all of the following are true of insurance except

b) Universal Life Some life insurance policies offer cash values that can be borrowed at any time and used for immediate needs. What type of insurer has no capital stock? 2)Legal Purpose D. The face amount remains the same throughout the life of the policy. \end{array} b) Fixed income The preferred risk classification indicates that an insured is in excellent physical condition and employs healthy lifestyles and habits. O c. The policyowner has the option of investing the cash value in several investment accounts. 5)Explain when coverage begins -below market interest rates on borrowing c) Accelerated benefit rider. a) The amount of insurance on the life of any debtor may exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor. A. Life insurance prodceeds A. 3. a) Lump-sum approach 3)increase the length of coverage D. Claim History 1)premium payment 3. 1)physical exam A. -receiving dividends(when declared) Correct: Misrepresentation, False statement contained in the application, An intentional deception of the truth in order to induce another to part with something of value or to surrender a legal right. Hazard 1. a) Remains level. By William Lb Qtjetjx, Author of . Which of the following documents delivered to the policyowner includes information about premium amounts, cash values, surrender values, and death benefits for specific years? (c) both I and II c) National Association of Insurance Commissioners the underwriting process is approved for: 3)substandard risk. B. this insurance is often written in connection with automobile loans. 3) type of plan they applied for. Endowments means policy is what(2) things? b) State attorney general A policy summary usually includes all the listed information, and must be delivered along with a new policy. Which of the following information about the applicant is NOT included on Part 1 of the application for life insurance. When a policy is non-contributory how much is paid? 2)Variable annuity C. Buy-Sell agreements are normally funded with a life insurance policy B. Buy-Sell Agreements pay in the event of a medical emergency 1)Statement of continued good health 4. d) Buyer's Guide. D) They must be signed by both the Producer and the applicant. b) Conditional receipt The following are all true regarding risk management, except: A. c) Disclosure rule D. They can decide when to pay their monthly premiums. CPI (consumer price index) without evidence. Pure Risk. The Terrorism Risk Insurance Program is administered by which of the following Federal entities? Get more out of your subscription* Access to over 100 million course-specific study resources What are the two options in death benefit options? Therefore, it is responsible for 1/3 of the $24,000 loss, or $8,000. C. Application Nonparticipating policy. A company doing business in the same state it was incorporated in and owned by the policy holders. A. c) The policy will be voided. B. (c) Most policies can be converted to a permanent life insurance policy. All of the following characterize term life insurance, EXCEPT: Select one: a. \text { Type II } & \$ 20 & \$ 30 & \$ 40 the application is used at the primary source of info. Who appoints the state insurance regulator in many states? C. Social Security works exactly same as private insurance. When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable statement of good health An__________ represents the insurer. Predicted needs of the family after the insured's death B) The reduced paid-up nonforfeiture option would provide protection until the insured reaches 100, but the face amount is reduced to what the cash would buy. 1) Competent Parties B. 4)settlement options, 1)stand alone policy (c) human life value method & &&\textbf{ Quarter } \\ -birth of child. D. Concealment Misappropriation or illegal withholding of the policyholder's money. 1)absolute assignment-all rights are assigned b. Life insurance is unique from other types of insurance in that it could perform the function of cash accumulation. c) Extended term c) Helping insureds to file claims If the insured becomes disabled, the rider allows the cost of insurance to be waived, with the exception of premium costs required to accumulate cash value, Who must notify the replacement company of a policy that is being replaced? All of the following statements about term insurance are trueEXCEPTa. (c) PV of the family's share of a deceased breadwinner's future earnings. d) Limited pay. Indicate by a plus (+)(+)(+), minus ()(-)(), or zero (0)(0)(0) if the factor would increase, decrease, or have an indeterminate effect. In addition, they provide financial support for Tom's aged father and Nancy's aged mother. 21,000 \\ c) Fixed premium Journalize the entry to transfer the total of all cost sheets completed from Work in Process to Finished Goods. compulsion? All of the following are true regarding life insurance illustrations EXCEPT. c) Coverage ends but the policy can be reinstated at any time. An insurer or producer may NOT knowingly employ an individual to act in a fiduciary capacity if that individual has been convicted of a felony or crime of moral turpitude within the past The 7 paytest is used to determine if a policy is a _______? States regulate the procurement of business from nonadmitted carriers by regulating the brokers who place business with these carriers. -pays an additional death benefit if the insured dies from an accident ? a) Agent's report (b) Prepare a correct income statement for October 2017. \hline & \text { Jul 1 } & 55,000 \\ Liquidity in life insurance refers to availability of cash to the insured through cash values. A. Now Tamara can afford whole life insurance. If there Is a risk of financial loss then there is a what? &\text { Cash }\\ C. The death benefit paid to the beneficiary -it is a type of Rider 1) mentally incompetent persons c. It is the failure to use ordinary care. An insured becomes disabled at age 22 and can no longer work. \end{array} What type of interest does universal life have? (d) annual premium and the annual policy dividend. An agent that enters into agreements with more than one insurer is called an: A _______ represents the insured in dealing with insurance companies. A. signed waiver of premium True or False: Under the Financial Responsibility Law, you are required to have insurance on any motor vehicle you own or drive, except motorcycles (b) Most policies can be renewed without evidence of insurability. Correct: C. Concealment, A. Department of Defense Which of the following statements regarding the taxation of Modified Endowment Contracts is FALSE? c) Variable Premium -Not a true insurance company Which of the following is true regarding the beneficiary designation of the former spouse. The Waiver of Cost of Insurance rider is found in what type of insurance? If you don't have health insurance, you pay all costs for healthcare and medical emergencies. -policyowners right provision What are two reasons that people deposit money in banks? C. Waiver &&\\ What constitutes the acceptance of an offer? The safety margin is narrower, because the cost of the insurance to the policyholder cannot be adjusted at a later time. D) adding cost of living coverage. c) Premium accountability. Consumer report a) A medical examination The insured agrees to maintain insurance equal to some specified percentage of the value of the property. (c) two-income earner family. A. Foregin a) Payor rider. She has limited income and significant life insurance needs. Copyright 2009-2022 Tests.com LLC - All Rights Reserved. ____________ is the transfer of the right of recovery from the insured to the insurance company. B. An IRA uses immediate annuities to pay out benefits; the IRA owner is nearly 75 years old when he decides to collect distributions. c. thoughts of harming a neighbor Accelerated Living Benefit/Death Benefit is what type of rider? d) 50% tax on the amount not distributed as required. Which kind of agent enters into agreements with more than one insurer? A surplus lines broker deals with direct writing companies only Which of the following is NOT an allowable 1035 exchange? c) Guides describing company financial integrity Retention, Avoidance, and Transfer are all _________________. A mutual insurer has no stock, and is owned by the policyholders. D. Breach of warranty d) Policy dividends. (a) I only (b) II only A contract between insurer and policy holder. The insurance provides protection for a specified period of time. Members are assessed to fund the corporation. Coverage is available in $50,000 increments up to the maximum of $400,000. James purchased yearly renewable term insurance. A whole life insurance policy is exchanged for a term insurance policy, Which of the following will be included in a policy summary? D. Offer All of the following statements about the settlement of a claim are true EXCEPT. -provides income for retirement The following are all causes for the Insurance Commissioner to suspend or impose conditions upon the continuance of a producer's license EXCEPT 1. d) The policy can be reinstated by paying back all policy loans and premiums. What is a statement in the application guaranteed true in all respects? -sex doesn't determine eligibility. In the needs approach, all of the following information is used to establish how much insurance needs to be purchased, EXCEPT: Mary should purchase $1.5 million ($75,000 x 20 working years remaining = $1,500,000). C. A surplus lines broker deals with direct writing companies only c) Whole Life Each withdrawal, however, is usually charged, and the amount and frequency of withdrawals are usually limited. Weiss and Fitch are two of these services, although there are more. c) To protect the policyowner Medical exams provide information on current health. d) Producer. Part 1 of the application includes the general questions about the applicant, including name, age, address, birth date, gender, income, marital status, and occupation. On DUE DATE. 2) standard risk c) Copy of the original application The policy is a contract of adhesion d) Joint and Survivor, B) The Waiver of Cost of Insurance rider is found in Universal Life policies. The replacing company notifies the replacement company. Most agents try to collect the initial premium for submission with the application. IRS classification of a policy that is overfunded? (c) face amount of the policy and the legal reserve. a) Material change Cause of potential loss to property such as fire, windstorm, hail, flood, etc. A) A policy summary must be delivered along with the policy and will provide the producer's name and address, the insurance company's home office address, the generic name of the policy issued, and premium, cash value, surrender value and death benefit figures for specific policy years. (receive dividends & the right to vote). C. Conditional contract D. Premiums are tax deductible as a business expense, B. Pure risk Buy-sell agreements are normally funded with a life insurance policy. A) Any distributions from MECs are taxable, including withdrawals and policy loans. c) Misrepresentation Which risk management type is shifting the risk of loss to a larger homogeneous group? & \text { Depr } & 3,000 \\ A SEC registration. Participating policy. A value-added tax ( VAT ), known in some countries as a goods and services tax ( GST ), is a type of tax that is assessed incrementally. D. Agents report. database of previously life and health insurance applications. C. group credit life insurance does not build cash values. Cash values can be borrowed at any time WorkinProcess$229,040.00EmployeeIncomeTaxPayable$33,880.00FactoryOverhead78,960.00SocialSecurityTaxPayable19,096.00Cash250,558.00MedicareTaxPayable4,466.00\begin{array}{lrlr}\text { Work in Process } & \$ 229,040.00 & \text { Employee Income Tax Payable } & \$ 33,880.00 \\ \text { Factory Overhead } & 78,960.00 & \text { Social Security Tax Payable } & 19,096.00 \\ \text { Cash } & 250,558.00 & \text { Medicare Tax Payable } & 4,466.00\end{array} (d) paid-up. c) Denying coverage after a reasonable investigation has been conducted A) An indeterminate premium reduction policy is a policy in which the premium is guaranteed for an initial period, then the insurer can charge up to a maximum premium charge that is specified in the policy. Past-due interest on a policy loan is added to the total debt. A policy summary C. Insured's annual expenses The insurer that is transferring the risk to another company is called the ____________ __________. Correct: C. Unilateral contract. a. whole life paid at 65 a. 3) Retaining the risk. A. When an insurance policy is not clear, the court will usually interpret in favor of the insured because of which characteristic? a. mentally counting backward from 1,0001,0001,000 2. What is NOT invested in the stock market but pays you interest? Upon policy delivery, the producer may be required to obtain any of the following EXCEPT 2. Predicted needs of the family after the insured's death Quarter($000)1234Cash$100$100$100$100AccountsReceivable1999699604Inventory20150590552AccountsPayable104959597\begin{array}{lrrrr} B) The plan is funded by permanent insurance only. (1), In Universal life, what options can the policy owner have with the premium payments to do? -The insurer would pay the face amount of the policy minus the past due premium. \hline \text { Jul 31 } & 17,000 D. Effect of inflation on income over time. When must insurable interest exist in a life insurance policy? B. All of the following are required signatures on a life insurance application EXCEPT. How do premiums for yearly renewable term insurance change as an insured gets older? In this particular instance the applicant did not commit intentional fraud. c. (c) face amount of the policy and the legal reserve. She meets the definition of total disability under Social Security. The following are all true regarding risk management, except: A. \text{Inventory} & 201 & 505 & 905 & 52 \\ Adverse selection is well controlled. \text{Sales revenue}&&\$780,000\\ a) No penalties, since the owner is older than 59 \text{ ???? } Conviction of a felony involving moral turpitude. &\text { Retained Earnings }\\ Company A carries 1/3 of the total coverage ($20,000 + $40,000 = $60,000). 3)substandard-highest, 6 factors that are complete for policy 2 be paid? \hline \text { Jul 1 } & 22,000 \\ 4. Which of the following statements concerning buy-sell agreements is true? Conditional contract means the policy holder does what? -and the right to vote. b) The elderly Insurance companies can charge an interest rate based on the policyowner's credit report. They keep a high percentage of any interest earned on their policies &\begin{array}{cr|} Empire Company is a manufacturer of smart phones. -Not invested in stock market B. Nonadmitted The failure to disclose known facts is what? 3)premium is collected B) In insurance, fraud is the intentional misrepresentation of material information that is crucial when deciding whether or not to write a contract for an applicant. 2. All of the following statements about term insurance are true EXCEPT. Policyholders -the applicant must always initial the change D. Term life. D. Accident Represent the insured's interest, Insurance Licensing - Chapter 2: Property Bas, Chapter 9- Commercial General Liability Cover, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, CompTIA A+ Certification Exam Prep - Chapter. D. A surplus lines broker places risks with nonadmitted insurers when coverage cannot be placed with admitted insurer carriers D. Viatical settlement. InventoryJul1Jul3122,000???? Premiums are not tax deductible as a business expense. What is the term for a cause of loss, such as the theft of a car? b) Fiduciary responsibility. After everything is signed & premium is collected What does the agent give to the policy holder? c. Premiums may be raised at renewal d. Group term insurance may cover the . B. A person cannot buy insurance unless that person is in a position to suffer a financial loss. If an insurer is incorporated in Rhode Island, but primarily does business in New York, what type of insurer would it be considered in New York? -tax free accumulation of borrowing. O d. (d) Most policies have a CV that is refunded when coverage ceases. -usually mutual fund security 4)defined contribution plans. c) Conditional -Take it or leave it contract If contract is up after 20 years & policy holder wishes 2 renew what occurs every year? B. C. Unilateral contract 3)low premiums. The CAS number shown in an entry is typically . This form of life insurance has fixed premiums and the cash value is not guaranteed. (b) Face amount decreases during the policy period, but premiums remain level. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company? All renewable term policies are accepted without__________ and only with_____ collected. A peril D) Using misrepresentation to convince a person to cancel an existing policy and buy a new one is called "twisting.". The correct answer is: Maggie's Piano Studio with 1 employee. c) Increases annually. A __________ represents the insured. b. We participate at both the national and state levels as a leading advocate in the judicial, legislative, and regulatory environment to ensure that Members' concerns are heard by lawmakers on issues that impact medical professional liability. -greater potential to grow the cash value but there is no guarantee The premium is level and guaranteed not to increase. c. Do you think that the government has the right to make and enforce laws that affect family life? O b. All of the following statements about term insurance are true EXCEPT. and what two kinds? Rebating is an unfair trade practice and is regulated by law. It is the specific cause of loss. 2)collateral assignment-some or only one right assigned. What does "liquidity" refer to in a life insurance policy? Which of the following is an example of liquidity in a life insurance contract? An underwriter will consider each of the following factors when evaluating a risk, except: A. (b) Cash value accumulation is slow to moderate. A. _____________ is a statement that is true to the best of the persons knowledge that is making the statement. 2)Foreign Insurer All of the following groups may purchase group health insurance coverage, EXCEPT: Groups must have at least two employees to be eligible for group insurance coverage. Estate conservation c) 15% for early withdrawal What are the 3 characteristics of a Mutual Insurance Company? A false statement in the application for insurance is_____________. -car accident not in conjunction with an illness (Choose from the following options) a) Withdrawals are not taxable. Explain your answer. b) Reduced paid-up . It has cash value that is invested into the stock market through mutual funds/securities. Instructions may not be altered by an agent and must clearly state that it is not part of the contract. Its controller resigned in October 2017. II. D) The Fair Credit Reporting Act governs what information can be collected and how the information can be used. All of the following are true of key person insurance EXCEPT ) The key employee is the insured. B. Avoidance Insurance is not designed to cover _____________ losses. Misrepresentation, Concealment and Deceit are all examples of what? Waiver of premium is a rider that can be added to a life insurance policy, and not something to be obtained from the applicant. -cash value can lose value. If the corporation collects the policy benefit, then d) Fiscal responsibility. Should a key person die, the benefit is treated as a reimbursement to the business for loss of services from that key person. The company records manufacturing costs by job number and uses a factory overhead applied rate to charge overhead costs to its products. 1) premium schedule differ from whole life If the insurance carried is less than required, the insurance may not cover the whole loss. \hline \text { Jul 31 } & 25,500 C) They must contain a warning that actual results may vary. 1)tax qualified plans Which of the following would be the best option that would help the surviving spouse of the insured to put her child through daycare after the insured's death? The applicant has been shown to be a poor personal credit risk. 1)policy owner can increase/decrease/ or skip premium payments ? C) common stock 4. Correct: C. Consideration. (a) I only d) An insurer may exclude any debtors as to whom evidence of individual insurability is not satisfactory to the insurer. 3)MIB=records of all previous insurances they had. Estimated direct labor costs for next year are$440,000.00. Life insurance proceeds 2)when benefits begin Involuntary Risk All of the following would be exempt from the producer licensing requirements EXCEPT: A) A customer service representative who discusses policies. d) Graded Premium. (Hint: Take a look at the Theory of Reasoned Action.). When an insured fails to disclose known facts in an application for insurance, he/she may be guilty of what? I. Or, Bill can invest $9,000 in project B that promises to pay annual end-of-year payments of$1,500, $1,500,$1,500, $3,500, and$4,000 over the next 5 years. -pay for certain time and stop B. also known as acceptance. The premium is guaranteed for an initial period and then the insurer can charge up to a maximum premium charge in what type of policy?

What Is Eric Heiden Doing Now, Is Snoop Dogg Still Alive, Articles A