Missed ?’s

Which of the following features of the Indexed Whole Life policy is NOT fixed? a) Policy period b) Cash value growth c) Premium d) Death benefit

B) Cash value growth

Which of the following individuals must have insurable interest in the insured? a) Producer b) Policyowner c) Beneficiary d) Underwriter

B) Policyowner

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) The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.

When must insurable interest exist in a life insurance policy? a) At the time of loss b) At the time of application c) At the time of policy delivery d) When there is a change of the beneficiary

B) at the time of application

When must insurable interest exist in a life insurance policy? a) When there is a change of the beneficiary b) At the time of loss c) At the time of application d) At the time of policy delivery

C) At the time of application

All of the following statements are true regarding installments for a fixed period annuity settlement option EXCEPT a) The payments are not guaranteed for life. b) The insurer determines the amount for each payment. c) It is a life contingency option. d) It will pay the benefit only for a designated period of time.

C) It is a life contingency option

During replacement of life insurance, a replacing insurer must do which of the following? a) Designate a new producer for a replaced policy b) Send a copy of the Notice Regarding Replacement to the Department of Insurance c) Obtain a list of all life insurance policies that will be replaced d) Guarantee a replacement for each existing policy

C) Obtain a list of all life insurance policies that will be replaced

The Medical Information Bureau (MIB) was created to protect a) Insureds from unreasonable underwriting requirements by the insurance companies. b) Medical examiners that perform insurance physical examinations. c) Insurance companies from adverse selection by high risk persons. d) Insurance departments from lawsuits by policyowners.

C) insurance companies from adverse selection by high risk persons

Children's riders attached to whole life policies are usually issued as what type of insurance? a) Adjustable life b) Whole life c) Term d) Variable life

C) term

All of the following are TRUE statements regarding the accumulation at interest option EXCEPT a) The interest is credited at a rate specified by the policy. b) The policyholder has the right to withdraw the accumulations at any time. c) The interest is not taxable since it remains inside the insurance policy. d) The annual dividend is retained by the company.

C)The interest is not taxable since it remains inside the insurance policy.

What is another name for interest-sensitive whole life insurance? a) Variable life b) Term life c) Adjustable life d) Current assumption life

D) Current assumption life

If a contract provides a set amount of income for two or more persons with the income stopping upon the first death of the insured, it is called a a) Joint and survivor annuity. b) Deferred annuity. c) Pure annuity. d) Joint life annuity.

D) Joint life annuity

Which of the following statements about a suicide clause in a life insurance policy is true? a) Suicide is covered for a specific period of years and excluded thereafter. b) Suicide is covered as long as the policy is in force. c) Suicide is excluded as long as the policy is in force. d) Suicide is excluded for a specific period of years and covered thereafter.

D) Suicide is excluded for a specific period of years and covered thereafter

Before he died, an annuitant had received $12,500 in monthly benefits from his $25,000 straight life annuity. He was also the insured under a $50,000 paid-up whole life policy that named his wife as primary beneficiary. Considering both contracts, how much will the annuitant's spouse receive in benefits? a) $50,000 b) $62,500 c) $75,000 d) Nothing

a) $50,000

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained? a) 3 days b) 5 days c) 10 days d) 14 days

a) 3 days

An investor buys a life policy on an elderly person in order to sell it for a life settlement. This is an example of a) A STOLI policy. b) A prearranged funeral plan. c) A viatical settlement. d) Third-party ownership.

a) A STOLI policy.

How often must domestic insurance companies be examined by the Chief Financial Officer in Florida? a) At least every 5 years b) Every 2 years c) Not more frequently than every 3 years d) Annually

a) At least every 5 years

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) Cash option

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? a) Cost of Living Rider b) Value Adjustment Rider c) Return of Premium Rider d) Inflation Rider

a) Cost of Living Rider

If an annuitant dies before annuitization occurs, what will the beneficiary receive? a) Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount b) Either the amount paid into the plan or the cash value of the plan, whichever is the lesser amount c) Amount paid into the plan d) Cash value of the plan

a) Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount.

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 period during which the annuity payments earn interest. c) It is the period over which the owner makes payments into an annuity. d) It is also known as the pay-in period.

a) It would not occur in a deferred annuity.

Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report a) Must be informed of the source of the report. b) Are entitled to obtain a copy of the report from the party who ordered it. c) Must be advised that a copy of the report is available to anyone who requests it. d) May sue the reporting agency in order to get inaccurate data corrected.

a) Must be informed of the source of the report.

Upon policy delivery, the producer may be required to obtain any of the following EXCEPT a) Signed waiver of premium. b) Statement of good health. c) Payment of premium. d) Delivery receipt.

a) Signed waiver of premium.

All of the following would be different between qualified and nonqualified retirement plans EXCEPT a) Taxation on accumulation b) Taxation of withdrawals c) Taxation of contributions d) IRS approval requirements

a) Taxation on accumulation

What is the purpose of a disclosure statement in life insurance policies? a) To explain features and benefits of a proposed policy to the consumer b) To obtain important underwriting information from the applicant c) To help consumers compare policy prices d) To protect agents and insurers against lawsuits

a) To explain features and benefits of a proposed policy to the consumer

Stranger-originated life insurance policies are in direct opposition to the principle of a) Insurable interest. b) Law of large numbers. c) Good faith. d) Indemnity.

a) insurable interest

Which of the following is a short-term annuity that limits the amounts paid to a specific fixed period or until a specific fixed amount is liquidated? a) Variable annuity b) Annuity certain c) Fixed annuity d) Refund life

b) Annuity certain

An insured receives an annual life insurance dividend check. What term best describes this arrangement? a) Accumulation at Interest b) Cash option c) Reduction of Premium d) Annual Dividend Provision

b) Cash option

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) Contracts of adhesion. .

All of the following are dividend options EXCEPT a) Paid-up additions. b) Fixed-period installments. c) Accumulated at interest d) Reduction of premium.

b) Fixed-period installments.

Which of the following statements about the reinstatement provision is true? a) It guarantees the reinstatement of a policy that has been surrendered for cash. b) It requires the policyowner to pay all overdue premiums with interest before the policy is reinstated. c) It permits reinstatement within 10 years after a policy has lapsed. d) It provides for reinstatement of a policy regardless of the insured's health.

b) It requires the policyowner to pay all overdue premiums with interest before the policy is reinstated

Variable Whole Life insurance is based on what type of premium? a) Graded b) Level fixed c) Increasing d) Flexible

b) Level fixed

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? a) Pay the full death benefit and refund excess premium b) Pay a reduced death benefit c) Pay the full death benefit d) Pay nothing; there was a misrepresentation on the application

b) Pay a reduced death benefit

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports? a) The customer has no knowledge of this action. b) The customer's associates, friends, and neighbors provide the report's data. c) They provide additional information from an outside source about a particular risk. d) They provide information about a customer's character and reputation.

b) The customer's associates, friends, and neighbors provide the report's data

Under an extended term nonforfeiture option, the policy cash value is converted to a) A higher face amount than the whole life policy. b) The same face amount as in the whole life policy. c) The face amount equal to the cash value. d) A lower face amount than the whole life policy.

b) The same face amount as in the whole life policy.

Social Security was created to provide all of the following benefits EXCEPT a) Retirement income. b) Unemployment income. c) Survivor's benefits. d) Disability income.

b) Unemployment income.

As a field underwriter, a producer is responsible for all of the following tasks EXCEPT a) Obtain appropriate signatures on the application for insurance. b) Issue the policy that is requested. c) Help prevent adverse selection. d) Solicit business that will fall within the insurer's underwriting guidelines.

b)Issue the policy that is requested.

An annuity contract is issued to a senior consumer over age 65. What is the maximum surrender charge for a withdrawal of money allowed on this annuity? a) 5% b) 8% c) 10% d) 12%

c) 10%

All agents licensed in this state must complete how many hours of continuing education specific to law and ethics? a) 2 b) 3 c) 4 d) 5

c) 4

In order to qualify for conversion from a group life policy that has been terminated to an individual policy of the same coverage, a person must have been insured under the group plan for how many years? a) 1 b) 3 c) 5 d) 10

c) 5

A paid-up nonforfeiture benefit will become effective as specified in the policy, unless the person entitled elects another available option within how many days after the due date of the premium in default? a) 15 b) 30 c) 60 d) 90

c) 60

What license or licenses are required to sell variable annuities? a) Only a securities license b) No license is required c) Both a life insurance license and a securities license d) Only a life insurance license

c) Both a life insurance license and a securities license

What is another name for interest-sensitive whole life insurance? a) Term life b) Adjustable life c) Current assumption life d) Variable life

c) Current assumption life

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? a) Ordinary life policy b) Limited pay whole life c) Level term d) Term to specified age

c) Level term

Which option is being utilized when the insurer accumulates dividends at interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early? a) Paid-up additions b) Dividend Accumulation option c) Paid-up option d) Accumulation at Interest

c) Paid-up option

Which of the following riders would NOT cause the Death Benefit to increase? a) Cost of Living Rider b) Accidental Death Rider c) Payor Benefit Rider d) Guaranteed Insurability Rider

c) Payor benefit rider

Who might receive dividends from a mutual insurer? a) Stockholders b) Agents c) Policyholders d) Subscribers

c) Policyholders

If an employer decides to change its life insurance policy to a similar one with a different insurer, which of the following describes the extent that replacement regulations will be exercised? a) The type of life insurance policy obtained will determine which replacement regulations will be required. b) The number of employees covered by the policy will determine which replacement regulations will be required. c) Replacement regulations will not apply in this situation. d) Special corporate replacement regulations will apply.

c) Replacement regulations will not apply in this situation.

Which of the following statements concerning a Simplified Employee Pension plan (SEP) is INCORRECT? a) SEPs have a higher tax deductible contribution limit than an IRA. b) Employer contributions are not included in the employee's gross income. c) SEPs are suitable for large companies. d) SEPs allow the employer to make annual tax deductible contributions up to 25% of an employee's earned income.

c) SEPs are suitable for large companies.

Which of the following is NOT true regarding the annuitant? a) The annuitant receives the annuity benefits. b) The annuitant must be a natural person. c) The annuitant cannot be the same person as the annuity owner. d) The annuitant's life expectancy is taken into consideration for the annuity.

c) The annuitant cannot be the same person as the annuity owner.

How will a life insurance beneficiary designation naming a spouse be changed by divorce? a) The beneficiary will be changed to revocable. b) Insurer's own policy rules will determine the result. c) The beneficiary designation will be voided. d) There will be no change.

c) The beneficiary designation will be voided.

Which of the following dates must be contained in a policy summary? a) The date that the policy was issued b) The date that the producer was licensed c) The date the summary was prepared d) The date the application was signed

c) The date the summary was prepared

Under a group plan, Certificates of Insurance must include all of the following EXCEPT a) A description of the insurance protection. b) The name of the insured. c) The name of the writing agent. d) The group policy number.

c) The name of the writing agent

When may an insurance company use suicide as a defense against paying a death claim? a) At any time suicide can be proven b) At no time c) When death occurs within a specified period of time after the policy was issued d) Only when there was a witness to the event

c) When death occurs within a specified period of time after the policy was issued

Which of the following best describes fixed-period settlement option? a) Only the principal amount will be paid out within a specified period of time. b) The death benefit must be paid out in a lump sum within a certain time period. c) Income is guaranteed for the life of the beneficiary. d) Both the principal and interest will be liquidated over a selected period of time.

d) Both the principal and interest will be liquidated over a selected period of time.

Who does the secondary notice provision protect? a) The policyowners b) Secondary addressees c) The insurer d) Elderly insureds

d) Elderly insureds

Under which installments option does the annuitant select the amount of each payment, and the insurer determines how long they will pay benefits? a) Variable period b) Variable amount c) Fixed period d) Fixed amount

d) Fixed amount

When a beneficiary receives payments consisting of both principal and interest portions, which parts are taxable as income? a) Both principal and interest b) Neither principal nor interest c) Principal only d) Interest only

d) Interest only

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? a) Term to specified age b) Ordinary life policy c) Limited pay whole life d) Level term

d) Level-term

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? a) Reciprocal b) Nonprofit service organization c) Stock d) Mutual

d) Mutual

Traditional IRA contributions are tax deductible based on which of the following? a) How long the plan has been in force b) Owner's age c) IRA limit d) Owner's income

d) Owner's income

All of the following are true regarding insurance policy loans EXCEPT a) The amount of the outstanding loan and interest will be deducted from the policy proceeds when the insured dies. b) The policy will terminate if the loan plus interest equals or exceeds the cash value of the policy. c) Policyowners can borrow up to the full amount of their whole life policy's cash value. d) Policy loans can be made on policies that do not accumulate cash value.

d) Policy loans can be made on policies that do not accumulate cash value.

An insured submits a proof of loss form within 10 days of a loss. The insurer, however, does not acknowledge the form for 3 months. Which of the following violations has the insurer committed? a) Rebating b) Inappropriate delay c) Dragging d) Unfair claims settlement

d) Unfair claims settlement

When may an insurance company use suicide as a defense against paying a death claim? a) Only when there was a witness to the event b) At any time suicide can be proven c) At no time d) When death occurs within a specified period of time after the policy was issued

d) When death occurs within a specified period of time after the policy was issued .

When would a 20-pay whole life policy endow? a) At the insured's age 65 b) After 20 payments c) In 20 years d) When the insured reaches age 100

d) When the insured reaches age 100