Chap 9 Pt 2

Question 1

Method considers time value of money by applying an interest adjustment to yearly premiums and dividends

Interest adjusted net cost

Free look period

Return policy

Answer 1

Interest adjusted net cost

Question 2

Which is used to compare cost of one policy against another to guide purchaser to policy that is competitively priced

Policy cost indices

Policy cost guide

Cost comparison methods

Answer 2

Cost comparison method

Question 3

Cir=

Answer 3

Comparative interest rate

Question 4

All are mandatory life ins policy provisions except

Misstatement of age
Grace period
Policy backdating
Incontestability

Answer 4

Policy backdating

It is not a mandatory provision and beyond 6 months is prohibited

Question 5

H policies individual and group are what after policy has been in force for a period of two years

Official policy

Free look

Loan

Incontestable

Answer 5

Incontestable

Question 6

Life ins policies are incontestable after policy has been in force for a period of

2 months
2 years
3 years

Answer 6

2 years

Question 7

Policy will pays benefits based on what the premiums paid would have purchased at insured’s correct age

Misstatement of insured age

Settlement of a death benefit

Free look

Answer 7

Misstatement of insured age

Question 8

A life ins policy that has cash value must have a provision for policyowner to

Answer 8

Borrow From those values

Question 9

Any life ins policy with cash value must have a

Grace period

Policy loan

Limitation period

Nonforfeiture provision

Answer 9

Nonforfeiture provision

Question 10

Life ins policies require that initial premium be paid

Answer 10

In advance

Question 11

Insurer must pay death claims with

2
4
6
(Months)

Answer 11

Two months

Question 12

Settlement of a death benefit must not be less than the

Claimant proceeds
Free look proceeds
Grace period proceeds

Answer 12

Face amount of the policy

Question 13

Fixed annuity free look=

Answer 13

20 days

Question 14

Free look period=

Answer 14

15 days

Question 15

Return policy for an unconditional refund without penalty beginning the day consumer receives the contract

Grace period

Grace loan

Limitation period

Free look

Answer 15

Free look

Question 16

Life ins policy may not contain provision under which lawsuit may be filed to a period of less than two years after cause of action

Settlement upon maturity

Nonforfeiture

Certain limitations periods

Answer 16

Certain limitations period

Question 17

In certain limitations period policy may not include provision that limits time to period of less than

2
4
6
Years

Answer 17

2

Question 18

All are mandatory life ins policy provisions except

Misstatement of age

Incontestability

Policy backdating

Grace period

Answer 18

Policy backdating is not a mandatory provision

Question 19

In tx Nonforfeiture law life ins policies insurers must offer at least ONE of the following Nonforfeiture options except

Reduce paid up

Extended term

Shortened benefit period

Reduction of premium

Answer 19

Reduction of premium

Question 20

Reduction of premium is NOT

Answer 20

A nonfortfeiture option

It is a dividend option

Question 21

Reduction of premium=

Answer 21

Dividend option

Question 22

If misstate age on group policy app

Adjust the premium

Cancel coverage

Issue an amended policy

Answer 22

Adjust the premium

Question 23

Policyowner surrenders his life ins policy that has been in force for five years within 60 days after premium due date, must pay

Death benefit
Cash surrender value
Nothing

Answer 23

Cash surrender value

Question 24

Conversion to an individual whole life policy is permitted without evidence of insurability within how many days of termination of employment

14 days
28
30
31

Answer 24

31

Question 25

Grace period in group policies=

Answer 25

31 days

Question 26

Individual covered under group life ins policy may convert to any of the following EXCEPT

Whole life

Level term

Universal life

Variable universal life

Answer 26

Level term