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P wants to name her husband as the beneficiary of her life policy. However, she wishes to retain all of the rights of ownership. P should have her husband named as the: A.irrevocable beneficiary B.revocable beneficiary C.secondary beneficiary - Correct Answer ✅B A contract that has as its basic function the systematic liquidation of accumulated assets through periodic payments is called an: A.indemnity contract B.investment contract C.endowment
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D.annuity - Correct Answer ✅D An insurance producer takes an application for a life insurance policy but does not collect the initial premium. On delivery of the policy to the proposed insured, the producer must collect the initial premium and which of the following? A.A copy of the MIB report B.The insured's signed statement of continued good health C.A copy of the conditional receipt D.A copy of the temporary insurance agreement that covered the period between the application date and the delivery date. - Correct Answer ✅B An employer can deduct premium payments as an ordinary business expense for which of the following life coverages?
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A.Family Income rider B.Survivorship Life policy C.Joint Life policy D.Modified Life policy - Correct Answer ✅A Which of the following statements is CORRECT about Group Life conversion privileges? A.Under the COBRA law, a departing employee may elect to remain a member of the Group Life plan for a limited period of time. B.Death during the conversion period is covered even if the departing employee chose not to convert the policy.
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C.A departing employee must individually pay the premium if the employee elects to be covered during the conversion period. D.If a departing employee elects to convert a life insurance policy, the insurer must offer Term insurance as one of the choices. - Correct Answer ✅B Which of the following policies is an interest-sensitive form of permanent protection? A.Universal Life B.Limited-Pay Life C.Graded Premium Whole Life D.Modified Whole Life - Correct Answer ✅A
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C.It is renewable at the option of the insurer, with proof of insurability. D. It is renewable at the option of the insured, with proof of insurability. - Correct Answer ✅B If an insured commits suicide after the Suicide clause in the insured's life insurance policy has expired, the insurer will take which of the following actions? A.Refuse to pay the Death benefit or refund any premiums B.Refund only the premiums paid C.Refund the premiums paid plus interest D.Pay the Death benefit - Correct Answer ✅D
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Which of the following policy provisions provides for continuation of coverage despite nonpayment of premiums? A.Entire Contract B.Ownership clause C.Nonforfeiture Option D.Insuring clause - Correct Answer ✅C An applicant for life insurance may question the validity and source of any consumer information developed under the A.Medical Information Bureau Disclosure Act B.Fair Credit Reporting Act (Insurance Information and Privacy Protection Act)
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policyowner's wife predeceases him, and then he dies, who will receive the policy proceeds? A.The children B.The policyowner's estate C.The primary beneficiary's estate D.The tertiary beneficiary - Correct Answer ✅A The Waiver of Premium provision of a life policy allows the insurer to take which of the following actions? A.Waive an insured's premiums if the insured becomes totally disabled before a certain age B.Waive an insured's premiums if the insured becomes partially disabled for a minimum time
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C.Increase an insured's coverage at an attained age without imposing a premium increase D.Reduce an insured's premiums if the insured pays them annually instead of monthly - Correct Answer ✅A Under the Social Security Retirement Benefits, all of the following factors will influence how much a retiring individual will receive as a monthly income benefit EXCEPT the individual's: A.age B."primary insurance amount" C."fully insured" or "currently insured" status D.sex - Correct Answer ✅D
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D.coverage on the insured's children within thirty-one days after they are born - Correct Answer ✅C Which of the following statements is NOT correct about representations? A.They can be a part of the contract. B.They are true in every respect. C.They are assumed to be accurate. D.They influence the insurer's acceptance of the risk. - Correct Answer ✅B If an Adjustable Life policyowner makes an additional premium payment, the policy may be affected in all of the following ways EXCEPT the: A.premium paying period may decrease
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B.value of the Nonforfeiture Options may decrease C.face amount may increase D.length of coverage may increase - Correct Answer ✅B An insured owns a $10,000 policy with a $4,000 cash value and a 6 percent interest rate. On January 1, the insured borrows $500 and pays one year's interest in advance. During the year, the insured does not repay any part of the loan or interest. If the insured dies on December 31, the beneficiary will be entitled to a MAXIMUM of: A.$3, B.$6, C.$9, D.$9,500 - Correct Answer ✅D
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C.The proposed insured's primary care physician D.The proposed adult insured - Correct Answer ✅D The right to change a beneficiary designation is reserved for the: A.beneficiary B.policyowner C.insurer D.insured - Correct Answer ✅B All of the following policies may be examples of third party ownership EXCEPT: A.Modified Life
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B.Group Life C.Split-dollar Life D.Key Employee Life - Correct Answer ✅A In life insurance, insurable interest must exist at the time the A.producer delivers a policy B.proposed insured has a medical examination C.producer writes an application on a proposed insured D.beneficiary files a claim - Correct Answer ✅C A payor benefit rider provides which of the following benefits
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C.Survivorship Life D.Joint and Several Annuity - Correct Answer ✅A If life insurance policy applicant is classified as a substandard risk, the insurance company will MOST likely: A.issue the policy with riders B.charge an extra premium C.require an annual medical examination D.lower the rate per thousand charged - Correct Answer ✅B When a producer submits an insurance application to the company, the producer must take all of the following actions EXCEPT:
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A.submit the initial premium, if it was collected B.ensure any changes on the application were initialed by the applicant C.submit a completed medical information report D.complete the producer's report - Correct Answer ✅C In life insurance, the Free Look provision begins on the: A.effective date of coverage B.policy delivery date C.date of application D.date that the insurer issues the policy - Correct Answer ✅B
