Pennsylvania 110 Q Exam
aneixybwjgbekh ekgr Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. Under the McCarran-ferguson act, is the minimum penalty for this?
$10,000
Every Pennsylvanian insurer, upon receiving notification of a claim, must acknowledge receipt of the notice within?
10 days
Producers must complete a total of ____ continuing education credits for each two-year licensing period.
24
An accelerated death benefit in Pennsylvania must be at least what percentage of the total death benefit?
25%
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If the consumer Price index has gone up by 4%, how much may Ron increase the face value of the policy?
4,000
How many months can a life insurance policy normally be backdated from the date of application?
6 months
In pennsylvania, and insurer May back date policy issue not more than how many months from the date of a life insurance application?
6 months
Proceeds from a life insurance policy are protected from the beneficiaries creditors by which clause?
Spendthrift clause
Bod and Tom start a business. Since each partner contributes an important element to the success of the business, they decided to take life insurance policies out on each other, and name each other as beneficiaries. Eventually, they retire and dissolve the business. Bob dies 12 months later. The policies continue in force with no change. Both partners are still married at the time of mom's death. In this situation, who will receive Bob's policy proceeds?
Tom
Which policy feature makes a universal life policy different from a whole life policy?
a flexible premium schedule
Which of the following is not considered advertising?
a rating from a service company, such as A.M. Best
A plan in which an employer pays insurance benefits from a fund-derived from the employer's current revenues is called?
a self funded plan
The double indemnity provision in a life insurance policy pertains to an insurance death caused by an?
accident
Kathy's annuity is currently experiencing tax deferred growth until she retires. Which phase is this annuity in?
accumulation period
An example of an unfair claim settlement practice is?
advising a claimant of the possibility that, should the claimant reject a settlement offer, an arbitration award might be less than the offer
How does life insurance create an immediate estate?
after first premiums paid, the face amount may be available to the beneficiary
When does an immediate annuity begin making payments?
after the first premium has been paid
An error was made on Mary's life insurance application. Which of the following areas do errors commonly occur on applications and for which the incontestable clause does not apply?
agw
According to Pennsylvania law, which of the following is not considered to be personally identifiable financial information?
blind trust data that does not include names and addresses
An ensure has a right to screen applicants for HIV in which of the following ways?
blood test for HIV
Donald is the primary insured of a life insurance policy and adds a children's term rider. What is the advantage of adding this rider?
can be converted to permanent coverage without evidence of insurability
Which of the following is not part of an insurance contract?
certificate of authority
The coverage, conditions, and limitations in the master policy of a group contract can be found in which document?
certificate of coverage and benefits
Whathappensif a life insurance applicant is given a conditional receipt from an insurance agent and then dies the next day?
claim will be paid if application is approved
Naming a contingent beneficiary as "all surviving children"is described by which term?
class designation
A provision that allows a policy owner to temporarily give up ownership rights to secure a loan is called an?
collateral assignment
Ownership of a life insurance policy maybe temporarily transferred with an?
collateral assignment
Life insurance policies will normally pay for losses arising from?
commercial aviation
A waiver of premium Rider allows an insured to waive premium payments if the insured is?
completely and permanently disabled
Which of these is not subject to income taxation under a modified endowment contract (MEC)?
death benefit
An example of a tax qualified retirement plan would be an?
defined contribution plan
Advertising regulations exist in order to?
demonstrate full and truthful disclosures to the public
Allof these are standard exclusions found in a life insurance policy except
disability
Which of these statements concerning traditional IRAs is correct?
earnings are taxable when withdrawn
Which prohibited act involves a producer spending a client's insurance premiums for his / her own personal use?
embezzlement
When soliciting insurance, a producer cannot?
emphasize Guaranty Association benefits
Which of the following is not a federal requirement of a qualified plan?
employee must be able to make unlimited contributions
Level premium permanent insurance accumulates a reserve that will eventually?
equal the face amount of the policy
When principal gives the agent authority in writing, it's referred to as
express authority
A producer is meeting with a client to determine whether an annuity should be suitable for purchase. which of the following topics needs to be discussed with the client?
financial objectives
A business will typically use which type of life insurance to cover their employees?
group policy
A lifeinsurancewriterthat allows an individual to purchase insurance as they grow older, regardless of insurability, is called an?
guaranteed insurability rider
Which of the following is considered to be an event or condition that increases the probability of the insured's loss?
hazards
Whichapproach predicts a person's earning potential and determines how much of that amount would be devoted to dependents?
human life value approach
Whenaproduceroffers something of value in return for the purchase of an insurance policy, which prohibited sales practice has been committed?
inducement
Which of the following is present when an applicant stands to lose value if the insured dies?
insurable interest
The principal of insurable interest, in regards to a life insurance contract is accurately described in which statement?
insurable interest can be based on the love and affection of individuals related by blood or law
Who is required to notify the producer in the event of appointment termination?
insurer
Whichsettlement option involves having the proceeds remain with the insurer and earnings paid on a monthly basis to the beneficiary?
interest only
An applicants character and personal habits can be obtained for underwriting purposes for which source?
investigative consumer report
Which of the following would disqualify a company's retirement plan from receiving favorable tax treatment?
it is temporary
Which contract element is insurable interest a component of?
legal purpose
When a decreasing term policy is purchased it contains a decreasing death benefit and?
level premiums
In pennsylvania, completion of counting education is required upon license renewal for which of the following?
licensed individuals qualified in major lines of insurance
Producer commissions may not be paid to?
licensed producers not appointed by an insurer
Which of these is not considered to be a common life insurance and nonforfeiture option?
life income annuity
What is created after policy proceeds are obtained in a lump sum and then immediately invested?
lump sum fund
What would be an expense factor in an insurance program?
mortality costs
Joanne has a $100,000 wholelife policy with an accumulated $25,000 of cash value. She would like to borrow $15,000 against the cash value. Which of the following statements is true?
net death benefit will be reduced if loan is not repaid
A whole life policy option where extended term insurance is selected is called an?
nonforfeiture option
Caroleisalicensed agent who lives in Ohio and transacts insurance in Pennsylvania. In Pennsylvania, Carol is considered to be an?
nonresident producer
How do interest earnings accumulate in a deferred annuity?
on tax-deffered basis
What kind of life insurance policy issued by a mutual insurer provides a return of divisible surplus?
participating life insurance policy
The automatic premium loan provision authorizes an insurer to withdraw from a policy's cash value the amount of?
past due premiums that have not been paid by the end of the grace period
Whichtypeof Rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
payor benefit
What is required before an insurance producer can act as a representative of an insurer?
producer needs to be appointed by that insured
According to the principle of utmost good faith, the insured will answer questions on the application to the best of their knowledge and pay the required premium, while the insurer will do fairly with the insured and it's
promises made
Which of the following is a reinstatement condition?
proof of insurability
In pennsylvania, and insurance producer license can be denied for failure to pay each of the following except?
property tax
An insurance producer is often responsible for field underwriting during the application process. All of these are possible filled underwriting rules except?
providing commission information to applicant
What is the primary feature of a viatical settlement?
reduced death benefit payment
A policy owner May exercise which of these dividend options that uses the dividend to pay all or part of the next premium due?
reduction of premium dividend option
If an annuity dies during the distribution period. what kind of annuity will return to a beneficiary the difference between the annuity?
refund annuity
Any of the following may be an unfair claims practice except?
refusing to pay persons bringing false or fraudulent claims
A life insurance company has transferred some of its risk to another insurer. the ensure assuming the risk is called the?
reinsurer
Term insurance is appropriate for someone who?
seeks temporary protection and lower premiums
In Pennsylvania, a producer may have their license revoked for which of the following acts?
signing a prospect's name without their knowledge or presence
Which of these ensures that proceeds of a life insurance policy will be free from attachment or seizure by the beneficiaries creditors?
spendthrift cluase
Kristi purchases and annuity that will pay her husband and incomefor 15 years. if he dies, this income will become payable to their children for the remainder of the period. Kristi has what kind of annuity?
temporary annuity certain
Which of these is not a characteristic of the accelerated death benefit option?
the benefit can be offered as
Converting a group plan to permanent life insurance requires?
the conversion being applied for within 31 days of termination
Karissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Which of these statements is true?
the death benefit will remain constant during the 10-year term
What happens when an insurance policy is backdated?
the policy's effective date is earlier than the present
Dorian exercise a nonforfeiture option by using his Life policies cash value to purchase an extended term insurance option. when the term insurance expires,
the protection ends
A partial surrender is allowed in which of the following life policies?
universal Life
Reggie purchased a life insurance policy with a face amount of $500,000. after 15 years, the cash value has accumulated to $100,000 in the policies face amount has become $600,000. which type of life insurance policy is this?
universal life
Under a traditional IRA, interest earned is taxed
upon distribution
Which type of policy combines the flexibility of a universal life policy with investment choices?
variable universal life policy
Whichtypeoflife insurance offers flexible premiums, a flexible death benefit, and the choice of how the cash value will be invested?
variable universal policy
avezg Life insurance may make an immediate benefit payment before the insured dies in which transaction?
viatical settlement
All of the following riders can increase the death benefit amount except?
waiver of premium
The Fair credit reporting act protects consumers?
with guidelines regarding credit reporting and distribution
A renewable term life insurance policy allows the policy owner the right to renew the policy?
without producing proof of insurability