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Exam Simulator Test
FLASH Cards
| Question | Answer |
|---|---|
| What are Annuity Unit? | Shares in an Annuity. Units you can sell Ann. units so the annuitant(you) may receive $ from them. |
| What is Annuitization? | The reception of monthly payments from an annuity after an accumulation period. Depending on the type of annuity, one may annuitize payments for a period of time or for the remainder of one's life. |
| What does Fluctuate mean? | To cause to rise and fall or vary irregularly. |
| What fluctuate at the time an Annuity annuitize and what becomes fixed. | Benefits can fluctuates. Units become fixed. |
| Term | the length of time before option matures, usually one year. |
| Index | the equity, stock, bond, or other index to which the interest credit is linked |
| Gain Formula | the method used to determine the gain in the index. Point to point, monthly averaging, daily averaging are the most common methods of calculating the gain |
| Adjustment Method | the way the option is limited in order to reduce the cost (and subsequent return) so that it becomes affordable. As an example the point to point option may cost 7% of the account value but will be "adjusted" to reduce the cost. |
| Market Value Adjustment | the company may reserve the right to adjust the value of your account based on current market conditions. This adjustment is most often applied to distributions, partial or complete withdrawals, and exchanges to other accounts. |
| Interest | a fee paid on borrowed assets. |
| Which earns higher interest rates? Equity indexed annuities or Fixed annuities? | Equity indexed annuties BUT they both guarantee a specific minimum interest rate. |
| What does an Accelerated Benefit option do? | It decreases the face amount to give the insured part of the benefits in case the insured becomes terminally ill or confined to a long term care facility. |
| Which term policy has the highest premium? | Level term |
| What does a collateral assignment do? | It is a Third party ownership which transfers some of the death benefits to your creditor for security of the loan in case the you die it'll pay the creditor the remaining interest due for the loan. But not ownership. |
| A partial withdrawal from your policy which part will be taxed? | The interest. |
| What type of policy is the most common to provide temporary protection? | Level term |
| Are dividends guaranteed? | No |
| What are Social Security benefits? | Retirement, disability and survivors |
| What entitles you to medicare benefits? | Social Security benefits |
| What does extended term nonforfieture option do if you cancel your policy. | The cash value can be use to purchase term insurance with a face amount equal to face amount for as long of a period of time the cash value will purchase at the insured age. |
| What is Key Person Insurance? | Business is policyowner and beneficiary/Insured is key employee |
| What is Mortality? | probability of death...tables used by life insurance companies |
| What is Morbidity? | probability of illness or accident...tables used by health companies |
| What is adverse selection? | the tendency of poor insurance risks to seek or continue insurance to a greater extent than other (good) risks. |
| What is assumed if there are unanswered question on app? | The policy will be interpeted as the insured waived the rights to answer the questions. Later penalized |
Created by:
karen.evans83@yahoo.
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