract is called a A - Commission. B - Regular fee. C - Charge fee. D - Service fee.
A
A key person's insurance policy can pay for the following?
Costs of training a replacement
Which of the following best describes annually renewable term insurance? A-It is level term insurance. B-It requires proof of insurability at each renewal. C-Neither the premium nor the death benefit is affected by the insured's age. D-It provides an annually increasing death benefit.
A
Which of the following is NOT a mandatory provision in health insurance policy? A - illegal occupation B - Grace period C - entire contract D- notice of claim
A
An insured misstates her age at the time the life insurance application is taken. A-This misstatement may result in Recession of the policy. B-Adjustment in the amount of death benefit. C-No change whatsoever. D-Automatic lapse.
B
In a life settlement contract, whom does the life settlement broker represent? A - The insurer B - The beneficiary C - The life settlement intermediary D - The owner
D
What required provision protects against unintentional lapse of the policy? A-Assignment B-Payment of premiums C-Reinstatement D-Grace period
D
Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid A-For 20 years or until death, whichever occurs first. B-Until the policyowner reaches age 65. C-For at least 20 years. D-Until the policyowner's age 100, when the policy matures.
A
Which policy provision outlines the specific responsibilities of the insured in the event of a loss? A - Proof of Loss B - Notice of Claim C - Duties of the Insured D -Assignment
C
If an applicant for life insurance policy is found to be a substandard risk, the insurance company is most likely to
Charge a higher premium
90 Which of the following best describes what the annuity period is? A - The period of time from the accumulation period to the annuitization period B - The period of time during which money is accumulated in an annuity C - The period of time from the effective date of the contract to the date of its termination D - The period of time during which accumulated money is converted into income payments
D
All of the following are considered Social Security benefits EXCEPT A - Disability. B - Survivors. C - Retirement. D - Group.
D
And personal auto policies, which of the following types of coverage gives a total amount per claim to be used wherever needed, instead of setting maximum for bodily injury and property damage? A - maximum combine payment B - blanket total C - comprehensive maximum D - combine single limit
D
Which of the following would be grounds for the Commissioner to deny, suspend, or revoke an insurance producer's license? A-The Commissioner determines the licensee does not intend to or is not in good faith carrying on the business of an insurance producer. B-The licensee has violated or failed to comply with any order of the insurance regulator of any other state or jurisdiction. C-The licensee has misrepresented the terms of any actual or proposed insurance contract. D-Any of the above
D
For what period of time is an insurance license issued in Minnesota? A-24 months B-36 months C-Licenses are perpetual D-12 months
A
If an agent wishes to sell variable life policies what license was the agent of team? A - securities B - adjuster C - surplus lines D - personal lines
A
All of the following are true of key person insurance EXCEPT A -The key employee is the insured. B - The plan is funded by permanent insurance only. C - There is no limitation on the number of key employee plans in force at any one time. D -The employer is the owner, payor and beneficiary of the policy.
B
An insured has a life insurance policy from a participating company and receive his quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called A - reduction of premiums B - paid up additions C - One year term purchase D - accumulation at interest
B
When the policyowner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option? A - Life income period certain B - Extended term C - Fixed amount D - Fixed period
C
Which of the following is correct regarding credit life insurance? A - It is purchased on an installment basis. B - It insures the life of a creditor. C - It has a maximum term of 20 years. D - It insures the life of a debtor.
D
Which of the following licensees are not compensated directly related to the amount of insurance sold? A -Insurance agent B - Insurance producer C - Insurance broker D - Insurance consultant
D
Which provision of a life insurance policy states the insurer's duty to pay benefits upon the death of the insured, and to whom the benefits will be paid? A - Entire contract clause B - Beneficiary clause C - Consideration clause D - Insuring clause
D
Who can make a fully deductible contribution to a traditional IRA? A- Anybody; all IRA contributions are fully deductible regardless of income level B - Someone making contributions to an educational IRA C- A person whose contributions are funded by a return on investment D-An individual not covered by an employer-sponsored plan who has earned income
D
If a life insurance policy has an irrevocable beneficiary designation, A - The beneficiary cannot be changed to for at least two years. B - The owner can always change the beneficiary at will. C - The beneficiary cannot be changed. D - The beneficiary can only be changed with written permission of the beneficiary.
D
An insured purchased a 10-year level term life policy that is guaranteed renewable and convertible. What happens at the end of the 10-year term? A - The insured may renew the policy for another 10 years, but at a higher premium rate. B - The insured must provide evidence of insurability to renew the policy. C - The insured may only convert the policy to another term policy. D - The insured may renew the policy for another 10 years at the same premium rate.
A
An insured stated on her application for life insurance that she had never had a heart attack, when in fact she had a series of minor heart attacks last year for which she sought medical attention. Which of the following will explain the reason a death benefit claim is denied? A - Material misrepresentation B - Waiver C - Utmost Good Faith D - Estoppel
A
An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live. The insured knows that his financial state will worsen even more with the upcoming medical expenses. What option could the insured utilize? A-Viatical settlement B-Estate liquidation C-Nonpayment of premium D-Change of beneficiary
A
The policyowner pays for her life insurance annually. Until now, she has collected a nontaxable dividend check each year. She has decided that she would rather use the dividends to help pay for her next premium. What option would allow her to do this? A - Reduction of premium B - Paid-up addition C - Accumulation at interest D - Cash option
A
An insurance contract must contain all of the following to be considered legally binding A - Consideration. B - Competent parties. C -Beneficiary's consent. D - Offer and acceptance.
C
What is the name of the insured who enters into a viatical settlement? A - Contingent B - Viatical broker C -Viator D - Third party
C
An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries? A - One of the beneficiaries will receive 1/3 and the other 2/3 of the proceeds when the insured dies. B - The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive. C - The beneficiary will receive 2/3 of the lump sum up front, and the remaining 1/3 will be paid over time. D - The beneficiary will receive 2/3 of the total benefit, with the final 1/3 payable when the first beneficiary dies.
B
An insured's home is damaged in an earthquake. He finds out that his homeowners policy will NOT cover the loss, because earth movement is listed in his policy's A-Conditions. B-Exclusions. C-Endorsements. D-Riders.
B
And insured had a $10,000 of term life policy. The annual premium of $200 was due on February 1, however, the insured failed to pay the premium. He died on February 28. How much would the beneficiary receive it from the policy? A-$0 B- $200 C- $9800 D - $10,000
C
To which of the following life products do the Replacement Regulations apply? A - Credit life insurance B - Coverage under a binding receipt issued by the same company C - Individual annuity D - Group life insurance
C
Twin brothers are starting a new business. They know it will take several years to build a business to the point 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? A - whole life B - ordinary life C - join to life D - decreasing life
C
What is the purpose of a fixed-period settlement option? A - To provide a guaranteed income for life B - To provide a guaranteed amount of money each month C - To provide a guaranteed income for a certain amount of time D - To settle the insurance company's liability
C
Which is NOT true about beneficiary designations? A-The policy does not have to have a beneficiary named in order to be valid. B-Trusts can be valid beneficiaries. C-The beneficiary must have insurable interest in the insured. D-The beneficiary may be a natural person.
C
Which of the following is NOT correct with regards to the death proceeds of a life insurance policy? A - If no beneficiary is named in the policy, the proceeds will go to the insured's estate. B - In the event the beneficiary predeceases the insured, proceeds are paid to the insured's estate. C - The insured's creditors may claim the proceeds from the life insurance policy of the deceased insured. D - The beneficiary cannot be required to use the policy's benefits to pay off the deceased insured's debts.
C
Which of the following is TRUE regarding variable annuities? A - The company guarantees a minimum interest rate. B - A person selling variable annuities is required to have only a life agent's license. C - The annuitant assumes the risks on investment. D - The funds are invested in the company's general account.
C
Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract? A - Indemnity B - Representation C - Warranty D - Concealment
C
A father purchases a life insurance policy on his teenage daughter and adds the Payor Benefit rider. In which of the following scenarios will the rider waive the payment of premium? A - If the father is disabled for at least a year B - If the daughter is disabled for more than 3 months C - If the daughter is disabled for any length of time D - If the father is disabled for more than 6 months
D
According to the Entire Contract provision, a policy must contain A- A declarations page with a summary of insureds. B-Buyer's guide to life insurance. C-Listing of the insured's former insurer(s) for incontestability provisions. D-A copy of the original application for insurance.
D
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT A -An offer of employment. B - Stocks, securities, or bonds. C - An offer to share in commissions generated by the sale. D - Dividends from a mutual insurer.
D
An individual has just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments. What type of life insurance policy would be best suited to this situation? A - Variable life B - Universal life C - Whole life D - Decreasing term
D
An insured decides to replace his life insurance policy with one offered by a new insurer. After receiving the policy, he is unsatisfied with the provisions and decides to return it. Within how many days must he return the policy to receive a full premium refund? A - 10 days B - 15 days C - 20 days D - 30 days
D
In which of the following cases will the insured be able to receive the full face amount from a whole life policy? A - As soon as the cash value exceeds the face amount B - If there are no named beneficiaries when the policy is paid up C - At age 65 D - If the insured lives to age 100
D
Personal Lines property policies are designed to meet the needs of A-Small companies. B-Nonprofit corporations. C-Private insurers. D-Individuals.
D
Should the Commissioner request information from a certificate holder, licensee, or other person under the jurisdiction of the Commissioner, they must comply with the request within the time specified in the request. If no time specified, they must comply within A - 45 days. B - 60 days. C - 10 days. D - 30 days.
D
The proposed insured makes the premium payment on a new insurance policy. If the insured should die, the insurer will pay the death benefit to the beneficiary if the policy is approved. This is an example of what kind of contract? A - Adhesion B - Personal C - Unilateral D - Conditional
D
What is the purpose of a fixed-period settlement option? A - To settle the insurance company's liability B - To provide a guaranteed income for life C - To provide a guaranteed amount of money each month D - To provide a guaranteed income for a certain amount of time
D
When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy? A - It is increased when extra premiums are paid. B - It decreases over the term of the policy. C - It remains the same as the original policy, regardless of any differences in value. D - It is reduced to the amount of what the cash value would buy as a single premium.
D
Which of the following best describes annually renewable term insurance? A - It requires proof of insurability at each renewal. B - Neither the premium nor the death benefit is affected by the insured's age. C - It provides an annually increasing death benefit. D - It is level term insurance.
D
Which of the following determines the cash value of a variable life policy? A - The companies general account B - The policies guarantees C - The premium mode D - The performance of the policy portfolio
D
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as A - Binding contracts. B - Contracts of adhesion. C - Unilateral contracts. D - Aleatory contracts.
B
Once an individual is licensed as an insurance producer for life or accident and health insurance, how many hours of training must he or she initially complete to sell long-term care insurance? A - 6 B - 8 C - 12 D - 4
B
The initial amount of credit life insurance may NOT exceed A-The borrower's annual income. B-The amount to be repaid under the contract. C-An amount set by statute and adjusted regularly for inflation. D-The borrower's monthly income.
B
This state provided for a temporary license for all of the following EXCEPT A-A producer's time in the military service. B-A producer's retirement. C-The death of a producer. D-A producer's disability.
B
What characteristic makes whole life permanent protection? A - Living benefits B - Coverage until death or age 100 C - Guaranteed death benefit D - Guaranteed level premium
B
What do individuals use to transfer their risk of loss to a larger group? A-Indemnity B-Insurance C-Insurable interest D-Exposure
B
Which of the following homeowners coverage forms applies to condominium unit owners? A- НО-4 B- НО-6 C- НО-8 D- НО-2
B
Which of the following is NOT a mandatory provision in health insurance policies? A-Grace period B-Entire contract C-Notice of claim D-Illegal occupation
D
Upon the termination of a covered employee the employer was notified the employee of their right to continuation of coverage within how many days?
14 days
All of the following are duties and responsibilities of producers at the time of application EXCEPT A - Change any incorrect statement on the application by personally initialing next to the corrected statement. B - Explain the nature and type of any receipt the producer is giving to the applicant. C -Probe beyond the stated questions if the producer feels the applicant is misrepresenting or concealing information. D - Check to make sure that there are no unanswered questions on the application.
A
An insured receives an annual life insurance dividend check. What term best describes this arrangement? A - Cash option B - Reduction of Premium C - Annual Dividend Provision D -Accumulation at Interest
A
A licensed Minnesota insurance producer must notify the Commissioner of a change of address within A - 7 days. B - 10 days. C - 30 days. D - 5 business days
B
A rider attached to a life insurance policy that provides coverage on the insured's family members is called the A-Payor rider. B-Other-insured rider. C-Change of insured rider. D-Juvenile rider.
B
Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of A-Rebating. B-Twisting. C-Defamation. D-Misrepresentation.
B
Which of the following is not a power given to the Commissioner? A - Impose appropriate penalties on persons or companies who violate insurance laws of the state B - Set the insurance rates to be charged for insurance transacted in the state C - Issue or rescind certificates of authority of insurance companies to transact insurance in the state D - Investigate any person or insurer licensed to transact insurance in the state to determine if any state insurance law has been violated
B
Which of the following would help prevent a universal life policy from lapsing? A - Corridor of insurance B - Target premium C - Face amount D - Adjustable premium
B
Which provision states that the legal right or interest in a policy may be transferred? A-Duties of the Insured B-Assignment C-Notice of Claim D-Pro rata
B
Who bears all of the investment risk in a fixed annuity? A - The annuitant B - The insurance company C - The owner D - The beneficiary
B
After an insurance company examination, the Commissioner or the examiner appointed by the Commissioner must file a written report of the examination within A - 10 days. B - 30 days. C - 60 days. D - 90 days.
C
All of the following are examples of third-party ownership of a life insurance policy EXCEPT A-A company purchases a life insurance policy on their manager, who is an important part of the operation. B-When an insured purchased a new home, the insured made an absolute assignment of a life insurance policy to the mortgage company. C-An insured borrows money from the bank and makes a collateral assignment of a part of the death benefit to secure the loan. D-An insured couple purchases a life insurance policy insuring the life of their grandson.
C
What is a definition of a unilateral contract? A - One author: the company wrote the contract; the insured must accept it as written. B - If one party makes a condition, the other party can counteroffer. C - One-sided: only one party makes an enforceable promise. D - Two or more parties go into a contract understanding there may be an unequal exchange of vaule.
C
What is the minimum required number of hours of prelicensing education per line of authority in this state? A - 10 hours B - 15 hours C - 20 hours D - 40 hours
C
What is the minimum required number of hours of prelicensing education per line of authority in this state? A-10 hours B-15 hours C-20 hours D-40 hours
C
What kind of deductible is applied between basic coverage and major medical coverage? A-Middle deductible B-Interval deductible C-Corridor deductible D-Bridging deductible
C
Which of the following provisions states that it is the insured's responsibility to notify the insurer of a loss within a specified number o days? A-Proof of loss B-Claim forms C-Time of payment of claims D-Notice of claim
D
Which of the following types of life insurance refers to temporary protection that only lasts for a specified period of time? A-Single-premium whole life B-Joint life C-Limited-pay whole life D-Term life
D
Which of the following types of policies allows for a flexible premium and a variable investment component? A - Guaranteed issue variable life insurance B - Variable whole life insurance C - Whole life insurance D - Variable universal life insurance
D
Which policy provisions stipulates for what period of time the policy will remain in effect after the premium payment due date?
Grace period
What is the purpose of a free look period in insurance policies?
It allows the insured to reject the policy with a full refund.