Completing the Application, Underwriting, and Delivering the Policy
If a policy includes a free-look period of at least 10 days, The Buyers Guide May be delivered to the applicant no later than
A) Upon issuance of the policy
B) Prior to filling out an application for insurance
C) Within 30 days after the first premium payment was collected
D) With the policy
With the Policy
If a life insurance policy contains a free-look period of at least 10 days, the buyers guide can be delivered with the policy. If it doesn't, the buyer's guide must be delivered prior to accepting the initial premium
Which of the following is incorrect regarding a $100,000 20-year level term policy?
A) The policy premiums will remain level for 20 years
B) If the insured dies before the policy expired, the beneficiary will receive $100,000
C) The policy will expire at the end of the 20-year period
D) At the end of 20 years, the policy's cash value will equal $100,000
D) At the end of 20 years, the policy's cash value will equal $100,000
Term policies do not develop cash values. All the other statements are true
This animal is known as the "King of the Jungle"
A) Cheetah
B) Snake
C) Lion
D) Penguin
Lion
Which of the following is TRUE about nonforfeiture values?
A) A table showing nonforfeiture values for the next 10 years must be included in the policy
B) They are required by state law to be included in the policy
C) Policy owners do not have the authority to decide how to exercise nonforfeiture values
D) They are optional provisions
B) They are required by state law to be included in the policy
Nonforfeiture values are required by state law to be included in the policy, and cannot be altered by the policyowner. A table showing the nonforfeiture values for the next 20 years must be included in the policy
This famous Disney sidekick forgets his favorite season in Frozen but loves warm hugs!
OLAF
When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is
A) Personal
B) Aleatory
C) Conditional
D) Unilateral
C) Conditional
The contract is formed on the basis that certain conditions are met
Why is an equity indexed annuity considered to be a fixed annuity?
A) It has a fixed rate of return
B) It has modest investment potential
C) It is not tied to an index like the S&P 500
D) It has a guaranteed minimum interest rate
D) It has a guaranteed minimum interest rate
White equity indexed annuities earn higher interest rates than fixed annuities, both types of annuities guarantee a specific minimum interest rate
This coin is worth 25 cents
A quarter
An Insured misstates her age at the time the life insurance application is taken. This misstatement May result in:
A) Automatic policy lapse
B) Adjustment in the amount of death benefit
C) No change to the policy
D) Recession of the policy
B) Adjustment in the amount of death benefit
If the applicant's age or gender was misstated on the application, the insurer, in the event of a claim, is allowed under this provision to adjust the benefits to an amount that the premium at the correct age or gender would have otherwise purchased
This upbeat song from Encanto is all about a family member we really aren't supposed to talk about!
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following:
A) Consideration
B) Legal Purpose
C) Contract of adhesion
D) Acceptance
Consideration
Consideration is something of value that each party gives to the other. The consideration on the part of the insured is the payment of premium and the representations made in the application
If an agent wishes to sell variable life policies, what license must the agent obtain?
A) Securities
B) Personal Lines
C) Adjuster
D) Surplus Lines
A) Securities
Variable products are governed in part by the Securities and Exchange Commission; therefore, agents selling variable life policies must also secure a securities license
This bright star gives the Earth light and heat.
The Sun
Which of the following riders would NOT increase the death benefit?
A) Accidental Death Rider
B) Payor Benefit Rider
C) Cost of Living Rider
D) Guaranteed Insurability Rider
B) Payor Benefit Rider
Payor Benefit Rider does not increase the death benefit; it only pays the premium if the Payor is disabled or dies. With Guaranteed Insurability Rider, the policyowner can increase the death benefit at specified ages or events; Cost of Living Rider increases the death benefit to keep pace with inflation; In Accidental Death Rider, if the death benefit will be a multiple of the face amount
In Cars, what is the racing number painted on Lightning McQueen
95
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) Third - Party ownership
C) A prearranged funeral plan
D) A viatical settlement
A STOLI policy
Stranger-originated life insurance (STOLI) policies are usually purchased by people who have no relationship with the insured with the intention of selling them for life settlements
All of the following entities regulate variable life policies except:
A) The Insurance Department
B) The SEC
C) Federal Government
D) The Guaranty Association
D) The Guaranty Association
Variable life insurance is regulated by both the state and federal government, as well as the insurance department, and the SEC
This is the opposite of the word hot.
cold
Which of the following is TRUE about a class designation?
A) It determines the succession of beneficiaries
B) It is not allowed
C) Beneficiaries are not identified by name
D) Beneficiaries must be part of the insured's immediate family
C) Beneficiaries are not identified by name
A class of beneficiary is using a designation such as "my children". This can be a vague term if the insured has been married more than once, or has adopted or illegitimate children. Many insurers encourage the insured to name each child specifically and to state the percentage of benefit they are to receive
Donald Duck has triplet nephews named
Huey, Duey, and Louie
What is the purpose of a conditional receipt?
A) It is intended to provide coverage on a date prior to the policy issue
B) It guarantees that a policy will be issued in the amount applied for
C) It is given only to applicants who fully prepay the premium
D) It serves as proof that the applicant has been determined insurable
A) It is intended to provide coverage on a date prior to the policy issue
Coverage commences on the date of the application or the date of a medical examination, whichever is later, on the condition that the applicant is determined to be insurable at the rate applied for
All of the following statements are true regarding installments for a fixed period annuity settlement option except:
A) It will pay the benefit only for a designated period of time
B) It is a life contingency option
C) The insurer determines the amount for each payment
D) The payments are not guaranteed for life
B) It is a life contingency option
Under the installments for a fixed period annuity settlement option, the annuitant selects the time period for the benefits; the insurer determines how much each payment will be. This option pays for a specific amount of time only, and there are no life contingencies
This is the name of the house where the family in Encanto lives, which has magic powers
Casita
Which two terms are associated directly with the premium?
A) Term or Permanent
B) Level or Flexible
C) Fixed or Varibale
D) Renewable or Convertible
B) Level or Flexible
A level premium is one in which the premium payment never changes. A flexible premium is found in Universal life policies where the insured changes their premium payment
What was Goofy's original name when he first appeared in cartoons?
Dippy Dawg