insurance test

100問 • 2年前

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問題一覧

All are true statements regarding the underwriting process, EXCEPT

AIDS and HIV virus exams can be conducted in discriminatory fashion

Insurance policies are offered on a “take it or leave it” basis which makes them

contract of adhesion

If a contract of adhesion contains complicated language to whom would the interpretation be in favor of?

the insured (customer)

Which of these require…… Offer Acceptance Consideration

contract

Which of these types of policies may NOT have the Automati Premium Loan provision attached to it?

decreasing term

When 3rd party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have ________

insurable interest in the proposed insured

Who elects the governing body of a mutual insurance company?

policyholders

Name the law that requires insurers to disclose information gathering practices and where information is obtained

Fair Credit Reporting Act

The part of a life insurance policy guaranteed to be true is called ________

warranty

Insurance contracts are also known as ________ because certain future conditions or acts must be met before any claims can be paid

conditional

Who makes the legally enforceable promises in a unilateral insurance policy?

the insurance company

Which of the following best describes a warranty?

a statement guaranteed to be true

The consideration clause of an insurance contract includes

the schedule and amount of premium payments

A life insurance arrangement which circumvents insurable interest statutes is called _______

Investor-Originated Life Insurance

A policy of adhesion can only be modified by whom?

the insurance company

A life insurance policy would be considered a wagering contract without ______

insruable interest

Stranger-Originated Life Insurance (STOLI) has been found to be in violation of which contractural elements?

legal purpose (insurable interest)

Which arrangement allows one to bypass insurable interest laws?

Investor-Originated Life Insurance

What is the consideration given by an insurer and the consideration clause of a life policy?

promise to pay a death benefit to a named beneficiary

When must insurable interest exist for a life insurance contract to be valid?

inception of the contract

Q purchases a $500,000 life insuranc policy and pays $900 in premiums over the first 6 months. Q suddenly dies and the beneficiary is paid $500,000. This exchange of unequal values reflect which insurance contract feature?

aleatory

Y purchased $100,000 worth of permanent protection on himself and $50,000 worht of 10-year term coverage for his wife on the same policy. Which of thes policies did Y purchase?

a whole life policy with an other insured rider

Insurance policy is considered an aleatory contract because _______

performance is conditioned upon a future occurrence

In an insurance contract, the insurer is the only party who makes illegally inforcible promises. What kind of contract is this?

unilateral

An insurance applicant must be informed of an investigation regarding his or her reputation according to the _______

fair credit reporting act

At what point must a life insurance applicant be informed of their rights that fall under the fair credit reporting act?

upon completion of the application

What are the types of agent authority?

express implied apparent

A contract or one party accept or reject the terms of a contract by another party is a contract of ______

adhesion

At what point does an informal agreement become a binding contract?

when consideration is provided by one of the parties to the contract

J is 35 years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?

20-pay life

What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?

whole life

Which of these life product is not considered interest sensitive?

modified whole life

Which of these policy characteristics is consistent with a straight life policy?

premiums are payable as long as there is insurance coverage in force

Which statement about a whole life policy is true?

cash value may be borrowed against

Variable whole life insurance can be described as:

both an insurance and securities product

Which is true concerning a variable universal life policy?

policy owner controls where the investment will go and select the amount of premium payment

N is a 40 year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?

30-pay life

A 15 year mortgage is best protected by what kind of life policy?

15 year decreasing term

A life policy that contains a monthly mortality charge as well as self-directed investment choices is called a(n):

variable universal life policy

Who has the option to renew a renewable term policy?

insured

Which of these types of life insurance allows the policy owner to have level premiums and to also choose from a selection of investment options?

variable life

S, age 40, is looking to buy a life insurance policy that will allow for increase and decreases in coverage as his needs change. The policy best suited for S would be ______

universal life

What type of policy would offer a 40 year old the quickest accumulation of cash value?

20-pay life

What type of life policy covers two people and pays upon the death of the last insured?

survivorship

A(n) ______ term life policy is normally used when covering an insured’s mortgage balance

decreasing

Under a renewable term policy,

the renewable premium is calculated on the basis of the isnured’s attained age

What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump-sum benefit at the end of that 30 years?

family maintenance policy

Which of the following is considered an element of a variable life policy?

underlying equity investment

F needs life insurance that provides coverage for only a limited amount of time with a death benefit that changes regularly according to a schedule. What kind of policy is needed?

decreasing term policy

At what point does a whole life insurance policy endow?

when the cash value equals the death benefit

J is issued a life insurance policy with a death benefit of $100,000. She pays $600 per year in premium for the first 5 years. The premium then increases to $900 per year in the 6th year and remains there after. The policies death benefit also remains $100,000. Which type of life insurance policy is this?

modified premium life

Which statement is correct regarding the premium payment for whole life policies?

premiums are payable throughout the insrued’s lifetime/coverage lasts until death of the insured

Term insruance has which of the following characteristics

expires at the end of the policy period

Who has the opinion to renew a renewable term policy?

isnured

What kind of life insurance product covers children under their parents policy?

term rider

The cash value in a(n) _______ life policy ay fluctuate to reflect changing assumptions regarding mortality cost, interest, and expense factors

universal

A life policy with a death benefit and cash value that can fluctuate according to the performance of its underlying investment portfolio is referred to as:

variable life

Which policy requires an agent to register with the National Association of Securites Dealers (NASD) before selling?

variable life

P is looking to purchase a life insurance policy that will pay a stated monthly income to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end of the 20 year period. What type of policy should P purchase?

family maintenance policy

How long does the coverage normally remain on a limited pay life policy?

age 100

Which provision allows the policy owner to change a term life policy to a permanent one without providing proof of good heatlh?

conversion

A variable insurance policy:

does not guarantee a return on investment accounts

Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies?

policy owner

J is 35 years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth or cash value?

20 pay life

A(n) _____ life policy offers the owner investment in products such as money-market funds, long-term bonds and equities?

variable

All of these are characteristics of an Adjustable Life policy, EXPECT:

face amount can be adjusted using policy dividends

Under an Interest Sensitive Whole Life policy,

cash values are determined by interest rates

Which of these life products is NOT considered interest-sensitive?

modified whole life

Life insurance that covers an insured’s whole life with level premiums paid over a limited time is called:

limited pay life

Which of the following policies is characterized by a flexible premium and death benefit and allows the policy owner control of the investment aspect of plan?

variable universal life

In a 10-year term life policy contains a renewability provision, the policy will renew

without evidence of insurability

D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?

level term

Which type of policy is considered to be overfunded, as stated by IRS guidelines?

Modified Endowment Contract

A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?

20-pay life accumulates cash value faster than Straight Life

A Limited-Pay life policy has:

premium payments limited to a specified number of years

The amount of coverage on a group credit life policy is limited to:

the insured’s total loan value

A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waved under which provision?

payor provision

What does a Face Amount plus Cash Value Policy pay upon the insured’s death?

face amount plus the policy’s cash value

K, age 45, and his wife, age 43, have 3 children. They purchase a Family policy that covers K’s wife to age 65. All of these situations will pay a death benefit EXCEPT:

K’s wife dies at age 66

When a life insurance policy exceeds certain IRS table values, the result would create which of the following?

modified endowment contract

S owns a life insurance policy with cash values that fluctuate according to the underlying investment performance of common stocks. Which of these policies does S own?

variable whole life

What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?

family maintenance policy

P is the insured on a participating life policy. Which statement is true if P’s premiums are waived due to disability?

p will still receive declared dividends

Which life insurance rider typically appears on a Juvenile life insurance policy?

payor benefit rider

How are policy owner dividends treated in regards to income tax?

interest on accumulations is taxed

The ______ is authorized to assign a life insurance policy as collateral for a loan

policy owner

When is the face amount of a Whole Life policy paid?

when the insured dies or at the age of the policys maturity date, whichever happens first

Which of these life insurance riders allow the applicant to have excess coverage?

term rider

P purchases a $50,000 whole life insurance policy in 2005. One fo the questions on the application asks if P engages in scuba diving, to which P answers “NO”. The policy is then issued with no scuba exclusions. In 2010 P takes up scuba diving in a scuba related accident in 2011. What will the isnurer pay to P’s beneficiary?

$50,000 minus any outstanding policy loans

N is covered by a Term Life policy and does not make the required premium payment which was due August 1. N dies September 15. What action will the insurer take?

claim will be denied

In a life insurance policy, which feature states that the policy will not cover certain risks?

exclusion

M has an insurance policy that also has an outstanding policy loan at the time of M’s death. The insurer’s will deduct the outstanding loan balance from the:

policy proceeds

When does a Guaranteed Insurability Rider allow the insured to buy additional coverage?

at future dates specified in the contract with no evidence of insurability requried

K owns a Whole Life policy. If K wants an increasing Death Benefit to protect against inflation, which Dividend Option should she choose?

paid-up additional insurance

A Return of Premium Life insurance policy is:

whole life and increasing term

Which statement is TRUE in regards to a policy loan?

past-due interest on a policy loan is added to the total debt

B recently died and was insured with a life insurance policy for over 5 years. During the claims process, the isnurer discovered that B had understated his age by 5 years at the time of the application. In this situation, the insurer will

pay the amount that the premium would have purchased at the correct age

Which of these types of policies may NOT have Automatic Premium Loan provision attached to it?

decreasing term

B receives yearly dividends and interest from a participating life insurance policy. Which of theses should B include as gross income for federal income tax purposes?

interest only

100

Which of these are NOT an example of a Nonforfeiture option?

life income

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問題一覧

All are true statements regarding the underwriting process, EXCEPT

AIDS and HIV virus exams can be conducted in discriminatory fashion

Insurance policies are offered on a “take it or leave it” basis which makes them

contract of adhesion

If a contract of adhesion contains complicated language to whom would the interpretation be in favor of?

the insured (customer)

Which of these require…… Offer Acceptance Consideration

contract

Which of these types of policies may NOT have the Automati Premium Loan provision attached to it?

decreasing term

When 3rd party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have ________

insurable interest in the proposed insured

Who elects the governing body of a mutual insurance company?

policyholders

Name the law that requires insurers to disclose information gathering practices and where information is obtained

Fair Credit Reporting Act

The part of a life insurance policy guaranteed to be true is called ________

warranty

Insurance contracts are also known as ________ because certain future conditions or acts must be met before any claims can be paid

conditional

Who makes the legally enforceable promises in a unilateral insurance policy?

the insurance company

Which of the following best describes a warranty?

a statement guaranteed to be true

The consideration clause of an insurance contract includes

the schedule and amount of premium payments

A life insurance arrangement which circumvents insurable interest statutes is called _______

Investor-Originated Life Insurance

A policy of adhesion can only be modified by whom?

the insurance company

A life insurance policy would be considered a wagering contract without ______

insruable interest

Stranger-Originated Life Insurance (STOLI) has been found to be in violation of which contractural elements?

legal purpose (insurable interest)

Which arrangement allows one to bypass insurable interest laws?

Investor-Originated Life Insurance

What is the consideration given by an insurer and the consideration clause of a life policy?

promise to pay a death benefit to a named beneficiary

When must insurable interest exist for a life insurance contract to be valid?

inception of the contract

aleatory

Y purchased $100,000 worth of permanent protection on himself and $50,000 worht of 10-year term coverage for his wife on the same policy. Which of thes policies did Y purchase?

a whole life policy with an other insured rider

Insurance policy is considered an aleatory contract because _______

performance is conditioned upon a future occurrence

In an insurance contract, the insurer is the only party who makes illegally inforcible promises. What kind of contract is this?

unilateral

An insurance applicant must be informed of an investigation regarding his or her reputation according to the _______

fair credit reporting act

At what point must a life insurance applicant be informed of their rights that fall under the fair credit reporting act?

upon completion of the application

What are the types of agent authority?

express implied apparent

A contract or one party accept or reject the terms of a contract by another party is a contract of ______

adhesion

At what point does an informal agreement become a binding contract?

when consideration is provided by one of the parties to the contract

J is 35 years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?

20-pay life

What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?

whole life

Which of these life product is not considered interest sensitive?

modified whole life

Which of these policy characteristics is consistent with a straight life policy?

premiums are payable as long as there is insurance coverage in force

Which statement about a whole life policy is true?

cash value may be borrowed against

Variable whole life insurance can be described as:

both an insurance and securities product

Which is true concerning a variable universal life policy?

policy owner controls where the investment will go and select the amount of premium payment

30-pay life

A 15 year mortgage is best protected by what kind of life policy?

15 year decreasing term

A life policy that contains a monthly mortality charge as well as self-directed investment choices is called a(n):

variable universal life policy

Who has the option to renew a renewable term policy?

insured

Which of these types of life insurance allows the policy owner to have level premiums and to also choose from a selection of investment options?

variable life

S, age 40, is looking to buy a life insurance policy that will allow for increase and decreases in coverage as his needs change. The policy best suited for S would be ______

universal life

What type of policy would offer a 40 year old the quickest accumulation of cash value?

20-pay life

What type of life policy covers two people and pays upon the death of the last insured?

survivorship

A(n) ______ term life policy is normally used when covering an insured’s mortgage balance

decreasing

Under a renewable term policy,

the renewable premium is calculated on the basis of the isnured’s attained age

What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump-sum benefit at the end of that 30 years?

family maintenance policy

Which of the following is considered an element of a variable life policy?

underlying equity investment

F needs life insurance that provides coverage for only a limited amount of time with a death benefit that changes regularly according to a schedule. What kind of policy is needed?

decreasing term policy

At what point does a whole life insurance policy endow?

when the cash value equals the death benefit

modified premium life

Which statement is correct regarding the premium payment for whole life policies?

premiums are payable throughout the insrued’s lifetime/coverage lasts until death of the insured

Term insruance has which of the following characteristics

expires at the end of the policy period

Who has the opinion to renew a renewable term policy?

isnured

What kind of life insurance product covers children under their parents policy?

term rider

The cash value in a(n) _______ life policy ay fluctuate to reflect changing assumptions regarding mortality cost, interest, and expense factors

universal

A life policy with a death benefit and cash value that can fluctuate according to the performance of its underlying investment portfolio is referred to as:

variable life

Which policy requires an agent to register with the National Association of Securites Dealers (NASD) before selling?

variable life

family maintenance policy

How long does the coverage normally remain on a limited pay life policy?

age 100

Which provision allows the policy owner to change a term life policy to a permanent one without providing proof of good heatlh?

conversion

A variable insurance policy:

does not guarantee a return on investment accounts

Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies?

policy owner

J is 35 years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth or cash value?

20 pay life

A(n) _____ life policy offers the owner investment in products such as money-market funds, long-term bonds and equities?

variable

All of these are characteristics of an Adjustable Life policy, EXPECT:

face amount can be adjusted using policy dividends

Under an Interest Sensitive Whole Life policy,

cash values are determined by interest rates

Which of these life products is NOT considered interest-sensitive?

modified whole life

Life insurance that covers an insured’s whole life with level premiums paid over a limited time is called:

limited pay life

Which of the following policies is characterized by a flexible premium and death benefit and allows the policy owner control of the investment aspect of plan?

variable universal life

In a 10-year term life policy contains a renewability provision, the policy will renew

without evidence of insurability

D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?

level term

Which type of policy is considered to be overfunded, as stated by IRS guidelines?

Modified Endowment Contract

20-pay life accumulates cash value faster than Straight Life

A Limited-Pay life policy has:

premium payments limited to a specified number of years

The amount of coverage on a group credit life policy is limited to:

the insured’s total loan value

A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waved under which provision?

payor provision

What does a Face Amount plus Cash Value Policy pay upon the insured’s death?

face amount plus the policy’s cash value

K, age 45, and his wife, age 43, have 3 children. They purchase a Family policy that covers K’s wife to age 65. All of these situations will pay a death benefit EXCEPT:

K’s wife dies at age 66

When a life insurance policy exceeds certain IRS table values, the result would create which of the following?

modified endowment contract

S owns a life insurance policy with cash values that fluctuate according to the underlying investment performance of common stocks. Which of these policies does S own?

variable whole life

What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?

family maintenance policy

P is the insured on a participating life policy. Which statement is true if P’s premiums are waived due to disability?

p will still receive declared dividends

Which life insurance rider typically appears on a Juvenile life insurance policy?

payor benefit rider

How are policy owner dividends treated in regards to income tax?

interest on accumulations is taxed

The ______ is authorized to assign a life insurance policy as collateral for a loan

policy owner

When is the face amount of a Whole Life policy paid?

when the insured dies or at the age of the policys maturity date, whichever happens first

Which of these life insurance riders allow the applicant to have excess coverage?

term rider

$50,000 minus any outstanding policy loans

N is covered by a Term Life policy and does not make the required premium payment which was due August 1. N dies September 15. What action will the insurer take?

claim will be denied

In a life insurance policy, which feature states that the policy will not cover certain risks?

exclusion

M has an insurance policy that also has an outstanding policy loan at the time of M’s death. The insurer’s will deduct the outstanding loan balance from the:

policy proceeds

When does a Guaranteed Insurability Rider allow the insured to buy additional coverage?

at future dates specified in the contract with no evidence of insurability requried

K owns a Whole Life policy. If K wants an increasing Death Benefit to protect against inflation, which Dividend Option should she choose?

paid-up additional insurance

A Return of Premium Life insurance policy is:

whole life and increasing term

Which statement is TRUE in regards to a policy loan?

past-due interest on a policy loan is added to the total debt

pay the amount that the premium would have purchased at the correct age

Which of these types of policies may NOT have Automatic Premium Loan provision attached to it?

decreasing term

B receives yearly dividends and interest from a participating life insurance policy. Which of theses should B include as gross income for federal income tax purposes?

interest only

100

Which of these are NOT an example of a Nonforfeiture option?

life income