Georgia Life Insurance Exam Study Guide: Key Concepts and Regulations, Exams of Credit and Risk Management

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Georgia Life Insurance Study Exam Guide

aS | An insurance producer selling a Variable Annuity whose cash value depends on the performance of an underh tment account must be with: - ANSWER The Financial Alife insurance policy whose cash value will fluctuate depending upon the performance ofa separate account is: - ANSWERS John Livingston owns a 30-Pay Life policy that he purchased at the age of 30. The cash value will equal the face amount of the policy when he reaches the age of: - ANSWER Which of the following types of insurance policies would provide the greatest amount of protection for a temporary period during which an insured will have limited financial resources? - ANSWER Which of the following statements about a Renewable Term policy is true?- ANS wer An Annuity is designed to provide which of the following financial features? IL. The liquidation of principal and interest II. Favorable lax treatment IIL The creation of an estate - ANSWER Mn ec ee ee ee ee ee ee ee ee aS | A45-vear old customer who is seeking to supplement his retirement income at age 65 would not buy a: ANSWER SUAS Which of the following is an example of a Limited-Pay Life policy? - ANS ——— -Life Paid-Up at You have a client that is a real estate agent. Which of the following types of permanent protection is best for this type of client? - ANSWER Sie Which of the following individual policy conversions is usually permitted without any evidence of insurability? - ANSWER (QRMSIOHEOM a Denn pONee tO BNW ROME sONey At age 30, Tom Morris wishes to purchase a Whole Life policy. His producer explains that he can pay for the policy in sevcral ways. One method is called 20-Pay Life, and another, ight Life. Tom wishes to know which plan will accumulate cash value at a faster rate in the early years of the policy. Which of the following would be the producer's most appropriate response? ANSWER.” Sandra Timms, age 27, is advised by her producer to purchase Life insurance to cover a 20-year- amortized $50,000 business-improvement loan. Which of the following plans would adequately protccl Ms. Timms at the minimum premium oullay? - ANS —— -A. $50,000 Deereasing Term Tn order to sell variable life insurance you must be registered with which of the following? - ANSWER ASB Which of the following contracts requires thal a sorics of benefit payments be made at specified intervals? - ANSWER SM Mn ec ee ee ee ee ee ee ee ee aS | A life insurance policy that combines term insurance protection, a flexible premium, and cash value accumulation is: - ANSWER {ae Aclient buys a $50,000 Whole Life policy on himself and wants to add $25,000 in Term coverage - ANSWERER for his spouse. He should add which of the following riders to his policy? A$10,000 Life insurance policy with a Triple Indemnity clause has been in force for three y The insured is injured in a train wreck and dies in a hospital five months later. The death proceeds payable under the policy would be: - ANS WER SOOO The provision in a Life insurance policy that provides protection against unintentional policy lapse is known as the: - _— -Automatie Premium Loan provision Aclient applied for Life insurance on October 1st. The application was approved and the policy was issued on October 10th. It was delivered to the customer on October 18th. When did the Free Look start? - ANSWER GSES Dividend projections may be included in a proposal for Life insurance: - ANSWER An insured died during the Grace Period of her Life insurance policy and had not paid the required annual premium. The insurance company is obligated to pay which of the following ta the beneficiary? - ASW) {iRQIESSSSS Its Hoe BOleo less ait aaneasreatGiis What Life insurance policy provision applies if a policy lapsed last year and the insured wants it back? - ANSWER RG een Mn ec ee ee ee ee ee ee ee ee aS | Which of the following is a Non-forfeiture Option that provides continuing cash value buildup? - ANSWERER SRO Which of the following Settlement Options might provide payments that exceed the proceeds of the policy and the interest earned? - ANSWER If the insured dies 5 vears after he bought a Life insurance policy and the insurer determines that there was material misrepresentation on his application, they will - ANSWERS A beneficiary designation that prevents the policy owner from making certain changes in the policy is: - ANSWERS An insurance company will grant an advance from the cash value of a Life insurance policy when the policy owner requesis which of the following? - ANSWER Es Which of the following stalements is true about exercising a Guarantecd Insurability option: I. The new insurance is available al. the original issue age ralo IL. Evidence of insurability is not required TIL The insured can exercise the option at any time after the age of 21 IV. The maximum purchase is specified in the contract - ANS ve Which of the following is true aboul the Misstatoment of Age provision: - ANS WER Tie Mn ec ee ee ee ee ee ee ee ee aS | Grandma owns a policy on her grandchild. ich rider would kick in if Grandma should die tomorrow? - ANSWER. Payor Benefit Rider rc 5,000 Accidental Death Benefit rider - ANS WEN SQSOOD A customer buys a $25,000 Life insurance policy with a $2 attached. If he dies of cancer, how much will his policy pay? Which of the following statements about the Misstatement of Age provision in a Life insurance ooliey is truc?- 1/91 SS EEE Jim gets married and wants to add his new spouse to his existing Life insurance policy. Which rider should ho add? - ANS WER-QSEINSUROM Rae Ina policy insuring the life of a child, which of the following allows lhe premiums lo be waived in the event of the death or disability of the person responsible for premium payments? - ANSWER SOREenennieet Which of the following statements about the Reinstatement provision is true? - ANS WER§ A client buys a Life insurance policy on July Ist and dics by suicide 6 months later. The insurance company will:- ANS -Deny the claim, but refund the premium Dividend projections may be included in a proposal for Life insurance when which of the following is true? ~ 4/VSWE) DRESS lees iaealealiieh Pas aeneOs sce MlveenusSnOT Mn ec ee ee ee ee ee ee ee ee aS | ive policy proceeds when: - ANS Sa The contingent beneficiary will r Arider that keeps a policy from lapsing due to non-payment of premium by borrowing from the cash value is: - ANSWER SHEEP ene The clause that states the insurer's promise to pay the policy benefits in accordance with the contract’s provisions is the: - ANS Insuring Clause Which of the following statements about a typical Suicide clause in a Life insurance policy is tris? Snicide is excluded for a specific period of vears and covered thereafter Margaret May wants to name her husband as the beneficiary of her Life policy; however, she wishes to retain all of the rights of ownership. Mrs. May should name her hnshand as: - ANS WE) SSE If the insured understated his age and the error is discovered after the insured's death, the insurance company will:~ ANS1/) ESSE leila sel envOuN ne The Life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the: - ANS W 2 TRSCReSaBTY Giaase An insured’s premium for Life insurance is based mainly upon their: - ANS wer Mn ec ee ee ee ee ee ee ee ee aS | Statements made by an applicant for a Life insurance policy that are supposed to be true are referred to as:- ANSWER-RQSESSCHIAEIOnS A producer submits a completed and signed application to the underwriter along with the first premium check. After checking the results of the physical exam, the underwriter issues a rated’ policy. Which of the following will not be required: - Anew comploted and signed Insurable interest must exist: - ANS -At the time of application Life insurance becomes effective when: - _ When the conditions in the conditional A prospect's sLatements made in the application for insurance conslitute a part of which of the following? - ANSWET-GQSSISSESEOnIO lense Once completed and signed by the applicant, a producer may change an application: - ANSWER- If an existing client of a producer wants to buy another Life insurance policy, the producer shows: Have the customer come in and complete and sign a new application Which federal law governs consumer investigative reports: - ANSWER _SQGRaRep orn A producer sends a completed and signed application along with the check for the initial premium to the underwriter, who notices that the applicant forgot to sign the check. When would Mn ec ee ee ee ee ee ee ee ee Por === -- coverage star? — 91S EEE All of the following are a part of a Life insurance policy, EXCEPT the: - ANSWER QQSmRonl With proper notice and authorization, insurers may report underwriting information that an applicant lists on their application for Life insurance to the: - Medical Information When giving a client a conditional receipt, which of the following is true?- ANS we i A producer takes an application from a proposed insured without receiving payment of the first premium. The insurance company issues the policy and, when the producer visits the proposed insured to deliver it, she realizes that the health of the applicant has deteriorated significantly I I I I since the application was taken. The producer should: - Refuse to deliver the policy I I I I I I Albert Metz, who has $2,000 of Group Life insurance, has just terminated his employment. Mr. Metz has how many days in which to convert his group coverage to individual coverage? - I ANSWER SG I When a company requires thal. Lucir employees pay part of the premium for the Group Life insurance coverage, it is known as a __ group: - ANSWE MQQHEEIBIEOES Mn aS | Premature distributions from a Traditional IRA prior to age 39 1/2 are subject to: - ANSWER- Carl Burk, whose wife is his business partner, buys a Life insurance policy on his wife's life. Because of this third-party ownership, the beneficiary should be the: - ANS ee ies When someone other than the insured is the owner of a Life insurance policy, the owner may do all of the following without the insured’s consent, EXCEPT: - ANSWER SSeS Traditional IRAs have a premature distribution penalty for distributions taken prior to age: - ANSWERS The owner ofa business is insured under a $100,000 Key Employee Life policy that contains a Double Indemnity clause and a Suicide clause. The business has paid the annual premium of $2,000. Six months after the inception date of the policy, the insured commits suicide. The insurance company’s liability for payment is: - ANSWENSZ00 Which of the following is not considered to be a ‘qualified’ plan?- ANS —— -Split Dollar An insurable interest must exist when: - | A life insurance policy is issued Mn ec ee ee ee ee ee ee ee ee