State exam practice
They must be part of the contract
All of the following are requirements for life insurance illustrations EXCEPT ?
The plan is funded by permanent insurance only
All of the following are true of Key Person insurance EXCEPT
At distribution, all amounts received by the employee are tax free
All of the following are true regarding a qualified annuity EXCEPT
They may be altered or withdrawn after the issuance of the policy
All of the following are true regarding representation EXCEPT
The annuitant received a fixed amount of return
All of the following statements about equity index annuities are correct EXCEPT
FINRA
An agent selling variable annuities must be registered with
15 days
An applicant for insurance is requesting more information from her agent about a claim that is currently being settled. Within what time period must the agent respond ?
The cost of coverage is deductible expenses by the employer
An employer offers group life insurance to its employees for the amount of $10,000. Which of the following is true ?
Decreasing Term
An individual has just borrowed $10,000 from his bank on a 5-year note. The note is due in installments. What type of life insurance policy would be best suited to this situation?
2.5%
An insurance company forwards fixed annuity premiums to their general account, where the money is invested. The guaranteed minimum interests is set at 2.5% burning an economic downswing, the investigations investments only drew 2%. What interest rate will the insurer pay to its policy holders ?
Have accumulated 6 work credits in the past 3 years
An insured becomes disabled at age 22 and can no longer work. She meets the definition of total disability under Social Security. What the other requirement must the insured have met to receive Social Security Disability benefits?
The insured may renew the policy for another 10 years, but at a higher premium rate
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 ?
$30,000
An insurer has been found guilty of a code violation regarding replacement. The insurer then repeats the violation. What will be the minimum penalty ?
Semiannually
Every long-term care insurer in California must submit to the Commissioner a list of all agents or other insurer representatives authorized to solicit individual consumers for the sale of long-term care insurance. These submitted agent lists must be updated at least
The uncertainty or chance of loss
For the purpose of insurance, risk is defined as
They are not included as income for the employee, but are taxable upon distribution
How are contributions to a tax-sheltered annuity treated with regards to taxation?
Fixed period
If a beneficiary wanted a guarantee that benefits paid from principal and interest would be paid for a period of 10 years before being exhausted, what option would a beneficiary select?
The beneficiary
In a group life insurance policy, the employer may select all of the following except
Upon the last death
In a survivorship life policy, when does the insurer pay the death benefit?
Unilateral
In insurance policies, the insured is not legally bound to any particular contract, but the insurer is legally obligated to pay losses covered by the policy. What contract element does this describe ?
February 28, 10 days after the time the policy is delivered
J applied for a life insurance policy on Jan 10, when would j need to return the policy to the insurer in order to receive a full refund of the premium pack ?
The loss may be intentional.
Not all losses are insurable, and there are certain requirements that must be met before a risk is proper subject for insurance. These requirements include all of the following EXCEPT
When the chrome payments begin
The main difference between immediate and deferred annuities is
Is defined as the frequency and the amount of the premium payment.
The mode of the premium payment
Group
"Discontinuance" is a term used to describe the termination of what type of insurance ?
19 years and 8 months
A 20-year family income policy was purchased effective April 1, 2001. The insured died four months later on August 1, 2001. The beneficiary receives monthly income for
Insurance broker
A person who transacts insurance business other then life insurance, for compensation from and on behalf of another person, but not of or as a representative of an insurance comp. for which he has an appointment is called ?
Pare risk
A situation in which a person can only lose or have no change represents
Premiums
All of the following are examples of risk retention EXCEPT ?
Being age 65
All of the following are required of eligibility for social security disability income benefits except ?
Be fined a sum of $1,000
An insurance agent who engages in the insurance business and validates the code with respect to the insurance replacement shall on the first violation
$150,000
Anyone convicted of committing an insurance fraud may be fined up to
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?
N/A
Every long term care insurer in CA must submit to the commissioner a list of all agents or other insurer representatives
Any form of life insurance
Partners in a business enter into a buy-sell agreement to purchase life insurance, which states that should one of them die prematurely, the other would be financially able to buy the interest of the deceased partner. What type of insurance policy may be used to fund this agreement?
The Grace Period
Signing and dating a delivery receipt for a life insurance policy helps to establish all of the following timeframes except
The people
The commissioner of insurance supervises and regulates the insurance affairs in the state of California, and is chosen by ?
Sale of this product requires a securities license
The following are features of the indexed universal life except ?
As of the application date
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective?
Speculative Risk
events in which the principal has both the chance of winning or losing
The insureds beneficiaries
The title page of the policy provides a summary of the benefits and and coverages provided by the policy. All of the following information is included in the title page EXCEPT ?
Only for the life of the annuitant
Under a pure life annuity, an income is payable by the company
Nothing, the payments will cease
Under a straight life annuity, if the annuitant dies before the principal amount is paid out, the beneficiary will receive
Family Income Policy
W owns a policy in which she is covered as the bread winner with permanent insurance and with decreasing term insurance in the form of a rider. What type of policy is this ?
Profitable distribution of exposures
What describes a situation when poor risks are balanced with preferred risks, and average risks are in the middle
Negligence
What other term is used to refer to unintentional torts ?
100%
What percentage of a company's employees must take part in a non contributory group life plan ?
Class Designation
When a policyowner designates an individual or group of individuals as the beneficiary if a life insurance death benefit without naming the individual
Prior to the issuance of the policy
When may a representation be withdrawn
fixed amount
When the policyowner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option?
Third Party Ownership
Which insurance arrangement will be appropriate for a parent buying a life insurance policy on a child where the parent is the policyowner?
Extended Term
Which nonforfeiture option has the highest amount of insurance protection?
Payor Benefit
Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or become disabled?
The owner of the life policy
Which of the following best defines the owner in a life settlement contract ?
Vanishing premium info
Which of the following can not be included along with illustrations used to sell life insurance ?
Actuarial
Which of the following departments is responsible for developing mortality and morbidity tables?
The loss must be catastrophic.
Which of the following is NOT a characteristic of pure risk?
To minimize the insured's level of liability in the event of loss
Which of the following is NOT a goal of risk retention?
Estimated Longevity
Which of the following is NOT a type of information that needs to be gathered in order to determine the value of someone's life when using the needs approach?
Need is predicted using the number of years until the insured's retirement.
Which of the following is NOT true regarding the Needs Approach method of determining the value of an individual's life?
Earned surplus are unassigned funds that are required to be reported on the insurers annual statement
Which of the following is a TRUE statement concerning an insurer's Earned Surplus?
Buyer's Guide
Which of the following is a generic consumer publication that explains life insurance in general terms in order to assist the applicant in the decision making process ?
Annuity Certain
Which of the following is a short term annuity that limits the amounts paid to a certain fixed period or until a certain fixed amount is liquidated
Creditor can only insure the debtor for the amount owed.
Which of the following is true regarding the insurance amount in a credit life policy?
Monthly
Which of the following premium modes would result in the highest annual cost for an insurance policy?
It transfers rights of ownership from the owner to another person
Which of the following statements is true about a policy assignment
Vacation travel expenses
Which of the following would be least likely to be considered a legitimate need that would be paid by insurance proceeds?
The medical info bureau
Which of the following would provide an underwriter with information concerning an applicants health history ?
Single life
Which settlement option provides a single beneficiary with income for the rest of his/her life ?
Option A
Which universal life option has a gradually increasing cash value and a level death benefit
A policy owner who is not the insured
Who is a third party owner ?
Insurance
a contract which one party undertakes to indemnify another against loss is called ?
They will be carried over into the next licensing period
An agent has completed 30 hours of continuing education by the end of a license period instead of the required 24 hours. What will happen to the 6 hours in excess ?
Foreign
An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurers classification in Wyoming ?
Single Premium Whole Life
An insurance policy that only requires a payment of premium at its inception and no further premiums contributions, and in addition to providing insurance protection for the life of the insured, endows at the insured's age 100, is called
The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive
An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries?
Aleatory
An insured pays $100 premium every month for his insurance coverage, yet the insurer promises to pay $10,000 for a covered loss. What characteristics of an insurance contract does this describe ?
Consideration
An insured pays an annual premium to his insurer. In return the insurer promises to pay benefits in accordance with the terms of the contract. This is called
Influence this information would have informing an estimate of the advantages of the contract
In determining how material a piece of information is to each party of a contract, the value is not determined by the event itself, but solely by which of the following ?
General election, for no more than 2 four year terms
In the state of California, who selects the insurance commissioner and for how long ?
Premiums paid by an employer on a $30,000 group term life insurance plan for employee
In which of the following instances would the premium be tax-deductible
It has the highest amount of insurance protection
What is the benefit of choosing extended term as a nonforfeiture option?
To provide a guaranteed income for a certain amount of time.
What is the purpose of a fixed period settlement option?
Protect agents against charges that they didn't properly serve a client
What is the purpose of errors and omissions insurance ?
To provide protection for the clients by requiring producers to maintain professional standards of conduct
What is the purpose of the California laws regulating production agencies?
To allow the consumer to compare the costs of different policies
What is the purpose of the buyer's guide?
Purchase a single premium policy for a reduced face amount
When a whole life policy lapses or is surrendered prior to maturity, the cash value can be used to
They can convert their coverage to permanent life insurance without evidence of insurability
When the bread winner that is insured by a family policy dies, what rights are provided to other family members that are covered under the policy ?
Life income with period certain
Which life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed period, during which, if the original dies, the payments will continue to a designated beneficiary?
Pure life provides payments for as long as the annuitant is alive
Which of the following best describes a pure life settlement option ?
Bridge coverage receipt
Which of the following is NOT a type of temporary insuring agreement ?
debtor and creditor
Which of the following is NOT an example of insurable interest?
The application given to a prospective insured
Which of the following is NOT the consideration in a policy?
Variable Annuity
Which of the following products requires a securities license ?
They can be changed only with the written consent of that beneficiary.
Which of the following statements is TRUE concerning irrevocable beneficiaries?
It will pay double or triple the face amount.
Which of the following statements is TRUE concerning the Accidental Death Rider?
