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Texas Life Insurance exam Latest
Update year 2024/
A key-person insurance policy benefit will pay for... - ✔✔Cost of training a replacement A life agent's license must be renewed.. - ✔✔Every 2 years on the anniversary date of issuance A life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specific period of time is known as the.. - ✔✔Incontestability clause A spouse receives $5,000 a month until the principle and interest on her husband"s life insurance policy have been paid out. Which settlement option did this beneficiary choose? - ✔✔Fixed amount A substandard risk compared to a standard risk would pay? - ✔✔a higher premium A temporary license is normally valid for.. - ✔✔90 Days
Adjustable Life - ✔✔Life insurance that permits changes in the face amount, premium amount, period of protection, and the premium payment period Agents whose license has been revoked will not be able to receive another license in Texas for at least.. - ✔✔5 Years Alien insurer - ✔✔and insurance company that is incorporated outside the united states An agent who offers a cash reward to a prospect for buying a policy is guilty of.. - ✔✔Rebating An annually renewable term policy? - ✔✔Renews each year with an increased premium An employee quits his job and converts his group insurance to individual policy. On which of the following will premium for the individual policy be based? - ✔✔Insured's attained age An example of limited-pay life policy? - ✔✔Life paid-up at the age 65 An individual inherited a large sum of money at age 40 and wanted to use it to provide a guarantee income after his retirement at age 60.
Buyers Guide - ✔✔General information about life insurance policies Commissioner of Insurance - ✔✔Must be a citizen of Texas Be well informed and qualified in the field of insurance and regulation Have at least 5 years of experience in the administration of business or government of practicing attorneys or certified public accountant Serves a 2 year term ending Feb 1 of each odd number year Common Disaster - ✔✔Under the Uniform Simultaneous Death, the law will assume that the primary beneficiary dies first. This provides that the proceeds will be paid to either the contingent beneficiary or to the insured's estate Consumer reports - ✔✔Include written and/or oral information regarding a consumers credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports and other public sources Counselor - ✔✔any person who, for a FEE or COMISSION, offers to examine a life, accident, or health insurance policy, an annuity or pure endowed policy
Decreasing Term - ✔✔A type of life insurance that features a level premium and a death benefit that decreases each year over the duration of the policy Dividends - ✔✔Paid only on participating polices. A return of excess premiums Not taxable Are not Guaranteed Does not have an insurable interest? - ✔✔Insured's best friend Domestic Insurer - ✔✔an insurance company that is incorporated in this state Entire Contract - ✔✔Stipulates that the policy and a copy of the application, along with any rider or amendments Equity-Indexed Life - ✔✔(indexed whole life) main future is that the cash value is dependent upon the performance of the equity index, such as S&P 500, although there is a guaranteed minimum interest rate Fair Credit Reporting Act - ✔✔Established procedures that consumer- reporting agencies must follow in order to ensure that records are confidential, accurate, relevant and properly used.
If a life policy does not pass the 7-pay test, that policy... - ✔✔Becomes a Modified Endowment Contract If an agent fails to obtain an applicants signature on the insurance application, the agent must? - ✔✔Return the application to the applicant for signature If no receipt is issued at the time of application, a statement of good health is usually required at the time of? - ✔✔Policy delivery If the agent feels that could misrepresentation on the part of the applicant for insurance, what must the agent do? - ✔✔Inform the insurance comapny In an insurance transaction, which of the following does a licensed agent represent? - ✔✔Insurer In group life policies, individual certificates are given to.. - ✔✔Each insured person Increasing Term - ✔✔Level premiums and a death benefit that increases each year over the duration of the policy term
Insurable Interest - ✔✔A financial interest in the life of another person; a possibility of losing something of value if the insured should die. Must also exist at the time of policy application or policy issue. Insurable Interest - ✔✔The policy owner must face the possibility of losing money or something of value in the event of loss Interest-sensitive Whole Life policy - ✔✔(Current Assumption) is a fixed premium whole life policy that provides a guarantee death benefit to age 100. Premiums may very according to interest rate fluctuations Investigative Consumer Report - ✔✔a report similar to consumer report, but one that also provides information on the consumers character, reputation and habits. Investigative Consumer Reports - ✔✔Similar to consumer report, primary difference is that the information is obtained through an investigation and interview with the associates, friends and neighbors of the consumer Irrevocable designation - ✔✔May not be changed WITHOUT THE WRITTEN CONSENT OF THE BENEFICIARY Level Term insurance - ✔✔Most common type of temporary protection purchased
Payor Benefit Rider - ✔✔Found in juvenile polices which waivers the premiums if the person paying them (often the parent) is disabled or dies while the child is still a minor Policy Replacement - ✔✔Present to the applicant a NOTICE REGARDING REPLACEMNT that is signed by both the applicant and producer Policy Summary - ✔✔Written statement describing the FEATURES and ELEMENTS of the policy being issued Premium Payment (MODE) - ✔✔Refers to the frequency the policy owner pays the premium Renewable Term - ✔✔Insurance which can, at the election of the policy owner be renewed at the end of a term without evidence of insurability Representations - ✔✔Statement made by the applicant on the insurance application that are BELIEVED to be true, but are not guaranteed to be true Representations are statements made by the applicant that are? - ✔✔Considered true to the best of the applicant's knowledge
Single premium - ✔✔Designed to provide a level death benefit to the insured's age 100 for a one-time, lump sum payment Social Security benefits - ✔✔Retirement, disability, and survivors Stock Companies - ✔✔Owned by the stockholders who provide the capital necessary to establish and operate the insurance company who share in any profits or losses Straight Life - ✔✔(Continuous Premiums) the basic whole life policy Term Insurance - ✔✔Temporary protection because it only provides coverage for a specific period of time. Also know as (pure Life insurance). Provides for the greatest amount of coverage for the lowest premium compared to other forms of protection The 10% early withdrawal penalty from an IRA can be waived for... - ✔✔Catastrophic medical expenses The advantage of qualified plans to employers is - ✔✔Tax-deductible contributions The application consist of? - ✔✔2 Parts
The number of Quarters required to obtain a fully insured status to receive Social Security benefits is... - ✔✔ 40 The renewable provision allows the policy-owner to renew the coverage at the expiration date - ✔✔Without evidence of insurability The time period during which an annuitant contributes to annuity is called? - ✔✔The accumulation period Under what circumstance will the contingent beneficiary receive the death benefit? - ✔✔If the primary beneficiary dies before the insured Universal Life - ✔✔(Flexible Premium Adjustable) Implies that the policy owner has the flexibility to increase the amount of premium going paid into the policy and to later decreases it again USA PATRIOT ACT - ✔✔this act prevents terrorist activities by monitoring financial transaction Variable Life Insurance - ✔✔a level, fixed premium investment-based product. Guaranteed minimum death benefit
Cash value is not guaranteed and fluctuates with the performance of the portfolio in which premiums have been invested by insurer Variable Universal Life Insurance - ✔✔Combines many features of the whole life with the flexible premium of universal life and the investment component of variable life. What best describes the USA PATRIOT Act with regards to the insurance industry? - ✔✔To prevent terrorism activities through monitoring of financial transactions What feature allows an insurance policy to remain in force for a specific number of days beyond the premium due date? - ✔✔Grace period provision What includes information regarding a person's credit, character, reputation, and habits? - ✔✔Consumer report What insurance arrangement will be appropriate for a parent buying a life insurance policy on a child where the parent is the policy-owner? - ✔✔Third-party ownership What is NOT a non forfeiture options in life insurance policies? - ✔✔Automatic premium loans
What is the main source of underwriting information used by the company in the risk selection process? - ✔✔Application What is the minimum required number of continuing education credits in the ethics every licensing period? - ✔✔2 Hours What is the requirement for a number of employees in a SIMPLE plan - ✔✔No more than 100 What is true about the free-look period in a life insurance policy? - ✔✔It commences when the policy is delivered What is true regarding a joint life policy? - ✔✔Premium is based on the average age of the insureds What is true regarding a universal life policy? - ✔✔The premiums can be decreased by the insured What kind of person would not be eligible to set up contribution to a traditional IRA? - ✔✔Age 72, a nurse What person is required to a producer license? - ✔✔A nonresident agent who negotiates insurance contracts
What provision of a life insurance policy states the application is part of the contract? - ✔✔Entire contract What term refers to the transfer of some or all of the ownership of some or all of the ownership rights of a life insurance policy from one individual to another? - ✔✔Assignment What would be considered a disadvantage of term insurance? - ✔✔If the insured dies after the end of the term, there is no death benefit to the beneficiary When a death claim is submitted, the insurer discovered that the insured understated her age on the application for a life policy. What will the insurer take? - ✔✔Pay a reduced death benefit based on the insured's actual age When must insurable interest exist in life insurance? - ✔✔Application or issue date When the insured purchased a new home, he wanted to purchase a life insurance policy that would protect his family against losing it should he die before the mortgage was paid. Which of the following policies is best suitable for that need? - ✔✔Decreasing term
