Insurance Planning Flashcards

Question

exclusion ratio of an annuity payout tax treatment

Answer 1

investment in contract/annual payment x life expentancy

Answer 2

all taxable income

Answer 3

pre 59.5= 10% penalty on taxable earnings

Answer 4

owner over 59.5, owner disabled, owner dies, immediate NQ annuity, substantially equal periodic payments later of: 5 years or owner reaches 59.5

Answer 5

Withdrawals: LIFO Annuitization: Exclusion allowance is applied from each payment until the basis is recovered.

Answer 6

primarily to defer current taxation in the exchange of life insurance and annuity contracts.

Answer 7

life insurance, endowments, annuities, qualified L-T care insurance

Answer 8

endowments, annuities, qualified L-T care insurance

Answer 9

annuities, L-T care insurance

Answer 10

basic homeowners coverage- basic homeowners coverage

Answer 11

special form- better homeowners coverage

Answer 12

contents broad form- for tentants/renters (only covers contents)

Answer 13

comprehensive form- best homeowners insurance

Answer 14

unit owners form- for condo/co-op owners (studs in)

Answer 15

Modified coverage- for older or historic homes only (less covereage); got very old , intricate woodwork, stained glass, etc

Answer 16

coverage specifies perils or “causes of loss” that are covered. Everything else is not covered.

Answer 17

coverage specifies excluded perils or “causes of loss” that will not be paid. Everything else is covered.

Answer 18

HO-03 & HO-05

Answer 19

HO-03 covers contents on a named perils basis and HO-05 covers contents on an open perils basis.

Answer 20

is for backyard

Answer 21

crate-crap

Answer 22

damage/destroyed digs

Answer 23

exposure to legal action

Answer 24

fractured femurs

Answer 25

by adding a HO-15 endorsement – remember this by 3 x 5 =15.

Answer 26

peril= the actual cause of loss: the things we insure for. ex: a fire hazard= a condition that makes loss from a peril more likely. ex: a gasoline soaked rag in the garage

Answer 27

the dwelling on an open perils basis but covers contents on a names peril basis

Answer 28

the LESSER of: The actual cost to repair damage or replace the building The stated limit of coverage under the policy

Answer 29

GREATER of: The “actual cash value” of the damage (Replacement cost minus depreciation) Proportion of the loss that is equal to the proportion of insurance maintained as compared to 80% of the replacement cost

Answer 30

(["Did Have" + "Should Have"] x Loss Amount) - Deductible

Answer 31

known as the “holder” and the “long.”

Answer 32

known as the “writer” and the “short.”

Answer 33

the seller

Answer 34

max bodily injured/max total/all bodily injured/ max property damage

Answer 35

damange to a car caused by an accident withan inanimate object- another car, light pole, building

Answer 36

all other damage to auto- theft, glass breakage, flood, fire

Answer 37

comprehensive

Answer 38

Provides additional liability coverage above and beyond the underlying limits of one’s homeowners and automobile liability coverage (an “umbrella”). Policies are commonly $1,000,000+. Typically requires the insured to maintain stated minimum coverage limits in the underlying homeowners and automobile insurance policies.

Answer 39

if required minimum liability insurance on the boat is maintained.

Answer 40

Does not pay until the underlying policy limit is exhausted.

Answer 41

Covers the same bodily injury and property damage exposures as the underlying policies but also typically extends coverage for personal liability (such as libel or slander). Typically covers cost of defense

Answer 42

Does not extend coverage for business interests of the insured.