NJ laws for life only

Question 1

_____ means any transaction in which new life insurance or a new annuity is purchased and as a result the existing life insurance or annuity has been or will be any of the following:

Lapes, forfeited,surrendered,termianted

reissued with any reduction in cash value

converted to reduce paid up insurance, continued as extended term insurance

amended so as to affect either a reduction in benefits or in the term for which coverage would otherwise remain in force

used in financed purchase

Answer 1

Replacement

Question 2

______ is the company that issues the new policy

Answer 2

replacing insurer

Question 3

_____ is the company whose policy is being replaced

Answer 3

existing insure

Question 4

Duties of the replacing producer:

Answer 4

Present to the applicant a Notice Regarding Replacement that is signed by both the applicant and the producer. A copy must be left with the applicant

Obtain a list of all existing life insurance and or annuity policies to be replaced including policy numbers and the names of all companies being replaced

leave the applicant with the original or a copy of written or printed communications used for presentation to the applicant

Submit to the replacing insurance company a copy of replacement notice with application

Question 5

Duties of replacing insurers

Answer 5

Notify existing insurers within 5 business days that a replacement may be in order for an existing policy, and mail copy of the illustration or policy summary for the replacement policy

Provide a policyowner notice of the right to return the policy within 30 days of the delivery and receive an unconditional full refund of all premiums (free-look provision

Maintain copies of the Notice Regarding replacement and the comparitive information form, policy summary, and all the sales materials for at least 5 years or until the next regular examination by the Department of Banking and Insurance

Question 6

Each insurer must maintain a complete file of disclosure documents at its home office for a period of ____ following the date of its last authorized use

Answer 6

3 years

Question 7

Failure of an insurer or its agent and other representatives to provide a buyer a Buyer’s Guide, an in force illustration, a policy summary or policy data or any other information required by the state regulations regarding disclosure will constitute an _____ that misrepresents that benefits, advantages, conditions, or terms of an insurance policy, and may result in penalties as prescribed by the Unfair Trade Practices Act

Answer 7

omission

Question 8

All advertisement must be maintained on file by the insurer for a period of ____ from their last use

Answer 8

5 years

Question 9

_______ is a misrepresentation, or incomplete or fraudulent comparison of insurance policies that persuades an insured/owner to his or her detriment, to cancel, lapse switch policies, or take out a policy with another insurer

Answer 9

Twisting

Question 10

Life insurance proceeds are protected from creditors and will be received by the policy beneficiary as long as the beneficiary is not

Answer 10

1) The insured
2) the person effecting the insurance
3) The executor or admin of the insured

Question 11

life insurance proceeds are also protected from the beneficiary’s debt and liability except that the amount of any premiums paid with intent to _____ creditors will be owed with interest from the proceeds of the policy

Answer 11

defraud

Question 12

If a group life or group health insurance provides for automatic discontinuance of the policy for nonpayment of premium (after grace period), the insurer is still _____ for valid claims of covered losses incurred before the end of the grace period

Answer 12

liable

Question 13

Even after the grace period expires, if the insurer continues to recognize submitted claims for any of the former group certificate holders, it is liable for valid claims for losses beginning before the effective date of ____________, which cannot be before the third scheduled work day after the notice is delivered

Answer 13

written notice of discontinuance

Question 14

_____ is a special type of coverage written to insure the LIFE OF THE DEBTOR and pay off the balance of a loan in the event of the death of the debtor

Answer 14

Credit insurance

Question 15

Credit life is written as ____. Creditor is the owner of the master policy, and each debtor receives a certificate of insurance

Answer 15

decreasing term insurance

Question 16

The creditor is the ______ and the beneficiary of the policy although the premiums are generally paid by the borrower (debtor)

Answer 16

owner

Question 17

Credit life insurance cannot pay out more than the

Answer 17

balance of the debt

Question 18

In NJ, the term of coverage for credit life insurance must be at least ______ when the credit life insurance is being placed on loans with a term of 8 to 15 years

Answer 18

7 years

Question 19

Which of the following documents must be provided to the policyowner or applicant during policy replacement

Answer 19

Notice Regarding Replacement

Question 20

During replacement of life insurance, a replacing insurer must do which of the following

Answer 20

Obtain a list of all life insurance policies that will be replaced

Question 21

A life insurance policy insures against several different perils. If the policyowner wants to cancel the coverage for one of those perils, can that be done

Answer 21

Only if the policy specifies that a separate premium for that peril coverage is separately cancelable

Question 22

The buyers guide and policy summary can be delivered with the policy or earlier if the policy contains an unconditional refund provision of at least

Answer 22

10 days

Question 23

Solicitation rules would apply to which of the following types of coverage

Answer 23

WHOLE LIFE

Question 24

If a credit life policy lapses for nonpayment before the debt is satisfied, within how many days must the creditor either refund the premium or apply it against the debt

Answer 24

60 days

Question 25

An alumni group, debtor group, and group sponsored by an employer could own

Answer 25

group life insurance

Question 26

In NJ, the public is protected by a notice of discontinuance when a policy is discontinued for nonpayment of premiums. When a policy is discontinued, all of the following are required

Answer 26

1) A reminder of the date of discontinuance
2) Ceasing to collect premium payments from group participants unless the group policyholder remains full responsible for the benefit
3) Written notice to the policyowner

Question 27

A life insurance policy has lapsed, and the policyowner would like to reinstate it. In order to initiate the reinstatement process, he must submit an application to his insurer. THe following is true

Answer 27

It is the policyowners responsibility to request the reinstatement application; the insurer must than deliver it within 30 days