- small business owner is the insured under a disability policy that funds a buy - sell agreement . If the owner dies or becomes disabled , the policy would provide which of the following ? a ) The business manager's salary b ) Disability insurance for the owner c ) Cash to the owner's business partner to accomplish a buyout d ) The rent money for the building
- A corporation is the owner and beneficiary of the key person life policy . If the corporation collects the policy benefit , then a ) The benefit is subject to the exclusionary rule . b ) IRS has no jurisdiction . c ) The benefit is received as taxable income . d ) The benefit is received tax free
- In a disability policy , the probationary period refers to the time a ) Between the 10th day of an illness - related disability and the first payment . b ) Between the first day of disability and the actual receipt of payment for the disability incurred . c ) During which illness - related disabilities are excluded from coverage . d) Between the first day of disability and the day the disability must continue before the insured receives any benefits .
- All of the following are true of key person insurance EXCEPT a ) The plan is funded by permanent insurance only . b ) There is no limitation on the number of key employee plans in force at any one time . c ) The employer is the owner , payor and beneficiary of the policy . d ) The key employee is the insured
- An insured pays a $ 100 premium every month for his insurance coverage , yet the insurer promises to pay $ 10,000 for a covered loss . What characteristic of an insurance contract does this describe ? a ) Aleatory b ) Good health c ) Adhesion d ) Conditional
- An annuity owner is funding an annuity that will supplement her retirement . Because she does not know what effect inflation may have on her retirement dollars , she would like a return that will equal the performance of the Standard and Poor's 500 Index . She would likely purchase ani a ) Equity Indexed Annuity b ) Variable Annuity c ) Flexible Annuity . d ) Immediate Annuity .
- The type of policy that can be changed from one that does not accumulate cash value to the one that does is a a ) Whole Life Policy . bi Convertible Term Policy ) Renewable Term Policy d ) Decreasing Term Policy .
- All of the following statements concerning dividends are true EXCEPT a ) Dividend amounts are guaranteed in the policy . b ) Lower insurance company costs generate higher dividends . c ) They stem from favorable underwriting experience . d ) Favorable investment results generate higher dividends
- Ifa policyholder declines the nonforfeiture benefit , what must the insurer provide to the client upon the lapse of the policy ? a ) An aleatory benefit b ) A full refund of premiums c ) Pro Rata premiums d ) A contingent benefit
- How long must an insurer maintain advertisements used in the sale of life insurance ? a ) 2 years . b ) 3 years c ) 5 years d ) 6 years Insurers must All health insurance policies issued in this state must provide coverage for maternity services . How many hours of inpatient care must be provided to a mother after a delivery by caesarian section ? a ) At least 48 b ) At least 96 c ) At least 24 d ) At least 36
- When can a Long - Term Care policy deny a claim for losses incurred because of a pre - existing condition ? a ) At any time b ) At no time c ) Within 6 months of the effective date of coverage d ) Within 12 months of the effective date of coverage
- What must a health carrier do within 72 hours of receiving a request for an expedited review ? al Provide written confirmation of the carrier's decision b ) Acknowledge receipt of the request c ) Notify the requesting enrollee of the carrier's established written procedures for an expedited review d ) Notify the requesting enrolice of the carrier's determination
- The president of a manufacturing company has offered one of the company's officers a special individual annuity plan that is unavailable to lower - echelon employees . This plan would be funded with before - tax corporate dollars , and it does not meet government approval standards . This annuity plan is a ) An executive annuity plan . b ) Subject to government standards . c ) Illegal . d ) Anonqualified annuity plan
- Which of the following is TRUE regarding the insurance amount in a credit life policy ? a ) The creditor may insure the debtor for an unlimited amount of coverage . b ) Allowable amount of coverage is determined by the State Insurance Commissioner . c ) The amount of coverage can be greater than the amount owed . d ) The creditor can only insure the debtor for the amount owed
- Which types of insurance companies marketing long - term care insurance coverage must establish procedures to assure that any comparison of policies by its agents will be fair and accurate ? a ) Every company is required to establish marketing procedures b ) Any company that uses any form of media to market policies that yield no less than 20 % of its business . c ) Mutual and stock.companies . d ) No companies are required to establish marketing procedures
- A producer has submitted a new application to his insurer ; however , 30 days later there was still no coverage available for the applicant . What must the producer do ? a ) Nothing producer has no further obligations once the application is submitted to the insurer . b ) Submit a complaint to the Department of Insurance c ) Submit a request for coverage to the insurer d ) Inform the applicant in writing
- Which of the following is NOT required on an application for a variable life insurance policy ? a ) Questions designed to assist the insurer in determining suitability of the insurance b ) A statement explaining the use of separate accounts in variable insurance c ) A statement that the death benefit may be variable or fixed d ) A statement that cash values may increase or decrease based on the separate account
- On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. What is the company guilty of?
- The sole beneficiary of a life insurance policy dies before the insured . If the policyowner fails to change the beneficiary before the insured's death , the proceeds of the policy will go to a ) The insured's estate b ) Probate c The state d . The beneficiary's estate .
- Under which of the following employer - provided plans are the benefits taxable to an employee in proportion to the amount of premium paid by the employer ? al Dental Expense b ) Basic Medical Expense c ) Disability Income dy Major Medical