Life Insurance Exam Textbook 01 Flashcards
A special characteristic of theinsurance contract where equalvalue is not exchanged between parties is known as
Aleatory
Life insurance contracts arethese agreements
Unilateral
What is the proper definition ofa take it or leave it contract,written by an insurer:
Adhesion
The premium paid by theinsured for an insurance policy is
Consideration
The best example of a Peril is:
Cause of loss
An admitted insurer is:
Approved to transact
An Actuary:
Works with statistics to establish premiums and isresponsible for the company’s financial soundness.
A new Life-Only licensee will need to take continuing educations courses. The requirements are:
24 hours during each 24-month licensing interval.
Which of these would be a substandard risk?
A person who may have less chance of surviving than the average. A person whose occupation would cause an increase in mortality hazard. A person whose hobby would cause an increase in mortality hazard. All of the Above.
Rob, a licensed agent, is working under the authority of a Life Only Agent licensee. He may write which type of policies?
Life.
The best type of life insurance a person can own is:
Term.
Insurance is a contract whereby the:
Insurer indemnifies the insured against loss.
Using the human value approach, the best way to figure out the amount of the death benefit is based on:
Proposed insured’s potential earnings.
An agent is meeting with a retired U.S. Army Major to sell him insurance. What should be the primary objective of the agent?
Meeting his financial objectives.
Term insurance:
Is only in force for a specific period of time.
A contingent beneficiary:
Receives the policy proceeds if there is no living primary beneficiary.
The death benefit of a life insurance policy is received by the (best answer):
Beneficiary.
An insurer pays a refund from the surplus of profits to the holder of a participating policy. What is the payment?
A policy dividend.
The Non-Forfeiture provision that would give the insured the most amount of coverage would be:
Extended Term Insurance.
If you choose the settlement option of receiving fixed monthly installments or fixed amounts, you may receive an amount that is:
More than the face amount.
An individual, who wishes to provide a retirement income for himself that will also provide a retirement income for his wife in the event he dies, should purchase which of the following:
A joint and survivor life annuity.
A pure life annuity offers protection against the risk of:
Outliving one’s income.
A(n) blank is a products used to accumulate funds and later liquidate that amount.
Industrial life policy.
The period of time during which a deferred annuity builds its value is referred to as:
An accumulation period.
A life annuity with a 10-year period contain:
Is guaranteed to pay for a minimum of 120 months either to the annuitant or beneficiary.
A Multiple Employer Trust (MET):
Is a legal entity formed to provide groups of small business owners with group health insurance and other types of employee benefit programs.
In a group insurance program, the employee receives:
A Certificate of Insurance.
Which of the following is true about a Keogh plan?
It is a retirement plan for self-employed individuals.
Which of the following are acronyms for federal legislation?
COBRA. TEFRA. ERISA. All of the above.
Eric has an insurance policy that was issued by the ABC Company. Mark, an agent for another insurance poicy, comes to Eric’s store and suggests that Eric cancel his present policy and buy one from him. Eric tells Mark that is he is quite happy with his present policy, whereupon Mark tells him that the policy is badly written and that the issuing company has a poor reputation for paying claims. Mark is guilty of:
Twisting.
Which of the following would not be considered an unfair trade practice?
Charging males and females different rates for life or annuity contracts according to the current mortality tables.
Of the following, which is a true statement about the California Insurance Code?
Legislature writes the insurance laws. Commissioner enforces the insurance laws. Agents are to follow the laws. All of the Above.
In the event that an insurer becomes insolvent, the most the insured would be relieved under the California Life and Health Gurarantee Association
$250,000.
The California Code of Regulations are:
Established by the Commissioner’s office of the Department of Insurance.
Which of the following is not used in determining health insurance rates?
Mortality.
Uniform policy provisions address which of the following?
Grace Period. Payment Claims. Reinstatement. All of the Above.
Which provision in a policy allows the insured to buy more insurance, at specified intervals, with no proof of insurability?
Guranteed insurability rider.
A Waiver of Premium Rider:
If the insured is permanently disabled , the insurer may retroactively waive premium payments from the start of the disability
The entire contract provision states which of the following, in addition to the policy, reflects the entire contract?
The Application.
An individual has a hospital indemnity policy that pays $500 a day. This person is hospitalized for two days and the bills are $400 a day. How much will the company pay?
$1,000.