WHICH OF THE FOLLOWING STATEMENTS EXPRESS INSURABLE INTEREST?
A POLICYOWNER MUST EXPECT TO SUFFER A LOSS WHEN THE INSURED DIES OR BECOMES DISABLED.
WHICH OF THE FOLLOWING STATEMENTS DESCRIBES THE PAROL EVIDENCE RULE?
A WRITTEN CONTRACT CANNOT BE CHANGED BY ORAL EVIDENCE.
AN INSURANCE COMPANY ONLY HAS HOW MANY YEARS TO CHALLENGE THE VALIDITY OF A LIFE INSURANCE CONTRACT
TWO
WHICH OF THE FOLLOWING TERMS IN USED FOR THE VOLUNTARY RELINQUISHMENT OF A KNOWN RIGHT
WAIVER
BOB AND TOM ENTER INTO A CONTRACT IN WHICH BOB AGREES TO FRAUDULENTLY INDUCE SICK PPL TO SELL THEIR CONTRACTS TO TIMES COMPANY. BOB AND TOMS CONTRACT CAN BE DESCRIBED AS:
VOID
IN WHAT PHASE OF THE SELLING PROCESS ARE SERIOUS PROBLEMS OF MISREPRESENTATION LIKEY TO OCCUR?
PRESENTATION OF RECOMMENDATION
WHICH OF THE FOLLOWING PHRASES SHOULD AGENTS AVOID USING WHEN EXPLAINING POLICIES TO PROSPECTIVE APPLICANTS OR CLIENTS?
VANISHING PREMIUM
WHICH OF THE FOLLOWING FOUR STEPS IS NOT PART OF A SALES PRESENTATION?
REVIEW THE PRODUCT APPLICATION
WHICH OF THE FOLLOWING SHOULD A PRODUCER NOT DO DURING A PRESENTATION?
SELL A POLICY
ALL OF THE FOLLOWING ARE REASONS WHY IT IS SELDOM IN THE BEST INTEREST OF A POLICYHOLDER TO REPLACE A LIFE INSURANCE POLICY WITH A NEW ONE EXCEPT:
REPLACEMENT POLICIES ARE NEVER IN THE BEST INTEREST OF THE POLICYOWNER
DIVERTING INSURANCE FUNDS FOR THE PERSONAL USE IS AN EXAMPLE OF:
MISUSE OF PREMIUMS
SELLING VARIABLE UNIVERSAL LIFE INSURANCE POLICIES AS MUTUAL FUNDS IS AN EXAMPLE OF A PROHIBITED PRACTICE CALLED:
MISREPRESENTATION
THE USE OF PREPRINTED MATERIAL IN A SALES PRESENTATION IS RECOMMENDED FOR WHICH OF THE FOLLOWING REASONS?
SUCH MATERIAL GENERALLY HAS BEEN REVIEWED FOR COMPLIANCE
SOLICITATION OF INSURANCE INCLUDES
ALL OF THE ABOVE
ALL THE FOLLOWING STATEMENTS REGARDING TERM LIFE INSURANCE ARE CORRECT EXCEPT
A 3 YEAR RENEWABLE POLICY ALLOWS A TERM POLICYOWNER TO INCREASE COVERAGE FOR THE NEXT 3 YEARS
WHEN LEVEL OF PREMIUM IS RENEWED, THE PREMIUM AMOUNT RISES TO REFLECT THE INCREASE MORTALITY RISK OF A INSURED'S OLDER AGE." WHAT PHRASE BEST DESCRIBES THIS APPROACH TO INCREASING PREMIUMS?
STEP RATE
WHICH OF THE FOLLOWING STATEMENTS DESCRIBING WHOLE LIFE INSURANCE IS CORRECT?
WHOLE LIFE INSURANCE IS DESIGNED TO MATURE AT AGE 100.
ALL OF THE FOLLOWING STATEMENTS REGARDING BASIC FORMS OF WHOLE LIFE INSURANCE ARE CORRECT EXCEPT?
LIMITED PAYMENT LIFE PROVIDES PROTECTION ONLY FOR THE YEARS DURING WHICH PREMIUMS ARE PAID
WHICH OF FOLLOWING STATEMENTS REGARDING MODIFIED ENDOWMENT CONTRACTS (MEC'S) IS CORRECT?
TO AVOID BEING CLASSIFIED AS AN M.E.C, A LIFE INSURANCE POLICY MUST SATISFY THE 7 PAY TEST
WHICH OF THE FOLLOWING WHOLE LIFE INSURANCE POLICIES ATTEMPTS TO MAKE INSURANCE PREMIUMS MORE MANAGEABLE BY OFFERING LOWER PREMIUMS DURING THE FIRST FEW YEARS FOLLOWING ISSUE?
MODIFIED WHOLE LIFE
ALL OF THE FOLLOWING STATEMENTS REGARDING SPECIAL USE OF POLICIES ARE CORRECT EXCEPT:
A JOINT LIFE POLICY IS AVAILABLE USING TERM INSURANCE ONLY
BOB PURCHASES A $50,000 FIVE-YEAR LEVEL TERM POLICY. ALL OF THE FOLLOWING STATEMENTS ABOUT BOB'S COVERAGE ARE CORRECT EXCEPT:
IF THE INSURED DIES BEYOND THE SPECIFIED FIVE YEARS, ONLY THE POLICY'S CASH VALUE WILL BE PAID.
MRS. WILLIAMSON PURCHASED A FIVE YEAR $50,000 LEVEL TERM POLICY WITH AN OTION TO RENEW. AT THE END OF THE 5 YEAR TERM, SHE RENEWS THE POLICY. WHICH OF THE FOLLOWING STATEMENTS IS CORRECT?
THE PREMIUM FOR THE RENEWAL PERIOD WILL BE HIGHER THAN THE INITIAL PERIOD.
ALL OF THE FOLLOWING STATEMENTS ABOUT VARIABLE INSURANCE POLICIES ARE CORRECT EXCEPT:
MATERIALS USED IN SELLING VARIABLE POLICIES MUST BE APPROVED BY THE STATE OFFICE OF INSURANCE REGULATION
IN CONTRAST TO TRADITIONAL WHOLE LIFE INSURANCE POLICIES, WITH VARIABLE LIFE INSURANCE PRODUCTS:
CONTRACT CASH VALUES ARE NOT GUARANTEED.
ALL OF THE FOLLOWING STATES ABOUT VARIABLE INSURANCE ARE CORRECT EXCEPT
THE ARE NOT CONSIDERED SECURITIES CONTRACTS.
IN WHICH OF THE FOLLOWING SITUATIONS DOES THE INCONTESTABLE CLAUSE APPLY?
CONCEALMENT OF SMOKING
AN ERROR IN AGE IS DISCOVERED AFTER THE DEATH OF AN INSURED BUT BEFORE ANY POLICY DEATH PROCEEDS ARE DISTRIBUTED. THE INSURED WAS OLDER THAN PREVIOUSLY ASSUMED. HOW WOULD AN INSURANCE COMPANY HANDLE SUCH A SITUATION?
THE AMOUNT OF THE DEATH PROCEEDS WOULD BE REDUCED TO REFLECT WHATEVER BENEFITS THE PREMIUMS PAID WOULD HAVE PURCHASED AT THE CORRECT AGE.
WHICH OF THE FOLLOWING STATEMENTS REGARDING THE ASSIGNMENT OF A LIFE INSURANCE POLICY IS NOT CORRECT?
ALL BENEFICIARIES MUST EXPRESSLY APPROVE ANY ASSIGNMENTS OF LIFE INSURANCE POLICIES.
WHICH OF THE FOLLOWING IS COMMON LIFE INSURANCE POLICY EXCLUSION?
DEATH FROM WAR
ALL OF THE FOLLOWING ARE STANDARD LIFE INSURANCE POLICY NON FORFEITURE OPTIONS EXCEPT
ONE YEAR TERM INSURANCE OPTION
WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES LIFE INSURANCE POLICY DIVIDENDS?
POLICY DIVIDENDS ARE INTENTIONAL RETURN OF A PORTION OF THE PREMIUMS PAID.
WHICH OF THE FOLLOWING STATEMENTS REGARDING A COST OF LIVING (C.O.L) RIDER ON A LIFE INSURANCE POLICY IS CORRECT?
AN INFLATION INDEX, USUALLY THE CONSUMER PRICE INDEX, DETERMINES THE AMOUNT OF INFLATION ADJUSTMENT THAT IS MADE TO THE POLICY UP TO MAXIMUM PERCENTAGE INCREASE.
IF AN INSURANCE COMPANY DETERMINES THAT THE INSURED IS TOTALLY DISABLED, THE POLICY OWNER IS RELIEVED OF PAYING THE POLICY PREMIUMS AS LONG AS THE DISABILITY CONTINUES." THIS STATEMENT DESCRIBES THE:
WAIVER OF PREMIUM RIDER
TO WHAT PERIOD WOULD A 10 DAY FREE LOOK PROVISION APPLY?
THE FIRST TEN DAYS AFTER THE ISSUED POLICY HAS BEEN RECEIVED BY THE INSURED
ALL OF THE FOLLOWING STATEMENTS REGARDING ASSIGNMENT OF LIFE INSURANCE POLICY ARE CORRECT EXCEPT:
THE POLICY OWNER MUST OBTAIN AN APPROVAL FROM THE INSURANCE COMPANY BEFORE A POLICY CAN BE ASSIGNED.
WHICH OF THE FOLLOWING IS STATED INT HE CONSIDERATION CLAUSE OF A LIFE INSURANCE POLICY?
AMOUNT AND FREQUENCY OF PREMIUMS PAID
ALL OF THE FOLLOWING ARE STANDARD LIFE INSURANCE POLICY NON FORFEITURE OPTIONS EXCEPT
ONE YEAR TERM INSURANCE OPTION
WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES LIFE INSURANCE POLICY DIVIDENDS?
POLICY DIVIDENDS ARE AN INTENTIONAL RETURN IF A PORTION OF THE PREMIUNS PAID.
WHICH OF THE FOLLOWING STATEMENTS REGARDING A COST OF LIVING RIDER ON A LIFE INSURANCE POLICY IS CORRECT?
AN INFLATION INDEX, USUALLY THE CONSUMER PRICE INDEX, DETERMINDS THE AMOUNT OF INFLATION ADJUSTMENT THAT IS MADE TO THE POLICY UP TO A MAXIMUM PERCENTAGE INCREASE.
IF THE INSURANCE COMPANY DETERMINDS THAT THE INSURED IS TOTALLY DISABLED, THE POLICYOWNER IS RELIEVED OF PAYING THE POLICY PREMIUMS AS LONG AS THE DISABILITY CONTINUES." THIS STATEMENT DESCRIBES THE:
WAIVER OF PREMIUM RIDER
ALL OF THE FOLLOWING STATEMENTS REGARDING ASSIGNMENT OF A LIFE INSURANCE POLICY ARE CORRECT EXCEPT
THE POLICYOWNER MUST OBTAIN AN APPROVAL FROM THE INSURANCE COMPANY BEFORE A POLICY CAN BE ASSIGNED
WHICH OF THE FOLLOWING IS STATED IN THE CONSIDERATION CLAUSE OF A LIFE INSURANCE POLICY?
AMOUNT AND FREQUENCY OF PREMIUMS MADE.
ALL OF THE FOLLOWING STATEMETS PERTAINING TO REINSTATEMENT OF A LIFE INSURANCE POLICY ARE CORRECT EXCEPT
A SUICIDE EXCLUSION PERIOD IS RENEWED WITH A REINSTATED POLICY
IF AN ERROR IS DISCOVERED AFTER AN INSURED DIES AND THE INSURED WAS YOUNGER THAN THE INSURANCE POLICY STATED, THE INSURANCE COMPANY WILL
INCREASE THE DEATH BENEFITS
THE RIDER THAT PROVIDES FOR A WAIVER OF PREMIUMS ON A JUVENILE POLICY IF THE ADULT PAYOR DIES OR BECOMES DISABLED IS A
PAYOR RIDER
WHICH OF THE FOLLOWING STATEMENTS ABOUT LIFE INSURANCE POLICY'S CASH VALUE IS CORRECT?
WHEN A WHOLE LIFE INSURANCE POLICY IS ACTIVE, THE OWNER CAN BORROW FROM THE CASH VALUE.
WHICH OF THE FOLLOWING STATEMENTS IS CORRECT?
A PER STIRPES DISTRIBUTION MEANS THAT A BENEFICIARY's share of a policy'
WHAT IS THE BENEFICIARY DESIGNATION THAT CAN ONLY BE CHANGED WITH THE BENEFICIARY'S WRITTEN AGREEMENT?
IRREVOCABLE BENEFICIARY
ALL THE FOLLOWING STATEMENTS CONCERNING A COMMON DISASTER PROVISION ARE CORRECT EXCEPT
THE PROVISION. STIPULATES THAT IF THE PRIMARY BENEFICARY OUTLIVES THE INSURED BY MORE THAN 48 HOURS THEN TH PROCEEDS WILL BE PAID TO HIS OR HER ESTATE
A CLAUSE THAT STATES THAT POLICY DISTRIBUTIONS PAYABLE TO A BENEFICIARY AFTER THE INSURED DIES ARE NOT ASSIGNABLE OR TRANSFERABLE AND MAY NOT BE ATTACHED IN ANY WAY IS CALLED A
SPENDTHRIFT TRUST CLAUSE
WHICH OF THE FOLLOWING INSURANCE CONCEPTS IS FOUNDED ON THE ABILITY TO PREDICT THE APPROXIMATE NUMBER OF DEATHS AND FREQUENCY OF DISABILITIES WITHIN A CERTAIN GROUP DURING A SPECIFIC TIME?
LAW OF LARGE NUMBERS
THE OWNER OF A CAMERA STORE IS WORRIED THAT HER NEW EMPLOYEES MAY HELP THEMSELVES TO ITEMS FROM INVENTORY WITHOUT PAYING FOR THE. WHAT KIND OF HAZARD IS DESCRIBED?
MORAL HAZARD
ALL OF THE FOLLOWING ACTIONS ARE EXAMPLES OF RISK AVOIDANCE, EXCEPT
PAT PAYS HIS INSURANCE PREMIUM
WHICH OF THE FOLLOWING STATEMENTS IS CORRECT?
ONLY PURE RISK IS INSURABLE
WHICH OF THE FOLLOWING STATEMENTS DOES NOT DESCRIBE AND ELEMENT OF AN INSURABLE RISK
THE LOSS MUST NOT BE DUE TO CHANCE
WHICH OF THE FOLLOWING BEST DESCRIBES THE FUNCTION OF INSURANCE?
IT SPREADS FINANCIAL RISK OVER A LARGE GROUP TO MINIMIZE THE LOSS TO ANY ONE INDIVIDUAL.
WHICH OF THE FOLLOWING STATEMENTS REGARDING TYPES OF INSURERS IS NOT CORRECT?
REINSURERS USUALLY DEAL WITH GROUP POLICYHOLDERS
REGARDING LANDMARK CASES AND LAWS INVOLVING THE REGULATION OF INSURANCE, WHICH OF THE FOLLOWING STATEMENTS IS NOT CORRECT?
THE FEDERAL TRADE COMMISSION DIRECTLY SUPERVISES ALL INSURANCE MARKETING ACTIVITIES.
WHICH OF THE FOLLOWING STATEMENTS REGARDING THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS (NAIC) IS NOT CORRECT?
THE NAIC IS EMPOWERED TO PROSECUTE AND PUNISH CRIMINAL VIOLATORS IN THE INSURANCE INDUSTRY
IN AN INSURANCE TRANSACTION, LICENSED AGENTS LEGALLY REPRESENT WHICH OF THE FOLLOWING?
INSURER
IN FLORIDA, PROPERLY LICENSED AND APPOINTED AGENTS MAY ACT AS BROKERS TO INSURANCE TRANSACTIONS, IN WHICH CASE THEY MAY LEGALLY REPRESENT
THE APPLICANT AND INSURED
A LIFE INSURANCE COMPANY ORGANIZED IN ILLINOIS, WITH ITS HOME OFFICE IN PHILLY, IS LICENSED TO CONDUCT BUSINESS IN FLORIDA. IN FLORIDA THIS COMPANY IS CLASSIFIED AS A
FOREIGN COMPANY
WHICH OF THE FOLLOWING IS NOT A SERVICE INSURER
LLOYD'S OF LONDON
A REINSURER IS A COMPANY THAT
ASSUMES PORTION OF THE RISK FROM ANOTHER INSURER
THE HEAD OF STATE OFFICE OF INSURANCE REGULATION IS A GENERALLY RESPONSIBLE FOR THE FOLLOWING EXCEPT
MAKING INSURANCE LAWS
IN ADDITION TO THE STATE, THE ORGANIZATION THAT REGULATED VARIABLE LIFE AND VARIABLE ANNUITIES IS THE
SECURITIES AND EXCHANGE COMMISION
ALL OF THE FOLLOWING METHODS SUPPORT THE SALE OF INSURANCE THROUGH AGENTS AND BROKERS EXCEPT
DIRECT SELLING SYSTEM
THE AUTHORITY THAT AN INSURER GIVES TO ITS AGENTS BY MEANS OF THE AGENT'S CONTRACT IS KNOWN AS
EXPRESS AUTHORITY
WHICH OF THE FOLLOWING STATEMENTS REGARDING INSURABLE INTEREST IS NOT CORRECT
A POLICY OBTAINED BY A PERSON WITHOUT INSURABLE INTEREST IN THE INSURED CAN BE ENFORCED
WHICH OF THE FOLLOWING STATEMENTS REGARDING UTMOST GOOD FAITH IN INSURANCE CONTRACTS IS CORRECT
MOST STATE INSURANCE LAWS CONSIDER STATEMENTS MADE IN AN APPLICATION FOR AN INSURANCE POLICY TO BE REPRESENTATIVE AND NOT WARRANTIES
WHICH OF THE FOLLOWING STATEMENTS DESCRIBES THE PAROL EVIDENCE RULE?
A WRITTEN CONTRACT CANNOT BE CHANGED BY ORAL EVIDENCE