Policy, Provisions, Options, & Riders

Question 1

Mike and Ike 08 30 year old identical twins. Both are in excellent Health. He’s brother personal life policy that has a $750 annual premium. Mike bars it’s in your renewable term policy. And I purchase a whole life policy. All of the following statements are true except

Answer 1

Mike has the option of using his cash value to purchase a reduced amount of paid up whole life insurance

Question 2

A life insurance rider that allows an individual to purchase insurance as they grow older, regardless of insurability is called

Answer 2

Guaranteed Insurability rider

Question 3

An error was made on Mary’s life insurance application. Which of the following areas do errors commonly occur on applications for which the incontestable clause does NOT apply

Answer 3

Age

Question 4

A policy owner may exercise which of these dividends options that uses the dividend to pay all or part of the next premium due?

Answer 4

Reduction of premium dividend option

Question 5

When does a life insurance policy waiver of premium takes effect

Answer 5

Insured becomes totally disable

Question 6

All of these are coming exclusions to the life insurance policy except

Answer 6

Accidental death

Question 7

In a life insurance policy, the entire contract consist of

Answer 7

Policies and attached application

Question 8

A whole life policy option where extended term insurance is selected is called

Answer 8

Non-forfeiture option

Question 9

If an insured dies doing the grace period with no premiums paid

Answer 9

The policy would be payable, minus the premium amount

Question 10

What is the name of the provision which states a copy of the application must be attached to the policy when issue

Answer 10

Entire contract

Question 11

A life insurance policy normally contains a provision that restrict coverage in the event of a death other all of the following situations except

Answer 11

Fare paying passenger

Question 12

Ron has a life insurance policy with a face value of $100,000 at a cost of a living rider. At the consumer price index has gone up 4%, how much may Ron increase the face value of the policy?

Answer 12

4000

Question 13

 Loans obtain by a policy owner against the cash value of a life insurance policy

Answer 13

Would not be treated as a taxable income

Question 14

A provision that allows a policy owner to temporary give up ownership rights to secure a loan is called

Answer 14

Collateral assignment

Question 15

James is the insured have a life insurance policy where his age was mistaken on the application. Which of the following is correct regarding the death benefit amount

Answer 15

The death benefit Pj will be what the premium what have purchased at the correct age

Question 16

Which situation accurately describes a reduced paid up non-forfeiture option?

Answer 16

Policy Has a decrease face value

Question 17

Barbara policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. This writer is called a

Answer 17

Guaranteed insurable rider

Question 18

Which statement is true regarding policy dividends?

Answer 18

A dividend option is selected by the insured at the time of the policy purchase

Question 19

A life insurance policy owner was injured in an automobile accident which resulted in a total and permanent disabled. Which rider would pay a monthly amount because of this disability?

Answer 19

Disability income rider

Question 20

How are act of war and aviation treated under a group life insurance policy?

Answer 20

policy exclusion

Question 21

Pat owns a 20 pay life policy with a paid up dividend option. Which of the following statements is true

Answer 21

The policy may be paid up early by using policy dividends

Question 22

A life insurance policy owner does not have the right to

Answer 22

Revoke and absolute assignment

Question 23

Joanna has a $100,000 whole life policy with an accumulated $25,000 of cash value. She would like to borrow $15,000 against the cash value. Which of the following statements is true

Answer 23

Net death benefit will be reduced if the loan is not repaid

Question 24

All of the following riders can increase the death benefit amount except

Answer 24

Waiver of premiums

Question 25

Which policy provision protects the policy owner from unintentional lapse of the contract

Answer 25

Grace period

Question 26

What does a grace period allowed a life insurance policy owner to do

Answer 26

Make a premium payment at the due date without any loss of coverage

Question 27

After a policy has labs which provision allows the insured to continue coverage

Answer 27

Reinstatement provision

Question 28

Of the following dividend options which of these is taxable

Answer 28

Accumulation at interest

Question 29

All of these are valid policy dividends options for a life insurance policy owner except

Answer 29

Accumulate without interest

Question 30

All of these are standard exclusion found in a life insurance policy except

Answer 30

Disability

Question 31

The suicide clause the life insurance policy states that if insured commit suicide within a stated. From the policy exception, the insurer will only be liable to return of premium paid

Answer 31

Minus indebtedness and without interest

Question 32

Ownership of a life insurance policy may be temporary transferred with a

Answer 32

Collateral assignment

Question 33

Which of the following protects a policy owner from a representation  Caused by an innocent mistake

Answer 33

Incontestable clause

Question 34

Which dividend option would an insurer invest a policy owners money and add any interest earning as a dividend accrue

Answer 34

Accumulation at interest option

Question 35

Which of the following is a reinstatement condition

Answer 35

Proof of insurability

Question 36

What time period allows an insured life insurance policy to remain in force even if the premium was not paid on the due date

Answer 36

Grace period

Question 37

Which provision will pay a portion of the death benefit prior to the insured deaths due to a serious illness

Answer 37

Accelerated death benefit

Question 38

A provision in a whole life policy that allows a policy owner to terminate the policy in return for a reduced paid up policy of the same type is called a

Answer 38

Nonforfeiture Provision

Question 39

Bruce is involved in an accident and becomes totally and permanently disabled. His insurance policy can change of force without payment of Further premiums. Which policy provision is responsible for this?

Answer 39

Waiver of premium provision

Question 40

Which of these is not considered to be a common life insurance nonforfeiture option

Answer 40

Life income annuity

Question 41

Two major actions required for a policy owner to comply with the reinstatement clause are

Answer 41

Provide evidence of insurability, pay past due premiums

Question 42

A waiver of premium rider allows an insured to wave premium payments if the insured is

Answer 42

Completely and permanently disable

Question 43

A guarantee issue insurance policy has no

Answer 43

Medical underwriting

Question 44

Which of the following is considered to be an alternative to a life settlement

Answer 44

Accelerated death benefit rider

Question 45

In order to activate the reinstatement clause of a lap life insurance policy, the insured must

Answer 45

Provide evidence of insurability to the insurer

Question 46

When an accidental death benefit is added to a whole life policy, how does this affect the policy cash value

Answer 46

Policy cash value is not affected

Question 47

Matt is applying for life insurance and requires a double indemnity rider. A double indemnity benefit will be payable to Matt’s beneficiary if Matt 

Answer 47

Dies Instantly from a car accident

Question 48

How is a life insurance policy dividends Legally defined

Answer 48

A return on excess premiums & not taxable 

Question 49

An endorsement found in insurance plan which modifies the provisions of the policy is called

Answer 49

Rider

Question 50

Which of these is not considered to be a nonforfeiture option in a whole life insurance policy

Answer 50

Interest only

Question 51

An insured individual and the policy beneficiary dies from the same accident, the common disaster provision states to ensurer will continue as if

Answer 51

The insured outlives the beneficiary

Question 52

Which of these Is considered to be a living benefit option in a life insurance policy?

Answer 52

Accelerated death benefit

Question 53

The automatic premium loan provision authorize an insurer to withdraw from a policy cash value the amount of

Answer 53

Past due premiums they have not been paid by the end of the grace.

Question 54

When the life insurance policy is surrendered, how does the cost recovery rule apply

Answer 54

The policy cost basis is exempt from taxation

Question 55

Dorian exercise a non-forfeiture Option by using his life policy cash value to purchase an extended term insurance option. When you term insurance expires

Answer 55

The protection ends

Question 56

Which of these is not a characteristic of the accelerated death benefit option

Answer 56

Benefit can’t be offered as a rider at the Pacific extra cost or maybe at no cost

Question 57

In what part of the insurance policy our policies benefits found

Answer 57

Declarations

Question 58

Kurt is an active duty service member who was recently killed in an accident while home on leave. Which military service exclusion clause would pay upon his death

Answer 58

Results

Question 59

Which of these would limit a companies liability to provide insurance coverage

Answer 59

Exclusion

Question 60

Which of the following is not part of an insurance contract?

Answer 60

Certificate or authority 

Question 61

What is an insurer required to do to face with an error made under the misstatement of age provision?

Answer 61

Pay age corrected benefit

Question 62

Free look provision gives a policy owner

Answer 62

The right to return the policy for a full refund within a specific number of days

Question 63

Which of the following does a policy owner not have the right to change

Answer 63

Dividend schedule

Question 64

All of the following are considered to be a nonforfeiture option available to a policy owner except

Answer 64

Reduction of premium

Question 65

What does a guaranteed insurability option allows an insured to do

Answer 65

Purchase additional coverage with no evidence of insurability required

Question 66

What are collateral assignment normally associated with?

Answer 66

Bank loans

Question 67

The double indeminty provision in a life insurance policy pertains to an insured death clause by

Answer 67

Accident

Question 68

An insurer will accept a premium from the insured and continue the coverage in force as through it was not late during the time.

Answer 68

Grace period

Question 69

Which of these is not a valid policy dividend option?

Answer 69

Monthly income payments

Question 70

Life insurance policies will normally pay for losses arising from

Answer 70

Commercial aviation

Question 71

A provision that allows the policy owner to withdraw a policy cash value interest free is a

Answer 71

Partial surrender

Question 72

If an insured age on a life insurance policy has been misstated, what is the insurer liability if the insured dies

Answer 72

A prorated death benefit based on the amount of insurance and insured premium would have been if purchase at the correct age

Question 73

Under a life insurance policy, what does a insuring clause state

Answer 73

The insurer obligation to pay a death benefit upon an approved death claim

Question 74

A whole life insurance policy accumulate cash value that becomes

Answer 74

The policy loan value with the insured may borrow against

Question 75

What is the purpose of having an accelerated death benefit on a life insurance policy

Answer 75

In allows for cash advances to be paid against a death benefit if the insured becomes terminally ill

Question 76

The rider that insurance premiums will be paid on a juvenile policy until the child reaches a specific age is called

Answer 76

Payor rider

Question 77

If it insured die because of An accident, which type of life insurance rider will provide additional coverage

Answer 77

Accidental death rider

Question 78

A life insurance policy can be surrendered for its cash value under which policy provision

Answer 78

Non-forfeiture option

Question 79

Which of the following is not a common life insurance policy rider

Answer 79

Extended Term

Question 80

Which type of rider will waive the premium on a child’s life insurance policy if the parents are paying the premium dies

Answer 80

Payor benefit

Question 81

An Insurer can be protected from adverse elections which policy provision?

Answer 81

Suicide clause

Question 82

What is an insurance policy grace period

Answer 82

Period of time at the premium is due but the policy remains in force

Question 83

When in life insurance policy is surrendered, how does the cost recovery rule apply?

Answer 83

The policy cash value is taxation 

Question 84

Which of these is not considered to be a common life insurance nonforfeiture option?

Answer 84

Life income annuity

Question 85

Which of the following is a reinstatement condition?

Answer 85

Proof of insurability

Question 86

Which of these would lemon a companies liability to provide insurance coverage?

Answer 86

Exclusion

Question 87

Jerry is an insured who understated his age on his life insurance application, paying $12 per $1000 of the insurance instead of $15 per 1000. If he dies, how will the adjust death benefit be calculated?

Answer 87

12/15th of the policy’s face amount

Question 88

Which of the following does a policy owner not have the right to change?

Answer 88

Dividend schedule

Question 89

Which of these is not a characteristic of the accelerated death benefit option

Answer 89

The benefit can be offered as a rider at a specific extra cost or may be at no cost

Question 90

A rider that assumes premiums will be paid on a juvenile policy until the child reaches a specific age is called a?

Answer 90

Payor rider

Question 91

A life insurance policy can render it’s cash value on which policy provision?

Answer 91

Nonforfeiture option